Friday, January 30, 2009

Proof That "Stimulus" = Pork and Payback

I've heard it said that spending beyond our means, and not saving anything, and trying to make a quick buck, are what got us into this economic situation in the first place. So what's our government's solution? To spend more beyond our means, not save anything, and hope that stimulates an economy that helps people make a buck. Hopenchange isn't a good economic philosophy, though.

It turns out, though, that this most recent almost-trillion-dollar package isn't "stimulus" at all. What was originally sold as a "roads and bridges" infrastructure package has only 3% designated for such projects. And when you see what's in the other 97%, you can tell it's just payback to Democrat constituencies for 8 years of having a Republican president. Just look at what's already been removed--hundreds of millions for "reproductive services", and resodding the National Mall? Just what the economists have been recommending to stimulate the economy--not.

And isn't this stimulus package supposed to jump-start the economy in the very short term? If that's so, then why is so much of the funding not even planned to be spent until late next year? This reckless boondoggle is supposed to have an immediate effect, not be vaporware for the future. That's what they tell us, but apparently the new Secretary of Education didn't get the memo:

Education Secretary Arne Duncan said the economy won't improve without the billions of dollars for schools in President Barack Obama's recovery plan.

"If we want to stimulate the economy, we need a better-educated workforce," Duncan said Thursday in an interview with The Associated Press.

"That's the only way, long-term, we're going to get out of this economic crisis," he said.

The stimulus plan is picking up criticism as it moves through Congress. Republicans complain that not all the money will create jobs immediately. Democrats admit it's true, but they say the economy needs long-term help, too.

We're doomed.

Update: Here's more food for thought, showing you how seriously our elected officials take governing:

Imagine that. The most expensive social experiment in American history -- one that will cost taxpayers more than both the Iraq and Afghanistan wars combined -- was allotted less than a single day of debate in Congress.

How about this?

I love this. The new kind of politics of hope. Eight hours of debate in the HR to pass a bill spending $820 billion, or roughly $102 billion per hour of debate.

Only ten per cent of the "stimulus" to be spent on 2009.

Like I said, pork and payback.


Ellen K said...

I just hope the Republicans hang tough. If nothing else so they can say "I told you so" when the house of cards comes tumbling down. I don't know how any rational person could think this bill has meaningful actions attached. Even such media suckups as Peggy Noonan are questioning the advisability of implementing what amounts to a country club support program for liberals.

Anonymous said...

Bush ruined this country (hence the current situation). It's high time something like this was passed. And you shouldn't criticize it, having supported the man 100% who got us into this situation in the first place.

Darren said...

If he was so powerful as President that he could single-handedly do this--and not just to this country, but to the whole world--why do you think he willingly gave up this power?

And why can't Obama single-handedly fix it?

I'm curious, although I don't honestly expect a serious answer from you: what, exactly, did President Bush do to cause this? Did he create the housing bubble? What was his involvement in Fannie Mae and Freddie Mac? Which lever does he pull to adjust oil prices? Be sure to let President Obama know the answers to these questions.

Some people forget that Democrats have run the co-equal Congress for two years, too. But that doesn't fit your narrative or satisfy your BDS.

Anonymous said...

Wow... don't you just love the person who wants to bash and blame Bush makes his/her comment anonymously?

And my response would be... let's just say that Mr. Bush was singlehandedly responsible for the mess we are in. Let's just pretend that is true for a second. Does that mean this so-called "stimulus" bill is the answer? Uh, NO!

I love your blog and appreciate the links and insight you give! Keep it up!

Anonymous said...

BDS, also known as the truth. ;)

Now, back to seriousness:

Nowhere did I say he was all-powerful or anything to make him sound like a dictator as you imply. I merely said that he worsened the state of our country, which I believe he did. I'll attempt to briefly explain why. Basically, I think he and his fellow neo-conseratives caused this by eliminating several restrictions on business, most obviously the very banks which spawned this mess (look it up if you don't believe me -- legislation, exec. orders, the whole nine yards). Also, I never said anything about oil prices, but I'm betting that invading a huge oil producing country didn't help with supply too much.

