You do know that 'jobless recoveries' only occur during Republican administrations, right?
I'll have to take a look at the print edition to see if the article appeared on the front page, or at least on the first page of a section of the paper. We both know that the MSM will not be touting a 'jobless recovery'. However, I think most Americans know the 'recovery' is very weak. Of course, there is a very simple explanation for this situation: Republicans prevented the use of more 'cowbell' (i.e., 'stimulus' spending)!
Jonah,
What this chart truly shows is that the definition of recession, three quarters in a row of negative growth, is a garbage in, garbage out definition. GDP is shown as increasing now due to the galactic amount of government borrowing, spending and creation of dollars. Maybe one of your highly touted economists can educate us on whether the definition of GDP has changed from 1945 to 2010. I would bet that it has changed and if you were to use the same definition as used in decades past, we are not growing the gdp. In other words we are still in recession and there is nothing on the horizon, except time, that can get us out of it.
The question is, what do Republicans plan to do to fix this? If they don't have a plan, they're no better than the status quo. The only thing I've heard so far is to cut spending, which will somehow magically lead to businesses hiring. I'm not sure what the logic is behind that, though - will defense spending cuts lead to companies like Boeing hiring more workers? Will NIH cuts lead to more or less spending in the biological sciences? Will Medicare and Medicaid cuts lead to more or less spending in the healthcare sector? Indeed, we have a real world experiment right now testing what the effects of massive austerity measures are on economies, in the form of Greece, Ireland, and the United Kingdom. So far, they're a massive failure. Their economies have contracted so fast that tax revenues have actually fallen so far that they're in a worse position vis-a-vis their debt than they'd have been if they'd continued spending. No serious economist thinks that government spending cuts will help the economy in the short term - over the long term, sure, but if we institute major austerity measures right now we would see more unemployment, not less, for at least the next two or three years, and probably longer. Do Republicans really want to run on the platform of "we have 9% unemployment now, but we really need to make it even worse before it can get better"?
McDonald's is responsible for the largest percentage of private sector jobs created this year(I forget the actual percentage). remenber when Democrats ridiculed Bush, when the economy was booming, about "low wage, burger-flipping jobs"?
Major structural changes going on, and they're always painful. I don't blame Obama (or Bush) for that underlying dynamic, but I sure as h*ll don't credit him for easing the recovery so far.
port1080: If you think that Green, Spain, or Portugal have actually implemented massive austerity programs, you probably will believe any form of DNC propaganda.
Nice try, port1080. The "stimulus" was $800 billion. Economists I've spoken to (I'm in the investment industry) estimate that boondoggle added - TOPS as an estimate - 1% of GDP growth over the past 2 years, ALL of it borrowed from future growth in the form of debt.
And before you regurgitate 3 million jobs "created or saved," stuff it. Every serious person knows the econometric model that produced that is GIGO.
The level of spending cuts we've seen thus far heralded as major is $38 billion in one year (nearly every cent of it accounting gimmicks). $30 billion for next year. Now please explain to me how if $800 billion dollars in "stimulus" yielded results this meager, how such piddling cuts would amount to large levels of lost growth (even if I accept the premise, which I don't.) You concede reduced spending would be bullish over the long term? Well, that's exactly what is being proposed.
You think this is bad? Wait until they start laying off Government workers. Look for the prep stories to start in about 6 weeks with the hammer dropping in September. Could be as high as 20,000, depending on if they force retirements or not. I'm not joking.
We're not talking about the stimulus here, we're simply talking about what spending cuts will do to the economy. It's a simple fact that if you cut government spending, unemployment will go up in the short term. There is no doubt about this - those people who formerly had government jobs (or who had jobs that were reliant on government money, like defense contractors) and who lose them will go on the unemployment rolls, and will be competing with the millions who are already unemployed. Do you doubt that? Do you have any logical explanation for why that might not be true? There are good arguments for cutting the size of government spending, but lowering unemployment in the short term simply is not one of them. It's logically consistent to argue that we are so over-extended that we just need to take our medicine, right now, and accept 15% or 20% unemployment in the short term, but I really doubt that anyone is going to win an election running on that platform (and I doubt that there are many politicians out there of any party with the political courage to try to implement it).
I would submit it's simply impossible to know with certainty what "would happen" or "would have happened," absent a time machine. But I hardly see how the stimulus argument is not germaine here. It badly undercuts your argument that immediate spending cuts -which amount to a pitiful fraction of even our current DEFICIT, let alone our GDP - would be economically hurtful when I can point to a bonanza of spending INCREASES many times larger that had such a neglible effect to the upside.
Believe it or not, economically productive decisions are made by private entities in the economy every hour, minute, and second that don't depend in the least on government contractors or payrolls.
"I would submit it's simply impossible to know with certainty what "would happen" or "would have happened," absent a time machine."
