From his town hall today:
“When you see, you know, those of you that are watching certain news channels on which I’m not very popular, and you see folks waving tea bags around, let me just remind them that I am happy to have a serious conversation about how we are going to cut our health care costs down over the long term, how we are going to stabilize Social Security,” he said. “[Sen.] Claire [McCaskill] and I are working diligently to basically do a thorough audit of federal spending,” Obama told the crowd, at one point mimicking the waving of a tea bag with his left hand.
“But let’s not play games and pretend that the reason is because of the Recovery Act, because that is just a fraction of the overall problem that we’ve got. We are going to have to tighten our belts but we are going to have to do it intelligently. And we got to make sure that the people helped are working American families and we are not suddenly saying that the way to do this is to eliminate programs that help ordinary people and give more tax cuts to the wealthy. We tried that formula for eight years and it did not work. And I don’t intend to go back to it.”
$1,300,000,000.00 is TIGHTENING our belts? Jeebus, what was it before the belt was tightened?
1.3 billion, what is that in reference to?
Be careful, yo mama might come by now to make his tenth post for the day about how when you keep talking about something it means you’re afraid of it.
SFC B (and others): Please quit acting like when Obama took office our financial house was in order and we just needed nice and careful maintenance of an already humming economy. Just quit it. Sparking the economy requires us to spend.
I can just imagine if todays conservatives were around in FDRs time, complaining about pork and spending and whatnot that eventually rolled into one of our biggest booms ever.
tighten our belts…….
……by spending 3.5 trillion dollars that we don’t have.
Rock on! That’s fiscal responsibility right there, folks!
And Obama wouldn’t understand the tea parties. One would have to at least ran a hotdog stand or held a real job in order to do that.
Burn!
And yes, you are afraid.
Yes, under Bush (and the Congress, controlled by the Democrats for the last two years) the government spent money like a drunken Kennedy. (But I repeat myself.) But the cure for spending too much is NOT “spending even more and more and more!”
And Oliver, nice revisionist history. FDR’s “New Deal” barely kept things going with the Depression, marginally keeping things from getting worse. What turned that around was World War II. Are you honestly saying that we should hope for another major war to save our economic asses?
J.
And please, speak up clearly — I can’t hear you very clearly with Keith Olbermann’s scrotum in your mouth.
J.
J.G.Thayer: “And please, speak up clearly — I can’t hear you very clearly with Keith Olbermann’s scrotum in your mouth.”
Well, at least the homophobia is a nice change from your blatant racism.
Yo mama: “Rock on! That’s fiscal responsibility right there, folks!”
It takes spending when the previous administration ground the economy to a halt. The GOP broke the fucking economy. Or was that Obama’s fault as well?
“And yes, you are afraid.”
Scoreboard.
Burn.
I don’t get it, Is Yo Mama serious or he one of the other posters making a stupid conservative joke?
rat_bastard: “I don’t get it, Is Yo Mama serious or he one of the other posters making a stupid conservative joke?”
How would you tell the difference?
World War II = Government Spending, douchebags!
Shoot, I wonder if there was also enormous deficit spending during WW2, the enormous government spending project that conservatives will readily admit helped pull us out of the great depression…
Yes, Jaytea and his fellow cons read a book (or more likely, the summary of a book) by a revisionist historian and felt that qualifies them to ignore the historical fact that FDR’s stimulus spending after the Hoover-created depression put America back on track.
>> Conservative media react to talk of Obama-led economic recovery by attacking FDR and New Deal
Yes, we’re also afraid. Afraid like we were in November of 2006. And terrified like we were in November of 2008. Paralyzed with
laughterfear.But the cure for spending too much is NOT “spending even more and more and more!”
Jay Tea, can you explain what you mean by this? Are you suggesting that aim of the stimulus bill was to “cure” runaway government spending? Cuz that what it sounds like.
So, Strowbridge, you’re fine with Oliver using the term “teabag,” but don’t like it when I use the more literal translation? Figures you don’t like honest language.
And just how was the economy in the 1930’s, anyway?
That’s right. It sucked.
J.
And yes, you are afraid.
Afraid of an anonymous, bed-wetting, chickenhawk wingnut blog commenter?
Survey says!…..
-X-X-X-
Hoover-created depression put America back on track.
Really? And how exactly did Hoover create the depression?
Evidence please.
Oh by the way, in addition to the so-called “revisionist historian” (revisionist = “I don’t agree with that!), two UCLA economists also said that Roosevelt’s New Deal spending prolonged the Great Depression by 7 years. While they lauded things like FDIC, the SEC, Social Security and unemployment benefits, they also said that Roosevelt went too far especially with the The National Industrial Recovery Act.
So I’m confused about the conservative line on this. FDR’s stimulus spending extended the depression, but the spending of WW2 ended the depression? Do I have that right?
Parthenon, WWII’s massive spending was precisely what the nation needed — focused on the manufacturing front. Further, there was a huge depletion of labor as millions of men left the work force for the military, allowing women and minorities unprecedented access to the workplace. There was also a shitload of direct public loans to the government, in the form of war bonds. There was an incredible, almost inconceivable level of personal austerity and “everyone has to do their part” in favor of the war effort.
There was also a huge public upswell against anyone who might be seen as “war profiteering” that kept businesses from showing too much wealth until the war was over.
The Depression was pretty much continued, in most effects, by the war, but almost no one minded — it was “for the cause” and everyone knew that once the war was over, everything would be just fine. That was a self-fulfilling prophesy.
So yeah, World War II did get us out of the Depression. But I’d be terrified of anyone who looked at it as a model for a modern recovery.
J>
…two UCLA economists also said that Roosevelt’s New Deal spending prolonged the Great Depression by 7 years. While they lauded things like FDIC, the SEC, Social Security and unemployment benefits, they also said that Roosevelt went too far especially with the The National Industrial Recovery Act.
Which makes me want to ask, of what relevance then, is this study to criticisms of Obama’s stimulus package?
The UCLA study’s main point was focused on FDR’s intervention in prices and wages by “allowing businesses in every industry to collude without the threat of antitrust prosecution and workers to demand salaries about 25 percent above where they ought to have been, given market forces.”
Parthenon, WWII’s massive spending was precisely what the nation needed — focused on the manufacturing front.
I’m sure this will totally clear things up for Parthenon.
Jesus Jay Tea, FDR took over in 1933, so it was his fault the economy sucked? By that mentality, if you are a Lions fan you should be yelling for the coach to be fired if they go 9-7 this year. I’ll give you points for being as consistently unfair to Obama as you are to FDR, but either way you’ve been fooled by pseudo-academics with the same agenda you have. A couple fringers at UCLA have become heroes among you wingnuts for trying to blame the bulk of the great depression of FDR. Sadly (for you), their attempts have fallen flat among the non-ignorant academics in History and Economics community.
FDR was far from perfect, but he didn’t create the great depression (the US was ~3 1/2 years into it when he took over) and he didn’t prolong it by increasing spending. By most measures, the great depression was over before WWII started (at least before US involvement, anyway):
YEAR GDP Unemployment
1929—-790.9——-3.2%
1930—-719.7——-8.7%
1931—-674.0——-15.9%
1932—-584.3——-23.6%
1933—-577.3——-24.9%
1934—-641.1——-21.7%
1935—-698.4——-20.1%
1936—-790.0——-16.9%
1937—-831.5——-14.3%
1938—-801.2——-19.0%
1939—-866.5——-17.2%
1940—-941.2——-14.2%
1941—-1101.8——11.9%
FDR’s biggest mistake was not increasing spending, but reducing it in 1936-7 due to inflationary concerns after learning of a 16% annual growth rate over the previous 12 months, which resulted in a fairly brutal 18 month recession. But most people would find a >50% reduction in unemployment and 6% growth rate to be a pretty solid record. Certainly it holds up pretty well following the amazing folly that was his republican predecessor. Hopefully, history will repeat itself…
Republican President Bush was in charge when the $1.3 trillion deficit was incurred.
FACTS:
Republican Reagan more than doubled the US debt. Between Republican Reagan and Bush I they more than quadrupled the US debt. Republican Bush II more than doubled the US debt again after Bush’s last deficit of $1.3 trillion is added in.
