It’s refreshing to have a president who is showing some leadership and moving this country forward after eight years of the the failed Bush Presidency.

I am eagerly waiting to hear what Prof. Raghuram Rajan has to say. He seems to have an excellent common sense approach and insight into the ways of the financial markets.

Obama was brilliant last night and the leadership he showed is part of what is needed to get the country on the right track. The plan may be flawed but it’s not the entire recipe for recovery, leadership is as important. He has the potential and hopefully he’ll continue to use it.

think it was a great idea pres obama, had that town hall and press conference to explain what is going on and about the bill and his goals for the future, and actually answered questions. something almost unheard of in the bush years

Obama was brilliant, showed leadership and controlled the press very well. He did his homework.

The thing that gets me is how the republicans think they can use this moment to gain seats in 2010.
It’s incorrigible to think that at this time of national crisis that this is the mind set of so many members of both houses. The other thing is the gotcha mentality of the main stream press, who keep harping on Obama’s failed attempt to reach across the aisle. We are heading into an economic downturn that could potentially destroy our country and leave us in semi-permanent recession for years.

Playing politics at this juncture is not patriotic as some would say, it’s pretty mean spirited. One of the worse is John McCain, imagine if he was president right now.

Obama was incredible last night, an expression of the forging strength that got him to the white house and inspired this country at a time of desperate need. His uncompromising authority, diligence, and realism once again lifted us at this crucial time – where the potential of emerging doubt could debilitate our country. Regarding the party split, and his willingness to work with Republicans, he showed a far reaching perspective, very clear that this is not something that will go away over night. And yet, he’s not stopping, and his commitment is visceral. You know a leader is a true leader when you walk away feeling strengthened yourself, and more committed to our own all-too-often-ignored sense of responsibility.

tom,
the debate over the stiumulus bill has done much to highlight the intersection of economics and politics when it comes to drafting policy. i would like your guests to speak to some of the problems economists face in “selling” best practice strategies to politicians. how well did economists do in ensuring that their empirically driven strategies were incorporated into the stimulus bill unvarnished?

Obama is ridiculous. He talks about some false debate between those who want to do something and those who don’t want to do anything. Pathetic. The debate is a matter of scale and whether policy goals should trump job creation. The debate is between tax cuts which put money in people’s hands now versus a spending plan that spends only $25 billion before the end of the year and only $110 billion by the end of next year. The debate is between one-time spending plans and permanent tax cuts. What will those employed to lay new sod on the Washington mall do after that job is completed in 6 months? The guy is all look, no substance.

There was bipartisan disapproval of the plan in the House. If anyone is playing politics its POR (Pelosi, Obama and Reid) and we’re all going to be POoRer for it.

Question: is there a dollar figure floated for losses over 5 or 10 or more years if we don’t have an $800B stimulous package? Would it be more or less? Can those dollars lost over 10 “lost years” (ala Japan) be compared to the $800B “spent” (projects and tax cuts) and the number of years it would take to “recover” those $800B?

I find it eerily ironic that Obama is employing the same fear tactics that Bush used in his war on terror?! I tired of that then and I’m tiring of this quickly as well. So much for change!

I wish we (and Obama) could express the stimulus — aka, loan to ourselves — as a percentage of GDP, not those scary sounding “trillions.” Most economists are saying (see Galbraith, et al) that it’s the relationship of the expenditure to GDP that matters. So far, we’re nowhere near a danger level. That’s the matter of scale that matters!

Majawill – it really is people who want to do something vs. people who want to stack up a trillion dollar bills to show us….what, exactly? The federal interest rate is 0%, it cannot go lower. We have the lowest tax rates we’ve had since Hoover. It’s not working. How long would you have us try the same strategy? I, for one, am tired of banging our collective head up against a wall. No matter how much money we try to give back to Americans, they aren’t spending it. They’re afraid to spend, they’re afraid to borrow, and banks are afraid to lend. So giant spending programs are really the quickest way out of this spot we’re in. If you can’t see that, I really don’t understand what numbers you’re looking at. Oh, also, there wasn’t bipartisan disapproval of the House bill. There was actually bipartisan support, and a calculated strategy decision by the House Republicans to bloc vote against it, which I don’t begrudge them.