Okay, let's take this one point at a time. If the government lays people off, they lose their jobs. Do you have any argument with that? Unemployment is at least 8.5% right now, do you have any argument with that?
So, with those two facts in hand, how do you cut government spending without seeing the unemployment rate going up in the short term? By what possible mechanism would it go down? Do you have any reasonable explanation, or do you just "believe"? Without that explanation, all you're doing is selling Hope and Change harder than Obama ever did.
port, this is pointless, we're talking past one another. You think you have this trump card trying to pin me down, "Do you have any argument with this? Do you have any argument with that?"
This goes to philosophical differences. I would happily concede those points if the U.S. free market were a fixed, finite entity, if all things were equal, if the dynamics of government spending happened in a vaccum, etc. I don't concede any of that because it's not true. A free market is the sum of millions of economic decisions by millions of free individuals, and it's far too complex for guys like you to micromanage with that level of certainty.
Say stimulus had never happened. Would the economy have contracted a little more deeply to find a natural bottom? Sure, very likely. The very definition of GDP requires that it would, since government spending is part of the calculation. It also may very well have restructured and expanded a little more rapidly off of that trough because entities that should have failed would have, and those resources would have been put to work more efficiently. Less uncertainty and a less hostile business climate may have freed up some of those trillions in cash that were hoarded by businesses and investors had they not been scared stiff over the impact of Obamacare, new debt and potential tax hikes.
Perhaps resources would have been put back to work sooner, in more productive ways, and we wouldn't be slogging along at this subpar growth rate when recoveries from other recessions of this magnitude were roaring at 5-7% by this point. The point is we simply will never know, regardless of your level of smug certitude about it.
And on the subject of what we're prepared to take into the election, I'm mildly surprised you guys are still trying to sell, "Well, sure things s*ck! But man, you don't know how much worse it coulda been!" It's very dog-ate-my-homework, dude.
If you privatize the functions of government spending you could reduce spending because the private sector will force efficiency. Just look at the $400 billion sink hole we call Fannie & Freddie.
You do know that 'jobless recoveries' only occur during Republican administrations, right?
I'll have to take a look at the print edition to see if the article appeared on the front page, or at least on the first page of a section of the paper. We both know that the MSM will not be touting a 'jobless recovery'. However, I think most Americans know the 'recovery' is very weak. Of course, there is a very simple explanation for this situation: Republicans prevented the use of more 'cowbell' (i.e., 'stimulus' spending)!
Reply to this commentLinkReport AbuseJonah,
Reply to this commentLinkReport AbuseWhat this chart truly shows is that the definition of recession, three quarters in a row of negative growth, is a garbage in, garbage out definition. GDP is shown as increasing now due to the galactic amount of government borrowing, spending and creation of dollars. Maybe one of your highly touted economists can educate us on whether the definition of GDP has changed from 1945 to 2010. I would bet that it has changed and if you were to use the same definition as used in decades past, we are not growing the gdp. In other words we are still in recession and there is nothing on the horizon, except time, that can get us out of it.
The question is, what do Republicans plan to do to fix this? If they don't have a plan, they're no better than the status quo. The only thing I've heard so far is to cut spending, which will somehow magically lead to businesses hiring. I'm not sure what the logic is behind that, though - will defense spending cuts lead to companies like Boeing hiring more workers? Will NIH cuts lead to more or less spending in the biological sciences? Will Medicare and Medicaid cuts lead to more or less spending in the healthcare sector? Indeed, we have a real world experiment right now testing what the effects of massive austerity measures are on economies, in the form of Greece, Ireland, and the United Kingdom. So far, they're a massive failure. Their economies have contracted so fast that tax revenues have actually fallen so far that they're in a worse position vis-a-vis their debt than they'd have been if they'd continued spending. No serious economist thinks that government spending cuts will help the economy in the short term - over the long term, sure, but if we institute major austerity measures right now we would see more unemployment, not less, for at least the next two or three years, and probably longer. Do Republicans really want to run on the platform of "we have 9% unemployment now, but we really need to make it even worse before it can get better"?
Reply to this commentLinkReport AbuseMcDonald's is responsible for the largest percentage of private sector jobs created this year(I forget the actual percentage). remenber when Democrats ridiculed Bush, when the economy was booming, about "low wage, burger-flipping jobs"?
Reply to this commentLinkReport AbuseMajor structural changes going on, and they're always painful. I don't blame Obama (or Bush) for that underlying dynamic, but I sure as h*ll don't credit him for easing the recovery so far.
Reply to this commentLinkReport Abuseport1080: If you think that Green, Spain, or Portugal have actually implemented massive austerity programs, you probably will believe any form of DNC propaganda.
Reply to this commentLinkReport AbuseYou know what 5 or 6% unemployment is called when a repub is in the White House don't you?
Recession.
And of course, when a Dem is in the White House, 9 or 10% unemployment is repeatedly called...
