Woody wrote:Scott Adams with a funny (if not slightly accurate) take

http://dilbert.com/blog/entry/ignorance_will_save_us/

Our past economic booms depended heavily on morons. Those wonderful stimulators of the economy had to buy stock in perpetually unprofitable tech companies, or invest in real estate after it was clearly overpriced. Every economic boom is powered by the clueless. I see no reason why the next one should be different, except that the government is doing the bamboozling this time.

Woody wrote:Scott Adams with a funny (if not slightly accurate) take

http://dilbert.com/blog/entry/ignorance_will_save_us/

...[C]entrist Senators exist to take politics as usual - whether it's tax cuts in Republican eras, or spending splurges in Democratic ones - and make it ever so slightly more fiscally responsible. So if the GOP wants, say, $500 billion in tax cuts, the country clearly needs $400 billion in tax cuts - but not a penny more! And if the Democrats want $900 billion in stimulus, then the best possible policy outcome must be ... $800 billion in stimulus! To read this Arlen Specter op-ed, justifying both the stimulus package and the cuts the "gang of moderates" have attempted to impose, is to encounter a mind incapable of thinking about policy in any terms save these: Take what the party in power wants, subtract as much money as you can without infuriating them, vote yes, and declare victory.

Now fiscal responsibility is generally a good thing, and so a centrism mindlessly focused on tweaking legislation away from deficit spending has its uses. But what Nelson, Collins, Specter and Co. have done isn't a new kind of politics. It's the definition of politics as usual. And in this particular case, there's a reasonable argument that it's actively pernicious - that if you can't shrink the stimulus package much more substantially than the centrists have done, you shouldn't shrink it at all. There's a case to be made for a stimulus that's radically different than the one we have now; there's a case to be made for a stimulus that's like the one we have now, but a great deal smaller and more targeted; and there's a case to be made for a stimulus that's absolutely gargantuan. But thanks to the centrists, we're getting the cheapskate version of the gargantuan version: They've done absolutely nothing to widen the terms of debate about what should go into the bill, and they've shaved off just enough money to reduce its effectiveness if Paul Krugman is right - but not nearly enough to make it fiscally prudent if the stimulus skeptics are right.

Werthless wrote:

dajafi wrote:

Woody wrote:There is a small point to be made in there though that recessions tend to be self-fulfilling to a certain extent

That's true, and not necessarily a small point. But it's both more politically effective and more consistent with reality as it's generally perceived for the message to be "Yes, things are bad right now and the trajectory is pretty scary. But we're trying to take action here to stimulate demand--your government is on the case, and we're going to get through it together."

Pretending that things are swell is an excuse for doing nothing. Now, Werthless has made it pretty clear that his preference is essentially to do nothing. That's fine as a political position, but at least try to honestly explain why it's the best course of action.

I think the idea of the stimulus package is to provide a bridge holding up demand until credit starts flowing again--which the administration is hoping their new bailout plan, to be announced tomorrow, will accomplish. The problem is that Obama didn't explicitly present it that way; he tried to be too cute by half and include "a down payment on long-term growth." Personally I'm strongly in favor of those kinds of investments in sustainable energy, education reform, improving the performance of the health care system, etc. But it's a fair point to argue, as Werthless did last week, that those things should get separate consideration.

It takes someone to agree with me for you acknowledge the merit. Even when I post something you agree with, you find the need to be dismissive. Your close-minded is revealed.

Going back to econ 101, inflationary expectations DO influence inflation. In a similar mechanism, consumer confidence can be construed as a crude predictor of demand (say that 5 times fast). Beating down consumer confidence with overly negative rhetoric probably further hurts consumer confidence. I can see why it may be politically advantageous to do this.

Let's say the stimulus has a 50% chance of preventing a depression if it was passed. Let's define depression has a universal definition (say 12% unemployment and 10% fall in GDP from peak to trough), to separate those that use that word loosely. I'm saying that repeated predictions by Obama, someone who the American people trust, likely increases the chance of depression. Maybe it moves to 51%. Maybe it moves to 60%. But I'm saying it moves it. But... it also increases their chance at re-election. Do people tend to agree with the 2 points?

