From Friday’s All-Stars.
On Obama’s claim that the stimulus is responsible for a slowing decline in GDP:
I would say that’s rubbish. According to the CBO, a trickle of the money has gotten out. Now, that’s not anything that would have influenced a recovery in this quarter.
What you are getting is a rebound from a huge drop in the first quarter of the year. We’re getting a bottoming out of housing prices. We had Bernanke, head of the Federal Reserve, who said earlier in the year, before the stimulus, that we would be emerging out of our recession at the end of this year, and we are on target.
What the stimulus will do — it’s going to kick in next year, when Democrats are going to need a boost, because unemployment, which is a lagging indicator, is going to be high all of next year. So perhaps it will drop a bit slightly as a way to help Democrats win the election next year. That’s good politics; it’s lousy economics.
On the House passing an additional $2 billion for the “cash for clunkers” program:
Well, look, you can argue the pros and cons. It is stimulating the auto industry. Of course, we’re already putting $80 billion into it, so why should you favor it [and] not “the cash for couches” and help the furniture industry?
However, even if you accept it, the liberals in Congress cannot do anything without at least one human sacrifice in the name of the Earth God. And that is that [“cash for clunkers”] requires, in the name of global warming–on which it will have no effect anyway–that all of the clunkers are destroyed in two days and turned into scrap.
You cannot resell it as a used car or use its parts, which means that if you are poor or young or an immigrant starting out and want a starter car, a secondhand car, they will be scarcer and the parts will be scarcer, which means the prices will be higher. And that will be imposed by a liberal in Congress who drives to Capitol Hill in his Lexus with air-conditioning and self-parking mechanism.