Obama will ruin the economy (Stimulus at $900 billion) (transporting, job market)

[elflord1973]

Originally Posted by theoakman

Please name "most economists" because I can name about 10 great economists off the top of my head that historically have shown that deficit spending makes things worse.

I'm not looking for a general claim that "deficit spending is bad", I'm looking for a specific claim that it prolonged and exacerbated the effects of the great depression.

Who claims that ? my understanding is that most economists (including for example Friedman) primarily attribute the depression to a monetary contraction.

I'd be surprised if you could name 10 economists who claim that sudden spending cuts are the best response to an economic downturn, even if they are in principal against big government.

You don't see how it solves the problem. Deflation means lower prices. Get rid of the spending, you can get rid of the income tax, and you can effectively raise wages for the employee.

As long as the tax cuts match the spending cuts, yes.

On top of that, you effectively lower wages for the employer to pay because the employee can afford to take on a lower wage if he's not paying income tax.

You can effectively lower wages via inflation. Nominal wages are sticky, real wages aren't.

The government doesn't know how to spend money smart.

I agree, but it's better than not spending money at all.

I'm not a fan of the various giveaways to various pre-determined "winners" (e.g. the Green giveaways are silly, I'd rather just see a corporate tax cut), but infrastructure spending isn't a bad thing.

[elflord1973]

Originally Posted by theoakman

All the boneheaded policies were funded by deficit spending.

What about tariffs ?

[Jerseyt719]

Originally Posted by tallguylehigh

I disagree. "Quit going overseas" I interpret to mean that global trade will slow down or halt, which is never a good thing. It was the final nail in coffin solidifying the Great Depression with the Smoot-Hawley tariff pact and would be even more disastrous now given our very delicate economic and financial relationship with China (they buy debt, we buy goods, rinse and repeat).

What we need to get out of this mess is to INNOVATE. We are never going to beat China, India, Vietnam on prices for goods already moved overseas (textiles, etc). We would simply be chasing our tail.

The US needs to use its more sophisticated work force to become the hotbed of technologies for the future. Things like alternative energy, nanotechnology, pharma, biotech, etc are the kinds of things that are huge untapped resevoirs that we need to corner in order to employ individuals.

Making widgets for $0.05 cheaper than something from overseas isn't going to do anything long term.

We DO need to manufacture our own products again. I didn't say stop trade altogether, but stop getting EVERYTHING from other countries. You basically said the same thing I did.

Our laws on trade here can be a bit ridiculous. For example, NJ is one of a handful of states NOT allowed to burn US coal for energy. There is a contract with Indonesia for $100M for this year's supply of coal. Indonesian authorities said, "you know what, make that $200M, not $100M". The gov't is holding us to buying that coal and who do you think is paying the extra? They can reneg on their part of the contract and there's nothing to be done about it.

There are businesses laying off here to hire "there". Met Life is an example - they are considering laying off Americans to hire more in India. That's a shame. Putting Americans out of work so the big wigs can keep their big bonuses. That's just wrong.

[elflord1973]

Originally Posted by Jerseyt719

We DO need to manufacture our own products again. I didn't say stop trade altogether, but stop getting EVERYTHING from other countries. You basically said the same thing I did.

No. You are for protectionist trade policy, which was one of the factors that exacerbated the great depression. He is against it. He is saying something completely different to you.

If you do indeed believe that it is necessary to "stop getting EVERYTHING from other countries", how do you propose that this be done?

Our laws on trade here can be a bit ridiculous. For example, NJ is one of a handful of states NOT allowed to burn US coal for energy. There is a contract with Indonesia for $100M for this year's supply of coal. Indonesian authorities said, "you know what, make that $200M, not $100M". The gov't is holding us to buying that coal and who do you think is paying the extra? They can reneg on their part of the contract and there's nothing to be done about it.

Were there any American coal producers who submitted a lower bid ? If the supplier renegs or changes prices, couldn't NJ seek another round of bids ?

