Did the Stimulus work?

Started by AndyZ, September 14, 2011, 12:59:41 AM

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AndyZ

I'm curious whether people feel that Obama's original stimulus plan worked.  I'm under the impression that it didn't work, which is why it confuses me that he's trying for another one now.
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Oniya

The problem is that it didn't go far enough.  Most states are prohibited from running on a deficit, and as a result, the state governments are slicing payrolls, laying off workers, and raising state taxes.  By doing a small stimulus, it was like throwing a single bucket of water on a ten-foot-square bonfire.  You got a lot of noise and blew off some steam, but in the end, it doesn't put out the fire.

In addition to a stimulus, the feds need to implement something like the WPA.  Even if it's 'just' getting construction workers some long-term, steady work (on an infrastructure that badly needs it!), that will trickle up as those workers grow comfortable enough to start spending.  That will raise demand for goods, and the manufacturers will start needing to crank out more goods - leading to more hours for current employees, and more openings for new employees.  With more goods being manufactured, you need more people selling the goods - in come the retail employees, and so forth.
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Zakharra

 An almost $800 billion stimulus package is small?  :o

AndyZ

Quote from: Oniya on September 14, 2011, 02:08:58 AM
The problem is that it didn't go far enough.  Most states are prohibited from running on a deficit, and as a result, the state governments are slicing payrolls, laying off workers, and raising state taxes.  By doing a small stimulus, it was like throwing a single bucket of water on a ten-foot-square bonfire.  You got a lot of noise and blew off some steam, but in the end, it doesn't put out the fire.

In addition to a stimulus, the feds need to implement something like the WPA.  Even if it's 'just' getting construction workers some long-term, steady work (on an infrastructure that badly needs it!), that will trickle up as those workers grow comfortable enough to start spending.  That will raise demand for goods, and the manufacturers will start needing to crank out more goods - leading to more hours for current employees, and more openings for new employees.  With more goods being manufactured, you need more people selling the goods - in come the retail employees, and so forth.

Maybe I misunderstand, but I thought the entire point of the stimulus was supposed to be something like the WPA, assuming you mean this: http://en.wikipedia.org/wiki/Works_Progress_Administration  However, I'm not sure that that worked either, since it didn't stop the Great Depression.

We spent all that money to get all those shovel-ready jobs that Obama promised us, right?  If it didn't work, why is he trying the same thing again with another 400 and some billion?
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Jude

It all comes down to a pretty simple question:  what exactly is your operational definition for the stimulus "working?"

Did it accomplish nothing aside from wasting 800 billion dollars?  No, that's absurd.

Was it the panacea that turned our economy around?  No, we're still experiencing a weak recovery.

Was it worth the expenditure?  That's a good question.  Unfortunately it's one that so few people are actually qualified to answer, and one that damn near everybody seems to have a truly uninformed opinion on.  A lot of the data necessarily to make that judgment isn't available at all.  All we have is projections to go off of, and in the end whether or not it was worth it is pretty subjective.  It's hard to say what would've happened if the stimulus had never occurred.

Requiring another round of stimulus isn't a sign that the first failed though -- the first could've helped without pulling us from the economic brink, just as the New Deal did.  What really got America out of the Great Depression was a lot more complicated than what is commonly believed.  It wasn't wartime deficit spending or anything FDR did as much as it was the near annihilation of Europe's means of production that turned nearly all of western Europe into a temporary consumer state subservient to US markets.

Oniya

Quote from: AndyZ on September 14, 2011, 02:24:43 AM
Maybe I misunderstand, but I thought the entire point of the stimulus was supposed to be something like the WPA, assuming you mean this: http://en.wikipedia.org/wiki/Works_Progress_Administration  However, I'm not sure that that worked either, since it didn't stop the Great Depression.

We spent all that money to get all those shovel-ready jobs that Obama promised us, right?  If it didn't work, why is he trying the same thing again with another 400 and some billion?

The problem is that while that was the intent of the last stimulus, the money didn't actually go where it was supposed to - creating new jobs. It got shuffled into already-well-lined pockets while lower-level jobs were still getting cut.  Supply-side economics is a pipe-dream.  To recover the economy, we need to create demand.
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AndyZ

Quote from: Jude on September 14, 2011, 04:03:25 AM
It all comes down to a pretty simple question:  what exactly is your operational definition for the stimulus "working?"

Did it accomplish nothing aside from wasting 800 billion dollars?  No, that's absurd.

Was it the panacea that turned our economy around?  No, we're still experiencing a weak recovery.

Was it worth the expenditure?  That's a good question.  Unfortunately it's one that so few people are actually qualified to answer, and one that damn near everybody seems to have a truly uninformed opinion on.  A lot of the data necessarily to make that judgment isn't available at all.  All we have is projections to go off of, and in the end whether or not it was worth it is pretty subjective.  It's hard to say what would've happened if the stimulus had never occurred.

Requiring another round of stimulus isn't a sign that the first failed though -- the first could've helped without pulling us from the economic brink, just as the New Deal did.  What really got America out of the Great Depression was a lot more complicated than what is commonly believed.  It wasn't wartime deficit spending or anything FDR did as much as it was the near annihilation of Europe's means of production that turned nearly all of western Europe into a temporary consumer state subservient to US markets.

That would suggest that the primary reason for our recession, then, would be that we don't really make things here in America any longer.  Am I correct on this?

Quote from: Oniya on September 14, 2011, 07:31:11 AM
The problem is that while that was the intent of the last stimulus, the money didn't actually go where it was supposed to - creating new jobs. It got shuffled into already-well-lined pockets while lower-level jobs were still getting cut.  Supply-side economics is a pipe-dream.  To recover the economy, we need to create demand.

I've only ever had basic economics classes, but if you raise demand, then you'll raise prices.  This will hurt the lower class when everything costs more money, which is definitely happening now.  Food, gas and everything has been jumping horribly lately.  I don't understand why this would be good for the economy; please explain.

With Obama trying to pass a new jobs bill, if the last one just went to the rich and connected as many seem to agree, why would this one be any different?  Is the new bill a good idea?