If you look at the ‘Gross Federal Debt’ (GFD) as a percentage (%) of ‘Gross Domestic Product’ (GDP), the last three Republican Presidents have increased that as well.
On the other hand, every Democratic President since FDR has paid down the GFD as a % of GDP, including Carter and Clinton. Clinton even left a substantial surplus that could have significantly paid down the debt. Instead it was promptly squandered by the Republicans.
The Republicans have been the Debtor Party for 30 years.
And please, speak up clearly — I can’t hear you very clearly with Keith Olbermann’s scrotum in your mouth.
Jay Tea, please stop with the aborted intentional funny. We all prefer to laugh at you, not with you. I’ll try to explain, since you have no sense of humor:
That Tea Party morons took it upon themselves to shout “Tea bag”, and called themselves “Teabaggers” = Funny
Their apparent lack of awareness of what they were saying = Hilarious
Actually describing, in detail, specific people “Tea bagging” each other without context as an insult = Not funny + kind of stupid + homophobic
You = ~1/1000000th as clever as you think you are
Your impotent rage overflowing throughout the comment pages = Funny
Crusty, please. Answer what I say, not what you wish I’d said.
The Depression was NOT FDR’s fault. What he did to fight it did mitigate the worst of it, but did little to end it. Maybe there wasn’t a good solution short of war, but that’s what it took to really kill the Depression.
J.
So people aren’t allowed to criticize probably excessive government spending of money we don’t have because the economy was ruined by excessive spending of money we don’t have?
When President Obama is telling us that we’re going to have to tighten our belts in the same three month period where he signed the most massive spending bill ever, the most massive “stimulus” bill ever, and is looking at spending even more in the not-too-distant future, I’m going to need to say something about it. Just think for a real quick second about what your reaction would be if Jay Tea said something like “We’re going to need to spend out way out of this recession.”
You’re going to need to forgive me for not being all giddy about the “Spend bajillions of dollars while expanding the government until we get involved in a world war that kills tens of millions of people and emerge as the only world power not bombed into a pre-industrial state with massive population displacement and loss” plan. Saying that we emerged from the Great Depression due to FDR is a lot like saying we got ourselves out of debt by hitting the lottery.
Honestly, I have no idea. I was thinking of the $787,000,000,000.00 stimulus bill when I wrote that comment, but no clue why I typed 1.3 billion. Bad day to stop huffing glue?
Maybe there wasn’t a good solution short of war, but that’s what it took to really kill the Depression.
Maybe that’s why Bush started the war FIRST.
How did that work out?
Maybe you remember from the history books that unlike the recent conflict, everyone in the United States was mobilized for World War II. My father, who was too old for active military service, gave up his job selling luxury goods (furs) and started welding Liberty Ships while also serving in the Coast Guard Reserve. Gas, tires, sugar, and other consumer goods were strictly rationed and some goods were unavailable at any price. Pay rates were frozen.
Are you ready to take part in THOSE aspects of The War That Ended the Depression? Why, they sound like SOCIALISM!
I didn’t think so. So what’s YOUR solution?
Jay Tea, I responded because you made two profoundly ignorant assertions, 1) And just how was the economy in the 1930’s, anyway? That’s right. It sucked. and 2) FDR’s “New Deal” barely kept things going with the Depression, marginally keeping things from getting worse. Maybe you should reread what you said before you complain about the response.
I’m starting to wonder if you get your depth of knowledge on the depression from listening to Rep Bachmann (R-MN)
As far as your assertion that WWII was “what it took to really kill the Depression”, that’s an dull, unmeasurable assertion. But I would say that 91% GDP growth in 8 years (1933-1941), with a very large unemployment drop is a pretty solid record, and a far cry better than “marginally keeping things from getting worse”.
Jay Tea is asserting that to get America out of the Great Depression it too GOVERNMENT SPENDING ON THE SCALE OF WWII.
What Jay Tea fails to understand is that SPENDING BY THE GOVERNMENT is what was key to getting out the Great Depression.
Most credible economists are saying that to get America out of the current Great Recession it will take a similar type of massive spending.
Jay Tea himself asserts that it was GOVERNMENT SPENDING ON A MASSIVE SCALE to get America out of a Great Depression.
What Jay Tea either doesn’t understand, or conveniently chooses to omit, is that the economic reality is that IT DOESN’T MATTER WHAT THE GOVERNMENT IS SPENDING ON, JUST THAT THE GOVERNMENT IS SPENDING!
Currently, the only reason we’re not in a Great Depression is because of the massive Federal government spending that the Republicans tried to stop and are still whining about even while they are simultaneously trying to take credit for the stimulus money coming into their states.
While the Dems are trying to save America, the Republicans are using Enron math to steal whatever isn’t nailed down.
Jay Tea is using Enron math, which at this point is the same as “Conservative math,” “Libertarian math,” and “Republican math,” to con those Americans who haven’t figured out he’s a Ponzi scheming sociopath with no loyalty to America or Americans.
To get America out of the Great Depression it TOOK GOVERNMENT SPENDING ON THE SCALE OF WWII.
But that spending scale would have been just as effective, even more effective, if it had been used to build domestic infrastructure.
Build a bridge and it’s economically productive for 50 years.
Build a bomb and it’s useful once.
WWII spending WAS effectively socialism. That ’socialist’ spending is what pulled the country out the Great Depression.
A Great Depression that was precipitated by right wing deregulation of the financial industry, by the way.
What freaks out sociopaths like Jay Tea and “yo mama” is that people like SFC B will figure out that not only was the Great Depression created by right wing deregulation, but that what got US out of the Great Depression was the massive “socialism” of the New Deal which ultimately morphed into massive government created jobs (in this case building war planes, ships, and tanks, but it could have as easily been solar panels, electric grids, and internet broadband deployment).
As for ’spending,’ Republicans have been doubling the US debt every time they’ve been in office for the last 30 years.
On the other hand, Republican Eisenhower had tax rates for earnings over $3.2 million dollar a year that were over 90% and he used that to build the massive Interstate Highway system that has been an economic boon for America for over 50 years now.
Facts are stubborn things, that’s why right wing sociopaths like Jay Tea are such pathological liars, if the truth were known nobody would listen to them.
Jay writes “FDR’s “New Deal” barely kept things going with the Depression, marginally keeping things from getting worse.”
You are a fucking liar, sir. I’d put you in touch with my grandfather who directly benefitted from the New Deal (got a job in the CCC when he couldn’t get one elsewhere), then went on to serve as an officer in WWII.
Then again, you wouldn’t know about military service either, you sad little chicken-hawk.
Hmm…the US economy declined by 29.3% from 1929 to 1933, recovered to 1929 level within 3 years, and grew by roughly 6-10% every year after the 2nd recession in 1937-38. It’s true that unemployment didn’t drop back down to 1920s levels until the war started, but the New Deal did cut the rate in half while helping propel strong economic growth…who knows whether the country would have had the infrastructure to sustain the war effort, absent all that government spending in the 1930s?
Repubs wrap their racism in fuzzy math
Just how often do these right-wing hacks have to be proven wrong before they shut the fuck up? Seriously. You guys have been consistently wrong for many, many years.
“Climate change? That’s not our problem.”
“G.W. Bush as President? That sounds like a wonderful idea.”
“Al Gore claims to have invented the Internet!”
“Trickle-down economics works, you guys! Seriously!”
“Sarah Palin is more qualified to be President than Obama!”
“Obama is a Muslim/foreign national/terrorist/socialist/Marxist/communist and can only read speeches from a teleprompter!”
“The U.S. is, has always been, and will always be, a Christian nation.”
You guys are fucking retarded. You have no credibility. You’re wrong more than you’re right. You support politicians that are demonstrably anti-intellectual, and who are proud of their ignorance (Bush, Palin, Bachman, Brownback, McCain, and so forth…). You think partisan hacks like Limbaugh, O’Reilly, Hannity, Coulter, and Malkin are on-target.
YOU ARE LIVING IN A BIZARRO WORLD.
And yet you keep talking, like a bunch of trained parrots who watch too much Fox News. Please, just shut the fuck up.