And you're correct, if by "run" you mean, had 1 more Senator than Republicans and only a slim majority in the house, against an opposite party president. Hardly enough to pass legislation.

Looking forward to your reply. If I'm wrong, I do want to know. Hopefully we can keep it civil.

Darren said...

You say he eliminated several restrictions on business--like what? There are *more* regulations today than there were 8 years ago! And how do you explain that the same thing is happening in Europe, which is *far* more regulated than the US?

Yes, I think you're wrong :-)

allen (in Michigan) said...

Oh, anon you've got to stop reading Daily Kos and suchlike. While Bush isn't my idea of a conservative continuous repetition of unsubstantiated charges doesn't make them true.

The banking mess is laid at the feet of the Democrats, including Barack Obama, who changed the lending rules for Fannie Mae and Freddie Mac so that "every American can become a homeowner". What that meant was that every mortgage originator, banks and mortgage companies, could make rotten loans that stood no chance of being repaid and be sure to have someone to sell those lousy loans too, Fannie Mae and Freddie Mac.

While the change to the rules preceded Bush's election it was on his watch that things got really bad and he didn't make enough of the disaster-in-progress. He was fighting a war and was diverted.

As for oil, surely you jest.

I don't have the URL at hand to prove it but under Saddam Hussein, Iraqi oil output went down from before Pa Bush's tenure. Dictators are like that - shortsighted. But then, who's going to tell them they're wrong?

You can see the same idiotic shortsightedness operating in Venezuela. Chavez diverted the vast sums needed to maintain/increase petroleum production to buy voter favor so production is down. Hussein bought weapons so production went down.

Add to that the increase in real demand by the burgeoning economies of China and India, along with other nations and the "fear" premium caused by unrest in the Mideast along with the idiotic "Peak Oil" types talking up resource depletion and you've got the oil price bubble.

Bush could've done something about that too but, you know, the war again.

By the way anon, you know those feelings of insightfulness and courage you get when you trash Bush? They're phony. You haven't exerted yourself to learn or understand anything, merely repeating what you've heard/read and, of course, you have no worries about any real danger. Try raising your standards a bit. It's tough but the rewards are real. If that matters to you.

Anonymous said...

This is a global crisis, which started with the US Banks, which takes me back to the point I made about restrictions in my previous comment. As for him deregulating the very banks that caused this problem, take a look at the Commodity Futures Modernization Act.

Now, onto player #2.
Allow me to start with a petty comment like yours. Stop watching Fox, etc.

Onto real things:
Yes, Saddam decreased production. Yes, we decreased it more when we invaded. I never mentioned China and India, I know there isn't anything he could've done about that, but he might've considered buying more oil instead of wasting however many billion it is per month in Iraq now.

And you're last statement is completely false. I don't like the feeling I get when I say these things, it makes me angry that they even have to be said in the first place. And I'm not repeating what I've read/heard. (As if you argument hasn't been heard 1000 times before) I do research on my own and come to my own conclusions, which in this case, just happen to be right.

Darren said...

You should sign your name to them.

allen (in Michigan) said...

If you're going to wave a lightning rod around - "Bush ruined this country (hence the current situation)." - try not to be too surprised when you attract some lightning.

As to the cause of the credit melt-down, that was engineered by the Democrats who, when stymied in one of their favorite pursuits, came up with what must've seemed like a delightful alternative.

You see, all that project housing, which in the distant past was going to be "decent, affordable housing", became fodder for the explosive demolition companies after the government agencies who mismanaged the misbegotten travesties, allowed them to be rendered unfit for human habitation. Turns out it's tough to get funding to pay for replacements for the buildings that were just blown to pieces. Despite the best efforts of the generous-with-other-people's-money Democrats some things just resist a positive spin.

Since the Democrats were prevented from putting up more unlivable tax-paid Taj MaSlums they suborned the credit industry. They changed the rules governing the quality of the mortgages that Fannie Mae and Freddie Mac could buy so that they could buy garbage loans. That's why the credit industry started making zero-down, no-documentation loans on inflated house valuations, because they knew they could dump the lousy loans off on the FMs.