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Oniya

Right now, businesses aren't hiring because no one is buying.  No one is buying because no one has money.  No one has money because no one has jobs.  No one has jobs because businesses aren't hiring.  Vicious circle -> downward spiral.

If demand increases (i.e., someone wants to start buying), then businesses have to up production.  If businesses have to up production, they need to hire more workers.  If they hire more workers, then those workers have more money.  If they have more money, they are able to spend it.  Demand increases, lather, rinse, repeat.
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AndyZ

Quote from: Oniya on September 14, 2011, 08:21:47 AM
Right now, businesses aren't hiring because no one is buying.  No one is buying because no one has money.  No one has money because no one has jobs.  No one has jobs because businesses aren't hiring.  Vicious circle -> downward spiral.

If demand increases (i.e., someone wants to start buying), then businesses have to up production.  If businesses have to up production, they need to hire more workers.  If they hire more workers, then those workers have more money.  If they have more money, they are able to spend it.  Demand increases, lather, rinse, repeat.

Alright, but if you're pushing up on things via demand, isn't the price going to rise as well?  This will necessitate a push on the lowest levels of society being able to buy even less with their money, which is only going to hurt them more.

I can see how more people would necessitate more things being made, but since we don't actually make things in America anymore, that isn't going to make more jobs for us.  That'll definitely help push China to make more stuff, which would help them, but would it help us?  Also, when there are things that we can't just push harder to make, like when farms are already working at capacity, having more people working would make more food, right?

This is getting confusing.  I'd love to hear from an economist right now.
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Zakharra

  Not necessarily. A higher demand for goods does not mean a higher price. Or the cost of computers, plasma TVs, DVD players, cell phones and the like -never- would have dropped in price to become affordable to the middle class and poor people. Scarcity of a product is what tends to drive up prices, that and a monopoly (such as the oil companies). A higher demand by itself won't.

AndyZ

Quote from: Zakharra on September 14, 2011, 08:53:25 AM
  Not necessarily. A higher demand for goods does not mean a higher price. Or the cost of computers, plasma TVs, DVD players, cell phones and the like -never- would have dropped in price to become affordable to the middle class and poor people. Scarcity of a product is what tends to drive up prices, that and a monopoly (such as the oil companies). A higher demand by itself won't.

If the demand goes up, then the supply has to go up as well in order to maintain the price.

http://en.wikipedia.org/wiki/Supply_and_demand

From my understanding, what allows the various prices to drop on technology is because newer models come out.  Once the new Widget 5.0 comes out, the Widget 4.0 becomes cheaper and more easily available.

Granted, in order to get all the way up to the 5.0, the Widget has to come out with various models, which have to have been bought up by someone with the money, usually the rich and early adapters.  However, that goes against other stuff, because in order to maintain that demand, there have to be the rich people to buy it when it first comes out.  That's how my economics teacher explained it, though I may be wrong.
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Oniya

I'd recommend looking up a guy named Robert Reich.  He was a White House economist during the Clinton administration, and has been quite vocal about the current state of things.
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
I do have a cause, though.  It's obscenity.  I'm for it.  - Tom Lehrer~*~All you need is your beautiful heart
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Zakharra

Quote from: AndyZ on September 14, 2011, 09:02:55 AM
If the demand goes up, then the supply has to go up as well in order to maintain the price.

http://en.wikipedia.org/wiki/Supply_and_demand

From my understanding, what allows the various prices to drop on technology is because newer models come out.  Once the new Widget 5.0 comes out, the Widget 4.0 becomes cheaper and more easily available.

Granted, in order to get all the way up to the 5.0, the Widget has to come out with various models, which have to have been bought up by someone with the money, usually the rich and early adapters.  However, that goes against other stuff, because in order to maintain that demand, there have to be the rich people to buy it when it first comes out.  That's how my economics teacher explained it, though I may be wrong.

  By that reasoning, why would ANYthing be cheap now? If there is a large supply, the price usually drops because of the sheer volume. Oil and gas seem to be one of the few things that doesn't follow that model.  Computers are a LOT cheaper now than when they became PC sized. $4-500 will get you a decent laptop or desktop, electronics of all types are extremely affordable. Places like Walmart are filled with very affordable items. Even the new models are fairly affordable and not priced out of the range of the average consumer. They cost more yes, but not excessively so. Volume is one thing that determines pricing.

Vekseid

Quote from: AndyZ on September 14, 2011, 02:24:43 AM
Maybe I misunderstand, but I thought the entire point of the stimulus was supposed to be something like the WPA, assuming you mean this: http://en.wikipedia.org/wiki/Works_Progress_Administration  However, I'm not sure that that worked either, since it didn't stop the Great Depression.

We spent all that money to get all those shovel-ready jobs that Obama promised us, right?  If it didn't work, why is he trying the same thing again with another 400 and some billion?

How anyone could confuse the WPA with the pathetic leavings that got termed the 'Stimulus' is beyond me. Aside from shoring up state and local budgets while it lasted, and temporarily resuscitating a few ailing industries, it was woefully inadequate to the task. It made up for the dropoff in state and local spending, but it did not actually increase total government (state, local, and federal combined) expenditures.

America has a 'true' underemployment pool of roughly thirty million. Which means that the United States, as a whole, is losing roughly three trillion dollars per year in lost labor utilization. Worse, these people still take up resources, just by the very factor of being there, meaning that security and other capacity costs are increased. Letting them sit to rot is not a wise move.

A proper WPA would be a roughly $3-4 trillion operation, and quite likely in the $5-7 trillion range over the course of an administration. However, a $4 trillion dollar package would be the easiest for bond markets to absorb (the money is, after all, right there, competing for US treasuries as is). Tax increases could probably make a $5-7 trillion dollar version viable without drastically growing the debt.

Quote from: AndyZ on September 14, 2011, 08:47:17 AM
Alright, but if you're pushing up on things via demand, isn't the price going to rise as well?  This will necessitate a push on the lowest levels of society being able to buy even less with their money, which is only going to hurt them more.

I can see how more people would necessitate more things being made, but since we don't actually make things in America anymore, that isn't going to make more jobs for us.  That'll definitely help push China to make more stuff, which would help them, but would it help us?  Also, when there are things that we can't just push harder to make, like when farms are already working at capacity, having more people working would make more food, right?