The choice we had is between Republicans spending billions and Democrats spending billions. People chose Democrats.

Social critic Jim Kunstler had a brilliant post Monday which touches on the stimulus package and more broadly addresses the folly of Washington’s approach to our predicament: http://jameshowardkunstler.typepad.com/

The republicans are using this and hoping it will fail so they can have leverage for 2010.

We are in a serious crisis here and these idiots are playing games. Shame on them and any democrat who is doing the same thing, such as the wall street democrat’s like Schumer.

A lot of conservatives dislike Paul Krugman, who predicted this down turn about two years ago and has been pretty much right for the last few years in general in regards to the economy. I don’t think the stimulus is large enough and this is what the republicans want, they want it to fail.

It is good to remember that Keynes type stimuli did not get it us out of the depression. It was the planned economy necessitated by the war of 1939-1945 that produced the economic recover. For the roots of this crisis you need to look to Marx and his destruction of capital by crisis scenario outlines in Capital Part 3.

President Barak is trying to save the World economy by ameliorating the effect on the US worker in return for political stability. He does not have the capacity to save the economic system from its self and so we are trying to export the crsisi to the rest of the world..

What is not lost in the rest of the developing world is how when faced by the same crisis in confidence in whose name they were subjected to the rigors of structural adjustment, Washington has chosen the exact opposite path of reflation. Our model has no credibility left.

Seib and many Republicans like to frame this back-and-forth about the stimulus package as one side turning out to be right and the other wrong. But they could both be wrong. The scariest part of this financial debacle is that no one appears to know exactly how to proceed. We are in a trial and error period. The only people trying to stand in the way of trial are the Republicans who stand to lose a lot if a trial succeeds. As Obama is beginning to point out, Republicans are largely responsible for the severity, if not the totality, of this mess.

I used to be a Republican BEFORE 2008 elections. Now I’m an independent who voted for Obama.

Obama is right on track.
FACT: The Democrats put NUMEROUS Republican proposals into the bill.
FACT: Not one Republican voted for it.

It’s clear where the most stubborn hard heads are.

The majority gives some. The minority gets some. The minority gives nothing?

Clear as ice: Republicans are frozen solid!

Democrats have had control of Congress for more than two years. They could have easily made proposals for the economy to avoid this crisis. They didn’t do so because they wanted to position themselves to do well in the 2008 elections. They are wholly responsible for the crisis worsening since January of 2007 and it was their political ambitions that got us here. The end justifies the means and we all pay.

I wouldn’t blame the Republicans for wanting to do the same; but then why did some Democrats vote against the stimulus in the House as well.

Loay your wrong. The WPA put millions back to work way before WW2. Unemployment went from 25% down to 10% by the mid thirties. My grandfather was one of the people employed by a WPA works project in the Brooklyn Navy yards. It saved his family from being destitute, and this was in the late 30’s.

The US did not get into the war until 1941 and it was not until 43 that our industrial sector was in full swing in supporting the war. WW2 did create a huge amount of work for a lot of people this is not debated, the reasoning that the FDR’s programs did not work is just not true, as Obama stated last night, he thought that argument was over a long time ago.

Banks are lending. Loans held on banks books are up over the last year.

What is gone is the “shadow banking system;” that is, securitization. The Fed has just come in to kickstart the mortgage- and asset-backed securities markets.

The fact that your guests don’t know this makes me question everything they say.

Let’s just give them all the boot and elect somebody else for a change.

Most Americans don’t agree with what’s in the stimulus, according to the latest Rasmussen poll, released yesterday. It found that nearly two-thirds of Americans would prefer a package with more tax cuts and less government spending. The lack of enthusiasm for this pending legislation will have a negative effect on consumer and investor confidence. Consumer confidence is already at an all-time low.

I guess it is too much to expect Obama and other Democrats to listen to the American people.

I agree with Clinton M. But what happened to the idea that money spent on infrastructure repair and maintenance creates more jobs than building new infrastructure? That is something Republicans should have brought up – instead of complaining about the size of the package. And what happened to the idea that money spent on public transportation also creates more jobs? Where were the Republicans there? The United States needs a credible opposition, not a bunch of cry-babies. The ideas come from this week’s edition of the magazine The Economist.