Now you know why real estate prices ballooned even while inflation stayed low. No matter how bad the deal was you could always stick the federal government with it, courtesy of the legislative Democrats. That lit a fire under the market that wasn't extinguished until the even the FMs couldn't paper over their losses. Bush knew about it, he even tried to do something about it but the Democrats had found a new way to display the depth of their concern for the less fortunate. As usual, with someone else's money.

As for the war in Iraq, of course it was necessary. The last war the U.S. got into that wasn't necessary was the Spanish-American war.

You see, in a democracy the elected representatives who have some responsibility for involving the U.S. in a war have to explain to mommies and daddies why the apple of their eye has to go off to be killed in foreign climes.

As you can imagine, if you still have an imagination the political left requiring that you relinquish your imagination along with your sense of humor and credulity, it's just not easy to get people to buy into that idea and in a democracy that means you'd better have a damned good case because it's going to be a tough sell to start with and never get easier.

In fact, the war in Iraq was necessary two weeks after Desert Storm ended because that's the first time Saddam Hussein abrogated the agreement that ended hostilities. He continued to abrogate the agreement all through the the remainder of Pa Bush's term, all the way through Bill Clinton's two terms and continued to do so after Dubya's election. He'd be doing it yet but for 9/11 which swept aside our distaste for a necessary but unappetizing task.

You may now roll your eyes in a theatrical display of disbelief. I recommend Al Gore as a roll model.

Anonymous said...

To Darren: My name is Michael and I am (was) in the Sacramento area as well. In fact, I was even a student of yours. :)

To the Michiginian(?): Why would I be surprised? I'm making anti-Bush comments on a Republican blog, I had a feeling I might get some replies.

To your first point... of all the causes I've heard on CNN, in Newspapers, etc, failed housing projects by the Democrats long ago is seldom one of them. Perhaps you could provide some references? Also, note that they did not gain any power to pass legislation until 2009 (since Bush in 2000).

Why was Iraq necessary? (No, going after Saddam doesn't count. Lots of dictators have done much worse and we've responded by giving them more aid.)

Your next sentence didn't make much sense to me, so I'll leave to you to clarify what point that was supposed to make.

Al Gore won the Nobel Prize, seems like a decent roll model to me. I recommend Rush Limbaugh for you.

Looking forward to a reply.

Darren said...

Yassar Arafat won a Nobel Prize, too.

Iraq was necessary because our government believed Saddam was building weapons of mass destruction--and before you even say it, just know that I'll put out quotes from President Clinton, VP Gore, and plenty of other Dems from before 2000 saying just that. After 9/11, we couldn't take the chance that he was, given his actions in the recent past.

And I've taught a lot of Michaels.

allen (in Michigan) said...

That's "Allen" in Michigan as opposed to "Allen" in Hawaii a poster who showed up a couple of times. Since we use our first names as handles it's a means of differentiating myself without giving up my handle.

> Why would I be surprised? I'm making anti-Bush comments on a Republican blog, I had a feeling I might get some replies.

No, what you're doing is repeating essentially content-free insults, "Bush ruined this country...", which means you don't feel the need to examine such pronouncements. That's acceptable, even expected at a football game but outside such venues its just evidence of laziness and fearfulness; laziness because it might require digging into unfamiliar and tedious sources and fearfulness because the alternative to being accepted as part of a smart, sophisticated, attractive crowd is just too scary.

No, I don't have any sources to point to. Retrospectively, the Democratic rhetoric about "everyone participating in the American dream of home-ownership" took on more sense in the context of the Democrats inability to get funding for the replacement of all the low-income housing projects that's been demolished. Unwilling to give up the pretense of generosity the Democrats managed to change the rules governing Fannie Mae and Freddie Mac so that they could buy loans with significantly lower scores then they previously could have. This created a market for lousy loans, previously a worthless commodity, and the loan-origination industry started loaning money to everything with a body temperature above room temperature.

> Why was Iraq necessary?