This is getting confusing.  I'd love to hear from an economist right now.

We do make quite a bit in America. We'd make more in America if we stopped sucking up to China, and forced things made in other countries to carry more flagrant notices. I always check to make sure my food isn't made in China, for example. I really would appreciate a bolder notice so I wouldn't have to check. For added fun, devalue our currency by 25% on top of it and watch China bitch.

Regarding inflation, if you have 10% inflation and the poorest are making %10,000 more (i.e., in many cases, actually having a damned job), are they really losing out?

I think the benefit traps programs put the poor in (once you make a certain amount of money, you start losing benefits faster than the money you earn) are far more of a sham than taxes, spending, and inflation.

Quote from: AndyZ on September 14, 2011, 09:02:55 AM
If the demand goes up, then the supply has to go up as well in order to maintain the price.

http://en.wikipedia.org/wiki/Supply_and_demand

From my understanding, what allows the various prices to drop on technology is because newer models come out.  Once the new Widget 5.0 comes out, the Widget 4.0 becomes cheaper and more easily available.

Granted, in order to get all the way up to the 5.0, the Widget has to come out with various models, which have to have been bought up by someone with the money, usually the rich and early adapters.  However, that goes against other stuff, because in order to maintain that demand, there have to be the rich people to buy it when it first comes out.  That's how my economics teacher explained it, though I may be wrong.

You're somewhat mixing disruptive technologies in with traditional supply and demand. Generic supply increases are things like retooling factories, more workers producing a specific good, digging/sucking more out of the ground, etc.

Technological disruption means that the pace of technology means that a new unit can perform the same need (or more of the same need) for cheaper (or the same price), which is what you see in newer models of computers/phones/etc. The modern rate of disruption is not something that most economics can easily wrap its head around, simply because technology is quickly driving the barrier of entry of more and more markets to zero. It's going to happen next with 3D printers, but I doubt it will stop there.

Of course, increased supply is a part of it too. Moving from a 32nm process to a 22nm process means that more chips can be crammed onto your typical 300mm wafer, and raw production can actually increase.

AndyZ

Quote from: Zakharra on September 14, 2011, 10:08:48 AM
  By that reasoning, why would ANYthing be cheap now? If there is a large supply, the price usually drops because of the sheer volume. Oil and gas seem to be one of the few things that doesn't follow that model.  Computers are a LOT cheaper now than when they became PC sized. $4-500 will get you a decent laptop or desktop, electronics of all types are extremely affordable. Places like Walmart are filled with very affordable items. Even the new models are fairly affordable and not priced out of the range of the average consumer. They cost more yes, but not excessively so. Volume is one thing that determines pricing.

That's the argument for increasing supply, at least as I understand it.  If you flood the market with lots of such things, the price will drop to make it easier for other people to afford them.  The argument for demand is quite different.

However, here's the basics:

If demand increases and supply remains unchanged, then it leads to higher equilibrium price and quantity.
If demand decreases and supply remains unchanged, then it leads to lower equilibrium price and quantity.
If supply increases and demand remains unchanged, then it leads to lower equilibrium price and higher quantity.
If supply decreases and demand remains unchanged, then it leads to higher price and lower quantity.

It helps to think of it in terms of a particular good.  If a particular band's CDs are crap and nobody wants them, the demand is down, the store will drop the price.


Quote from: Vekseid on September 14, 2011, 11:15:28 AM
How anyone could confuse the WPA with the pathetic leavings that got termed the 'Stimulus' is beyond me. Aside from shoring up state and local budgets while it lasted, and temporarily resuscitating a few ailing industries, it was woefully inadequate to the task. It made up for the dropoff in state and local spending, but it did not actually increase total government (state, local, and federal combined) expenditures.

America has a 'true' underemployment pool of roughly thirty million. Which means that the United States, as a whole, is losing roughly three trillion dollars per year in lost labor utilization. Worse, these people still take up resources, just by the very factor of being there, meaning that security and other capacity costs are increased. Letting them sit to rot is not a wise move.

A proper WPA would be a roughly $3-4 trillion operation, and quite likely in the $5-7 trillion range over the course of an administration. However, a $4 trillion dollar package would be the easiest for bond markets to absorb (the money is, after all, right there, competing for US treasuries as is). Tax increases could probably make a $5-7 trillion dollar version viable without drastically growing the debt.

I don't think we'd ever be able to borrow that much money.  However, what really confuses me is, if it didn't work for FDR, why would it work now?  Is Obama's new jobs plan a good idea?

I also disagree with raising taxes while we're trapped in this thing, like when Obama said that it was the last thing you want to do.

QuoteWe do make quite a bit in America. We'd make more in America if we stopped sucking up to China, and forced things made in other countries to carry more flagrant notices. I always check to make sure my food isn't made in China, for example. I really would appreciate a bolder notice so I wouldn't have to check. For added fun, devalue our currency by 25% on top of it and watch China bitch.

One thing that really puzzles me is that people say that we have to have all these bureaucracies for things because big business would just put plastic in our food or whatever, but China can get away with all of this stuff.  What's the point of having these things if they don't do anything?

Also, I think if we just started printing money, people would stop buying our debt at all.  Then our credit rating would just plummet, right?  It's similar to the thing about whether we should raise the debt ceiling.

QuoteI think the benefit traps programs put the poor in (once you make a certain amount of money, you start losing benefits faster than the money you earn) are far more of a sham than taxes, spending, and inflation.

I think I remember Clinton talking about this, how the programs aren't designed to help people rise up, they just keep people trapped in them.  I'm very big on the whole "teach to fish, don't just hand out fish every day" mentality, and I think everyone would agree that government doesn't actually do that.

QuoteYou're somewhat mixing disruptive technologies in with traditional supply and demand. Generic supply increases are things like retooling factories, more workers producing a specific good, digging/sucking more out of the ground, etc.

Technological disruption means that the pace of technology means that a new unit can perform the same need (or more of the same need) for cheaper (or the same price), which is what you see in newer models of computers/phones/etc. The modern rate of disruption is not something that most economics can easily wrap its head around, simply because technology is quickly driving the barrier of entry of more and more markets to zero. It's going to happen next with 3D printers, but I doubt it will stop there.

