Posted on 07/03/2009 8:24:17 AM PDT by RayChuang88
O.K., Thursday’s jobs report settles it. We’re going to need a bigger stimulus. But does the president know that?
Let’s do the math.
Since the recession began, the U.S. economy has lost 6 ½ million jobs — and as that grim employment report confirmed, it’s continuing to lose jobs at a rapid pace. Once you take into account the 100,000-plus new jobs that we need each month just to keep up with a growing population, we’re about 8 ½ million jobs in the hole.
And the deeper the hole gets, the harder it will be to dig ourselves out. The job figures weren’t the only bad news in Thursday’s report, which also showed wages stalling and possibly on the verge of outright decline. That’s a recipe for a descent into Japanese-style deflation, which is very difficult to reverse. Lost decade, anyone?
Wait — there’s more bad news: the fiscal crisis of the states. Unlike the federal government, states are required to run balanced budgets. And faced with a sharp drop in revenue, most states are preparing savage budget cuts, many of them at the expense of the most vulnerable. Aside from directly creating a great deal of misery, these cuts will depress the economy even further.
So what do we have to counter this scary prospect? We have the Obama stimulus plan, which aims to create 3 ½ million jobs by late next year. That’s much better than nothing, but it’s not remotely enough. And there doesn’t seem to be much else going on. Do you remember the administration’s plan to sharply reduce the rate of foreclosures, or its plan to get the banks lending again by taking toxic assets off their balance sheets? Neither do I.
(Excerpt) Read more at nytimes.com ...
Our income tax laws are driving American citizens and businesses to funnel their liquid assets using tax loopholes to offshore financial centers in places like the Bahamas, Bermuda, Cayman Islands, Panama, and so on and forcing American businesses to send their production and corporate headquarter operations overseas. We now have somewhere between US$12 and US$17 TRILLION in liquid assets "offshored" for tax reasons and American companies are sending their production to Mexico, Canada and the Far East also for tax reasons. Clean up our national and state taxation systems NOW to encourage personal savings and capital investment staying in the USA and our economy will turn around literally in a matter of months as the vast majority of those "offshored" liquid assets return to the USA to flow in our financial system and American companies bring production back to the USA under better tax conditions.
These idiots think that government spending has a net positive multiplier attached to it vis a vis economic growth. If that’s true, then why don’t we borrow and print $40 trillion? Then we’ll REALLY have some growth!
If the other stimulus lost all those jobs why do we need another.?
It wasnt the stimulus that lost the jobs, but the other stimulus didnt produce any jobs either.
We sure dont need another one.
What we need now is for all unspent funds, including those socked away for the new health agency that will hire more affirmative action workers to form a commission to decide who lives and who dies, to be returned.
“Let’s do the math.”
Math and Krugman make strange bedfellows.
For the first time ever Krugman is coherent
There can be no recovery with the threat of enormous tax hikes (expiration of Bush cuts, C&T, health care) and trillion dollar annual deficits from here to eternity. Deep-sixing these things once and for all, cutting federal spending and regulations, and cutting marginal rates would propel us to a robust future. Until then, it will be a “jobless recovery.”
semi coherent
So Krugman wants MORE spending? welp, there goes the coherency of his argument.
“O.K., Thursday’s jobs report settles it. We’re going to need a bigger stimulus.”
Nobel Prize winning idiot.
Since under FairTax there are no more taxes on earning money, all the incentive to send liquid assets and goods production out of the USA for tax reasons goes away. And that means a VASTLY stronger financial system and jobs staying in the USA, too.
Obama's people realize this, and they are approaching panic because of it.
There is only one stimulus program that wlll work. The IRS must refund the last 5 to 10 years of income taxes to people with the proviso that the money go to pay off debt. Whatever is left over may be spent or invested as people wish. Then, and only then, will stimulus have any effect.
You have to get rid of the debt first.
He's pretty much gotten everything his addled mind wanted from the current gang in Washinton. We are seeing the results. Instead of admitting that he is a once fairly competent economist, that has now gone completely insane, he is in denial of the obvious facts. His Keynsian prescriptions are fundamentally flawed and totally ineffective in an environment where businesses are scared witless by the transformation of their country into a banana republic (see Chrysler bond holders).
Since by definition income taxes favor debt financing over cash payments, no wonder why we get into serious economic recessions every 20 years or so. By switching to FairTax, the incentive for debt financing is DRASTICALLY cut, mostly because Americans can confidently sock away their hard-earned assets without a bite from the IRS and/or state tax agencies and pay for big-ticket items with cash or with much smaller loans.
How do you figure? He comes across as a gambling addict way in the hole, convinced his next big bet will fix everything.
Absolutely. Why don't people understand that debt is real and must eventually be paid? You can kick it down the road only so long until it catches up to you from the rear. And we're taking it in the rear right now.
It will only get worse until people take your advice. The stock market priofit making is disconnected from the underlying real debt right now and that fools some people. Like zer0, probably.
He was coherent in sizing up the situation.
Incoherent in the solution.
Exactly.
It’s like putting a 100 lb backpack on a marathon runner.
The Government really thinks they can implement a central planned economy WITHOUT martial law? They are clueless!
Social engineering has about a 100% failure rate. Human nature has about a 100% success rate. Time is the variable.
What color is the sky is Krug’s world?
The "debt" is actually much bigger, since they don't count the money they owe to Social Security, which they'll have to start paying back in a few years, maybe next year, or the year after, as fewer people are paying in per person drawing out as the population ages.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.