What precisely is the law, and what is wrong with it ? What law do you propose in its place ?

There are businesses laying off here to hire "there". Met Life is an example - they are considering laying off Americans to hire more in India. That's a shame. Putting Americans out of work so the big wigs can keep their big bonuses. That's just wrong.

What do you propose be done about this ? Would it be better for them to keep all their American workers and go bankrupt, or keep some of them and stay profitable ? How many of those American workers would choose to migrate to India and take the jobs that have been outsourced at those wages ?

One fallacy that you embrace again and again is the notion that employment is driven by anything other than economic growth. The problem with having everyone hire American workers and buy American products, is that they need to stay profitable to hire anyone or buy anything.

[Jerseyt719]

Originally Posted by elflord1973

No. You are for protectionist trade policy, which was one of the factors that exacerbated the great depression. He is against it. He is saying something completely different to you.

If you do indeed believe that it is necessary to "stop getting EVERYTHING from other countries", how do you propose that this be done?


Were there any American coal producers who submitted a lower bid ? If the supplier renegs or changes prices, couldn't NJ seek another round of bids ?

What precisely is the law, and what is wrong with it ? What law do you propose in its place ?



What do you propose be done about this ? Would it be better for them to keep all their American workers and go bankrupt, or keep some of them and stay profitable ? How many of those American workers would choose to migrate to India and take the jobs that have been outsourced at those wages ?

One fallacy that you embrace again and again is the notion that employment is driven by anything other than economic growth. The problem with having everyone hire American workers and buy American products, is that they need to stay profitable to hire anyone or buy anything.

I propose to reopen factories where we once manufactured goods that we use in this country. Nothing wrong with that. We can keep profitable by stamping out the greed of the CEOs in this country. Is any business person worth $2M bonuses?? Seriously?? The big companies and factories are making absolute fortunes on the goods manufactured overseas and putting it right in their pockets. You've see the reports on the sweatshop factories out in the world. And the big wigs are putting every extra cent right into their pocket. Rather than create jobs over here, let's eliminate them and put them overseas so a handful can become more rich? That's just not right.

Would you move to India? I know I wouldn't. I happen to love this country and would love to see our own people be given opportunity to work again. After all, when we work, we make money, we pay taxes and we SPEND money. I will stand by my belief that we need to be a little more patriotic as other profitable nations are. Sorry, but we don't need to have EVERYTHING made overseas just to save more money for the executive pocket.

No, if you read my post, we CAN'T burn American coal (NJ, and a handful of other states), that's set by the BPU (more corruption in gov't.). We're bound by this contract and they (Indonesian supplier) changed the terms. The BPU isn't letting the energy company shop for another source - they're making them use that coal from that contract. No new bids, no looking around. A bit ridiculous, huh?

[wileynj]

Originally Posted by Jerseyt719

I propose to reopen factories where we once manufactured goods that we use in this country. Nothing wrong with that. We can keep profitable by stamping out the greed of the CEOs in this country. Is any business person worth $2M bonuses?? Seriously?? The big companies and factories are making absolute fortunes on the goods manufactured overseas and putting it right in their pockets. You've see the reports on the sweatshop factories out in the world. And the big wigs are putting every extra cent right into their pocket. Rather than create jobs over here, let's eliminate them and put them overseas so a handful can become more rich? That's just not right.

Would you move to India? I know I wouldn't. I happen to love this country and would love to see our own people be given opportunity to work again. After all, when we work, we make money, we pay taxes and we SPEND money. I will stand by my belief that we need to be a little more patriotic as other profitable nations are. Sorry, but we don't need to have EVERYTHING made overseas just to save more money for the executive pocket.

No, if you read my post, we CAN'T burn American coal (NJ, and a handful of other states), that's set by the BPU (more corruption in gov't.). We're bound by this contract and they (Indonesian supplier) changed the terms. The BPU isn't letting the energy company shop for another source - they're making them use that coal from that contract. No new bids, no looking around. A bit ridiculous, huh?