Of course, increased supply is a part of it too. Moving from a 32nm process to a 22nm process means that more chips can be crammed onto your typical 300mm wafer, and raw production can actually increase.

This might not be what you're saying, but I used to think that the rate of increase for technology would mean that eventually no one would have jobs.  Everything would be automated.  Obama has mentioned this to some degree with ATMs.

However, one thing of note is that whenever things progress, something comes up to fill the void.  Having more time means that we want more entertainment.  Having the internet means that we buy all sorts of internet stuff.  New things pop into existence as well.

I may very well be missing your point here.
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Oniya

Taxes need to be applied better - not a simple 'increase' or 'decrease' (or even 'fail to increase or decrease').  Right now, a lot of the wealthy entities (corporations and individuals) get out of paying even the same rate of taxes as the rest of us see taken out of our paychecks.  An economy depends on money moving, not stagnating in some Swiss bank account.
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
I do have a cause, though.  It's obscenity.  I'm for it.  - Tom Lehrer~*~All you need is your beautiful heart
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AndyZ

Quote from: Oniya on September 14, 2011, 11:55:10 AM
Taxes need to be applied better - not a simple 'increase' or 'decrease' (or even 'fail to increase or decrease').  Right now, a lot of the wealthy entities (corporations and individuals) get out of paying even the same rate of taxes as the rest of us see taken out of our paychecks.  An economy depends on money moving, not stagnating in some Swiss bank account.

Absolutely agree that we need to get rid of all the loopholes and such.  There's no freaking way that GE should be paying 0%.
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Vekseid

Quote from: AndyZ on September 14, 2011, 11:40:50 AM
I don't think we'd ever be able to borrow that much money.  However, what really confuses me is, if it didn't work for FDR, why would it work now?  Is Obama's new jobs plan a good idea?

There is roughly 3.5 trillion available for us to borrow right now.

And yes, it did work for FDR. Look up the unemployment rate going until 1937 when programs were scaled back.

What I proposed is more akin to a WWII-level mobilization, however, without the restrictions on private industry. That certainly worked with the private restrictions - sans those, I think a very impressive job could be done.

Quote
I also disagree with raising taxes while we're trapped in this thing, like when Obama said that it was the last thing you want to do.

Raising taxes on those who spend all of their money is bad, yes - you want to lower their taxes. However, raising taxes on those who don't spend there money is, at worst, economy-neutral. Far more likely they will start reinvesting their income, which in turn will improve the economy on its own.

Quote
One thing that really puzzles me is that people say that we have to have all these bureaucracies for things because big business would just put plastic in our food or whatever, but China can get away with all of this stuff.  What's the point of having these things if they don't do anything?

Declaring that well-purposed regulatory agencies are bad because they have been hamstrung by lobbyist efforts is not a particularly sound argument. If you think a particular regulation or set of regulations are bad, that argument should be made on its own merits, not 'they should all just go'. They are, quite often, there for a well-thought out reason, though some things (e.g. corn subsidies) may be addressing a situation that no longer applies.

Quote
Also, I think if we just started printing money, people would stop buying our debt at all.  Then our credit rating would just plummet, right?  It's similar to the thing about whether we should raise the debt ceiling.

Like people stopped buying Japan's debt when they started printing money?

Or, you know, when we did?

How many record low yields has Japan had since then? Us?

Yes, there is such a thing as printing too much. You can also have too much fire and e.g. burn your house down. It doesn't necessitate freezing to death in the winter. It necessitates responsibility.

Quote
I think I remember Clinton talking about this, how the programs aren't designed to help people rise up, they just keep people trapped in them.  I'm very big on the whole "teach to fish, don't just hand out fish every day" mentality, and I think everyone would agree that government doesn't actually do that.

Some government programs certainly can. It's a simple matter of how they are structured - don't allow situations like that to happen.

Oh, yes, some freeloaders will bitch. I don't get the impression you're on their side and, shock, neither are many progressives.

Quote
This might not be what you're saying, but I used to think that the rate of increase for technology would mean that eventually no one would have jobs.  Everything would be automated.  Obama has mentioned this to some degree with ATMs.

This is the origin of Karl Marx's quote "From each according to his ability, to each according to his need." He believed that technology would effectively enable such a society. You work one hour a month or year and feed a million people - random, minimal labor becomes enough to sustain society.

It's not, physically, impossible. The Solar System represents a ridiculous amount of unharnessed wealth along with the energy to exploit it. The real issue is getting there without getting trapped into some dystopia where e.g. someone has control of all of the machines and turns the world into their own utopia where everyone else suffers.

Quote
However, one thing of note is that whenever things progress, something comes up to fill the void.  Having more time means that we want more entertainment.  Having the internet means that we buy all sorts of internet stuff.  New things pop into existence as well.

I may very well be missing your point here.

I'm not sure what you are trying to address. You confused increased supply with disruption. Disruption is where something gets outmoded, and is what you described as an increase in supply when it was, for the most part, not.

Oniya

Quote from: Vekseid on September 14, 2011, 12:24:39 PM
Some government programs certainly can. It's a simple matter of how they are structured - don't allow situations like that to happen.

For example, having welfare taper off as someone gains monthly income, providing a cushion to keep them at a certain, life-sustaining level.
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
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AndyZ

Quote from: Vekseid on September 14, 2011, 12:24:39 PM
There is roughly 3.5 trillion available for us to borrow right now.

From where?  I haven't heard this.

QuoteAnd yes, it did work for FDR. Look up the unemployment rate going until 1937 when programs were scaled back.



Unemployment rate in the US 1910–1960, with the years of the Great Depression (1929–1939) highlighted.

Source: http://en.wikipedia.org/wiki/Great_Depression

Did he start the program at the very peak and bring things down to the valley, before it started rising again after 1937?  I guess I can see that it made a bit of a dent, but not really.

I just remember what Henry Morganthau, the Secretary of the Treasury for FDR said on the matter: “We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong…somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises…I say after eight years of this administration we have just as much unemployment as when we started…And an enormous debt to boot!”

