It wasn’t much of a speech, was it? Nobody expected it to be a policy home run. After all, the specifics — nearly all of which were leaked in advance — were warmed-over retreads from previous “jobs” speeches. Of the initiatives:
· Temporary payroll tax reduction, plus an extension to new businesses
· A new-hire tax break
· Extended unemployment insurance with a new training for the long-term unemployed
· Extending the expensing of small business expensing
· Supposed “quick acting” infrastructure spending, especially in schools
· Checks to states to hold on to favored employees
Only the notion that it would be “paid for” was held back for the speech itself — but of course that is just another promise. So we got another speech with fundamentally mediocre substance. Indeed, even by late August Macroeconomic Advisers was warning that a similar package would generate under 40,000 new jobs per month between now and the end of 2012. This package is “bigger” and would like get scored differently, but the bottom line would be the same.
In short, we knew in advance that the President wanted to spend nearly another ½ trillion dollars and not move the dial on unemployment. We didn’t know that it would be spend and promise to tax, but the shock value is small.
The surprise to me was that the politics were so flat. Sure, he succeeded in floating proposals that Republicans will largely oppose, thereby cementing his strategy of portraying them as recalcitrant even as he supposedly tries to reach across the aisle. And, again, he took to the podium and lectured all Members about evils of partisan divide, thereby running away from his Democratic colleagues on the Hill.
But these are small-ball tactics on policy and politics. They do not do anything to counter the emerging narrative: President Obama is unready to lead. And his only plan for growth and jobs is spend, spend, spend.
Go Saints!
So, Doug - if you're going to quote Macroeconomic Advisers to criticize the proposal, can we assume that you agree with the premise of their criticism: that the proposal (as then leaked) was insufficiently stimulative to counteract the fall-off in aggregate demand, and larger stimulus is required?
Or do you only believe in conventional macroeconomics when it suits you?
Reply to this commentLinkReport AbuseHe's using Obama's reason for spending to show that even the spenders don't think they'll create many jobs with this approach.
Reply to this commentLinkReport AbuseI'm sorry denroy, but there is a big difference between telling this audience: "Macro Advisers thinks it won't create jobs" and telling them "Macro Advisers thinks that the package needs to be larger in order to stimulate the economy enough to make a real dent in unemployment".
The first is disingenuous. The second is honest, but doesn't convey the impression that Doug is trying to create.
Reply to this commentLinkReport AbuseNo, they're both honest. Macro Advisors thinks this will fail, AND that it would succeed if it were much larger. So, if President Obama wants something that will succeed under these terms, let him muster up the gumption to propose something much larger. That would be wrongheaded, but at least it would be brave. What he sort of proposed tonight is both wrongheaded and craven.
Reply to this commentLinkReport Abuse*Some* macroeconomists think we need a mega-ultra stimulus. Doug is saying that *even those who think that* believe half a trillion won't do anything significant; 40k jobs/month is a rounding error in an economy this size. And we know that a full trillion in Obama-style stimulus did bupkis. So, we need to go to 1.5T or 2T, added to a debt everyone agrees is too big, and *maybe* that will do the trick?
Good luck with that, gbh.
Reply to this commentLinkReport AbuseSorry, how do you know that the first stimulus did "bupkis"?
Can you tell me what growth and unemployment would have been without it?
If that question is beyond you, try this simple research task: can you tell me what the OVERALL net government stimulus in the United States was in 2009/2010, once you offset the decline in state outlays from the increase in federal outlays?
If you can't answer that question, you have no business commenting on the success or otherwise of the first stimulus, because you're lack the basic information to make a sensible assessment.
Reply to this commentLinkReport AbuseReality is how I know it did bupkis. Pretend stats are just that.
Reply to this commentLinkReport AbuseThat's the way, denroy - embrace your ignorance! Once you decide that you don't need to know anything about anything, the world is a much simpler place.
Reply to this commentLinkReport AbuseGBH-
Did the stimulus save or create our current economy? Im still not sure.
What I am sure about is that the administration had projections about what the unemployment rate would be with or without the "stimulus", and they failed miserably in their goal (8% peak). Only a truly "ignorant" person would try and spin that into some sort of success story.
Reply to this commentLinkReport AbuseHaha what a facetious comment. So stats you disagree with are 'pretend', but stats which support your arguments (even if forecasts) are real? The denialists mantra. Ignoring all evidence if they disagree with you. Perhaps that's why you're offering no credible alternative, just unveiled vitriol because you 'know' from your one individual experience. And you wonder why Congress is hated so much?
Reply to this commentLinkReport AbuseState spending certainly did not slump anywhere near a trillion dollars over two years. Most of the money being thrown around by the feds, and not spent or at-risk-of-not-being-spent by states, was on marginal gov't employees who matter little to bottom line national productivity and matter even less to *business investment*, which is what we need right now when businesses are scared to invest and sitting on two trillion in cash. They sense tax hikes on the horizon to pay for all the money Obama is throwing around, and lo and behold there's Obama calling on corporations and "the rich" to "pay their fair share". So the solution is... more spending, which will make the job-creators expect more taxes? Suuuure.
Reply to this commentLinkReport AbuseThe fact remains that we have tried stimulus spending 30 or 40 times since the dawn of the New Deal.
Not once has it worked.
Reply to this commentLinkReport AbuseHow many more times must it fail before you give it up?
RE: "Can you tell me what growth and unemployment would have been without it?"
Hooray! Let's hear it for the "Failed Big Government being an excuse for more failed Big Government!" argument! Can't get enough of that.
Y'all keep pining for insight into alternate universes when I'm pretty sure the revelations would be damning to you and your ilk. Yes, I'd love to see "how much worse things would have gotten" if, for example, FDR "let a crisis go to waste" and didn't foolishly meddle with the economy and expand the federal government to ridiculous (and unsustainable) proportions.
While I would welcome such knowledge of the unknowable, I'm not going to sit around waiting for it. You see, there's this stuff called "reality"...
Reply to this commentLinkReport AbuseCatchpa "Marital aid." Whiskey Tango Foxtrot?
"Can you tell me what growth and unemployment would have been without it?" According to your experts about 8.5% unemployment.
So sounds like we should have done nothing. It would have been more effective and less debt generating.
Reply to this commentLinkReport AbuseThis is an admirable comment gbh. But of course if you call the people who "know" that the first stimulus had no positive effects out, you can expect a lot of black ink and obfuscation.
You see, a lot of conservatives don't need no darn facts to know that the first stimulus had no effect or negative effect. They have faith.
Reply to this commentLinkReport AbuseWait, wait--I know this one! Without the stimulus, unemployment could go as high as 8%! At least, that's what experts predicted. Granted, if it turned out unemployment went to, say, 10% WITH the stimulus, I would conclude said experts are unqualified to make predictions and should be ignored in the future.
Reply to this commentLinkReport AbuseThere's nothing conventional in the belief that govt spending is stimulative. Economists stopped believing that nonsense 40 years ago.
Reply to this commentLinkReport AbuseI feel better about the economy already. Clueless is almost too kind a word.
Reply to this commentLinkReport AbuseI'll gladly pay you Tuesday for a hamburger today.
Reply to this commentLinkReport AbuseYou're being too charitable. Give me a hamburger right now, and on Tuesday I'll tell you how I plan for other people to pay for it in the distant future.
Reply to this commentLinkReport Abuse