A Shameless Obama Snow Job [Reader Post]

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Shame and public humiliation used to be very effective forms of social conditioning. In Middle Age Europe an offender would often be placed in a pillory or stock and be subject to public humiliation and ridicule for their offense. The idea was that after being subjected to such humiliation the offender would mend their ways in order to avoid a repeat performance. Such discipline was not always effective, but the recidivism rate was probably far below what is seen in the American judicial system today.

In America circa 2010 one could make the argument that the very notions of shame and public humiliation have almost vanished in both public and private spheres. Paris Hilton, Eliot Spitzer, Barry Bonds, Charlie Crist, the Salahis, the popularity of Reality TV etc. In an America where almost anything seems to go, where nothing is reproachable, where everyone’s position is equally valid regardless of its substance, it’s no surprise that we have a President and administration who have the audacity to make ludicrous arguments to demonstrate the success of their policies and then expect us to accept them – and that’s before the sycophants in the media begin to spin them.

President Obama set the tone early on. In the administration that promised an unprecedented level of transparency, they were going to be crystal clear in demonstrating the efficacy of their policies in the place where it mattered most: Jobs. While previous administrations traditionally utilized the traditional Payroll or Household Surveys to measure the effect of their policies, this administration was turning a new page in government accountability, jobs that were “Saved or Created”. Rather than tethering themselves to what was actually going on in the economy, President Obama created a fantasy measurement with no correlation to anything but their imagination, something that could be neither be proved nor disproved. Saved or Created is such a vacuous measure that it would actually be possible for the administration to claim they had saved virtually every job in America. One could imagine President Obama giving the following statement to start off the Summer of Recovery:

“The country’s economic situation when we took over was so bad we were forced to take drastic measures. The single most significant measure we took, The American Recovery and Reinvestment Act was a resounding success. Uncertainty at the time was deep and widespread: There were suggestions China was preparing to dump American bonds, OPEC was looking at pricing oil in Euros and companies across the country were considering mass layoffs to conserve cash. The American Recovery and Reinvestment Act gave international markets and domestic employers the confidence that our administration was going to do what was necessary to bring order to America’s economic house after eight years of economic mismanagement. As a direct result of that stimulus bill and our sound economic policies, the 25 million jobs that our internal analysis suggested might be lost were indeed saved and I’m glad to say here today that we have put our economy back on solid footing and America is beginning to grow once again.”

While he didn’t actually make the above statement, given the lack of substance underlying the Saved or Created measure and the media’s proclivity to paint everything Obama in glowing hues, one wonders why they didn’t.

Now that the Summer of Recovery has been shown to be on life support and Saved or Created has not helped President Obama’s cratering approval ratings, the administration has just rolled out the latest measure for demonstrating the genius of their economic policy… “Lives Touched”. According to CHT2M Hill, the company that received 4 or the 10 largest contracts under the stimulus plan:

“Lives Touched” is a figure that the U.S. Department of Energy (DOE) uses to track the amount of people who have been positively affected by the Recovery Act funds. This total would include people who have been provided full time employment (i.e. saved and created jobs) through the Recovery Act and people who at some point have supported a project funded by the Recovery Act.

First Saved or Created and now Lives Touched? Really? Such idiocy could only happen in a country where embarrassment, shame and humiliation have ceased to exist. What else explains the willingness of the administration to seriously suggest such tools to measure economic efficacy? That is the mentality of a four year old with cookie crumbs on his face telling his mommy that some imaginary person took the cookies. The four year old might be excused as having not quite grasped the concept of truth vs. fiction. Despite their childlike pursuit of policies that are so obviously flawed, the Obama administration is not filled with children. They should have, at least in concept, understood that inventing unsupportable criteria to measure real world events is simply unacceptable. Only in a country that no longer knows what shame means can politicians act with impunity when they should be embarrassed. In the fable “The Emperor’s New Clothes” the Emperor was not embarrassed because he actually thought he was wearing respectable clothes. Barack Obama on the other hand has been nakedly inventing stories to mislead the American public for 18 months. Perhaps a little shame and public humiliation are in order for having the audacity to think Americans are too stupid to see through his illusions.