That would be "un-American". Ethically, I think CEOs, etc. should volunteer to forego huge bonuses and increased salaries while the economy is in the shape it is in now...some have and I applaud them but others only care about themselves...
If we try to "cap" salaries... some will deem us to be a communist country!

[elflord1973]

Originally Posted by Jerseyt719

I propose to reopen factories where we once manufactured goods that we use in this country. Nothing wrong with that.

How do we achieve that end ?

We can keep profitable by stamping out the greed of the CEOs in this country. Is any business person worth $2M bonuses?? Seriously??

How do we "stamp out greed" ? If the market says that this is what they are worth, why not ?

The big companies and factories are making absolute fortunes on the goods manufactured overseas and putting it right in their pockets.

Whose pockets ? If you have a 401k, your pockets.

You've see the reports on the sweatshop factories out in the world. And the big wigs are putting every extra cent right into their pocket. Rather than create jobs over here, let's eliminate them and put them overseas so a handful can become more rich? That's just not right.

This is not an either-or proposition. AGAIN, economic growth drives employment. Companies that are making losses do not hire people. People get laid off in downturns, not during periods of economic expansion.

No-one is FORCED to pay large bonuses, or FORCED to send jobs overseas.
If it is more efficient to pay lower bonuses and keep jobs in America, go ahead, try it. Put the outsourcers out of business. This doesn't require government intervention.

The problem is that it is actually more efficient to outsource, and this results in lower prices for consumer goods, which raises YOUR living standards.

Would you move to India? I know I wouldn't. I happen to love this country and would love to see our own people be given opportunity to work again.

But people want to move from India to here (even though they might love their country too).

If there are all these jobs in India, if being the country that exports cheap labour is such a good thing, then why aren't you and every other American lining up to get into India ?

The living standards that you enjoy depend on cheap imports.

Jobs could be kept here in the free market by taking the currency down -- effectively underbidding the overseas sweatshops. The problem is, you wouldn't enjoy the standard of living available to you today if this is how it was done.

After all, when we work, we make money, we pay taxes and we SPEND money. I will stand by my belief that we need to be a little more patriotic as other profitable nations are. Sorry, but we don't need to have EVERYTHING made overseas just to save more money for the executive pocket.

It's not just "to save more money for the executive pocket". That's a fallacy. It boils down to the fact that it's a more efficient way to produce things, and everyone benefits -- whether it's companies that add value further up the chain (which is where the good jobs are btw) that import goods made overseas, and ultimately hire American workers, or whether it is via lower prices that again, increase YOUR standard of living.

No, if you read my post, we CAN'T burn American coal (NJ, and a handful of other states), that's set by the BPU (more corruption in gov't.). We're bound by this contract and they (Indonesian supplier) changed the terms.

If the terms are changed, it's not the same contract and we're not bound for it. Look, can you provide me with an independent source ? Because quite frankly, your account makes absolutely no sense.

[theoakman]

Who claims that ? my understanding is that most economists (including for example Friedman) primarily attribute the depression to a monetary contraction.

There's a difference between Monetary Policy and Fiscal Policy. Friedman was for saving the banking system. Friedman's coauthor, Anna Schwartz already said that they screwed up this rescue because they bailed out bad banks. There is a difference between saving bad banks and saving a system.

I'd be surprised if you could name 10 economists who claim that sudden spending cuts are the best response to an economic downturn, even if they are in principal against big government.

Milton Friemdan, Ludvig von Mises, Friederich von Hayek, Murray N. Rothbard, Henry Hazlitt, Anna Schwartz, James Buchanan, Lew Rockwell, Peter Schiff, Ron Paul.

You can effectively lower wages via inflation. Nominal wages are sticky, real wages aren't.

That makes American's poorer.

I agree, but it's better than not spending money at all.

No it isn't. When you have debt, you have to pay it back. You can't pay off debt by taking on twice as much. Spending money is only an option when you have it. George Bush ran the biggest deficits in American history and it only made the hole deeper. Obama is going to one up him.