So, Strowbridge, you’re fine with Oliver using the term “teabag,” but don’t like it when I use the more literal translation? Figures you don’t like honest language.
The difference is this:
We’re using YOUR term to make fun of your stupid-ass “movement”. Liberals didn’t call them “teabaggers”, they called themselves “teabaggers”.
FACT: Obama quadrupled the deficit within his first 100 days.
FACT: in order to meet obama’s budget goals, the economy will have to grow an average of 3.4%, even though we just had a -6.1% first quarter. Which means that the deficit will actually be WORSE.
FACT: Dems (and Obama) are responsible for the last 2 budgets
FACT: Republicans ruined the fucking economy in the first place and left the banks insolvent, requiring massive Federal spending to a) get them back on their feet to make loans and b) try and quell the disastrous unemployment rate.
FACT: According to Dick Cheney, deficits don’t matter, so the WATB Republican tea-baggers should just listen to their dark master and STFU.
FACT: The economy probably won’t be healthy again until 2010 at the earliest, but it will be restored and Barack Obama and the Democratic party will deservedly take full credit for fixing the Bush Recession. At that time, I will happily remind SaveFarris that not a single Republican house member voted for the stimulus, and that many of his own party including its leader, Rush Limbaugh, were actively hoping that Obama and America would “fail.”
FACT: Even if you hate Obama, you can’t seriously think that four more years of a Republican presidency would be a good thing for America. Not after the GOP ruined the whole goddamn country in the first place.
“Just how often do these right-wing hacks have to be proven wrong before they shut” up?
Until right wingers pathological wrongness destroys all human life.
They are currently on target to have the job done by 2099.
It had been on target for 2044 but Obama’s Presidency pushed it back by 45 years.
It’s possible that before the year is out the left might even be able to push that target back to 2120.
Every day this year has been a little more encouraging.
Just sayin’.
Farris – No one is listening to you. This is an unfortunate (for you) occurrence, but one that you and your ilk brought on yourselves. You strapped yourself to the fucking Titanic of political parties. You have zero credibility.
EVEN IF you happened to be right this time, that Obama’s economic policies are going to be disastrous, no one outside your bubble is going to listen. You’re talking to yourself. And the fact that no one is around to hear you is your own goddamned fault. Congratulations.
And I will add – I have way more trust in Barack Obama than I do in you and your wrong-headed friends. His track record is better than yours. Although, let’s be honest: How could it be worse?
FACT: Obama started off with Republican Bush’s $1.3 trillion dollar deficit.
FACT: Republican Bush more than doubled the US debt when that $1.3 trillion deficit is included.
FACT: Republicans failure to either raise taxes or reduce spending is why the debt has doubled each time a Republican has been President the last three Republican Presidents in a row.
FACT: Democratic President Clinton left Republican Bush with a SURPLUS.
FACT: Republicans squandered the surplus.
FACT: Republicans refused to reduce spending when they were in charge.
FACT: Republicans INCREASED SPENDING every time they’ve been in control of the Presidency.
FACT: Republicans INCREASED SPENDING every time they’ve been in control of Congress.
FACT: Republicans demanded a tax cut DURING A TIME OF WAR.
FACT: The deficits are the only thing currently keeping the current Republican Great Recession from slipping into a Second Republican Great Depression.
FACT: If Republicans were genuinely concerned about deficits they would have cut spending when they were in charge or raised taxes.
FACT: Republicans don’t care about “deficits” except when it’s a convenient political attack, even if that means hurting America even more than their corrupt, thieving economic policies already have.
FACT: News Reference’s list above is primary evidence for why Republicans have absolutely no credibility anymore.
FACT: SaveFarris molests collies.*
*may not be fact**
**but I wouldn’t be surprised.
Anyone notice how the Jay Tea always get quiet whenever News Reference drops bombs?
Or is it that his mouth is full of Glen Becks scrotum?
To Jay Tea:
If you are claiming that World War II, not the New Deal, ended the Depression then you are admitting that the New Deal did not go far enough.
WWII was a massive increase in the size, scope and scale of government and included massive federal deficit spending along with a massive, and mandatory, government full employment act (i.e. the draft).
So, by belittling the New Deal what you are saying is that we need even more massive government intervention in the economy.
Do I have that right?
MIke in DCs’ question about whether the United States would have had the infrastructure to fight Germany and Japan without the New Deal is a scary one to contemplate.
Had Roosevelt not enacted the New Deal we likely would have been in no position to take on the two largest industrial powers of the time.
Let’s not forget that the highest income tax bracket was around 90% during WWII.
Gee, who would have thought that Jay was in favor of taxes that high?
If you are claiming that World War II, not the New Deal, ended the Depression then you are admitting that the New Deal did not go far enough.
… OR … that the New Deal was the Wrong Deal and actually prolonged the Depression. If FDR hadn’t increased tax rates, people would have had their own money to spend and been able to stimulate themselves out of the Depression faster than the Government could.
His track record is better than yours.
What track record? Yeah, he REALLY cleaned up Illinois, didn’t he? It’s a vertiable role model when it comes to crime, taxes, social services, and government corruption. Obama sure did a bang-up job!
FACT: Obama started off with Republican Bush’s $1.3 trillion dollar deficit.
FACT: The 2009 Budget was passed on February 23, 2009. Who was President that day?
FACT: Republican Bush more than doubled the US debt when that $1.3 trillion deficit is included.
FACT: See above.
FACT: Republicans failure to either raise taxes or reduce spending is why the debt has doubled each time a Republican has been President the last three Republican Presidents in a row.
This is true. Does that mean Democrats get to QUADRUPLE it scott-free?
FACT: Democratic President Clinton left Republican Bush with a SURPLUS.
FACT: The SURPLUS wouldn’t have been created had Republicans not taken control of the House in 1994. Both FY 2004 & 2005 saw the deficit INCREASE, not decrease. Only when the House changed hands and Republicans put a brake on spending did the deficit start to recede. Yeah, they f*#@ed it up starting in 2001. But if it wasn’t for the Elephants, there wouldn’t have been a surplus in the first place.
FACT: Republicans refused to reduce spending when they were in charge.
No argument here. If only you held Democrats to the same standard.
FACT: Republicans INCREASED SPENDING every time they’ve been in control of the Presidency.
FACT: Democrats have INCREASED SPENDING every time they’ve been in control of the Presidency. (Yes, even Clinton. It’s just that receipts caught up w/ expenditures.)
FACT: Republicans INCREASED SPENDING every time they’ve been in control of Congress.
FACT: Ditto.
FACT: Republicans demanded a tax cut DURING A TIME OF WAR.
FACT: JFK demanded a tax cut DURING A TIME OF WAR.
FACT: The deficits are the only thing currently keeping the current Republican Great Recession from slipping into a Second Republican Great Depression.
This being a FACT and all, I’m sure you have documentary evidence for this, right? Or is this only your theory? And not so much FACT?
If FDR hadn’t increased tax rates, people would have had their own money to spend and been able to stimulate themselves out of the Depression faster than the Government could.
Save, please tells us exactly how much FDR raised the income tax rate during the Depression.
FACT: Democrats have INCREASED SPENDING every time they’ve been in control of the Presidency. (Yes, even Clinton. It’s just that receipts caught up w/ expenditures.)
Just the fact that the budget balanced, then, right? Pesky fact, that. Too bad that same fact didn’t apply to Reagan or Bush, huh?
… OR … that the New Deal was the Wrong Deal and actually prolonged the Depression. If FDR hadn’t increased tax rates, people would have had their own money to spend and been able to stimulate themselves out of the Depression faster than the Government could.
There is absolutely no evidence to back any of this up except that incorrect and misleading unemployment chart that doesn’t accurately track unemployment (since it excludes workers in government programs who were collecting paychecks for work, which has always counted as employment in my book).
As for the tax rates nonsense, I’m with Fafaroo. Only no dice if all you do is quote the top marginal tax bracket increase, because the amount in the top bracket changed from $100,000 in 1931 to $1,000,000 in 1932 so the whole tax code changed. Also 1932 wasn’t FDR. How much did taxes raise for the average household during the depression?
Hoover raised it from 25% to 63% his last year of office. (And boy was that dumb of him.)