Crossposted from Imperfect America

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Summer of wreckovery- ummm, ummm, ummm.

“Lives touched”. I heard about that the other day and couldn’t stop laughing at the ridiculousness of it. ‘Saved or Created’ was bad enough. Now we are expected to swallow another fairy dusted term that cannot ever be quantified using reality.

One has to wonder just how his steadily dwindling number of supporters can accept the stupidity of “lives touched” at face value, without feeling shame that they worship at the feet of an imbecile.

I posit that the true quantification of “lives touched” by the ARRA is actually zero. Why, you ask? Because the Act takes wealth from those who have it, and gives it to others, oftentimes specified to particular groups that can be looked at as ‘political payoffs’ instead of actual public projects. And because of that, instead of strengthening a weakened economic base for activity to build upon, it places funds upon those that aren’t anywhere near the base of the economic pyramid and we have false economic activity that will only end up weakening the pyramid’s base more once the money runs out. Short term gains that in order to continue long term, require an infusion of tax-payer dollars at steady intervals, and if not, will crumble the pyramid upon itself when those projects end, and the jobs go away.

Add to that the effect on people of giving them something they haven’t earned for themselves, and we see no ownership, or pride, in what those tax-payer dollars have resulted in. All in all, a very negative feeling from all those “lives touched” by the ARRA.

At this point he should worry about keeping his Own Job.
ARRA and TARP have utterly failed. Fannie and Freddie are circling the bowl,
Social Security and MEDICARE are not funded, OBAMACARE is a huge ripoff,
the Deficit is a new record and as Maggie Thatcher said when you run out of
OPM things get difficult.

I guess that means if you still have a job, it was “saved or created” by Obama’s Pork-o-imulus. And, if you’re able to flip a light switch and the light comes on, it is “life touched” by the same Pork-o-imulus.

Utter BS.

Come November, take nothing for granted, do not get complacent. Bring your neighbors, your relatives, pick up strangers on the street and bring them to the voting booth. Lets touch some lives in Congress with career changes.

November… 4 weeks, and 2 days away.

Nice quote on the DOJ website

“The common law is the will of mankind, issuing from the life of the people.”

It is, at once, contrary to our own Constitution, as it implies a majority will amongst the people should be the law. No where in the statement is the protection of people’s rights, including the minorities, whom, according to the quote, the majorities can overrule. I question the ignorance of the decision to place such a quote on an American government department website.

It is also contrary, funny enough, to the current fight by liberals against the CA Proposition 8, overwhelmingly approved by the people of the state of California, and also the AZ immigration law, which polls show is approved overwhelmingly by not only the people of Arizona but the entire US. For the DOJ to use such a quote, and then to engage in a lawsuit against a sovereign state of the union, and against the will of the people, is funny, and tragic.

@ Mer

Did you leave a month out perhaps?

Why is the Department of Energy tracking Porkulus, and not Labor or Commerce?

-Just one of the things that popped into my head…

@John Galt 7

And with the majority of people not liking Obama Care? How is that DOJ saying true?

Funny how Progressives always talk about the “will of the people”, right up until the “people” don’t agree with them…

@Dr.D: 😳 math was never my strong point… I will say it was Freudian in nature.. wishing November were but a month away…. thanks for the catch…

JohnGalt, do you have a wonderful hidden valley somewhere where it can’t be seen overhead? Several friends who have joined you in your paradise?

@dee

Not yet, but I’m looking. 😉

Although a registered Democrat, I’m basically an economic conservative. In the true sense of the word. I’ve never had any credit card debt. I did take out second mortgages on my house, but this was to pay for two private college educations for my two kids. My wife and I have always lived frugally and within our means. We’ve sacrificed income for the sake of being able to spend our years doing work we continue to love and for having the freedom to miss nothing in the lives of our children.

