Links 2/15/11


  1. attempter


    The unwillingness of Congress to provide more help can be traced in large part to the shape of the budget when the crisis hit. With the tax cuts and the increase in government expenditures for wars and other things during the Bush administration, the budget was in poor shape even before the crisis hit. When the crisis did hit, the poor shape of the budget led to an initial stimulus package that was much too small, and there was very little follow up when it became clear that the initial stimulus was insufficient. Now, although the the economic limits have not been reached — helping the unemployed would have little impact on the long-run budget problem — it appears that the political limits have been reached and more help for the unemployed is all but out of the question. Thus, while the Bush tax cuts did very little to spur economic growth, they were costly, and those costs go beyond the hole in the budget caused by the cuts. The resulting budget problems also limited our ability to respond to the recession, and all of the additional struggles that households will endure because we were unable to give them the help they need are part of the Bush tax cut legacy.

    How much partisan hackery can you pack into one sentence? Yes, all Bush policy was awful. So did the Dems change it the way they were mandated to do?

    “The unwillingness of Congress to provide more help” can really be traced to nothing other than the fact that it didnt want to help. On the contrary, its every action proves it wanted to do more harm.

    The budget was in poor shape because of Bush’s wars and other things? Then why didn’t the Dems end the wars and get rid of these other things? Why didn’t they end Bush’s tax cuts for the rich?

    “When the crisis did hit, the poor shape of the budget led to an initial stimulus package that was much too small.”

    Two lies. The crisis didn’t passively “hit”, like a random asteroid. It was the premeditated result of over a decade of systematic, bipartisan organize crime. And the phony “stimulus” was really just another corporate bailout (the pervert TSA scanners were paid for with stimulus money; that was a typical expenditure). Maybe the parasites of pork can lament that it was too small, but no one else, since even at Krugman’s $2 trillion dream figure it still wouldn’t have done anything to help Americans.

    “Now, although the the economic limits have not been reached — helping the unemployed would have little impact on the long-run budget problem — it appears that the political limits have been reached and more help for the unemployed is all but out of the question.”

    The political limits were reached in fall 2008 when the system, as a bipartisan crime, chose to use the crisis as a pretext to further empower Wall Street and its crimes instead of deploying government’s power to support Main Street and smash Wall Street. This is the #1 Bush/Obama policy. It’s also the policy of literally every other Rep and Dem establishment cadre.

    This proves that mass permanent unemployment is an intended part of the assault. So why would anyone think there was ever any other political option available at all, from the system point of view?

    “the Bush tax cuts did very little to spur economic growth, they were costly……all of the additional struggles that households will endure because we were unable to give them the help they need are part of the Bush tax cut legacy.”

    Again, the Dems could have repealed the Bush tax cuts at will. As Thoma knows perfectly well, the Dems were perfectly able to do anything they wanted as far as these policies go. It’s obvious on its face that they did exactly what they wanted to do.

    So here too, it’s no longer the Bush tax cut legacy, but the Bush/Obama tax cut legacy.

    This is an excellent example of how the system role of the Democrats is to normalize Republican “abuses” as the new normal use. Thoma’s one of the criminals of the propaganda of this role.

    1. DownSouth

      In the Weidner-Williams letter, what screamed at the top of its lungs to be rebutted was this in the first sentence:

      Recent labor markets developments, including mismatches in the skills of workers and jobs, extended unemployment benefits, and very high rates of long-term joblessness, may be impeding the return to “normal” unemployment rates of around 5%.

      The authors felt this was such an important point that they repeated it in the second paragraph:

      But, in the wake of the most recent recession, many economists are concerned that developments such as mismatches in the skills of workers and jobs, extended unemployment benefits, and a rise in long-term joblessness may have raised the “normal” or “natural” rate of unemployment above the 5% level that was thought to be typical before the downturn.

      This is pure 24 kt, unadulterated neoclassical dogma, as explained in this study by two researchers from the University of Guadalajara:

      1.2.3 Escuela económica neoclásica

      Analiza la informalidad con base a la Ley de Say, la cual indica que, en condiciones de equilibrio (macroeconómico), toda oferta crea su propia demanda. Rechaza la idea de escasez de vacantes o de barreras en el mercado formal para absorber a todos los individuos. La informalidad se debe más bien a que las vacantes disponibles en el sector formal no cubren las expectativas de los trabajadores.