I've already answered that question but to reiterate, Saddam Hussein's invasion of Iraq precipitated Desert Storm. To prevent the collapse of his regime Hussein signed an agreement to end hostilities and promptly abrogated the agreement. He continued to abrogate the agreement in a wide variety of ways including interfering with the work of the weapons inspectors.

The inspectors were there because Saddam had used chemical and biological weapons against both his own people and Iran so we knew he had them. The agreement he signed pledged him and his government to actively assist the inspectors. If the Iraqi government had simply stood idly by and let the inspectors roam around unimpeded that *still* would have abrogated the agreement. He was pledged to *help* the inspectors.

The war in Iraq was necessary two weeks after the agreement ending Desert Storm was signed but Hussein rightly determined that we weren't willing to go to war over a document even though he'd miscalculated when he decided we weren't willing to go to war when he crossed the Kuwaiti border. But 9/11 changed all that and with the collapse of the World Trade Center towers went our patience with Saddam Hussein.

> Your next sentence didn't make much sense to me, so I'll leave to you to clarify what point that was supposed to make.

Every war since the Spanish-American war has been unavoidable and, it's arguable, avoided until dangerously late. The Spanish-American war wasn't justifiable from the standpoint of defending against a threat or attack by the Spanish empire. Therefor, it's arguable that the Spanish-American war wasn't necessary.

Darren got there ahead of me but Al Gore's Nobel Peace Prize wasn't quite the honor that it might have been if it hadn't been conferred on the likes of Yassir Arafat.

> Al Gore won the Nobel Prize, seems like a decent roll model to me.

If rolling your eyes is the sort of response you'd emulate then Al Gore's your guy. As a role model for those who see the rolling of eyes as evidence of intelligence he has few peers.

> I recommend Rush Limbaugh for you.

I wish but I don't see a four hundred million dollar radio deal in my future.

Oh yeah, use a handle.

mazenko said...

OK, here's my two pennies:

The current global economic crisis can be laid at the feet of George Bush, as well as Bill Clinton, Phil Graham, Tom Delay, Tom Daschle, Alan Greenspan, the mortgage industry, the credit card industry, ratings companies, sovereign wealth funds, and consumers, mostly American. It wasn't a Democratic or Republican or liberal or conservative issue - it was a result of humanity - of human foibles.

In terms of the sub-prime mortgage component, that may have been a spark to the tinder. However, a bunch of poor people defaulting on their mortgages cannot bring down any economy without a myriad of other factors and bad decisions. The meltdown comes from a complex web of derivatives - asset-backed securities, CDOs, credit default swaps, re-bundled bonds with dubious ratings, and major miscalculations in leverage. It really is that complex, and to try and link it to one act/person/party is naive.

A key component, of course, is the easing of the 1933 Glass-Stegal Act - supported by both parties. However, in many ways, that action has also prevented the problem from being worse. Clearly, the most revealing detail is Greenspan's conclusion that he never fathomed business/finance leaders could be so foolish with their decisions. It was just bad business.

In terms of factors such as CRA and FNM/FRE, we must keep in mind that those programs were in place and effective for nearly thirty years. In fact, the worst actions came between 2003 and 2007 after greater restrictions had been put in place. Nearly sixty percent of the sub-prime mess was outside of the government programs. And, again, it's not a huge systemic problem unless these assets were not turned into securities and repackaged and resold with deceptive ratings to a financial sector that wasn't even truly aware of what it was buying. This included pension funds, 401ks, and sovereign wealth funds.

I'm an independent who is fiscally conservative, and I regularly split my vote between parties, when I don't vote Libertarian. That said, I hate to see the sort of name-calling and finger-pointing that goes on in discussing this issue because most of it is disingenuous and mis-informed.

For the most comprehensive understanding of how we got here, I highly recommend two comprehensive analyses - The Trillion Dollar Meltdown by Charles Morris and Bad Money by Kevin Philips.

Anonymous said...

I'm afraid you'll have to take my word for it, Darren. Sorry, but I'm not one to give out my last name online. (Especially with all the excitement I've generated in this post)

Beginning with your comments:
I know, and he deserved it. Some Israeli leaders won it too.