I'm not a fan of the various giveaways to various pre-determined "winners" (e.g. the Green giveaways are silly, I'd rather just see a corporate tax cut), but infrastructure spending isn't a bad thing.

Infrastructure spending isn't a bad thing, when you have the money. We don't. Furthermore, our economy isn't hurting because of our roads. You are putting the chicken before the egg. Let the economy fix itself, then worry about the roads.

[Amazonas]

Originally Posted by elflord1973

How do we achieve that end ?



How do we "stamp out greed" ? If the market says that this is what they are worth, why not ?



Whose pockets ? If you have a 401k, your pockets.



This is not an either-or proposition. AGAIN, economic growth drives employment. Companies that are making losses do not hire people. People get laid off in downturns, not during periods of economic expansion.

No-one is FORCED to pay large bonuses, or FORCED to send jobs overseas.
If it is more efficient to pay lower bonuses and keep jobs in America, go ahead, try it. Put the outsourcers out of business. This doesn't require government intervention.

The problem is that it is actually more efficient to outsource, and this results in lower prices for consumer goods, which raises YOUR living standards.



But people want to move from India to here (even though they might love their country too).

If there are all these jobs in India, if being the country that exports cheap labour is such a good thing, then why aren't you and every other American lining up to get into India ?

The living standards that you enjoy depend on cheap imports.

Jobs could be kept here in the free market by taking the currency down -- effectively underbidding the overseas sweatshops. The problem is, you wouldn't enjoy the standard of living available to you today if this is how it was done.



It's not just "to save more money for the executive pocket". That's a fallacy. It boils down to the fact that it's a more efficient way to produce things, and everyone benefits -- whether it's companies that add value further up the chain (which is where the good jobs are btw) that import goods made overseas, and ultimately hire American workers, or whether it is via lower prices that again, increase YOUR standard of living.



If the terms are changed, it's not the same contract and we're not bound for it. Look, can you provide me with an independent source ? Because quite frankly, your account makes absolutely no sense.

The way you perceive market economy is soooo compartmentilized that is somewhat disturbing. What Jersey179 and the oakman have said makes, to certain extent, some sense. First off all, it is possible to recapture the manufacturing sector just the same way it was done in the 40's and 50's. Make no mistake, it won't be an easy transition, just the same way it wasn't when the entire globalization philosophy took place a few decades ago. There's a book called China: Fragile Superpower, that gives a more in-deph description of how, when, where, who, and the reasons behind behind the dismantling of the manufacturing sector in the United States.

Second of all, 401K's got diluted into almost nothing in a matter of days, so who's got the loot? Also, India immigration has not only slowed down through the course of the last 10 years, but Indians living in Western nations are moving back to their homeland. Of course, this includes nations from formerly known as thirld world countries. In addition, you need to keep in mind that these transitions are graduals and slow. You can not deny that the living standard of the average American has decreased tremendously since the 50's......then again anything we say makes no sense to you. Now, if every corporate and political figure has the same economy market mindframe as you, it is no wonder why we're so f***** up. And I don't mean to come up so rude, but somethings are just plain common sense and not so much technicallity. Then again, we make no sense

[elflord1973]

Originally Posted by theoakman

Milton Friemdan, Ludvig von Mises, Friederich von Hayek, Murray N. Rothbard, Henry Hazlitt, Anna Schwartz, James Buchanan, Lew Rockwell, Peter Schiff, Ron Paul.

That makes American's poorer.

Please show me a Friedman quote where he calls for massive spending cuts as a way to solve deflation (btw, I do have his "Capitalism and Freedom" book. I do see him calling for an end to discretionary control over interest rates, but I'm not familiar with him calling for spending cuts as a solution to deflation.)

Besides Friedman, all the names I'm familiar with on that list are Austrian school (and Ron Paul isn't an economist) -- hardly a broad sampling of the mainstream of economics .