A modest proposal:
We need to connect the discussions about stimulating the economy with the need for sustainability. Sending consumers off to the mall isn’t the solution. This could be the opportunity to rethink what we need and how we want to spend our money (to the extent we have discretionary income). Wouldn’t it make more sense to purchase services and goods from people in our communities and to keep in mind the three Rs: reduce, reuse, recycle? Everything is connected, but you wouldn’t necessarily know it from the discussions.

There’s no ribbon-cutting ceremony when you fill a pot-hole or add an off/on ramp. This plan is skewed to new bridges to nowhere because that plays better with the constituents back home. This plan looks forward about 1 year. It’s about spending, not investing. It’s about scaring us so we don’t ask too many questions.

[...] On Point takes a look at and pulls apart President Obama’s recipe for recovery. [...]

One question, please;
It is the average and below average(economically)citizen who is coming to the resuce of these large financial institutions. So why on “public ” radio, you know, “objective” “independent” ostensibly public radio, did this hour feature exclusively,guests who represent big business and finance? Where were the voices of ,say, Public Citizen, or “The Nation” just to name two. Why is the Left always marginalized on “public” radio these days?

Jeffe

Not quite accurate. The economy did go from 3.1% unemployment in 1929 to 25+% unemployment by 1933. Unemployment fell to 13% in 1937, rose to 17% in the recession of 1938 and fell to 13% by 1940. These are all deflationary figures they do not show an economy that is growing. The economy only really started growing with rearmament starting in 1940. It took the planned war command economy to get us out of the depression and not merely to reduce its effect. We have a choice to either accept these cycles of what Marx termed capital destruction (and the concomitant social instability) or a command economy. What we are getting is the worst of both worlds

02/09/2009

A GOVERNMENT BANK

The time has come for the government to start its own bank. Not the Treasury or the federal reserve, but a regular bank owned and operated by the government. Put away the bail out, the stimulus, and take the money as a reserve to start the bank, writing loans, mortgages, even issuing credit cards with regular strict lending standards, just cut out the bull crap of the SBA that takes six months and more to issues a small business loan. Since we have seen that the banks taking money from the federal government are only keeping it or paying bonuses to their executives while the average American suffers, and the small business can not get any money, the best option now would be for the government to get in to banking and hire bureaucrats on the cheap as opposed to high dollar bankers.

The current banking system has failed and it has failed the country, we surely don’t need to hand the same more money, I wrote about this before that the government is throwing good money after bad, that the TARP was a farce and a failure, I have been proven right. The government should not be in the business of creating jobs, it should concern itself with collecting taxes on incomes. The jobs will again be created as the small businesses and individuals can borrow money and start new ventures, thus the jobs will be created like they should be.

Handing out money to states and counties and cities does not make much sense either as the money will be lost to corruption and diverted to the friends and families of the politicians. in contracts.

Interesting, the Gallup poll says the opposite. Public Support for Stimulus Package Unchanged at 52%.

Guess we just want to use polls that support our own agenda, is that not true Majawill.

Loay I have to say there is a huge difference between 25% unemployment and 13%, while war did accelerate the employment of man and women power it does not mean that the New Deal was not working, quite the contrary, it was. The stat you left out about 38 was that FDR listened to the republicans and tried to lower balance the budget and reduced spending which is why there was a spike.

If you count the 25% unemployed as well as the underemployed which was about the same percentage almost half the country was in pretty bad shape finacially.
The New Deal, while perfect, did put a huge amount of people back to work which revived towns and cites.

Democrats and Republicans have both been pigs at the trough. But then we’re just doing what we pay them to do – bring home the bacon (ok, poor mixing of metaphors). We’re the dopes who vote the same group (more or less) in every year, then expect Obama to solve the problem that we created with our votes.

It was a good speech and he’s an awfully bright guy. But so far, all he’s shown besides running a great campaign and giving inspiring speeches is he’s a little sloppy with his cabinet picks and is capable of spending a massive amount of money in a hurry. Ironically, spending massively might be just what is needed right now, so he doesn’t have much choice, but it still doesn’t give us much reason to think he’s all that capable. Wait til we see if the bill is filled with all the usual pork for influential politicians before we say he’s really shown he can do more than spend lots and lots of other people’s money.