But FDR out-dumbed him by taking it all the way to 94% by 1944.
(source)
Hoover raised it from 25% to 63% his last year of office. (And boy was that dumb of him.)
But FDR out-dumbed him by taking it all the way to 94% by 1944.
Hey look! SaveFarris quoted the top marginal tax rate without any qualification, just like I figured he would.
Go back, read my post and try again. You can start here and move through the tax code as you’d like. Try looking at and around the average household income tax rates.
From what I’m seeing, this is about right: “An income of $2,000 per year guaranteed a comfortable life-style and put a household at the top 10 percent of incomes.”
And in case you’re having a hard time reading those charts, the bottom bracket goes up to $4,000. Which is well above the average family income.
Did I do enough of your research for you?
Oliver Willis writes:
SFC B (and others): Please quit acting like when Obama took office our financial house was in order and we just needed nice and careful maintenance of an already humming economy. Just quit it. Sparking the economy requires us to spend.
You’re right, under Bush we borrowed and spent waaaay too much money. I would love to hear how accelerating that trend will lead to recovery. Examples of government spending producing recovery would also be helpful.
I can just imagine if todays conservatives were around in FDRs time, complaining about pork and spending and whatnot that eventually rolled into one of our biggest booms ever.
Biggest boom ever? When did that happen? Certainly not until after he was dead. I guess by that logic Reagan was responsible for the boom under Clinton.
And yes, I would have kicked and screamed about FDR’s spending, which screwed up the economy and left unemployment in double digits. But don’t take my word for it — here is Treasury Secretary Morgenthau in 1939:
We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong … somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises … I say after eight years of this Administration we have just as much unemployment as when we started … And an enormous debt to boot!
Oh, and as for WWII’s role in ending the Depression:
http://www.marginalrevolution.com/marginalrevolution/2008/11/what-ended-the.html
The post cites Christina Romer, who now works for Obama.
alright im white and a little racist from time to time like everyone is but all you far right winger psycho crhistians need to realize it was your guy that ruined the economy over the last eight years…. not the black guy whose been in office for 100 days. people are you really that dumb, i know i have a buisness degree, but you right wingers lacking that upper education should still be able to conceive the fact that bush ruined the economy, his increased spending combined with tax cuts….. that doesnt balance out that creates a loss just like in buisness when companies spend too much and do not have enough revenue to cover expenses…. taxes are revenue for the country, bush cut them and started two wars and spent money like a lottery winner get with the program and out of denial please it is all bush’s fault and i will keep reminding you psycho religious wack jobs
SaveFarris, the problem is that you’re assuming the spending occured in a vacuum. Here’s the difference:
Purpose of Republican Spending:
- Killing foreigners
- Torturing foreigners
- Indefinitely detaining foreigners
- Increasing teen pregnancy rates
- Denying gay people human rights
Purpose of Democratic Spending:
- Fixing the economy that the Republicans screwed up.
See the difference?
But don’t take my word for it — here is Treasury Secretary Morgenthau in 1939
Don’t take my word for it. Take some other guy’s word for it!
Glad to see Colin is back and using other people’s opinions as proof of his own.
Oh shit I said I was going to try and ignore him. Sorry, that didn’t last long. My bad.
SaveFarris seems to be under the standard right wing delusion that Dems should live by Republican “standards” that Republicans refuse to live up to.
FACT: Republican Bush’s $1.3 trillion dollar deficit was baked into the budget before he left.
FALSE: “JFK demanded a tax cut DURING A TIME OF WAR.”
JFK advocated eliminating the loopholes that let the ultra-wealthy get out of paying their taxes. He advocated the elimination of those loopholes in combination with an overall decrease in the tax rate for the net effect of INCREASING TAX REVENUE.
? “Does that mean Democrats get to QUADRUPLE it [the debt] scott-free?”
By Republican standards, if Obama doubles the US debt, he’ll be more fiscally responsible than Republican President Ronald Reagan, Republican President Bush 1, and when it’s all added up, Republican President Bush 2.
And again, under Republican President Reagan and Bush 1 the US debt QUADRUPLED.
FACT: If it weren’t for the Republicans, the SURPLUS UNDER DEMOCRATIC PRESIDENT CLINTON would have significantly paid down the debt.
Instead, Republicans squandered the surplus, using it, by their own rhetoric, as “welfare” for the ultra-rich.
I’ll concede that it’s only every credible economist (particularly those handful that foresaw this economic collapse) that asserts that America is only keeping out of a Second Republican Great Depression because of the massive Federal stimulus money.
Most of those economists also believe that the stimulus is still inadequate to pull the US out the current Republican Great Recession.
It’s a simple thing: if no one is spending then an economy will turn into a recession. If that lack of spending continues, a recession can devolve into a depression.
Very few people are spending in America. We’ve been in a recession since 2007, it’s now the longest recession since the Great Depression. Unemployment is still sharply increasing. Manufacturing is sharply decreasing. Consumer demand has gone down sharply.
The only ‘big spender’ left in America is the government.
If the American government wasn’t spending, the longest recession since the Great Depression would assuredly be a Second Great Depression.
FACT: The Republican’s economic theories pushed this country into the worst recession since the Great Depression. They deregulated the markets, deregulated the banks, deregulated the financial industry, and even started a war that they claimed would reduce the price of oil and instead the price of gas doubled.
The result of the Republican economic theories: worst recession since the Great Depression.
And in the 1920’s it was right wing theories of deregulating the financial markets that created the boom/bust that became the Great Depression.
Right wing theories “help”, at best, less than 10% of Americans, while simultaneously looting and destroying the wealth of the other 90%.
But even those top 10% were knocked silly by Republicans economic theories this time around: most stock portfolios sunk by 1/2 and some sank by 2/3.
SaveFarris is excellent at repeating the falsehoods perpetuated by the cultish right wing extremists that currently has it’s hands around the throats of the Republican Party.
Whether SaveFarris understands that they are hurting more than 90% of the American population is still in question.
But at some point, SaveFarris, if you are unwilling to accept facts, you are either crazy or a liar.
So far I think SaveFarris is just one of the conned, a simple sucker too ignorant to recognize that they are hurting America, but I’ll consider the possibility that they are a crazy liar who is indifferent to America and Americans. The evidence certainly supports it.
By the way, has anyone read the right wing’s “Two Santa Clause Theory?”
The Two Santa Clause Theory is Republican Enron math on steroids. It explains succinctly that the Republicans were never serious about cutting spending OR reducing the debt.
In fact, the Republican’s Two Santa Clause Theory was designed explicitly to create ‘intellectual’ cover for the Republicans to simultaneously increase spending and increase the US debt.
Which is precisely what Republicans have done for 30 years: increase spending and increase the US debt.
Zython you left out:
-giving uncounted billions to large corporate donors.
“Colin”, you’ve already expressed a sociopathic indifference to Americans health. You’ve no loyalty to your fellow Americans and people like yourself are a big reason Americans have repudiated most of the Republican’s predatory sociopathy.
Nonetheless, “Colin”, I’ll see your Tyler Cowen gambit and raise you a Noble Prize winning Paul Krugman on Tyler Cowen.
Krugman’s best line on Cowen: “I don’t know how a trained economist can make something this simple so complicated …”
Another post by Krugman on Tyler Cowen, best line: “Whatever you think of this [argument Tyler Cowen links to], it has nothing whatsoever to do with the current stimulus debate. Read before linking.”
In fact, Krugman regularly, though very politely, corrects Tyler Cowen’s perpetual misunderstandings.
—-
For the record: the fact that Christina Romer works for Obama isn’t necessarily a recommendation.
Obama has a lot of right wing corporatists (Geithner, Summers, Sunstein, etc.) working for him.
Romer is at best a centrist who has said some interesting things, but still not enough to not consider what she’s says without considerable skepticism.
J.G.Thayer: “So, Strowbridge, you’re fine with Oliver using the term ‘teabag,’ but don’t like it when I use the more literal translation? Figures you don’t like honest language.”
Calling someone gay as an insult is homophobic.
You don’t have to be gay to tea bag.
Fucking idiot.
Seriously, are you this fucking stupid that I have to explain these things to you?
Glad to see Colin is back and using other people’s opinions as proof of his own.