QuoteDeclaring that well-purposed regulatory agencies are bad because they have been hamstrung by lobbyist efforts is not a particularly sound argument. If you think a particular regulation or set of regulations are bad, that argument should be made on its own merits, not 'they should all just go'. They are, quite often, there for a well-thought out reason, though some things (e.g. corn subsidies) may be addressing a situation that no longer applies.

Certainly not claiming that they all need to go point blank, but I think we do need to go through a lot of this stuff and prune.  However, that's another argument.  I should probably start up a thread on that.

QuoteLike people stopped buying Japan's debt when they started printing money?

Or, you know, when we did?

How many record low yields has Japan had since then? Us?

Yes, there is such a thing as printing too much. You can also have too much fire and e.g. burn your house down. It doesn't necessitate freezing to death in the winter. It necessitates responsibility.

Why is it that sometimes we need to have people buy debt and other times we can just print more money?  I still don't really understand that.

QuoteThis is the origin of Karl Marx's quote "From each according to his ability, to each according to his need." He believed that technology would effectively enable such a society. You work one hour a month or year and feed a million people - random, minimal labor becomes enough to sustain society.

That would mean that the communist society wouldn't actually work until such technology existed, though, right?  We're certainly not at the utopia where people only need to work one hour a month.  Or am I missing something?

Personally, I always thought that it should be "to each according to his effort."  I don't think the freeloading guy with higher needs than a hard worker should get more of the resources.

QuoteI'm not sure what you are trying to address. You confused increased supply with disruption. Disruption is where something gets outmoded, and is what you described as an increase in supply when it was, for the most part, not.

I think I'm confused on what you mean here.  I'll still try to explain what I'm saying and you can help me understand how it fits in.

When we make a machine to do something, someone else has to repair the machine.  When we build something new, there's always another level where humans are needed.  That's going to be true until machines are self-aware, and even then, you'll still need the "grand masters" for various things, but I don't know if you're familiar with that sci-fi story.

For example, in Charlie and the Chocolate Factory (spoilers ahead), Charlie's dad had the job of screwing caps on the end of toothpaste tubes.  He ended up getting replaced by a machine, but then he got a job repairing the machine.

Maybe the issue I'm having is that, yes, technology lowers the need for human labor in certain areas, but its existence necessitates new areas for human labor in other areas.  Wouldn't that have some effect on the disruption thing?
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Quote from: AndyZ on September 14, 2011, 12:54:18 PM
For example, in Charlie and the Chocolate Factory (spoilers ahead), Charlie's dad had the job of screwing caps on the end of toothpaste tubes.  He ended up getting replaced by a machine, but then he got a job repairing the machine.

*snickers*  Read that book with the little Oni this summer.

One thing that is required to keep people from becoming obsolete as their jobs are automated is going to be education of the existing workforce.  It's one set of skills to (to use the example) screw caps on the ends of toothpaste tubes, and another to repair the machine that screws on the caps.  On the plus side, this would require employing people to train the soon-to-be repair squads, but the education needs to be accessible to Mr. Bucket in his two room shack.
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
I do have a cause, though.  It's obscenity.  I'm for it.  - Tom Lehrer~*~All you need is your beautiful heart
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Callie Del Noire

The thing is.. work programs like FDR put into play did VITAL things to US infrastructure that we're still benefiting from. And let's be honest, some of them would have NEVER been done if it wasn't for the intent to generate jobs to jumpstate the economy. How many highways, bridges, rail spurs and other things were started would have been done if it wasn't for the program.

And let's be honest, we need an entity that doesn't have to absolutely look at the bottom line and develop programs that can help us. We, as a country, need to do it.

Our infrastructure needs to be fixed. We're a decade (or more) behind other countries in our infrastructure for a lot of things. Our roads, bridges, lots of things.

Dashenka

I know the solution to all your problems...

Move to Russia... economic growth of nearly 4% without any major stimulance packages.


Seriously though, I haven't read any of the things that Obama did but I think all the measures taken by any government to increase employment and decrease the financial impact or whatever they are doing, cannot be noticed on such a short term. It would take a few years before things like that will have a real effect.

The bubble burst and now everybody is blowing up the bubble again but it's still small. All those changes made globally are efforts to get it up again and in 50 years orso everything we do now, will come crushing down again. Give the man a little time to make it all work. Every government in the world is now being criticized for cutting on everything. Next government will have money and they'll be heroes. That's the fun of politics, if you are riding the tide, you're a hero, if you are trying to swim you're basically fucked.

As for the infrastructure, I beg to differ. Not sure which countries are ahead of the US when it comes to infrastructure but I sure as hell never been there. It's not in Europe, Africa or South America so maybe some countries in Asia although I still wouldn't agree.
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Oniya

Quote from: Dashenka on September 14, 2011, 02:55:19 PM
Seriously though, I haven't read any of the things that Obama did but I think all the measures taken by any government to increase employment and decrease the financial impact or whatever they are doing, cannot be noticed on such a short term. It would take a few years before things like that will have a real effect.

The bubble burst and now everybody is blowing up the bubble again but it's still small. All those changes made globally are efforts to get it up again and in 50 years orso everything we do now, will come crushing down again. Give the man a little time to make it all work. Every government in the world is now being criticized for cutting on everything. Next government will have money and they'll be heroes. That's the fun of politics, if you are riding the tide, you're a hero, if you are trying to swim you're basically fucked.

I'm actually more peeved off at the politicians that seem to be actively combating any attempts to increase employment.  The ones that are trying have my support.  The ones who aren't deserve a quick boot in the pants.  (I actually got an email from one of my Congressmen that not only indicated he had read my letter, but addressed a number of my concerns directly with references to legislation he had initiated.  If he's running again this year, he's got my vote.)

Oh, and on the infrastructure issue:

http://business.financialpost.com/2011/08/16/crumbling-infrastructure-adds-to-u-s-economic-woes/

I don't know about the 'decade behind' bit, but the fact that our bridges and highways are in this sort of shape confirms that we need to do something to fix them.
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
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Callie Del Noire

I think that the US has tossed aside MANY options over the years. There was a project a while back that a bunch of Japanese companies offered back in the 80s to give the US the vehicle and construction gear contracts in return for the State Department greasing the wheels on setting up a new Canal system in Central America.