I believe Bush believed that, but I also believe he had advisors that told him the intelligence was faulty. Before you commit American forces to a deadly and expensive war, "think" is not acceptable, you need to *know*.

On to Allen again:
I'd hardly call my insults content free. I've provided reasoning multiple times, as I do again in this post. I'll let the fact that you have no sources speak for itself, there.

Saddam violating an agreement after Desert Storm is your justification for the Iraq War many years later? Interesting. Funny, even Bush didn't give that as a reason.

I wasn't talking about that sentence. I was talking about this one:
"You see, in a democracy the elected representatives who have some responsibility for involving the U.S. in a war have to explain to mommies and daddies why the apple of their eye has to go off to be killed in foreign climes."

Likes of Yassir Arafat? What about the Israel leaders who received it at the same time? You probably consider Yassir a terrorist or something.

What do you mean by rolling my eyes? I don't see how that fits in at all. Al Gore was a VP of the US, a Senator, and Nobel Prize winner, and much more. Clearly he's wrong on everything. A terrible role model, you might be right.

Didn't Rush just say he hopes Obama fails the other day? I second my recommendation of him for your choice. (Note: easy to make money when you piss off everyone just to draw attention to yourself)


allen (in Michigan) said...

Oh, for gosh sakes this is the Internet, no one knows if you're a dog. Just pick a moniker for convenience. How about Al (in Gore)? I promise I won't set the relentless minions of the International Zionist Conspiracy on your trail.

> I know, and he deserved it. Some Israeli leaders won it too.

Sorry, the value of the Nobel Peace Prize isn't resurrected because the legitimately elected representative of a legitimate government gets the same award as callous authoritarian thief.

The Nobel Peace Prize is an utterly politicized icon that gets what little value it has in the reflected glory of the Nobel prizes for science. Beyond that it consists of nothing more then the arrogance of people who believe that if they sufficiently venerate a symbol their inferiors will be inspired to follow suite. As one of those inferiors, I decline.

> Saddam violating an agreement after Desert Storm is your justification for the Iraq War many years later? Interesting. Funny, even Bush didn't give that as a reason.

Actually, Bush did give that as a reason. That's why the inspectors never had to find a thing and Saddam was on the hook to make it real clear he wanted to help them every way possible. With years to do it and a whole country to search there was never the slightest possibility that anything was going to be found that Saddam didn't want found. The purpose of the inspectors was so Saddam could demonstrate that he really did want any bad things found if they were there to be found.

It's not just Saddam Hussein who had to make demonstrations of good faith either. Muammar Qaddafi, to shed the stigma of a terrorist supporting state designation, had to submit to the same indignities. He managed to do it just fine because he wanted to make it clear that he was out of the terrorism business. Whether he was or wasn't a supporter of terrorism wasn't really the point though. All the inspections demonstrated was that Qaddafi was willing to do business, to exert himself and submit to an indignity, to make at least an effort to demonstrate good faith.

> Didn't Rush just say he hopes Obama fails the other day? I second my recommendation of him for your choice

A your point would be what? That opposition to the policies with which you disagree is unacceptable in the dawning of the age of change we can believe in?

Obama's a left wing Democrat forced towards the center by pragmatism. That's why the troops aren't being pulled out of Iraq, why the prison at Guantanamo isn't closing, why he isn't pushing to rescind the Bush tax cuts and why Nancy Pelosi has been making tough noises of late. Were he in a position to do so his voting record, and what little back story there is on the man, makes it clear he'd issue an imperial decree enacting socialized medicine, cradle-to-grave welfare and every other sugarplum that dances through the heads of good, little lefties when they lay down to sleep. Since he can't issue imperial decrees - oh the bitter disappointment of democracy! - he'll do his best to advance policies I believe will be damaging to America.

Here's a flash for you, I hope Obama fails as well.

> (Note: easy to make money when you piss off everyone just to draw attention to yourself)

Har! If that were the case then Keith Olbermann would be rich enough to hire Bill Gates to wash his car.

Anonymous said...

Yassir was directly elected as well. How was a thief or authoritarian? Nonetheless, it's not up to you do decide who and who isn't worthy of a Nobel Prize (thankfully). Can you name a Nobel Prize winner in a field outside of science that you like?