I believe that government should be run the same way. Pay as you go.

What conservatives fail to understand (or, cynically, choose not to explain) is that a Keynesian stimulus occurs when the government borrows money to increase the total amount of capital circulating in the economy. Let’s say, for illustration, that the total amount of money in circulation within the USA is 1,000,000 dollars. But then a recession hits. It hits because people and businesses become fearful and stop spending money. There is now only 900,000 dollars in circulation, rather than 1,000,000 dollars. When people and businesses stop spending money, there is less demand for goods and services. People lose jobs. Economic growth stalls.

What to do?

What Ronald Reagan did, when he inherited a recession from Jimmie Carter was to cut taxes. The idea behind cutting taxes was to increase the personal and business supply of money, to encourage spending, to reverse the economic stall. So far, so good, but there’s a problem. The government now doesn’t have enough money to pay for national defense and health and human services and education. So the government has to borrow money. Any time the government increases borrowing for the purpose of putting more money into circulation in the economy, it is a Keynesian stimulus.

Reagan’s Keynesian stimulus worked, only there was a huge increase in the budget deficit/national debt; so what did Reagan (wisely) do, once the recession was over? He raised taxes. Then GHW Bush came into office, and he raised taxes, also. Then Clinton came in, and he raised taxes, also. Step by step. And, lo and behold, the budget deficit was reversed; the national debt actually started going down.

There will alway be a boom and bust component to the business cycle. Always. Always has been. Always will be. So, after nearly two decades of growth, there was a slight recession at the beginning of GW Bush’s first term in office. What did Bush do? Wait it out? No, he, like Reagan, gave the economy a Keynesian stimulus. He did this by massively cutting taxes (to levels well below Reagan’s) and, to make up for the resulting fiscal deficit, borrowed massive amounts of money. This was not necessarily a bad thing, because the truth is that Keynesian stimuli work. You borrow money and put more money into circulation, and recessions end sooner than they would have, on their own.

But here’s the problem. Unlike Reagan, GWH Bush, and Clinton, all of whom raised taxes, gradually, to reduce the deficit and reign in the money supply as the recession ended, Bush continued his tax cuts for 10 years. This produced massive deficits. Alan Greenspan saw this happening, and saw that the only way to reduce deficits was to grow the economy to an extent that tax revenues would be increased; so he cut Federal Reserve interest rates so low that all interests rates dropped to ridiculously low levels. T Bill rates dropped from 6.5% to 1%, by the end of Bush’s first term. This did two things: firstly, it put massive amounts of cash into the hands of wealthy Americans, who did not invest this money in generating new businesses, but who, instead, looked for passive ways to make money. The stock market was overvalued. So was the housing market. But more money could be had by borrowing it at the historically low rates (“leverage” — borrowing money to invest at a higher return than the interest payment on the borrowed money). So one problem was too much American money, with no where to go. The second problem was those 1% T Bill rates. What about the huge amount of dollars (EuroDollars and PetroDollars and AsiaDollars) held overseas? They don’t want a lousy 1% interest rate. So now you’ve got a huge slush fund of money around the world with no place to go. Enter collateralized debt obligations — collateralized by worthless real estate. And now you are on the cusp of The Great Depression, V. 2.0.

But the key point that I want to make, before going on, is that a Keynesian stimulus is a Keynesian stimulus is a Keynesian stimulus. A true tax cut is accompanied by a spending cut of equal magnitude. That’s a tax cut. You don’t have to borrow any money to pay for it. A tax cut paid for by borrowing money is not a tax cut. It is a Keynesian stimulus.

Getting back to September, 2008. We are on the cusp of The Great Depression, V. 2.0. What to do? Just sit tight and ride it out?