Yes, the freakin’ Secretary of the Treasury. But I’m sure he was wrong and that actually the New Deal was a raging success.
“Colin”, you’ve already expressed a sociopathic indifference to Americans health. You’ve no loyalty to your fellow Americans and people like yourself are a big reason Americans have repudiated most of the Republican’s predatory sociopathy.
Sorry I am just not that into mindless flag waving and basing my feelings towards fellow humans on whether we have the same passport or not.
Oh, and I’ll note that not one link you cited contradicts what I posted about World War II and the Depression. In fact, it doesn’t look like you did any research at all other than a search for instances of Krugman mentioning Cowen.
Yes, the freakin’ Secretary of the Treasury. But I’m sure he was wrong and that actually the New Deal was a raging success.
I don’t care whose opinion something is, regardless of their position. That opinion needs to be backed up by something other than more people sharing the opinion.
Morgenthau didn’t like Keynesian economics before he became Treasury Secretary, so his position that it hadn’t worked after being Secretary for a few years doesn’t do the trick for me. I respect that Roosevelt had as a Secretary someone who was critical of his policies, and I hope Roosevelt weighed what Morgenthau said very carefully. But Morgenthau’s opinion does not carry historical weight as proof of those policies’ success.
That you seem unable to distinguish between opinion (even expert opinion) and fact is a concern. You clearly believe in your opinion very strongly, and I’m not surprised that you have an affinity for opinions similar to yours, but you keep slapping them down on the table as if they prove something. They don’t.
That they don’t prove anything does not make me more correct or you more incorrect. They simply don’t make the case one way or the other.
No, they don’t prove my point but it’s pretty damn interesting that a guy with a major say in implementing the New Deal declared it a failure.
If Don Rumsfeld declared the invasion of Iraq to be a failure do you think that would have been similarly irrelevant?
No, they don’t prove my point but it’s pretty damn interesting that a guy with a major say in implementing the New Deal declared it a failure.
*cough*
No, they don’t prove my point but it’s pretty damn interesting that a guy with a major say in implementing the New Deal declared it a failure.
See above, re: never liked it in the first place.
I think this says more interesting things about the less polarized nature of politics in this country a century ago than it does about the New Deal itself.
But either way, if you find it interesting, cool. But stop whipping it out in the middle of an argument like it’s supposed to be anything other than color commentary.
If Don Rumsfeld declared the invasion of Iraq to be a failure do you think that would have been similarly irrelevant?
Well, absent other evidence of the success of failure of the war, yes, it would have been. The same way his opinion that it was a success was irrelevant in the face of the facts.
*cough*
Again:
No, they don’t prove my point but it’s pretty damn interesting that a guy with a major say in implementing the New Deal declared it a failure.
But either way, if you find it interesting, cool. But stop whipping it out in the middle of an argument like it’s supposed to be anything other than color commentary.
Call it what you will, I find it rather illuminating that a senior member of FDR’s own cabinet found his own economic policies to be ineffectual.
But you’re right, that proves nothing. The proof is in the fact that double digit unemployment persisted through the entire 1930s.
It’s a noted contrast with the 1920-21 recession in which the government responded by basically doing nothing and the economy recovered nicely.
Well, absent other evidence of the success of failure of the war, yes, it would have been. The same way his opinion that it was a success was irrelevant in the face of the facts.
At least you are consistent.
But you’re right, that proves nothing. The proof is in the fact that double digit unemployment persisted through the entire 1930s.
Ok, data we can discuss. Thank you.
I think focusing purely on whether unemployment was in double digits or was not in double digits is misleading. If unemployment started at, say, 30% and went down to 15%, that’s a significant improvement in conditions even if the situation hadn’t returned to pre-recession levels. And that’s pretty much what happened.
Take a look at this chart. The solid line is what I assume you’re using as your measure, which is the work from Stanley Lebergott in 1964. Unfortunately, this measure is not entirely accurate as it counts a number of people as unemployed who were not unemployed. Namely people employed under emergency government work programs
If we remove the people working in emergency government work, via the WPA or similar organizations, we get the dashed line. These jobs may not count to free-market enthusiasts as much as private jobs, but at the least it’s not fair to count them as unemployed. They were working, they were getting a paycheck and they were in all likelihood spending that paycheck.
That brings us to the dotted line, which removes government workers from the picture entirely and shows unemployment vs. employment in private nonfarm jobs. I believe what this means is that government workers are not counted as unemployed, but are removed from the series entirely.
Counting this, unemployment peaked at just over 30% and fell to just below 15% before the 1937 recession. It then climbed to around 20% before beginning to fall again.
Halving unemployment over 4 years may not be all the progress we’d want, but it is progress. Whether or not this is failure depends on what your standard for success is. To me, this is success. Honestly, to everyone I’ve met who lived through it, it was success, too.
It’s a noted contrast with the 1920-21 recession in which the government responded by basically doing nothing and the economy recovered nicely.
Another noted contrast is the cause of the 1920-21 recession. For instance, take a look at household debt as a percentage of GDP during the early 20’s vs 1929. In 1929 it was 100% of GDP. In 1921 it was 30% lower.
The recession of 1921 was caused by a needed natural market correction brought on by the end of WW1. The Great Depression had more do do with a massive debt deflation spiral than correcting for post-war overproduction.
In fact, I’d argue that the 1920-21 recession is closer to the popping of the Tech bubble in 2000, both in that it was relatively short (though less mild; its affects were more pronounced), but ended without correcting a number of more serious underlying problems. Perhaps, had debt decreased more significantly during that recession, and had it not continued to increase at unsustainable levels through the rest of the decade, the Great Depression would not have been as severe.
Either way, I don’t think they’re comparable recessions just because they were both recessions. They don’t resemble each other enough to draw as broad a conclusion as you’re suggesting.
Jesus that was long. Sorry.
Thank you Eric Sipple!-)
And, lol, Zython.
http://google.com/search?q=%22Appeal+to+authority%22+logical+fallacy
Colin plays the “double digit” game:
‘99% is the same as 10% because they’re both double digits.’
Republican Enron math = Thieves + Suckers
Unemployment began dropping immediately upon implementation of FDR’s New Deal of big government spending and only rose again when FDR briefly STOPPED big government spending and tried to balance the budget.
When deficit spending started back up, unemployment started going back down.
All of this happened before World War II (which itself was a BIG government spending spree that INCREASED THE VALIDATION of the economic model of Keynsian economics.)
“Colin,” you are regurgitating right wing revisionism. Maybe you are a sucker enough to believe, but your being a fool doesn’t make your fictions ‘true.’
And repeating fictions suggests you are either a fool or a liar.
You don’t seem like a fool.
“Colin,” I think you are simply a liar.
Which, while it makes you a perfect leader/deceiver for the Republican right wing it also puts you in the category of “CON ARTIST,” COLIN.
Excellent graph and article, Eric. Thanks.
BTW, “Colin,” don’t confuse Eric’s liberal courtesy
with my conservative wrath.
It’s a noted contrast with the 1920-21 recession in which the government responded by basically doing nothing and the economy recovered nicely.
Right. Because the recession of 1920-21 was very similar to the great depression. In what way? This is just abject stupidity, FDR took office 3 years after the great depression, if it were a simple recession, it would’ve been over in time for Hoover to be re-elected.
The Morgenthau quote is interesting, but curiously incomplete. Morgenthau was never a fan of the New Deal, and in the late 30’s became a harsh critic of his own administration for not taking more aggressive action to help Jews emigrate from Europe. As the only Jew in FDR’s cabinet, he was quite offended (and rightly so) that FDR didn’t take more aggressive action.
All said, I don’t think anyone here claims the New Deal was the only, or even most important, component of FDR’s economic recovery plan. The first step was simply reversing the horrible policies of his predecessor (ended the deflationary cycle was a huge improvement, lowering effective interest rates was also important). Where conservatives error greatly in their assessment of the New Deal is where they ignore the effect of the policy on 1) Minimizing/alleviating suffering of the poor (never a strong point of conservatives) 2) Improving morale (we wouldn’t want a “nation of economic whiners”) and 3) Building infrastructure (which came in quite handy for WWII).