      De acuerdo a esta perspectiva y basada a partir de la oferta, el empleo informal se debe a tres razones fundamentales:

      – factores de tipo friccional que llevan a los individuos a estar desempleados o subempleados por cortos periodos de tiempo mientras encuentran una opción en el mercado de trabajo formal;

      – la existencia de un desempleo voluntario en el que el sujeto no encuentra un empleo que satisfaga su curva de utilidad, medida ésta a partir del salario y las características propias de los puestos de trabajo disponibles, y

      – las externalidades o fallas del mercado (rigideces, trabas burocráticas…) que interfieren cuando la oferta y la demanda no puedan regularse automáticamente en el corto plazo, pero sí en el largo plazo. El ajuste entre oferta y demanda se determina en una demanda laboral rígida, en la cual los empleados informales no encuentran muchas opciones debido a las fallas del Estado.

      Los neoclásicos coinciden en que es necesario aminorar las rigideces y costos en la permanencia de la mano de obra y a la vez garantizar algunos derechos a los trabajadores, como la seguridad social. Aunque difieren en el grado y campos en que se debe hacer, así como en los mecanismos a implementar en las políticas públicas que deberían acompañar tal proceso.

      I suppose neoclassical economic dogma has become so regnant in the thinking of the Democratic Party that it no longer even elicits an objection from Democratic henchmen like Thoma.

      1. Fran


        I am so tired of the idea that our workers lack the appropriate skills and need more education – or here there is a little different twist – their skills are ‘mismatched’. Everyone needs retraining?! Well, I’ll say skills are mismatched when people with viable PRODUCTIVE skills and experience are available but the jobs available are (UNSKILLED) menial tasks, aggressively selling things that people don’t need about which the sales people know nothing, gambling (they like to call it investment), firing people and cutting benefits (salary) to ‘save’ money, running for office, etc…… We are doing away with all of the useful jobs. Most of my friends are highly educated with years of experience which is up to date. THEY are a lot of the ones being laid off! to become permanently unemployed.

    2. rjs

      notice you get one paper from the Fed that the new normal unemployment rate is 6.7% and all the lackey economists fall right right into line…that’s great for them, that’s another 1.7% of the people they can let fall thru the cracks without a pang of conscience..

  2. Francois T

    Re: “Who is Influencing Obama’s Budget Proposal?”

    Ok! Does that mean that, in a post-Citizens United world, we will have to wait for future presidents to be in their 2nd mandate, theoretically free of the influence of big money, to start thinking about the common good? Or are we just doomed by a tsunami of corporate money and this self-defeating attitude of the average Americans who won'[t bother to vote because “it won’t change anything anyway”?

    In a word…Did we already lost this Republic?

    1. mk

      Did we already lose this Republic? – I realized we did when Obama and daughter swam in the “gulf of mexico” right after they announced the oil volcano. BP is in the lead position for clean up, gov’t. entities like EPA and Coast Guard take their orders from BP. Apparently, as does Obama. That’s why BP is still spraying dispersants when EPA told them to stop. And why banksters are still getting bonuses and why the gov’t. has decided to accept GM alfalfa, etc.

      1. Stelios Theoharidis

        Re: Dispersants, the ‘father of green chemistry’ Paul Anastas who is now the assistant administrator for the EPA’s Office of Research and Development (ORD) and the science adviser to the agency was on Radio Times the other day. I was listening to the portion about green chemistry and then half way through the discussion it moved towards dispersants. He seemed to note that the use of dispersants was a success and that the microorganisms that naturally consume oil were doing their ‘jobs’.

        First question I had was what the dispersants had to do with the notion of ‘green chemistry’ since they were apparently identified to be quite toxic. I personnally don’t know and I don’t suspect that we will know for some time whether it was successful. It is likely at least in my mind that the gulf waters will have high levels of toxicity from the spill, even if the organisms eat the oil the more persistent toxins will remain. But, I am rather sure of two things 1) it is not the responsibility of the the EPA to do public relations for BP and 2) it is quite difficult to trust what is coming out of the administration in regard to the spill based our experience of previous obfuscations concerning it, crude volume estimates being the most glaring example.

  3. Ina Deaver

    It is my reasoned belief that 15, 20 minutes at most, with such a puppy would fix my whole day. Certainly it would lower my blood pressure.

