[SK in CV]

[quote=Veritas]”The U.S. health care system is deeply, deeply broken and Obamacare is going to make things even worse. Health care is one of the top reasons why American families get pushed into poverty.”

http://www.zerohedge.com/node/438067%5B/quote%5D

You know that really isn’t a bad article. But that line you quoted seems out of place. There isnt’ a shred of evidence in the article that HCR has anything to do with the deeply broken system. Nor any evidence that it will make things worse. Nowhere else in the article (that I could find anyway) is HCR even mentioned. It’s nothing more than a gratuituous hack that diminishes the value of an otherwise well written article.

[SK in CV]

[quote=Allan from Fallbrook]I would point out that, in spite of our not always having a big-ass military, we haven’t hesitated to use force to advance our fortunes and this goes all the way back to policies such as Gunboat Diplomacy and Manifest Destiny. We’ve been a going concern from the jump (the original iteration of “Life, Liberty and the Pursuit of Happiness” was “Life, Liberty and the Pursuit of Property”) and we’ve always liked that particular mix of policy and bayonets.

[/quote]

I found that bolded part fascinating. I’d never heard that before. It made me laugh. And head straight for google. Where I found this.

The phrase has meant different things to different people. To Europeans it has suggested the core claim—or delusion—of American exceptionalism. To cross-racial or gay couples bringing lawsuits in court, it has meant, or included, the right to marry. And sadly, for many Americans, Jefferson might just as well have left “property” in place. To them the pursuit of happiness means no more than the pursuit of wealth and status as embodied in a McMansion, a Lexus, and membership in a country club. Even more sadly, Jefferson’s own “property” included about two hundred human beings whom he did not permit to pursue their own happiness.

Lots more good stuff in the article.
http://hnn.us/articles/46460.html

Curiosity can keep us entertained for an entire holiday weekend.

[SK in CV]

[quote=walterwhite]i think jews have a biblcial commandment somewhere to visit the sick. i think i read somewhere in the torah that a visit to the sick eases 1/60 of their suffering. probably not in this case, but may work for gallstone operation. but seriously, a visit to the sick benefits the visitor as much or more than the person being visited.[/quote]

Good job! The visiting the sick is the commandment from Genesis (I won’t bore you with the precise section). The Talmud says he who visits the sick, even 100 times a day, takes away 1/60th of the pain. (weird, I know, for an athiest to remember this shit.)

I was just thinking about it last night. I have a close friend dying of cancer. He’s actually my brother’s closest friend, and my brother has been at his house every day. I was there once last week. In and out of conciousness, saying some hilarious stuff. (He just told his sons he married their mother because she had great boobs. She was standing there and confirmed that she knew it to be true.) And he’s had people in and out of his house constantly. Some he hasn’t seen in years. I don’t really think I should go back again. I don’t think it’s helping him or his family. One of those rules that kinda works in general. But not always.

[SK in CV]

[quote=Arraya]Hello rock, meet hard place[/quote]

Great comment. The quoted part is, I think, a precise description of the current economic situation and the body politic. Even if there was a fix, the climate prohibits it from happening.

And this part:
[quote=Arraya]Now, we are at another inflection point – where they are stuck in a crisis of creativity focusing mainly on trying to reinflate the bubble with a banking system that is faking it and a populace that is both commodity and debt saturated as well as there being no true engine for job growth.[/quote]

For too many years we have relied on growth (construction spending) being the engine. I’m living in Phoenix now, a city that for the last 30 years has survived on growth. There has been virtually no other significant industry. Without growth, much like my wrinkly neighbors to the NW in Sun City, it will wither and die.

What the country needs is something like a new iphone. Or better yet, a cross between a new blackberry and a new iphone. (I’m a blackberry fanboy, and I know it doesn’t really fit, eh. But there is good reason for including it.) Something that is affordable for the masses. Something that is a necessity for business as well. It belongs in a kitchen as well as an office. Something that is developed and constructed here. (Before the Israelis invent it, and ship it off to China for construction.) Something that i can plug into my business analytics models and prove to business managers that putting one in the hands of every employee will improve bottom line without costing jobs. It will save on power consumption and make Korean made 3D glasses obsolete. Students from K-graduate school will carry it to class every day.