Personally, I think he’ll get chewed up by our political system – he seems too interested in getting along. I think the only one who could change Washington is someone who doesn’t care what politicians of either party, or reporter’s think and is willing to sacrifice personal popularity to change things. Sadly, that person will be demonized by every group that is currently in power and will likely be a one term president.

I would say my 66% beats your 52% and it came out yesterday. The Gallup poll number was older and down from the last survey, so it would appear the trend is not your friend. You conveniently left that out jeffie.

also 52 favor, 38 oppose and 10 no opinion, as of feb 5th

http://www.gallup.com/poll/114184/Public-Support-Stimulus-Package-Unchanged.aspx

I have a comment/question.

One of the things I have read recently, is that if the banks are allowed to just go belly up (primarily the big investment banks), that many of the investors/bond holders are going to be left holding an empty bag – and that many of those investors/bond holders are you and me, through our 401K’s, etc. So in allowing bankruptcy to occur, we would be voiding any still solvent 401K the public might be holding, in addition to all the other type of investors.

What if the Fed were to cover all 401K plans for their loses (either as an stock or bond holder), and the other investors (such as speculators, CDS, CDO, etc) will lose all their investment. This seems to me a fair and ethical way to use the “taxpayers” money to help out the “taxpayer”. It would satisfy the publics’ urge to get much needed relief; it would clear up the “unknown” factor of the financial institutions and allow for the establishment of a restructured banking sector.

Lastly, the fed could allow for the withdrawal of up to 50K from a person’s 401K without penalty. This would provide an instant infusion of spending money for the public from effectively the public’s own private saving accts, bring in taxes for the government (state and federal) and cost the less than if they were to buy back “bad assets”, etc which gives little if any return to the public sector. And my bet is most of that money will be spent to either buy or pay off debt, both of which would benefit the economic picture. And lastly, if done right now, there would be less loss in the value of those 401K which effectively is money destroyed for no good reason through the fall in the stock market.

My point is that we can post polls until we are blue in the face to support our agendas. This does nothing but to massage your ego, and in your case this seems to be your agenda, you play gotcha with everyone who disagrees with you.

You can spin this anyway you want.
Majawill lets do nothing like your suggesting. Or better yet give everyone $1000 or maybe more in tax cuts. Which will do nothing for the economy and only hurt the treausary.

If we do nothing then the chances are pretty good this country will fall into a huge economic slump that will take years to crawl out of. Is this what you want?
If your a flag waving republican and you called anyone who was against the war in Iraq a traitor or unpatriotic is it not a little hypocritical to not want the country to avoid such a crisis as we are in now? Who is this not worthy of tax spending? You supported a false war which wasted billions but to have a program to help your fellow Americans in need your going to say no. Is this your position Majawill?

We have a problem in this country about taxes and what the function of government should be in relation to this problem.

For the people who advocate small government, the next time you have an emergency, like your house is on fire, call your neighbors and see if you can get a bucket brigade to put out the fire. Or better yet form a militia to patrol your streets when your idea of small government layoff all the cops. As for rubbish removal, well your on your own and you’ll have too go to the dump once a week.

My point is the majority of the public disagrees with the president and he’s not paying attention. That’s no spin.

I’ve never said do nothing. If you can find a quote, show it. Or are you just trying to set up some false debate between do somethings and do nothings like Obama tried to do. I understand his underhanded motivations, what are yours?

What’s the difference to the Treasury between cutting the government’s budget while letting people keep more of what they earn to spend as they know best or having the government spend it on worthless projects after it goes through eight levels of administration, each taking a cut, plus we have to borrow the money to do it which means raising taxes on all of us for generations to pay the interest and principal?

You’ve got to be kidding; there’s no middle ground between a government that coddles us and one that provides a public fire department. You’re great at creating false debates.

Majawill – “I understand his underhanded motivations …”

Underhanded motivations? A democratic president, elected by a massive majority partners with a democratic congress to push a democratic agenda – doesn’t seem so underhanded to me. Seems like an out-in-the-open, natural course of events. After seeing hard-right policies fail miserably, we get to see the flip side of the coin.

