dagblog - Comments for "Consequences and the Truth About Them"

as did Paul Krugman and his

Barth — Sun, 31 Jul 2011 15:04:39 +0000

as did Paul Krugman and his many disciples (including, to be certain, some within the administration at the time).

Stimulus, of course, cannot be measured simply in terms of the actual jobs funded by federal money, but by what goes back into the economy from those who spend money that they otherwise would not have earned (and, the taxes paid on that income). A grwoing economy can manage, if not erase, a budget deficit. We have seen that happen. We have not seen supply side work, and, indeed, its academic advocates have abandoned it. Only politicians have held onto it.

As have the uneducated fools around us. Using polls to determine government policy is foolhardy. A majority of our fellow citizens, for instance, do not want the debt ceiling raised (though apparently they like default even less).

Also, this from Drew's

AmericanDreamer — Sun, 31 Jul 2011 14:04:46 +0000

In reply to Thanks for the post and

Also, this from Drew's article fills in some of (what for me had been, anyway) the blanks on what has appeared pretty straightforwardly obvious:

The question arises, aside from Obama’s chronically allowing the Republicans to define the agenda and even the terminology (the pejorative word “Obamacare” is now even used by news broadcasters), why did he so definitively place himself on the side of the deficit reducers at a time when growth and job creation were by far the country’s most urgent needs?

It all goes back to the “shellacking” Obama took in the 2010 elections. The President’s political advisers studied the numbers and concluded that the voters wanted the government to spend less. This was an arguable interpretation. Nevertheless, the political advisers believed that elections are decided by middle-of-the-road independent voters, and this group became the target for determining the policies of the next two years.

That explains a lot about the course the President has been taking this year. The political team’s reading of these voters was that to them, a dollar spent by government to create a job is a dollar wasted. The only thing that carries weight with such swing voters, they decided—in another arguable proposition—is cutting spending. Moreover, like Democrats—and very unlike Republicans—these voters do not consider “compromise” a dirty word.

The President proposed at least two modest plans for stimulus spending, someone familiar with all these deliberations told me, “but he’s not as Keynesian as before.” This person said, “If the political advisers had told him in 2009 that the median voter didn’t like the stimulus, he’d have told them to get lost.” By 2011, in his State of the Union address in January he moved from jobs creation (such as the stimulus program) toward longer-term investment.

The speech Obama gave on April 13 marked his conversion to fiscal centrism; to being the fiscally responsible Democrat. In that speech he stated that he wanted to reduce the debt by $4 trillion—thus aligning himself with the Republicans—but also asked for revenues to partly offset that reduction. It was all about reelection politics, designed to appeal to this same group of independents. “And that’s why,” I was told by the person familiar with the White House deliberations, “he went bigger in the deficit reduction talks; bringing in Social Security is consistent with that slice of the electorate they’re trying to reach.” This person said, “There’s a bit of bass-ackwardness to this; the deficit spending you’d want to focus on right now is the jobs issue.”

This all fits with another development in the Obama White House. According to another close observer, David Plouffe, the manager of Obama’s 2008 presidential campaign, who officially joined the White House staff in January 2011, has taken over. “Everything is about the reelect,” this observer says—”where the President goes, what he does.”

Plouffe’s advice to the President defines not just Obama’s policies but also his behavior. Plouffe tells the President, according to this observer, that the target group wants him to seem the most reasonable man in the room. Plouffe is the conceptualizer, and Bill Daley, the chief of staff who shares Plouffe’s political outlook, makes things happen; Gene Sperling, the director of economic policy, and Tom Donilon, the national security adviser, are smart men but they come out of politics rather than academia or deep experience in their respective fields. Once Austan Goolsbee, chairman of the Council of Economic Advisers, departs later this summer, all of the President’s original economic advisers will be gone. Partly this is because the President’s emphasis on budget cutting didn’t leave them very much to do. One White House émigré told me, “It’s not a place that welcomes ideas.”

I'm not sure what polling or other data they were looking at. Based on the polling data I'm aware of--which going back to November and continuing to now shows the public far more interested in seeing jobs and the overall economy addressed than the debt--theirs appears to be a bad read of what last November meant.