My post has nothing to do with my support or opposition to the stimulus or bailout.

Werthless wrote:

dajafi wrote:

Woody wrote:There is a small point to be made in there though that recessions tend to be self-fulfilling to a certain extent

That's true, and not necessarily a small point. But it's both more politically effective and more consistent with reality as it's generally perceived for the message to be "Yes, things are bad right now and the trajectory is pretty scary. But we're trying to take action here to stimulate demand--your government is on the case, and we're going to get through it together."

Pretending that things are swell is an excuse for doing nothing. Now, Werthless has made it pretty clear that his preference is essentially to do nothing. That's fine as a political position, but at least try to honestly explain why it's the best course of action.

I think the idea of the stimulus package is to provide a bridge holding up demand until credit starts flowing again--which the administration is hoping their new bailout plan, to be announced tomorrow, will accomplish. The problem is that Obama didn't explicitly present it that way; he tried to be too cute by half and include "a down payment on long-term growth." Personally I'm strongly in favor of those kinds of investments in sustainable energy, education reform, improving the performance of the health care system, etc. But it's a fair point to argue, as Werthless did last week, that those things should get separate consideration.

It takes someone to agree with me for you acknowledge the merit. Even when I post something you agree with, you find the need to be dismissive. Your close-minded is revealed.

Going back to econ 101, inflationary expectations DO influence inflation. In a similar mechanism, consumer confidence can be construed as a crude predictor of demand (say that 5 times fast). Beating down consumer confidence with overly negative rhetoric probably further hurts consumer confidence. I can see why it may be politically advantageous to do this.

Let's say the stimulus has a 50% chance of preventing a depression if it was passed. Let's define depression has a universal definition (say 12% unemployment and 10% fall in GDP from peak to trough), to separate those that use that word loosely. I'm saying that repeated predictions by Obama, someone who the American people trust, likely increases the chance of depression. Maybe it moves to 51%. Maybe it moves to 60%. But I'm saying it moves it. But... it also increases their chance at re-election. Do people tend to agree with the 2 points?

My post has nothing to do with my support or opposition to the stimulus or bailout.

dajafi wrote:I don't think either of them would be thrilled to realize this, but Paul Krugman and Ross Douthat are sort of saying the same thing today: mindless centrism hurt the stimulus on the merits. I won't bother quoting Krugman--you pretty know what he said without having to read it (though here's the link)--but here's Douthat:

...[C]entrist Senators exist to take politics as usual - whether it's tax cuts in Republican eras, or spending splurges in Democratic ones - and make it ever so slightly more fiscally responsible. So if the GOP wants, say, $500 billion in tax cuts, the country clearly needs $400 billion in tax cuts - but not a penny more! And if the Democrats want $900 billion in stimulus, then the best possible policy outcome must be ... $800 billion in stimulus! To read this Arlen Specter op-ed, justifying both the stimulus package and the cuts the "gang of moderates" have attempted to impose, is to encounter a mind incapable of thinking about policy in any terms save these: Take what the party in power wants, subtract as much money as you can without infuriating them, vote yes, and declare victory.

Now fiscal responsibility is generally a good thing, and so a centrism mindlessly focused on tweaking legislation away from deficit spending has its uses. But what Nelson, Collins, Specter and Co. have done isn't a new kind of politics. It's the definition of politics as usual. And in this particular case, there's a reasonable argument that it's actively pernicious - that if you can't shrink the stimulus package much more substantially than the centrists have done, you shouldn't shrink it at all. There's a case to be made for a stimulus that's radically different than the one we have now; there's a case to be made for a stimulus that's like the one we have now, but a great deal smaller and more targeted; and there's a case to be made for a stimulus that's absolutely gargantuan. But thanks to the centrists, we're getting the cheapskate version of the gargantuan version: They've done absolutely nothing to widen the terms of debate about what should go into the bill, and they've shaved off just enough money to reduce its effectiveness if Paul Krugman is right - but not nearly enough to make it fiscally prudent if the stimulus skeptics are right.