Halving unemployment over 4 years may not be all the progress we’d want, but it is progress. Whether or not this is failure depends on what your standard for success is. To me, this is success. Honestly, to everyone I’ve met who lived through it, it was success, too.
Well progress strikes me as necessary but insufficient to determine success. After all, recovery and progress follows every recession we’ve ever had. The notion that unemployment would have remained at a permanent 25% plateau is rather implausible.
The fact remains that it took about 8 years to get unemployment down to 10%.
The task is to show that unemployment declined by more than what otherwise would have been the case absent the New Deal.
While we are looking at graphs we should also consider this:
http://1.bp.blogspot.com/_oKWxWOEilyQ/STQBv-aP7mI/AAAAAAAAALI/IpRp4SsZJ24/s1600-h/Depression.png
This is an examination of GDP rather than unemployment, which is more useful since unemployment is a lagging indicator. GDP had already started to recover when FDR took office.
We also know that some of the New Deal programs plainly did not help progress. For example the National Industrial Recovery Act, which set things like maximum hours that could be worked and I believe even minimum prices to combat deflation. As wikipedia says:
http://en.wikipedia.org/wiki/National_Industrial_Recovery_Act#Impact
It is widely agreed that the NIRA was a failure as public policy. As noted above, even by early 1935 there was nearly a consensus in Congress that the industry codes were not working and that the economic effects of the public works provisions would not be felt for many years. But why the NIRA failed is the subject of dispute.
A key criticism of the Act at the time as well as more recently is that the NIRA endorsed monopolies, with the attendant economic problems associated with that type of market failure. Even the National Recovery Review Board, established by President Roosevelt in April 1935 to review the performance of the NRA, concluded that the Act hindered economic growth by promoting cartels and monopolies.
I don’t doubt that many people you know think the New Deal was a success. Its implementation correlated with recovery. Correlation, however, does not mean causation. And if you want to swap anecdotes both sets of my grandparents did not approve of the New Deal.
But let’s set all of that aside and say that the New Deal was a success. The context for this that the New Deal justifies Obama’s spending explosion. But the New Deal, while engaging in sizable spending, did not run much of a deficit, making up the difference with increased tax revenue:
http://www.nytimes.com/images/blogs/freakonomics/posts/Fishchart.jpg
Either way, I don’t think they’re comparable recessions just because they were both recessions. They don’t resemble each other enough to draw as broad a conclusion as you’re suggesting.
No, they don’t. But then again nothing can compare with the Great Depression.
‘99% is the same as 10% because they’re both double digits.’
Unemployment went down from 25% to 10% in about 8 years. 10% unemployment is nothing to brag about.
News Reference, you really are in idiot, but I will indulge your rant nonetheless.
With regard to your chart, go back and check GDP in the chart I posted in response to Eric. Unemployment is a lagging indicator. GDP is a better measure, and it started to recover before FDR did anything.
When deficit spending started back up, unemployment started going back down.
Uh-huh:
http://www.nytimes.com/images/blogs/freakonomics/posts/Fishchart.jpg
All of this happened before World War II (which itself was a BIG government spending spree that INCREASED THE VALIDATION of the economic model of Keynsian economics.)
So I guess you approve of Bush’s wartime spending as a means of boosting the economy right?
“Colin,” you are regurgitating right wing revisionism. Maybe you are a sucker enough to believe, but your being a fool doesn’t make your fictions ‘true.’
And repeating fictions suggests you are either a fool or a liar.
You don’t seem like a fool.
“Colin,” I think you are simply a liar.
Which, while it makes you a perfect leader/deceiver for the Republican right wing it also puts you in the category of “CON ARTIST,” COLIN.
I see you have been confusing paint chips with potato chips again. I hate to be the person that gets cornered by you at a party.
Right. Because the recession of 1920-21 was very similar to the great depression. In what way? This is just abject stupidity, FDR took office 3 years after the great depression, if it were a simple recession, it would’ve been over in time for Hoover to be re-elected.
Nothing can compare with the Great Depression, but we do the best we can.
The Morgenthau quote is interesting, but curiously incomplete. Morgenthau was never a fan of the New Deal, and in the late 30’s became a harsh critic of his own administration for not taking more aggressive action to help Jews emigrate from Europe. As the only Jew in FDR’s cabinet, he was quite offended (and rightly so) that FDR didn’t take more aggressive action.
Interesting, but the fact remains that as Treasury Secretary he was basically calling his own policies a failure.
All said, I don’t think anyone here claims the New Deal was the only, or even most important, component of FDR’s economic recovery plan. The first step was simply reversing the horrible policies of his predecessor (ended the deflationary cycle was a huge improvement, lowering effective interest rates was also important). Where conservatives error greatly in their assessment of the New Deal is where they ignore the effect of the policy on 1) Minimizing/alleviating suffering of the poor (never a strong point of conservatives) 2) Improving morale (we wouldn’t want a “nation of economic whiners”) and 3) Building infrastructure (which came in quite handy for WWII).
And the left can’t seem to grasp that the New Deal was hardly an unqualified success. Your first point is a baseless attack so I will ignore it. You are on more solid ground with your second. As for the third, I am unsure.
http://en.wikipedia.org/wiki/Works_Progress_Administration#Projects_funded
This is an examination of GDP rather than unemployment, which is more useful since unemployment is a lagging indicator. GDP had already started to recover when FDR took office.
We have no data saying what the recovery would have looked like without New Deal programs, nor had it recovered for any length of time before FDR took over. It leveled out during the election year and ticked up as he was taking office.
Looking at the rate of recovery, I doubt it would have been better, so based on GDP I think the best you could argue is that it did nothing extra, but did not retard recovery.
As the government was spending a lot of money – money that was going into infrastructure and manufacturing and to workers who would then spent it – I have a hard time seeing an argument that FDR’s policies did not accelerate the growth of GDP.
The task is to show that unemployment declined by more than what otherwise would have been the case absent the New Deal.
Yep, and your task is to show that GDP would have increased as quickly as would have been the case absent the New Deal.
You know what we do have? We have unemployment on a downward trajectory and GDP on an upward trajectory. Considering America’s role as exporter prior to the Depression, the lack of demand in the rest of the world made recovery in America exceedingly hard. Recovery required increasing domestic demand to offset reduced global demand for American goods. This was what the New Deal programs did.
If these programs did not drive GDP recovery, what was the driver?
So I guess you approve of Bush’s wartime spending as a means of boosting the economy right?
No bid contracts to corporate interests operating overseas are not the same thing as massively increased domestic manufacturing. All spending is not created equal.
And I think we need to get away from stimulative spending as the only piece of FDR’s policies. The spending was important, but so was an awful lot of other stuff. Things like regulation reform, stabilization of the banking sector and the creation of a social support system that could sustain temporary economic shocks.
Mostly FDR was just a really, really good president who changed the fabric of how America takes care of its own. FDR’s America was successful for 3/4 of a century, and only after much of what made it great was slowly dismantled by resurgent conservative interests over the past 30 years. And what’s left of it is the only reason this crisis isn’t worse; take away the FDIC and I’d hate to see what kind of retail bank runs we would have seen.
Note I am not saying Republican. I’m saying conservative. The Democrats hopped on the train too, and rode it happily until it crashed into the side of the mountain last year. Just like it did in 1929.
“Colin” is a classic right winger, he starts off with a predetermined belief, ignores evidence which contradicts his belief, and then cherry picks evidence to support his predetermined belief.
“Colin” even points to a graph that refutes his position and then asserts that it is supporting evidence. Which it is, it is evidence that supports the refutation of “Colin’s” argument.
America’s Gross Domestic Product was going down, down, down during Republican Hoover’s Presidency.
That was BEFORE the Presidency of the Democratic FDR.
FDR was elected and THEN the GDP started going up, up, up.
“Colin” then asserts things which only a minority of crazy right wingers “believe” and asserts that that nonsense is “widely agreed” upon.
Agreed upon by whom? Crazy right wingers? Right wing revisionists?
Citing a graph without attribution that refutes his own argument and linking to “write your own” Wikipedia articles doesn’t “prove” anything other than that “Colin” is either easily conned or assumes that he can con everyone else.