To the extent there were and are members of the public who think reducing spending is the way to go, I would say that these folks are not economically literate and you can't make fateful decisions about a country's economic policy based on what economically illiterate members of the public believe. You have to educate them, not let them determine your course of action.

The view of those who maintain the stimulus was lowballed is consistent with even the WH's flawed interpretation of last November's results--that there is some apparently justifiable view by the group of people upon whom the President's political future depended that "government spending doesn't matter.".

Had the spending component been larger, and in particular had members of the public seen, actually observed, or known more previously unemployed people who were doing infrastructure upgrade work or other valuable work then stimulus spending wouldn't have been thought to be irrelevant or counterproductive to job creation. And the White House would have needed to incorporate into its narrative of pulling out of our troubles and building a better future visual images and stories of individual lives once shattered and now filled with hope.

As it was a lot of the stimulus went to preserving the of people such as teachers, firefighters, police whose salaries are paid out of state and local revenues that wouldn't have been there without the stimulus. So the stimulus was very effective in keeping things from getting much worse. It just wasn't enough and the White House needed to stick to its guns on stimulus and just be more effective in making its case in a wider range of ways than sending the Press Secretary on Meet the Press to defend it in front of that audience.

I don't happen to believe one had to have been clairvoyant to have seen this. As I've noted many times, Pelosi saw it and acted on it, spurring her House to pass a $!50-$200 billion jobs bill that got reduced to near nothing by the Senate and a passive White House.

"cerebral replaced political

oleeb — Sun, 31 Jul 2011 07:39:53 +0000

In reply to Consequences and the Truth About Them

"cerebral replaced political calculation"

Oh please! It's more like naive and no principles for which he would be willing to fight replaced pure political calculation.

Cerebral my ass!

Thanks for the post and

AmericanDreamer — Sun, 31 Jul 2011 04:27:44 +0000

In reply to Consequences and the Truth About Them

Thanks for the post and links. I found this, from Drew's article, interesting:

Because of the extent to which the President had allowed the Republicans to set the terms of the debate, the attitude of numerous congressional Democrats toward him became increasingly sour, even disrespectful. After Obama introduced popular entitlement programs into the budget fight, a Democratic senator described the attitude of a number of his colleagues as:

Resigned disgust at the White House: there they go again. “Mr. Halfway” keeps getting maneuvered around as Republicans move the goalposts on him.

According to a report in The Hill newspaper in late June, the tough-minded, experienced, and blunt Democratic Representative Henry Waxman of California told Obama in a White House meeting that he’d asked several Republicans about their meeting with him the day before, and, “To a person, they said the President’s going to cave.” Then the congressman said to the President of the United States, “And if you’re going to cave, tell us right now.”...

There is a lot of buzz about

mightbealiberal — Sun, 31 Jul 2011 03:23:03 +0000

In reply to Consequences and the Truth About Them

There is a lot of buzz about Professor Melissa Harris-Perry after her guest-hosting gig on TRMS last week. I agree she did a really good job, it's clear she brought her classroom skills to the small screen in the host's chair. But I hope no one replaces Rachel Maddow on MSNBC at 9PM for a long, long time.

I will come back. But reading

Richard Day — Sat, 30 Jul 2011 23:38:36 +0000

In reply to Consequences and the Truth About Them

I will come back. But reading this I cannot help but think of the Governor of Arizona.

Sometimes there are transformations.

After her dem friend was shot and turned into a handicapped individual, she changed.

She has vetoed some crazy bills from the right and pissed off powerful people.

I have been struck by the Gov's change of heart.

Unless we see that kind of change of heart, we are destined to fail as a people.

I really believe that.

The Gov of Wisc and the Gove of Ohio and....the repubs have shown no remorse, no fear of the unexpected, no fear of the end of the country.

Really amazing to me.

We had Arnie Carlson as gov in Minn. and he got so damn mad at the right decades ago he just decided to call himself an independent.

Even after our state was so ashamed of the repubs we called ourselves the Independent repubs.

Boehner is a coward.

Our Prez might be labeled a coward at a later date for good reason.

But Boehner is a goddamn coward. And I hope he rots in hell.

the end