Infrastructure doesn't have to be for the US. Though I think there is enough. I personally think that we (as a country) could do with a LOT of internet backbone upgrades. Cause trust me.. if we wait on the companies here in the US to do it..we'll be back on dial up before you know it.

The US companies would rather eat one another than reinvest in their infrastructure.

Jude

#25
Prosperity in capitalism comes from the same thing on the macro level that it does from the micro level -- new economic strategies and products.  The internet was responsible for the prosperity of the 90s, and after that bubble burst we've failed to supplant it with anything new, novel, and substantial.  In its place there are a whole host of new macro economic strategies that have risen to prevalence (and have been rising really since the 80s) -- that's all supply side economics is: a new way to squeeze more out of old models.

We need to focus on emerging technologies and new markets, but we don't have the infrastructure (and I don't mean physical infrastructure) to do so.  Our pathetic achievements in Science and Mathematics are the product of an incurious, lazy culture of self-appointed experts with a scientific literacy that lags behind Europe and brains facilities for critical thought that have long since atrophied.  We are the incarnation of populism gone bad.

The fact that we don't make things here anymore (which isn't true) has nothing to do with our current predicament.  It's that we're not making enough good, new ideas at this point to keep our global edge.

We're losing the intellectual battle, and that's not something that can be righted by a stimulus bill or a new WPA.  We need a cultural shift, and I doubt it'll happen.

Vekseid

Quote from: AndyZ on September 14, 2011, 12:54:18 PM
From where?  I haven't heard this.

Just look up corporate cash reserves and excess bank deposits. I've linked both from previous discussions here and they last totaled ~3.4 trillion when I looked. Companies and banks want to do something with this money, not have it lose real value to inflation.

Quote


Unemployment rate in the US 1910–1960, with the years of the Great Depression (1929–1939) highlighted.

Source: http://en.wikipedia.org/wiki/Great_Depression

Did he start the program at the very peak and bring things down to the valley, before it started rising again after 1937?  I guess I can see that it made a bit of a dent, but not really.

There was a prior program that the WPA was based on, but only focused on youth.

And I'm not sure how you'd call a 30% drop 'a bit of a dent' - it sustained three million jobs on its own. If Obama managed to drop U6 to ~12%, I don't think you'd deny that he'd be in a vastly superior political position.

Quote
I just remember what Henry Morganthau, the Secretary of the Treasury for FDR said on the matter: “We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong…somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises…I say after eight years of this administration we have just as much unemployment as when we started…And an enormous debt to boot!”

The US mobilization during World War II sure as hell proved him wrong. Which is telling, considering wars are particularly bad things to invest in. A similar level of mobilization in infrastructure development, environmental restoration, and/or space exploration would be vastly superior.

Quote
Certainly not claiming that they all need to go point blank, but I think we do need to go through a lot of this stuff and prune.  However, that's another argument.  I should probably start up a thread on that.

Why is it that sometimes we need to have people buy debt and other times we can just print more money?  I still don't really understand that.

It's not an either-or proposition. You can't print Zimbabwe style. I don't think I need to explain why. In a Keynesian system (a la what guided the postwar boom up until the 70's), you print enough so that you reflect the overall depreciation of durable goods, which is generally thought to be 4%-5%.

But that brings in relatively little money - though you can use it to pay debts with less inflation risk than handing it to people who will spend the money. If you want lots of money, you either need to borrow excess reserves, impose taxes, or both.

Quote
That would mean that the communist society wouldn't actually work until such technology existed, though, right?  We're certainly not at the utopia where people only need to work one hour a month.  Or am I missing something?

That specific vision would not work until then, but it is more specific than communism. Central planning's main problem is logistics, and modern computing allows that to be handled reasonably well, which is why China and companies like Wal-mart can continue to thrive. It's certainly not ideal - it retards the pace of innovation and the spread of new ideas. Communism's other traditional problem is a lack of accountability and transparency, but a strong constitution can help with that (and I am of the opinion that America's is due for some polishing in that regard).

Quote
Personally, I always thought that it should be "to each according to his effort."  I don't think the freeloading guy with higher needs than a hard worker should get more of the resources.

And at that point, he wouldn't. The freeloader would be vegitating in some virtual reality Universe of Ultracraft, using up a negligible fraction of his energy allotment while the laborer was busy terraforming Mars.

But there are cases where we benefit from supplying someone elses need. Health care is a good example. You benefit from your neighbor and the beggar down the street being vaccinated, not being sick, and not being afraid to go to the doctor if they get sick. You benefit from them being able to work, rather than being forced to resort to crime to survive.

Quote
I think I'm confused on what you mean here.  I'll still try to explain what I'm saying and you can help me understand how it fits in.

When we make a machine to do something, someone else has to repair the machine.  When we build something new, there's always another level where humans are needed.  That's going to be true until machines are self-aware, and even then, you'll still need the "grand masters" for various things, but I don't know if you're familiar with that sci-fi story.

But this requires fewer and fewer people, until, eventually, someone comes up with a code of ethics for an AGI to follow and promote that (we hope) benefits the human race as a whole. This is actually occurring right now in the programming field.

Quote
For example, in Charlie and the Chocolate Factory (spoilers ahead), Charlie's dad had the job of screwing caps on the end of toothpaste tubes.  He ended up getting replaced by a machine, but then he got a job repairing the machine.

Maybe the issue I'm having is that, yes, technology lowers the need for human labor in certain areas, but its existence necessitates new areas for human labor in other areas.  Wouldn't that have some effect on the disruption thing?

Disruption just means one piece of equipment gets obviated by another.

The overall reduction in labor required for society to function has been going on for centuries, and is continuing - just look at how productivity rose while jobs continued to be lost. It has enabled the rise of an educated class that can be dedicated to research, which has sped the process along further. It has enabled the rise of a massive entertainment class alongside of it.

We don't 'need' those classes - but they are certainly nice to have! But those are the only two places jobs can expand into in the very long term - and computers can take their jobs, too, though we might not allow that, if only to stave off ennui.