Even “Colins” citation of Morgenthau is corrupted by “Crusty Dems” context of Morgenthau’s concerns about inadequate support of European Jews.
Without the groundwork of Democratic President FDR’s New Deal, America wouldn’t have been able to meet the challenges of World War II.
FDR’s New Deal not only pulled America out of the Great Depression, it readied America to suceessfully meet the challenges of World War II.
Apparently that offended “Collins” Grandparents.
Which side were they on, “Collin?”
“Colin” is a classic right winger, he starts off with a predetermined belief, ignores evidence which contradicts his belief, and then cherry picks evidence to support his predetermined belief.
“Colin” even points to a graph that refutes his position and then asserts that it is supporting evidence. Which it is, it is evidence that supports the refutation of “Colin’s” argument.
America’s Gross Domestic Product was going down, down, down during Republican Hoover’s Presidency.
That was BEFORE the Presidency of the Democratic FDR.
FDR was elected and THEN the GDP started going up, up, up.
“Colin” then asserts things which only a minority of crazy right wingers “believe” and asserts that that nonsense is “widely agreed” upon.
Agreed upon by whom? Crazy right wingers? Right wing revisionists?
Citing a graph without attribution that refutes his own argument and linking to “write your own” Wikipedia articles doesn’t “prove” anything other than that “Colin” is either easily conned or assumes that he can con everyone else.
Even “Colins” citation of Morgenthau is corrupted by “Crusty Dems” context of Morgenthau’s concerns about inadequate support of European Jews.
Without the groundwork of Democratic President FDR’s New Deal, America wouldn’t have been able to meet the challenges of World War II.
FDR’s New Deal not only pulled America out of the Great Depression, it readied America to successfully meet the challenges of World War II.
Apparently that offended “Collins” Grandparents.
Which side were they on, “Collin?”
As the government was spending a lot of money – money that was going into infrastructure and manufacturing and to workers who would then spent it – I have a hard time seeing an argument that FDR’s policies did not accelerate the growth of GDP.
That assumes that if the money had been left with the taxpayers or lenders to spend that they would have put it to less productive uses than the government. I find that rather difficult to believe given the inefficiencies and corruption involved in government procurement and spending.
You know what we do have? We have unemployment on a downward trajectory and GDP on an upward trajectory. Considering America’s role as exporter prior to the Depression, the lack of demand in the rest of the world made recovery in America exceedingly hard. Recovery required increasing domestic demand to offset reduced global demand for American goods. This was what the New Deal programs did.
You realize that exports currently only account for 9% of GDP right? I have a hard time believing that it was much different in the 1920s.
If these programs did not drive GDP recovery, what was the driver?
In an economic downturn companies and individuals always adjust and shift their allocation of resources. This is what produces recovery. Think about it, if government or some other exogenous factor were needed to pull an economy out of a downturn then all downturns without such intervention would produce an endless downward spiral. Self-evidently this is not the case.
Look at Spain in the 1990s:
http://www.tutor2u.net/blog/files/spain_unemployment_1208.gif
Unemployment declined from about 24% — numbers on par with Great Depression figures — in 1994 to 10% by late 2001. Did government spending drive this? Not really. In fact the Aznar government had an austerity budget that included wage freezes and spending cuts to get in line with the EU requirement for deficits of less than 3% GDP. They also engaged in privatization. In many ways it was the antithesis of the FDR approach.
Now, did Aznar create the recovery? Perhaps not. But this would seem to indicate that government spending is not the magic elixir some claim it to be.
And I think we need to get away from stimulative spending as the only piece of FDR’s policies. The spending was important, but so was an awful lot of other stuff. Things like regulation reform, stabilization of the banking sector and the creation of a social support system that could sustain temporary economic shocks.
You’re right, regulation played a big part. Much of that was bad, as I already showed, and unconstitutional which is why some of the programs were scrapped.
Mostly FDR was just a really, really good president who changed the fabric of how America takes care of its own. FDR’s America was successful for 3/4 of a century, and only after much of what made it great was slowly dismantled by resurgent conservative interests over the past 30 years. And what’s left of it is the only reason this crisis isn’t worse; take away the FDIC and I’d hate to see what kind of retail bank runs we would have seen.
Note I am not saying Republican. I’m saying conservative. The Democrats hopped on the train too, and rode it happily until it crashed into the side of the mountain last year. Just like it did in 1929.
This is a tangent that I don’t have the appetite for a full dissection of but I will make a few points:
1. What FDR programs did conservative interests dismantle? The only one that comes to mind is Glass-Steagal. I have yet to see any kind of explanation of how that contributed to the economic crisis.
http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html
The truth is, however, the Gramm-Leach-Bliley Act had little if anything to do with the current crisis. In fact, economists on both sides of the political spectrum have suggested that the act has probably made the crisis less severe than it might otherwise have been.
2. If you want to blame right-wingers for the last 30 years I think that is a burden they would happily bear. According to the UN:
http://data.un.org
US per capita GDP in 1981 was $13,314. Now it is $45,057.
Some might see that as something less than a train wreck.
3. I imagine that you think social security was one of FDR’s crowning achievements that rescued the elderly from a life of dining on dog food. There are at least a couple of problems with this. First, social security kicked in when most people were reaching the end of their expected lives, so the benefits reaped weren’t terribly great:
http://mjperry.blogspot.com/2009/04/chart-of-day-retirement-age-v-life.html
Since that time life expectancy has increased, which is why the program — which is similar to a pyramid scheme — has future funding problems. The other problem is the worker-retiree ratio.
Second, while elderly poverty has decreased, this is unsurprising. After all, we are a vastly wealthier country than during the 1930s. It therefore shouldn’t be a surprise that a decline in poverty has occurred. Correlation doesn’t equal causation.
Lastly, social security is a system badly in need of reform. It’s a trainwreck that takes my wages and then gives some portion of them back to me when I retire, assuming the program still exists. Why can’t I have the option of opting out and investing my money as I see fit?
So Colin the Con Artist asserts: “That assumes that if the money had been left with the taxpayers or lenders to spend that they would have put it to less productive uses than the government.”
That’s a verifiable fact. It’s called the paradox of thrift.
During a recession, the individually rational thing to do is to stop spending and save money.
The problem with that individually rational reaction to a recession is that on a macro-economic scale it exacerbates the recession and can risk a depression.
Individually rational economic choices ends up damaging the market because the market relies on the social force of a large number of people buying and selling.
At the beginning of the Great Depression nearly everyone stopped spending and started saving and that accelerated a downward spiral of the economy.
Government is the “spender of last resort” in such a scenario.
It’s true, if you’re willing to stand by and watch an economy drown, eventually it might recover. It also might mean that the country that used to be strong is then overtaken by one that didn’t share it’s economic fate.
Colin is willing to stand around and watch the American economy drown.
Some people have more loyalty to America and Americans. Clearly that doesn’t include right wingers and especially doesn’t include libertarians.
Colin actually has the gall to cite Spain to support his ’stand by and watch’ economic theory, Spain used to be a contender as one of the strongest nations on earth and now barely has 1/10 the GDP of US.
Clearly they’ve been using Colin’s economic remedies.
“I find that rather difficult to believe given the inefficiencies and corruption involved in government procurement and spending.”
Uhm, Enron, Worldcom, AIG, Lehmann Brothers, … sorry, but the “inefficiencies and corruption involved in” the deregulated ‘free market’ is what took down the American economy. Again.
Government is the only thing offering a lifeline. Again.
If your economic theories had worked, “Colin”, there wouldn’t have been a global financial meltdown. Clearly your theories failed. Now you’re just selling snake oil.
And as for government procurement corruption, were you paying ANY attention the last 8 years the Republicans have been handing out taxpayer dollars to their corporate cronies? KBR, Halliburton, Blackwater, goodies to Republican’s corporate friends, unbid cost plus contracts, …
The long list of corporate corruption is directly attributable to right wing deregulatory ideology.
And here Colin is, selling the same snake oil that made US sick.
Colin, tell US again how Democratic President FDR’s reduction of the unemployment rate by 60% ‘isn’t anything to write home about.’ Or am I confusing you with one of the othe shapeshifters lurking here.