I agree with this, but I imagine that from the Obama/Democratic perspective, if the choice is either a bill flawed by the fruits of "mindless centrism" or no bill, they open Door #1. Letting the Republicans block the bill is a loser for them politically as well as, if you believe in the merits of the bill, on substance.

The other consideration is that this is how our system works: things get diluted. Douthat's point about tax cuts holds here: I remember in early 2001 the new Bush administration proposed $1.6 trillion in cuts, the Democrats in the Senate shaved $250 billion or so off of it, and from my perspective as a Democrat I thought, "okay, that's at least something." From a system perspective, there's value in feeling that the minority still has some influence.

dajafi wrote:

Werthless wrote:Let's say the stimulus has a 50% chance of preventing a depression if it was passed. Let's define depression has a universal definition (say 12% unemployment and 10% fall in GDP from peak to trough), to separate those that use that word loosely. I'm saying that repeated predictions by Obama, someone who the American people trust, likely increases the chance of depression. Maybe it moves to 51%. Maybe it moves to 60%. But I'm saying it moves it. But... it also increases their chance at re-election. Do people tend to agree with the 2 points?

My post has nothing to do with my support or opposition to the stimulus or bailout.

What's so irritating about you--beyond the avatar, I mean, and the dumb user name, and the general arrogance--is that you're blind to your own biases.

The underlying premise of your statement seems to be that the content of the stimulus proposal itself is more or less irrelevant to the prospects of avoiding an economic catastrophe and/or (my point) ameliorating the consequences of the current downturn--but that Obama's rhetoric is strongly influential upon what will happen. If you think the stimulus is irrelevant or harmful, that's one thing, though you're pretty far out on the fringe in that view.

The other argument--that the bummer-language rhetoric is, or at least is supposed to be, instrumental in getting the legislation passed, and that Obama is betting that the legislation will have far more impact on what happens with the economy than his words in a given news cycle--seems to be lost on you. As does the point that Obama's electoral chances are probably much more tied to the actual performance of the economy (the correlation between GDP growth and presidential election outcomes is very well documented) than to his ability to make an I-told-you-so claim or blame Bush or anyone else who came before.

The more I think about this, the more I don't believe the politics were handled very well. Obama probably should have come out of the gate characterizing the stimulus as part one of a two-part recovery scheme, part two being the revised bailout provisions. And maybe he should have broken out the long-term investments from the short-term measures in the stimulus package itself, though I get the rationale in doing that part the way they did. But this is the picture that's emerging now. If it works, or if the economy turns around anyway, he'll probably win re-election. If it doesn't, he and the Democrats probably go down over the next two cycles.

jeff2sf wrote:My god could I not possibly disagree with that guy more than that... Specter and the Maine ladies are heroes, not mindless centrists. You've got two positions, both hopelessly wed to their own method of how to solve the problem, neither willing to bend. And then you have the grownups who come in and say, well gee, neither is going to get 100% "their way". Of course the Dems should get MORE of what they went in the bill reflecting their party's strength, but where can we find some parts of the bill that are probably Dem overreaches and take those parts out. "Mindless centrists" more like "mindless bloggers".

allentown wrote:I can readily believe that an $800 billion stimulus plan with all Washington hands, media, and Wall Street behind it and saying it is likely to solve the problem might well be as effective as a $1.6 trillion stimulus in the present climate of doubt, partisan bickering, and frankly Wall Street not wanting the economy to turn around until they have extracted the maximum amount of government rent that they think possible (in other words, let's not sink the ship, but we really want to be left on a high mountain and not this deep hole we find ourselves in, and well, we do hold the economy hostage as we have amply proven.)

jeff2sf wrote:Again though, that's silly. You've got these two parties that are screaming up to the heavens about how each of their plans are perfect (they can't both be right). I mean this is basic Compromise 101. Yes, of course beauty is in the eye of the beholder. Most Dems are going to think their plan is perfect as is, and most GOP are going to find their plan perfect. I mean what on earth did you want these HEROES to do?

jeff2sf wrote:I mean, without it, the Dems would get 100% what they want or the GOP getting 100% what they want when they're in power, and if that ever becomes the case, I won't want to live in America any more.