And a jobs tax credit to encourage it to happen. Despite the fact that I have no idea what it is, problem solved.

[SK in CV]

[quote=Allan from Fallbrook]SK: Can we include wrong-headed in here as well? I have no issue with marginalizing stupid in order to support rational, but, all too often, simply questioning “settled science” (empirically speaking, there is NO such thing), whether its economics or AGW/Climate Change, is treated as heretical or blasphemous.

I read Krugman’s article on the need for additional stimulus. I don’t take any issue with the assertion, what I do take issue with is Krugman’s insistent and persistent abuse of anyone who disagrees with him and his continued use of strawman arguments to attempt to pro-actively submarine his opponents. Since when did asking questions become such a big deal? If we’re truly committed to a rational, well thought approach, I’d think that empiricism would hold pride of place.

I’ve also watched those whose fervent belief in AGW has caused them to lose all objectivity on the subject, frothing at the mouth over the temerity of those who are proffering the newest NASA and CERN findings on climate change for review and comment.

I strongly agree with you, SK, but I’d also offer the observation that that blade cuts both ways.[/quote]

I agree with you. It goes both ways. Krugman, who at one time I suppose, was a real economist. Now he’s an advocate. And has to be taken with a grain of salt.

Unlike him, I don’t “know” that there is some sort of stimulus that will work. I’m willing to listen to anything within reason. (returning to the gold standard is NOT among them.) But I take no exception to his style. Any more than I take exception to Ben Stein’s style. (I use him as an example because, like Krugman, he’s been brilliant at times. And at other times, he’s simply a clown. And also because I recently saw him tell Bill O’Reilly that he didn’t know WTF he was talking about. And that makes me happy.)

Strawmen, ad hominem attacks and outright lies don’t get us anywhere. No matter where they come from. But apparently they make good ratings. McLuhan was unfortunately right. Even before the internets.

[SK in CV]

Yes.

[SK in CV]

[quote=Veritas]
SK and Econ. Thanks for the econ. review. You all make my head hurt in a good way. I think you are both brilliant, but the voters will not care. [/quote]

I gotta jump in here and argue this point. At least one of them. You’re right, the voters will not care. They won’t care because absolutely absurd ideas get thrown around as if they have merit.

Creationism is not science. It is fairytale. Global warming is a hoax is not science, it is propaganda advanced by those with financial interest making people believe it is a hoax. Gay marriage is a threat to conventional marriage is hogwash, put forward by bigots. The birther thing never deserved a glimpse of sunlight. And supply-side economics, as promoted by EconProf and others is as empty as any of these. Lowering taxes on the rich, irrespective of the current tax rate on the rich, will not always create jobs, nor be good for the economy. Increasing taxes on the rich, irrespective of the current tax rates on the rich, will not always decrease investment nor cost jobs, nor be bad for the economy.

We can’t have serious discussions when rediculous theories, without basis in fact, are advanced as reasonable talking points. They’re not. I am not supporting censorship, I’m supporting marginalization of stupid ideas. Stupid ideas are too often placed at the table for discussion as rational and supportable options. They’re not. There is no path to progression unless teh stupid is eliminated as an option.

/rant

[SK in CV]

[quote=Allan from Fallbrook]
Relative to Obama’s “pragmatism”: I truly don’t think he’s being pragmatic, I think he’s genuinely trying to make everyone happy and has completely underestimated the hard ideological line that the GOP would take and HOLD. The GOP has NOT budged and this is where Obama’s inexperience has wrong-footed him, again and again, and where an experienced street fighter like Hillary would (probably) have done a better job.