Recovery!
Reply to this commentLinkReport AbuseNice try, port1080. The "stimulus" was $800 billion. Economists I've spoken to (I'm in the investment industry) estimate that boondoggle added - TOPS as an estimate - 1% of GDP growth over the past 2 years, ALL of it borrowed from future growth in the form of debt.
And before you regurgitate 3 million jobs "created or saved," stuff it. Every serious person knows the econometric model that produced that is GIGO.
The level of spending cuts we've seen thus far heralded as major is $38 billion in one year (nearly every cent of it accounting gimmicks). $30 billion for next year. Now please explain to me how if $800 billion dollars in "stimulus" yielded results this meager, how such piddling cuts would amount to large levels of lost growth (even if I accept the premise, which I don't.) You concede reduced spending would be bullish over the long term? Well, that's exactly what is being proposed.
Reply to this commentLinkReport AbuseYou think this is bad? Wait until they start laying off Government workers. Look for the prep stories to start in about 6 weeks with the hammer dropping in September. Could be as high as 20,000, depending on if they force retirements or not. I'm not joking.
Reply to this commentLinkReport AbuseWe're not talking about the stimulus here, we're simply talking about what spending cuts will do to the economy. It's a simple fact that if you cut government spending, unemployment will go up in the short term. There is no doubt about this - those people who formerly had government jobs (or who had jobs that were reliant on government money, like defense contractors) and who lose them will go on the unemployment rolls, and will be competing with the millions who are already unemployed. Do you doubt that? Do you have any logical explanation for why that might not be true? There are good arguments for cutting the size of government spending, but lowering unemployment in the short term simply is not one of them. It's logically consistent to argue that we are so over-extended that we just need to take our medicine, right now, and accept 15% or 20% unemployment in the short term, but I really doubt that anyone is going to win an election running on that platform (and I doubt that there are many politicians out there of any party with the political courage to try to implement it).
Reply to this commentLinkReport AbuseI would submit it's simply impossible to know with certainty what "would happen" or "would have happened," absent a time machine. But I hardly see how the stimulus argument is not germaine here. It badly undercuts your argument that immediate spending cuts -which amount to a pitiful fraction of even our current DEFICIT, let alone our GDP - would be economically hurtful when I can point to a bonanza of spending INCREASES many times larger that had such a neglible effect to the upside.
Believe it or not, economically productive decisions are made by private entities in the economy every hour, minute, and second that don't depend in the least on government contractors or payrolls.
Reply to this commentLinkReport AbuseTake a look, port1080.
External Link
Reply to this commentLinkReport Abuse"I would submit it's simply impossible to know with certainty what "would happen" or "would have happened," absent a time machine."
Okay, let's take this one point at a time. If the government lays people off, they lose their jobs. Do you have any argument with that? Unemployment is at least 8.5% right now, do you have any argument with that?
So, with those two facts in hand, how do you cut government spending without seeing the unemployment rate going up in the short term? By what possible mechanism would it go down? Do you have any reasonable explanation, or do you just "believe"? Without that explanation, all you're doing is selling Hope and Change harder than Obama ever did.
Reply to this commentLinkReport Abuseport, this is pointless, we're talking past one another. You think you have this trump card trying to pin me down, "Do you have any argument with this? Do you have any argument with that?"
This goes to philosophical differences. I would happily concede those points if the U.S. free market were a fixed, finite entity, if all things were equal, if the dynamics of government spending happened in a vaccum, etc. I don't concede any of that because it's not true. A free market is the sum of millions of economic decisions by millions of free individuals, and it's far too complex for guys like you to micromanage with that level of certainty.
Say stimulus had never happened. Would the economy have contracted a little more deeply to find a natural bottom? Sure, very likely. The very definition of GDP requires that it would, since government spending is part of the calculation. It also may very well have restructured and expanded a little more rapidly off of that trough because entities that should have failed would have, and those resources would have been put to work more efficiently. Less uncertainty and a less hostile business climate may have freed up some of those trillions in cash that were hoarded by businesses and investors had they not been scared stiff over the impact of Obamacare, new debt and potential tax hikes.
Perhaps resources would have been put back to work sooner, in more productive ways, and we wouldn't be slogging along at this subpar growth rate when recoveries from other recessions of this magnitude were roaring at 5-7% by this point. The point is we simply will never know, regardless of your level of smug certitude about it.
And on the subject of what we're prepared to take into the election, I'm mildly surprised you guys are still trying to sell, "Well, sure things s*ck! But man, you don't know how much worse it coulda been!" It's very dog-ate-my-homework, dude.
Reply to this commentLinkReport AbuseHey port1080...
If you privatize the functions of government spending you could reduce spending because the private sector will force efficiency. Just look at the $400 billion sink hole we call Fannie & Freddie.
Reply to this commentLinkReport Abuse