Of course, this all depends on the people in charge of the machines either being highly diverse, or noble. Right now, that is not the case.

Zakharra

Quote from: AndyZ on September 14, 2011, 11:40:50 AM
That's the argument for increasing supply, at least as I understand it.  If you flood the market with lots of such things, the price will drop to make it easier for other people to afford them.  The argument for demand is quite different.

However, here's the basics:

If demand increases and supply remains unchanged, then it leads to higher equilibrium price and quantity.
If demand decreases and supply remains unchanged, then it leads to lower equilibrium price and quantity.
If supply increases and demand remains unchanged, then it leads to lower equilibrium price and higher quantity.
If supply decreases and demand remains unchanged, then it leads to higher price and lower quantity.

That also ignores, increased supply AND increased demand.  I noticed that particular qualification was left out. That can lead to lower prices and high demand.

Vekseid

Or higher prices, as when supply chases (does not quite catch up with) demand as in e.g. oil.

Zakharra

 Possibly. Oil, I've noticed doesn't quite work the same as other commodities. The supply can be fine, as it is now and has been in the past, yet the price goes up when anything seems to 'threaten' the market. Even the Libyan rebellion did that.  Yet when the incident passes and oil resumes it's normal flow, the price of gas and diesel rarely drops to it's former level. Even when  oil does drop, there's no corresponding drop in fuel prices.

Jude

"Necessities" don't follow market rules very well.  The fact that oil is a non-renewable source makes it difficult.

It isn't like food or electricity either where you can simply find new venues of production.  Oil expansion isn't as easy or possible.

Vekseid

It's more that refined oil has a half-life. A small disruption in refining can throw prices up, while an oversupply of refining will drive prices down. Oil is also a bit inelastic, that is, demand decreases less than linearly with with changes in price, so it takes a ~2.5% increase in price to reduce demand by 1%.

Aludiana of the Dusk

Infrastructure where I live currently, and had lived in Missouri up until about a year ago this past May was just plain awful. Granted, where I lived in Missouri we were outside of town on a gravel road. At some point during the five years I lived there, money became an issue and I don't know if it was the county or the state, but it was decided that since that area was primarily populated by the Amish, who don't pay taxes (they do actually), that the Amish could take care of their roads. I remember one winter my husband's grandmother went out and bought a snow plow attachment for her van to help plow the road so that the English people could get onto a drivable road and get to work. They stopped coming around and grading the roads too, which leaves them an awful mess and probably contributed to why we were having to get new tires at least once a year.

Now, the city I live in mow has a bypass for one of the major non-interstate US highways that cuts through the middle of town. Its in such bad shape that it would actually cost less to build an entirely new bypass that would bypass the current bypass so that is what they are going to do. And in my neighborhood, there are barely any storm drains. Maybe one on each street corner; which may be fine for the people who live near street corners. But for everybody else, and especially the people who live on the cul de sacs like I do; if there is heavy rain for more than 15 or 20 minutes, the street turns into a river, and our yard becomes a pond. The standing water has actually gotten so deep that my corgi can swim in it. Ducks have made nests and laid eggs in my garden. Nobody seems willing to do anything about that or even talk about fixing residential streets though.
~On Hiatus Indefinitely~

Oniya

Here's the report on our infrastructure from the American Society of Civil Engineers.  It's dated 2009, but I doubt the numbers have gotten any better with the current economic climate. 
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
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Roxy Rocket

#34
(removed for now)

Oniya

I find that the economist Robert Reich does a good job of explaining things in layperson's terms.  I'm sure I've linked to him up-thread, but he's easy enough to find.
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
I do have a cause, though.  It's obscenity.  I'm for it.  - Tom Lehrer~*~All you need is your beautiful heart
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Roxy Rocket

#36
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Oniya

How about looking at the way he writes/talks instead of how Wikipedia writes/talks about him.

http://marketplace.publicradio.org/display/web/2011/08/10/reich/
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
I do have a cause, though.  It's obscenity.  I'm for it.  - Tom Lehrer~*~All you need is your beautiful heart
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Jude

A commenter on that article said it best.
QuoteI'm still puzzled at the folks insisting that the problem is debt and taxes. The Reich approach is pretty standard Keynes. Demand is low because consumers have little or no money and are concerned about their jobs, if they have them. Corporations are sitting on 2.5 trillion dollars in cash, but are quite logically unwilling to invest in production because there are no customers. There is little that would change this if government were left out of the equation. Bring in the feds, spend money (yes, borrowed money. That 2.5 trillion can be put to work with treasury bonds, at least) on infrastructure and energy efficiency, things we need in the long run anyway. BUT it has to be large enough to knock unemployment down and turn the mood of consumers. When they start feeling more comfortable with their long term position, they'll start buying and companies, again logically, will start investing in production to make a profit off of these potential customers. Simple, albeit expensive in the short term. Supply side says the problem is that the wealthy/job creators don't have enough money to work with. (2.5 trillion not enough to cover costs, apparently.) Or are concerned about all those taxes (which are at their lowest point in 50 years.) Or are spooked by the debt (which is not out of line with debt over the last 20 years, during which we had both boom and bust times.) There is no inherent logic in supply side economics aside from the standard "Why make money when the government will just take it from you" nonsense that doesn't stand up to the basic light of current taxation levels. Yes we have a debt problem caused by both overspending and undertaxing. (Yes, undertaxing. We have some of the lowest tax rates in the industrial world.) When we get out of this ditch we should definitely start working on both of those issues. But we have to get out of the ditch first.

Oniya

Reich has advocated the government becoming the 'customer of last resort' in other blog entries.  I'm pretty sure I've seen him reference going for the infrastructure as a source of jobs as well.  It was the lack of 'economic jargon' that I was focusing on, compared to the Wikipedia article.
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
I do have a cause, though.  It's obscenity.  I'm for it.  - Tom Lehrer~*~All you need is your beautiful heart
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gaggedLouise

#40
With the recessive conditions described in that WP comment on Reich, you could argue that supply and demand are in balance. People aren't buying because they have no jobs and next to no money to spend, or if they have jobs they don't feel confident about the near future; and many corporations are not investing or hiring people anymore because the demand is very low. Okay. It's an equilibrium, but a too low equilibrium, and doesn't really reflect the skills and aspirations of either side, or their possible purchase power if there would be more renewing growth and more jobs and goods created.