[/quote]

We’re seeing the same thing, just maybe saying it differently. Truthfully, I don’t know where his ideals lay. He’s no left winger. Never has been. Centrist, Corportatist Democrat is more likely, but I fear we will never know. The deal is more important to him than the outcome, whether it furthers his ideals or not. (ACA, the disasterous tax deal he made the end of last year, this year’s debt limit deal, I could go on.) He routinely bends over to real politic, rather than staking a claim and letting real politic act. He starts where he should end, and ends up somewhere neither he, nor any of his supporters want him. (quite a bit of speculation there. At this point, I have no clue where he wants to end up. He always seems so happy with the deals he’s made. Maybe it IS where he wanted to end up.) He’s the mediator in chief. You think maybe Hillary would have done a better job? I can’t disagree. But maybe the biggest problem that I have with Obama is that I think he thinks he’s done what he set out to do. Make compromises. How charming. (there, i said it 6 different ways.)

[SK in CV]

[quote=Allan from Fallbrook]
As Bill Clinton famously said, “It’s the economy, stupid” and it is. Unfortunately, Obama does not get this and, in trying to be all things to all people, he’ll satisfy no one. This country is capable of amazing things, but the more reactionary elements of BOTH parties are stifling that capability and strangling growth.[/quote]

Of course it’s the economy, and I think he does get it. But beyond his tactics (which I’ll get to), he faces two possibly insurmountable problems.

First, and probably foremost, I’m not sure there is a fix for the economy. There are tweaks and incentives and a little of this and a little of that, but there is no magic plan that will make it all better in the next 15 months. (At least not one that is politically feasible. The right stimulus would do it. Say .5 to 1 $trillion in infrastruce spending. That wad was already blown.) The right complains that he has no plan. But the truth is, neither does the right. As painful as it may be, doing absolutely nothing might be as effective as doing anything. (At least this was true before the debt limit debacle. Tax rates would have gone up the end of next year. Now it’s tax rates go up AND draconian budget cuts. That will surely NOT help.)

Second, as you mentioned, the intransigent opposition he’s dealing with. And it’s really worse than intransigent, because even if he (Obama) goes a different direction, they won’t support it, because it’s his idea. Nothing he suggests will ever be supported.

And his tactics further bind him. Armando Llorens, who writes at both TalkLeft and DailyKos wrote the following this morning, responding to John Cole and Jon Chait:
http://www.dailykos.com/story/2011/09/05/1013620/-Hows-That-Pragmatism-Working-Out-Politically-?via=siderec

Obama’s “theory of change” was aimed at offering the political opposition a choice between cooperation on progressive policy initiatives or self-isolation through obstruction and extremism. In other words, in a country unhappy with partisan gridlock, Republicans would either go along with key elements of a progressive agenda, or shrink themselves into an ever-more-extreme ideological rump that was irrelevant to the direction of the country.

(Emphasis supplied.) One GOP landslide in 2010 and an Obama approval rating of 40 later, it seems difficult to argue that the Theory of Change has worked politically. Will Obama stick to it through the 2012 election and will it be advisable for him to do so? I argue, and I think “liberals” argue, that no, that would be a political mistake. Jon Chait and John Cole seem to be arguing that Obama needs to “stay the course.”

Chait and Cole are idiots. I half jokingly suggested to Armando (who, in addition to being a keen political observer, may be the best the left has on SCOTUS issues and analysis) in 2006 that Obama would do well to hire him as a political consultant on both policy and tactics. (He ultimately became a Clinton supporter.) Obama’s pragmatism will be his downfall. It hasn’t worked. It won’t work.

[SK in CV]

I won’t (and can’t reasonably) dispute that it was WWII that ended the depression.

But neither can it be disputed that government spending was cut sharply in ’37, most as a result of those concerned with mounting government debt. Followed by a > 30% increase in unemployment. Followed by a return to large scale government spending (I think it was close to $5 billion in stimulus). Followed by the end of the recession. Beginning to end was less than 2 years.

That said, employment didn’t return to pre-recession levels until a few years later when the US entered WWII. Would it have happened without the war? Probably not with the speed and endurance that it did.