During a recession, the individually rational thing to do is to stop spending and save money.
And how exactly does one go about “saving money” nowadays?
CDs?
Savings Accounts?
IRAs?
All those help the banking industry, the hardest hit sector of the economy.
Stocks?
Mutual Funds?
401(k)s?
All those help the economy at large.
So while saving in and of itself won’t help things like consumer spending, it *WILL* help the economy.
Or you could take all those savings and have the government tax it, skim their beaurocratic fees off the top, and then “re-invest it”. Of course, then it’s the government deciding who gets the money instead of individuals.
Because politicians know what’s best for you, right?
I don’t have time to address Newsy’s entire rant but will make a few points:
1. If the paradox of thrift holds then no economy entering a downturn would ever recover without government stimulus. Plainly this is not the case.
2. I don’t even know what this means:
It’s true, if you’re willing to stand by and watch an economy drown, eventually it might recover. It also might mean that the country that used to be strong is then overtaken by one that didn’t share it’s economic fate.
Economic prosperity isn’t a zero sum game. We don’t benefit when other countries fail. In fact, the better others do the better it is for us, since they become better export markets. If other countries become rich and surpass us that’s wonderful. I think for example that Norway has a higher per capita GDP than us. I guess they have “overtaken” us. But who cares?
3. Re” this bit:
Colin is willing to stand around and watch the American economy drown.
No, I am unwilling to watch the government strangle it. The reality is that I have faith in the private sector — that is to say, the American people who work in the productive part of the economy — to make adjustments and retool the economy for future growth. It is a faith in people instead of politicians.
4. Your Spain example is laughable. Spain reduced its huge unemployment during the 1990s by following free market policies. Spain was only a great power when it was raping and pillaging the New World for gold and silver. I, however, am not interested in the prosperity of governments but rather people.
5. Re: Enron, Worldcom, etc. Those two companies were both bankrupted by the free market. Enron no longer exists. This stands in stark contrast to government programs where failure is rewarded with budget increases and largesse. The marketplace punishes failures while government rewards them.
Government may be offering a lifeline to many companies but that doesn’t interest me. I am not a fan of corporate welfare, unlike many on the left as illustrated by their support for bailouts.
6. Newsy is absolutely right that the GOP handed over money to their corporate buddies. This is a profoundly good argument for reducing the scope of government.
7. As for alleged deregulation, the only example of this I can think of is Glass-Steagal, which predated Bush. I also don’t see how it contributed to the financial crisis. On the regulatory front Bush is most notable for piling on additional rules with the advent of Sarbanes-Oxley.
The only reason CD’s and Savings Accounts are SAFE up to $100,000 (?now $250,000?) is because of GOVERNMENT GUARANTEES, SaveFarris.
And for that matter, SaveFarris, for all I know, people are going to stuff mattresses with money. It’s what people did during the Great Depression after the bank runs ruined a lot of people.
And who is going to borrow? Most people aren’t in a position to buy a car or a house or a new refrigerator. So even if the ‘banks’ were theoretically ‘helped’ by government gauranteed deposits, there still aren’t people lining up to go into debt.
And while the littel banks didn’t make the reckless gambles enabled by Republican deregulation of the banks, LARGE BANKS THAT GAMBLED AND LOST REPRESENT THE LARGEST PORTION OF ASSETS IN AMERICA. And those banks literally gambled your deposit away, a deposit that would be GONE if it weren’t for government gaurantees and bailouts.
So, SaveFarris, your first questions offers support for LARGE SCALE GOVERNMENT ACTIVISM once you’ve thought it through.
And this has all been explained repeatedly. Did you miss that day in class SaveFarris or is someones systematically lying to you? Maybe you need better sources of information. Try reading:
Paul Krugman
http://krugman.blogs.nytimes.com
Robert Reich
http://robertreich.blogspot.com
Brad DeLong
http://delong.typepad.com
Dean Baker
http://prospect.org/csnc/blogs/beat_the_press
And, gee, who all is investing in Stocks? Mutual Funds? and 401(k)s these days?
Most peoples assets dropped by 40% and some by 60%. Stocks DOWN, Mutual Funds DOWN, 401(k)s WAY DOWN, IRAs WAY DOWN.
People’s retirement “cratering” is one of the reasons nobody is “spending” let alone “borrowing.”
People who relied on the “market” for their retirement incomes got sucker punched. Their assets might not recover for a decade, if ever. Some of the elderly’s loss of HALF OF THEIR ‘WEALTH’ may eventually put them on the streets.
See, SaveFarris, your second questions reveals the COMPLETE FAILURE OF THE RIGHT WING’S MAGIC MARKET CULT.
That sunk in to people who were paying attention. Clearly you need to start doing your OWN homework, SaveFarris, and not rely on Limbaugh and Colin the con artist for market advice.
Which part of “no one is spending except for the government” don’t you understand?
But, please, SaveFarris, keep revealing the profound ignorance and deceit of the right wing. Ya’all got US into this current Republican Great Recession, and if the Republicans you helped sucker and lie into your Ponzi scheming fantasy nonsense ever figure that out, the drunken Republican Spending Party will be over.
“Colin” you are one man misinformation machine.
“Colin”, I keep thinking you are too smart to believe your own Con, but for the way you discredit your own arguments, perhaps you really don’t know what you are talking about.
You spout discredited right wing economic theories as if you were time warped from 1980 and still believed in “voodoo economics.”
It’s funny, even elder Bush I recognized that Hollywood entertainer and Republican salesman Reagan was a nutter on economics.
It was Republican Bush I that labeled Republican Reagan’s magic Ponzi scheme: “Voodoo Economics.”
Reagan’s nonsense theory: ‘cut revenues and revenues will go up!’
Painful, stupid nonsense.
Republican Reagan MORE than doubled the US debt, Reagan understood that massive spending ‘helped’ the economy. Unfortunately he did it for political opportunism.
Reagan increased US debt not to get US out of the Republican created Great Republican Recession but in order to hand tax cuts to the ultra wealthy even while raising taxes on the working class by massive amounts.
REPUBLICAN REAGAN RAISED SPENDING, INCREASED GOVERNMENT DEBT, RAISED TAXES ON THE WORKING CLASS, and all to hand the ultra wealthy tax cuts.
Reagan literally screwed the poor for the rich.
If anyone wants to know about the heart of Republican economic con-artistry the need to read “Two Santa Clause Theory.” “Republican “Economics”"
You cite the welfare capitalism country of Norway as having a higher GDP per capita than US.
Congrats, you just discredited 30 years of Republican economics that claimed that “welfare” was incompatible with “capitalism” by listing a “welfare capitalism” country whose citizenry have HIGHER INCOMES than Americans.
Norway also has lower infant mortality rates and longer life expectancy.
And your citation of a welfare capitalist country where citizens earn more money, live longer lives, and have lower infant mortality rates is meant to illustrate ? what? That America should adopt their economic system. Ok, you’ve sold me.
Clearly, by the measure of per capita GDP, life spans, and the health of babies, the welfare capitalist country of fewer than 5 million people beats US on all of those measures.
My point was that some countries have better economic plans than others. Your economic theories just gambled America’s wealth and lost trillions and you are still peddling discredited nonsense.
Nothing the “trickle down” republicans will ever do will help in any way to better the cause of the working man. By working man I mean anyone who works for”the man” and enriches them through his/her labors. The only “job” they want you to have is servant/soldier! The consumerist society we currently subscribe to has proven itself to be based on lies and misguided morals/ethics–trust in those at the top to trickle down anything is a losing proposition. A new “open eyed” approach is needed–one that encompasses all people–not just affluent people and corporations!
His track record is better than yours.
Farris:What track record?
He’s still right more of the time than you guys.
Republicans caused deficits because they cut taxes while increasing spending (military and/or social). Democrats contribute to deficits only slightly less, by increasing taxes AND spending (social and/or military). The only exceptions during the 32 years I’ve been alive were Reagan and Clinton: Reagan simplified and cut everyone’s taxes, but raised military spending more than any other President since FDR, thus contributing to massive ’80s deficits. Clinton cut taxes for middle class and working class people, plus added some new tax credits for everyone, but deficits took eight years to disappear because he also increased social spending.