Keynes to the rescue. The banks have no money, because they find themselves with massive losses from worthless collateralized debt obligations (CDOs). Solution: give the banks liquidity (money to lend) by borrowing money from around the globe to buy up the bad CDOs. But this is still not enough, because the economy had been humming because of record levels of consumer debt and now there was no more consumer lending available. Also, businesses and people both got scared and stopped buying things. So, again, what do you do?

The GOP proposed a $500 billion Keynesian stimulus, based largely on tax cuts. The Obama administration spent $230 billion more than this, divided between aid to state and local governments (preserving the jobs of police, fire, teachers, etc., and keeping highways repaired, sewage and trash collection services running, keeping felons in prison, etc.), tax cuts (I think, nearly $250 billion), unemployment benefits (putting food on families, in GW BushSpeak, and keeping unemployed families spending to mitigate a domino effect), and the smallest component on things like infrastructure and energy R&D.

Now, was Keynes a failure, this time around? Hardly !

We averted The Great Depression, V. 2.0. Absent the bank bailout and the “stimulus,” we’d still be in highly negative growth (well on our way to TGD v 2.0) and unemployment would be running 16.5%. With only the bank bailout but without the “stimulus,” unemployment would be running 11.5%. Because of the stimulus, we are out of the recession and we have 3,000,000 more people currently employed than there would been without it.

Why do people call it a “failure?” Well, this is entirely political. Economic forecasts are based on existing data. Back in 2008, Obama’s top economic advisor (Romer) ran the numbers and calculated that the stimulus would keep unemployment at 8% or less. But, as you may know, economic data lags. There is an initial estimate, but, months later, the “real” figures come in. Thus, first quarter 2010 GDP growth was initially pegged at 2.5%, but has since been downward adjusted to 1.9%. That’s what happened in 2008 — only to a much greater extent. Romer’s “numbers” were based on early 2008 data, which actually turned out to be much worse than originally determined. Here’s the kicker: even BEFORE the Obama “stimulus” was begun, unemployment had ALREADY risen to above 8% !!

It’s an utterly shameless “gotcha,” is all it is.

Anyway, there is no such thing as a modern American politician who is not a Keynesian. Maybe Ron Paul. I could actually vote for that guy. A true liberterian. Keep the government out of everything, including foreign wars and women’s bodies. But I digress.

Why is it a good idea to let the Bush tax cuts sunset for the segment of the population which earns over $250,000 per year? For the same reason Reagan raised taxes, gradually, once the worst was over, recession-wise. You know who advocates raising taxes on the rich? Warren Buffett. Bill Gates. And many others of their ilk. A progressive tax isn’t socialistic. It was advocated by Adam Smith, for goodness sake. Rich people benefit from the services government provides to a much greater extent than do middle class people. They should pay more, because they get more. I could take any occupation and prove to you that, the higher on the food chain, the more benefit is received from government. Plus, the cash availability problem is not that the rich people don’t have enough or that businesses don’t have enough. Businesses are sitting on enormous amounts of capital. They just aren’t spending it on hiring people and I don’t think they will. A lot of the jobs lost by baby boomers just aren’t coming back. This is a topic for another time. And, to put things into perspective, the so-called socialist tax increases of Obama would simply restore tax rates to where they were under Reagan!

Now is a very good time to buy a house, particularly in locales (and there are many of these) where houses are selling for less than their replacement value.

– Larry Weisenthal/Huntington Beach, CA

“And with the majority of people not liking Obama Care?”

A majority have evidently been convinced not to like and to place much blame upon something that hasn’t even gone into effect yet.

This is another version of blaming Obama for causing unemployment that was already skyrocketing before he took office–or of blaming democrats for a recession because they’re the ones who have tried to respond to it.

All of the republican rhetoric will ultimately boil down to two things: Another round of tax cuts for the wealthiest, and increasing levels of long-term social insecurity for mainstream America–many more of whom will be joining the ranks of the poor in their old age.

What complete utter BS Larry!