I don't care if Bush gave that reason. It was given as the reason for the invasion to the American people. That's the issue here. He told us something that was not true, and we went to war over it.

Again, your next sentence is 100% incoherent to your previous point, so I won't be able to comment on that.

And by Rush saying he hopes Obama fails, he essentially hopes this country fails. Obama's goal is to bring about a new era of prosperity to this country. I'm sure that sounds just sickening to you, but saying you want the President to fail because he's not of your political party is plain stupid. I wanted Bush to succeed.

I'll ignore your following sarcastic sentence that also seems unrelated. We know he's a Democrat, so it's natural he'll push Democratic policies. He can (and has) issued decrees, just like Bush did, in the form of executive orders.

Keith Olbermann is not even comparable to Rush Limbaugh. Of course, you probably see them as the same, not surprising.

Darren said...

Anonymous, you're off the deep end.

Hoping President Obama fails to enact the legislation he wants to enact is NOT the same as hoping the country fails. Totalitarian states equate the leader with the country, WE do not. I hope the man does well, which means that I hope he does things that don't screw us over and might even help. I hope he implements as little of the agenda he's told us about as possible.

I notice you're changing the goalposts on the Nobel Peace Prize winner. Good tactic, the left always uses it. It's good to see, though, that you think that all elected leaders are honorable and not authoritarian. I look forward to seeing or hearing all your praises of President Bush over the last 8 years.

If you think President Obama is going to bring a "new era of prosperity", you're drinking too much of the kool-aid. If you can show me any example in the history of the planet of a country's taxing and spending itself into prosperity, I'll pay more attention to your argument.

Want a difference between Olbermann and Limbaugh? Limbaugh doesn't use foul language as a matter of course when sharing his political views--at least, I've never heard that he has. Can't say the same for Olbermann. And there's clearly a temperament issue as well.

allen (in Michigan) said...

> Yassir was directly elected as well.

Of course he was in charge of the PLO, the effective government of the Palestinians, up till then. That would mean he wasn't elected until he was elected. What do we call someone who assumes control of a government by violence and intimidation?

> How was a thief or authoritarian?

He was a thief because he lined his pockets at the expense of the Palestinian people. He was an authoritarian because he wasn't an elected representative. It's kind of an either/or thing.

> Nonetheless, it's not up to you do decide who and who isn't worthy of a Nobel Prize (thankfully).

Umm, actually it is. You are free however to name those whose responsibility it is to decide the worth of the Nobel Peace Prize.

> And by Rush saying he hopes Obama fails, he essentially hopes this country fails.

It is, apparently, up to you to decide what meaning to impute to Rush Limbaugh's words.

> Obama's goal is to bring about a new era of prosperity to this country.

Let me clue you in; goals are easy, achieving is tough. I discovered that when I found out that tying a towel around my neck didn't give me super powers.

> I'll ignore your following sarcastic sentence that also seems unrelated.

I don't suppose the fact that any response you could make would be pointless since Obama has, in fact, demonstrated repeatedly that he's as pragmatic and unapologetically calculating as the situation demands with, it's beginning to appear, not a principled bone in his body.

> Keith Olbermann is not even comparable to Rush Limbaugh.

Ya got that right Pancho. Olbermann's a talentless hack, neither inventive nor insightful, who takes himself very seriously. While Limbaugh may not be heir to Edward R. Murrow's legacy, or Will Rogers' either he's head and shoulders above second-rater like Olbermann as attested too by his audience.

Anonymous said...
This comment has been removed by a blog administrator.
Darren said...

That last comment crossed a line.

Keep it civil, or keep it away.

Anonymous said...

Well, hard for me to argue without being given the chance to talk.

Are you planning to ignore the points I made in that comment, then?

Darren said...

They were completely without merit, in addition to crossing the line. I don't mind your making a fool out of yourself, but you will *not* do so by essentially calling me a liar and ascribing to me vile views I do not hold.

I don't owe you this forum. Treat this blog like my house--you're a guest here, conduct yourself accordingly.