Having a reserve army of tens of millions of people who are outside the ordinary labour market and ready to jump in on any job, even with wages as low as in China, isn't going to drive real growth. It would drive some share stocks up, but not lift the main street market.

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Oniya

The thing is, if you take that in conjunction with the state of America's infrastructure as described by the American Society of Civil Engineers, there is a lot of work that's needed.   That can provide consistent work for that workforce for long enough to get the retailers and manufacturers hiring, which hopefully opens up more jobs for people to move into, even after the construction reaches an acceptable level.  (I mean, let's face it, construction work never really ends.)
"Language was invented for one reason, boys - to woo women.~*~*~Don't think it's all been done before
And in that endeavor, laziness will not do." ~*~*~*~*~*~*~*~*~*~*~Don't think we're never gonna win this war
Robin Williams-Dead Poets Society ~*~*~*~*~*~*~*~*~*~*~*~*~*~Don't think your world's gonna fall apart
I do have a cause, though.  It's obscenity.  I'm for it.  - Tom Lehrer~*~All you need is your beautiful heart
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Roxy Rocket

#42
(removed for now)

Asuras

The stimulus was too small. Some people - like Paul Krugman - thought it was too small in 2009. I thought it was okay and I was wrong. One can argue that it was ill-managed, but the bigger issue is just that it was too small. In 2009, we were looking at Great Depression II and throwing $700 billion (4% of the economy) wasn't enough.

And that doesn't take into account "downside risks to growth" (Bernanke), "headwinds" (Obama), or "shit that we didn't see coming that will fucking murder us" (me) like the European debt crisis combined with slowdowns in China and Japan.

People point to high levels of unemployment and say that the stimulus didn't work. The fact that unemployment stopped rising when the stimulus went into effect - like I said, we were looking at Great Depression II -  indicates that it did at least staunch the bleeding.

AndyZ

Quote from: Asuras on September 23, 2011, 11:06:33 PM
People point to high levels of unemployment and say that the stimulus didn't work. The fact that unemployment stopped rising when the stimulus went into effect - like I said, we were looking at Great Depression II -  indicates that it did at least staunch the bleeding.

Part of the issue I have there is that they said that if it was put into effect, the unemployment rate would never go above 8%, but it went up past 9%.  So I'm not sure how it stopped rising.  Wasn't it at like 7% when they implemented it?
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Asuras

Quote from: AndyZ on September 23, 2011, 11:31:56 PM
Part of the issue I have there is that they said that if it was put into effect, the unemployment rate would never go above 8%, but it went up past 9%.  So I'm not sure how it stopped rising.  Wasn't it at like 7% when they implemented it?

When Obama took office (you may have to backdate that chart to 5Y) he was already presiding over a country around 8% unemployment.

Again, I'm not celebrating how awesome the stimulus was, but given the gigantic hole we were facing we could have done far, far worse. And we should keep digging ourselves out of it now.

krakenknight

You do realise that every American citizen owes $80000 personally to China. The fact is that american spending behaviour is not fiscally responsible or in fact feasable. As someone who lives in a country with 42% unemployment I think American's have forgotten that they need to build inroads to the rest of the world to stay competitive.

The America of the 50s was built on Military spending and until the end of the Reagan years that economic model worked, however America didn't shift how its economy worked after that to adjust to the new climate. Germany went heavily into industry, China and India Manufacturing and Japan technological innovation.
The US culturally stagnated, preferring to outsource its industry and continue with unrealistic borrowing practices. The problem is that in the current climate America can't compete with Chinese and Indian Manufacturing so they go out of business, and a lack of new industry creation after the dot com collapse has made Venture Capitalists wary to taking risks.
Someone needs to break the US reliance on credit or the world economy will never properly recover.

Jude

#47
Quote from: krakenknight on September 28, 2011, 02:59:12 AM
You do realise that every American citizen owes $80000 personally to China.
That number can't possibly be correct.  With a population of roughly 300 million, it would mean we owe China roughly 24 trillion dollars, which is higher than the United State's total debt (not just the portion owed to China) by about 10 trillion dollars.

EDIT:  If this is to be believed, China owns about 900 billion worth of our debt:  http://www.guardian.co.uk/news/datablog/2011/jan/18/us-federal-deficit-china-america-debt

That puts them at about $3000 dollars per person.  Muuuch less worrying.

EDIT:  http://www.guardian.co.uk/news/datablog/2011/jul/15/us-debt-how-big-who-owns - and by the latest numbers, we're still not quite up to 4k per person.

krakenknight

Quote from: Jude on September 28, 2011, 09:17:59 AM
That number can't possibly be correct.  With a population of roughly 300 million, it would mean we owe China roughly 24 trillion dollars, which is higher than the United State's total debt (not just the portion owed to China) by about 10 trillion dollars.

EDIT:  If this is to be believed, China owns about 900 billion worth of our debt:  http://www.guardian.co.uk/news/datablog/2011/jan/18/us-federal-deficit-china-america-debt

That puts them at about $3000 dollars per person.  Muuuch less worrying.

EDIT:  http://www.guardian.co.uk/news/datablog/2011/jul/15/us-debt-how-big-who-owns - and by the latest numbers, we're still not quite up to 4k per person.

My apologies I made a math mistake I meant in total to all creditors and it was only $40000. The 80000 was the figure an accountant friend and I kicked around after we discounted those people unable to pay due either to age or monetary circumstances.

Sorry honest mistake, not trying to overinflate on purpose.

Oniya

I'd stick with 'kicking around' the $40,000, if you want to make the point without hyperbolizing.  By 'discounting' the people that would be unable to pay (or any group of people), you automatically negate the phrase 'every American citizen'.
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krakenknight

Quote from: Oniya on September 28, 2011, 10:24:02 AM
I'd stick with 'kicking around' the $40,000, if you want to make the point without hyperbolizing.  By 'discounting' the people that would be unable to pay (or any group of people), you automatically negate the phrase 'every American citizen'.

I know I'm sorry about making that error. Its still completely unacceptable.