    Thanks for the antidote. I needed that. If I could just smell the puppy breath, the effect would be complete.

    1. MyLessThanPrimeBeef

      The photo is quite profound.

      Here we have the famous dog, Adams, as naked as he can be (although we don’t get the full frontal view), and he’s reaching out to his Creator.

      The photo is called ‘The Creation of the naked dog Adam.’

      I believe it was taken by some guy named Michael something.

  4. Max424

    I’ve come to the conclusion that Robert Reich is a liberal.

    That means, we have one on the outside, Reich, one on the inside, Elizabeth Warren, one seated in the 100 seat Senate, that filibustering fool, Bernie Sanders, and perhaps a dozen or so seated in the 451 seat House.

    Liberals! We can get er done!

  5. MyLessThanPrimeBeef

    ‘Der Gang nach Canossa’ – just as Holy Roman emperors waited in the snow for the Pope (ok, only one did), so too today, presidents must wait in the snow for the Chamber of Commerce, Wall Street bankers and big oil companies.

    It’s the only natural consequence of allowing businesses to erect office buildings taller than churches.

    I think the solution is to make all vertical buildings horizontal – all buildings are to be one standard story high.

    1. Birch

      “all buildings are to be one standard story high”

      kinda like shopping malls – the new churches. Great if you enjoy urban sprawl.

  6. Michael H

    Off topic, another Al Qaeda terrorist turns out to be a US informant?

    From the Guardian:

    “An American jihadist who set up the terrorist training camp where the leader of the 2005 London suicide bombers learned how to manufacture explosives, has been quietly released after serving only four and a half years of a possible 70-year sentence, a Guardian investigation has learned.”

    Exclusive: Release prompts claim Islamist was US informant while assisting London terrorist

  7. Hugh

    I don’t even know how long ago I wrote about the government “defning” away the country’s horrific unemployment numbers.

    In January, the BLS number for the unemployed was 13.863 million. This reflects the U-3 rate. But by calculation, the BLS undercounts the unemployed by 6.75 million. Its estimate of its undercount was 6.643 million. The U-6 measure of un- and under employment was 25.12 million. There is a 2.8 million overlap between the U-6 and the undercount. So if you wanted a total for what we call disemployment, we are looking at 29.1 million. The U-3, the unemployment measure reported in the press as “the” unemployment rate is less than half this.

    And the BLS has arbitrarily reduced unemployment in the last two months by some 1.2 million. So that it now is reporting an unemployment rate of 9%.

    Now if we raise the level of “natural” unemployment to 6.7%, as per the Fed, we are talking about the difference between 9% and 6.7%, that is 2.3% of the labor force or approximately 3.5 million people.

    In other words, by defining and refining, government has reduced the problem from 29.1 million down to 3.5 million, a more than 8-fold decrease. In terms of the overall economy, and the society too for that matter, 3.5 million unemployed is hardly worth worrying about and no doubt explains why the Administration has done virtually nothing to address the jobs issue. A minor upturn in the business cycle should take care of it.

    It’s thinking like this that not only built the Titanic but drove it into the iceberg.

  8. propertius

    “Gonorrhea acquires piece of human DNA”…and becomes next chairman of Goldman Sachs, no doubt.

    1. Anon

      I think it’s very romantic of Science Daily to run this piece on Valentine’s Day.

      But the bit about there being only one drug left to treat gonorrhea is scary.

  9. lambert strether

    Single payer bill re-introduced. A chance for Open Left vets Stoller and Bowers to put the hard feelings behind them and support health care policy that can actually be shown to work. (Moreover, single payer, or Medicare for All, is a centrist solution, unlike, say, a radical leftist solution like the UK’s National Health Service, which nationalizes medical care delivery. Even better, the right doesn’t think Medicare is a government program!)

  10. Trying again...

    I would like to present an article for discussion.

    This comes from Michael Lewis, the dissenter to the dissenters, even to the lone dissenter – the more alone dissenter of the FCIC. [Is this the Onion?]

    I really had hopes for this. Sadly, the triple dissent seems to boil down to ‘women make men go gaga’, and “We’re all cheaters so who gives a $h*t?” In other words, “Ya’llz been robbed, moving on, next.”

    Boo hoo. My expectations have no where left to go.

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