FTN wrote:

allentown wrote:I can readily believe that an $800 billion stimulus plan with all Washington hands, media, and Wall Street behind it and saying it is likely to solve the problem might well be as effective as a $1.6 trillion stimulus in the present climate of doubt, partisan bickering, and frankly Wall Street not wanting the economy to turn around until they have extracted the maximum amount of government rent that they think possible (in other words, let's not sink the ship, but we really want to be left on a high mountain and not this deep hole we find ourselves in, and well, we do hold the economy hostage as we have amply proven.)

You can't be serious. Can you?

dajafi wrote:

jeff2sf wrote:My god could I not possibly disagree with that guy more than that... Specter and the Maine ladies are heroes, not mindless centrists. You've got two positions, both hopelessly wed to their own method of how to solve the problem, neither willing to bend. And then you have the grownups who come in and say, well gee, neither is going to get 100% "their way". Of course the Dems should get MORE of what they went in the bill reflecting their party's strength, but where can we find some parts of the bill that are probably Dem overreaches and take those parts out. "Mindless centrists" more like "mindless bloggers".

But that implies there was a rationale behind making the cuts they made--other than raw political calculation--which I think must have determined what stayed and what got tossed. I haven't seen anyone saying that they were surgically targeting "overreaches," even before you consider that's inevitably in the eye of the beholder.

What I think you're saying is that the centrists acted to force the appropriate political solution, in which the plan is 58 percent Democratic and 42 percent Republican (I'm simplifying since that's the approximate Senate breakdown). I see the logic, but what Douthat's arguing is that this detracts from the plan on its merits, pretty much whatever you think of it.

allentown wrote:

dajafi wrote:

jeff2sf wrote:My god could I not possibly disagree with that guy more than that... Specter and the Maine ladies are heroes, not mindless centrists. You've got two positions, both hopelessly wed to their own method of how to solve the problem, neither willing to bend. And then you have the grownups who come in and say, well gee, neither is going to get 100% "their way". Of course the Dems should get MORE of what they went in the bill reflecting their party's strength, but where can we find some parts of the bill that are probably Dem overreaches and take those parts out. "Mindless centrists" more like "mindless bloggers".

But that implies there was a rationale behind making the cuts they made--other than raw political calculation--which I think must have determined what stayed and what got tossed. I haven't seen anyone saying that they were surgically targeting "overreaches," even before you consider that's inevitably in the eye of the beholder.

What I think you're saying is that the centrists acted to force the appropriate political solution, in which the plan is 58 percent Democratic and 42 percent Republican (I'm simplifying since that's the approximate Senate breakdown). I see the logic, but what Douthat's arguing is that this detracts from the plan on its merits, pretty much whatever you think of it.

A lot of money to the states got cut. I suspect many assume the governors can successfully plead for the $ and get it in a later bill.

dajafi wrote:

jeff2sf wrote:I mean, without it, the Dems would get 100% what they want or the GOP getting 100% what they want when they're in power, and if that ever becomes the case, I won't want to live in America any more.

I hear that. The process of governing in our system, which was designed to make it very hard to take big steps, exacts a price in loss of focus/consistency/efficiency. But it's held up pretty well on balance.

This is kind of a change of subject, but I do worry that the sophistication of interest-group politics and the difficulty of taking big steps could really hurt us when it comes to formulating a response to something as big, and as unrewarding as far as short-term political outcomes, as climate change. So many people have so much invested in the status quo that it's going to be almost impossible to respond at the scale the problem demands.