But I have to add here. Top marginal income tax rates for those making over $20,000 a year (I’m guessing pretty decent money at that time) almost doubled to 55% after US engagement. For the very wealthy, it rose to 89%, and then to over 90% where it stayed for the duration of that war and the next. And the economy exploded (in a good way) with those high tax rates. JM would have approved.

[SK in CV]

[quote=EconProf] But the top rates already exceed 60% when you factor in federal (about 39%) Ca (about 11%), FICA, and a bunch of miscellaneous taxes. [/quote]

Please find me exactly where that bracket exists. I can’t find a greater than 60% marginal rate anywhere. Enlighten me please.

[SK in CV]

[quote=EconProf]
You are kind of making my point here, SK. The lack of consumer demand your clients cite is because of a lack of jobs, no confidence by consumers and businesses in the future, and a fear that the failed policies of the past few years will merely be increased..[/quote]

The first part I have no problem with. The bolded part is pure speculation without evidence. There’s no evidence that consumers aren’t spending because of fear of failed policies. They’re not spending because they have no money! So no, i’m not making your point at all.
[quote=EconProf]
The very “stimulus” programs that have indeed pumped money into the economy–in great part to failed programs and wasteful bailouts–have cast a dark cloud over investors and consumers. [/quote]

Failed? I don’t think so. Less successful than hoped for? absolutely. Badly conceived and poorly executed? Yep. But not failed.

[quote=EconProf]
The Keynesian multiplier that arguably worked somewhat during the Depression is now nearly nonexistent. But the negative incentive and confidence effects of this “stimulus” are very real and offset any multiplier benefits.
BTW, Republicans can be just as guilty of an over-reliance on Keynesian economics as Democrats.[/quote]

If Republicans were even considering Keynes, they would have raised taxes in 2004. Keynesian theory has never had any influence among Republicans in at least 30 years. I’m not sure that there’s been much on the Democratic side either. There’s talk. But no action.

[quote=EconProf]
The regulatory burden of Sarbanes-Oxley was passed, I believe, during the Bush presidency, and we know much of the stimulus was begun in his last months in office before being continued and greatly increased under Obama. [/quote]

Perfect example of what I said earlier. Business complains about burdens presented by SOX compliance. And they deal with it. Hasn’t put companies out of business. In fact a whole new industry has grown up around it.

And no, we ddon’t know that any stimulus was passed during the Bush presidency. TARP was passed in his last few months in office. That wasn’t a stimulus. It was a crisis averting injection of capital into the system.

[quote=EconProf]
As to the “mistake” of FDR that led to a second phase of the Great Depression, perhaps you are referring to his attempt to “pack” the Supreme Court by boosting its membership so as to make it more compliant with his more extreme proposals, which by then were getting quite alarming to the general public. In fact, his business bashing did a lot to sap employment throughout the 1930s, and even Keynes advised FDR and his Treasury Secretary to ease up on the rhetoric if the US wanted to see a recovery. As Keynes put it, you need to preserve “animal spirits” in order to keep capitalism going.[/quote]

No, his packing of the supreme court, while ballsy, wasn’t the mistake I was referring to. It was his (non-Keynesian) reduction in government spending which lead to a halt of the advances of the previous 7 years. A recession within the depresssion. As soon as government spending resumed, so did economic growth. An identical similar concern exists now.

[SK in CV]

Allan, in order:

Agree. He’s a phenomenal campaigner. I can only think of a couple times I’ve seen that guy since the election.

Agree. It’s like choosing between Charlie Sheen and Emilio Estevez. Charlie: Idiot savant or just idiot. Emilio: who?

Agree. Though in fairness, it isn’t the front pagers at Dkos, they’re all about electing Democrats. But they allow anyone to post about almost anything. And some of them, as a Fox News guy once described a dear friend whose since been banned there, live out where the buses don’t run. (Funny aside here, I just googled that phrase, and it’s attributed to a Miami Vice episode and more recently, a 2009 statement by Brit Hume about someone. But John Gibson, at least 2 years earlier, used it to describe my blogger buddy.)