Personally, I HOPE this is the New Deal 2.0, with lots of spending on assets this nation can leverage far into the future. Invest in infrastructure, invest in the arts, invest in the green economy, invest in the environment – these things inject money into the economy AND help build a better America. I would MUCH rather see the government build more schools and hire more firefighters than chuck me an extra couple hundred more dollars that I can use to buy another LCD made in a Korean factory.

But seriously, what did you expect? I mean, are you looking for some quick patch job that would put us back to where we were a few years ago? The average working man has been in the soup for over a decade – it requires comprehensive structural changes to fix, something a few tax cuts aren’t going to do. If the democrats want to go after a few birds with the same stone – fine by me.

Obama was elected preaching a new direction – now, he and Congress start driving in a new direction and whining Republicans and Wall St. apologists start seething out of the wood works crying about being bullied. Well, I certainly didn’t see that much movement towards the middle from their side of the isle during the last 8 years so if it sticks in their craw a little, they deserve it.

And it’s not as if they’re offering ANYTHING new! Their alternative plan?! That wasn’t middle ground – that was textbook GOP legislation! Tax cut, tax cut, tax cut! The same sad bleating noises I’ve had to listen to for nearly 3 decades! No, you can have it. Viva the new Dem era.

Well, looks like the proposed $15K tax break to homebuyers has been stripped off the bill. I find it ironic that Republicans objected to the size of the bill and in order to placate a few of them what gets scratched? A provision that would give people their taxes back. That’s some achievement for Republicans to go back to their constituencies with.

Yeah I’m trying to set you up… a little defensive and paranoid are we? One thing is for sure we are in uncharted waters here and the only game in town is the government.

The sates need money almost all of them in fact are in a fiscal nightmare. Something has to give, a lot of services are going to disappear in the next year in a lot of towns and cities. I have a friend who lives in a small town in Vermont and the state has cut the money for the up keep of the fire department, which is mostly volunteers. It seems there might not be a fire department this time next year as no one can afford it. That means if your house has a fire it burns down. Not a good situation if you ask me.

The same is happening Massachusetts, police and firemen are being laid off.

“My point is the majority of the public disagrees with the president and he’s not paying attention. That’s no spin.”

I’m not seeing this, like I said your only facts are based on one poll. You don’t like Obama that’s pretty plain to see. I hated Bush and Cheney and I put up with them for eight years. They destroyed this countries credibility in the international arena. They a took us down the current path of ruin, everything that is happening now is from happened on the Bush’s tenure as president. 9/11 happened on his watch. You can sit there and foam at the mouth all you want, Obama won and he won by a large margin.

Next thing you’s be blame George Soros for the economic downturn, the he and a cadre liberal billionaires conspired this finical crisis to help get Obama elected. This is the kind of nonsense that is being put out there by the right wing nut jobs these days. It’s amazing to me how much the right seems to hate this country.

@Bill S

Your idea is refreshing and interesting, and should be considered.

Lots unemployed people out there, they have no significant savings, their last resort is 401K, but afraid of taking them out with penalty.

Here’s the change Obama’s brought so far

He’s violated his executive order on lobbyists three times (in two weeks).
He’s keeping extraordinary rendition.
He’s making census-taking blatently political by putting Emanuel in charge of it.
He’s given up on bipartisanship.
He had barely any input into the stimulus plan (he’s not a detail guy).
He can’t be bothered to do enough due diligence on his appointees to know (or care) if they pay their taxes (there’s his ethics, then everyone else’s).
He’s all show, but there’s no there there. We waited through the transition and since the inauguration for the Treasury’s non-plan plan. They must have been busy preparing their tax returns from three years ago.

I’d like to know how $350M for the saltwater mouse (or whatever the hell it is)–(something Nancy Pelosi wanted) will stimulate the economy — will they be buying SUV’s? She also wants millions of dollars for STD education — how the hell does that stimulate the economy? This country has gone crazy with “I Want Everything but, I Don’t Want to do Anything to Get it.” Our politicians have made stealing LEGAL in the form of taxing the hard working, responsible person to death!!! I NEVER thought I would live in a socialist country. Wake up people!!