Agreed. I see it more as a failure in leadership style than a failure in leadership. His style might have worked in a different time. Not now. He’s more concerned with making deals than with policy goals. But whether by ignorance or malevolence, it doesn’t matter. He’s failed.

[SK in CV]

[quote=UCGal]Allan, even Markos Moulitsas (sp?) the founder of dailykos, recently published a diary that questioned what the heck Obama was doing.

http://www.dailykos.com/story/2011/09/01/1012544/-Whatever-it-is-Obama-is-doing,-itsnotworking?detail=hide%5B/quote%5D

That particular column was referring to politics, not policies. But he (Obama) gets plenty of criticism for policy too at that site. Markos even mentions the call to primary him. Fact is, republicans are much better at politics, democrats are a miserable failure at messaging. Particularly Obama. But despite that failure, the electorate still dislikes democrats a bit less than they dislike republicans. Funny that.

[SK in CV]

[quote=EconProf]You are making this much more complicated, and ideolgical, than it needs to be. Keynes advocated stimulating aggregate demand, whether consumption, investment, or government during the Great Depression, i.e., when output fell well short of potential. His theory was that to expand output when there was so much slack in the economy would not be inflationary–indeed deflation was the problem back then. There is increasing debate among economists now as to how well that really worked (See Amity Schales’ book, The Forgotten Man). After all, unemployment was still 17% in 1939.
Today’s politicians latch on to Keynesian theory as an excuse to expand government and give it a theoretical justification. But we are increasingly looking at the behavioral effects of government policies and discovering that they can be both large and harmful. Looking back at two years of TARP, cash for clunkers, subsidies for GM, green initiatives, proposed tax hikes, we can see that businesses and consumers are rightfully afraid of their future. Businesses can’t predict their future costs or regulatory environment, so they sit on their cash hoard. Yes, they are fraidy-cats.
From your comments we would agree that the boom of the Bush years was an artificial one–fueled by easy money, overleveraging by consumers, banks, businesses and other assorted culprits. Plenty of blame to go around. And our current problems are prolonged and deep because we are in the painful deleveraging process.
We’d also probably agree that capitalists want to do what it takes to maximize profits in the future–that’s what makes for hiring and spending if conditions are right. Which is why I don’t understand your statement that “…it has zero to do with government policies and regulations.” If you believe that then you probably have never started a business or hired a work force.[/quote]

Last things first, I’ve started businesses, run businesses for others, and been paid pretty handsomely to tell others how to run their businesses. Currently I’m the CFO for a small business whose clientele is exclusively big business because small business rightfully can’t justify spending millions on IT. I can’t afford to be bound by ideological thinking. Whether it’s politics or religion or economics, to quote Robert Langdon, faith is a gift I have yet to receive. I deal in empirical evidence. Anything less would be a disservice to my employer.

In the last 2 weeks I’ve spoken with 3 CFOs and CIOs for billion dollar companies. All had proposals in their hands for us to do work for them. All 3 said their plans had been put on hold despite issuing RFPs with immediate start dates within the last quarter. All 3 said their plans had been put on hold because of uncertain consumer demand. Not regulations. Not health care reform. Not tax uncertainty. Not political uncertainty. Businesses deal with government demands. It can eat into their margins. But it doesn’t keep them from doing business. Lack of customers does.

As to the high unemployment that remained in 1939, you conveniently didn’t mention Roosevelt’s mistake in ’37, which was instrumental in creating a new recession. Wasn’t very Keynesian of him.

And yes, I think the boom in the middle of the last decade was somewhat artificial. War is a temporary expansion of the economy. The tax cuts from the early part of the decade did little to build the economy. They, along with a couple trillion spent on wars, (in addition to the criminal expansion of consumer debt) set the wheels in motion for the pop culture debt crisis we have today. I have no way of knowing for sure, but I suspect that higher top marginal tax rates, slightly higher interest rates, and no unneeded wars would have lead to a much more stable economy entering the new decade.

[Author]

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