A presidential commission has convened and has offered up plans to make serious cuts in the federal budget deficit (see: http://www.bloomberg.com/news/2010-11-10/deficit-panel-s-plan-would-seek-to-cut-social-security-mortgage-deduction.html).
The problem is that both sides, liberals and conservatives, are wincing. Liberals don't want to see any curbs on Social Security and Medicare, the conservatives don't want to see any reduction in tax breaks or the defense budget. Because of these disputes, it is unlikely that fourteen of the eighteen panelists will come up with a consensus view on how to cut the deficit, and any legislation is unlikely to ever come up for a vote (see: http://www.reuters.com/article/idUSN1018968620101110).
In other words: more of the same. Both sides don't want to take the deficit seriously. The United States is facing a crippling deficit that could leave the country in the same shape California is in, and that Greece already went through earlier this year.
Serious times demand serious actions. The days of cutting every tax you can find and spending as much as you want are over. Action to increase taxes and to reduce sacred cow spending are long overdue.
Instead of continuing to vote for politicians that tell us exactly what we want to hear, it is time to vote for adults who will do what is necessary. Unfortunately, it is the message Americans don't want to hear, and certainly don't want to vote for.
And thus, no serious solution is likely to come out of Washington, DC.
RG
Wednesday, November 10, 2010
Thursday, October 28, 2010
Lost in the Shuffle
The distinction between the reality of America's economic situation and the beliefs people have about it is surprisingly stark. A few facts to start the post:
*The Dow Jones is up almost 40% under the Obama administration. Today's close was 11,113.95. The close on January 20, 2009, when Obama took office, was 7949.0. A massive increase.
*Growth is well out of negative territory. To be specific: "during 2008 the economy dropped 1.7 percent compared with the year before. We started looking back through the years, and saw only upticks from 2007 to 1950. In 1949, we found our first decline, of 0.7 percent. There was also small declines in 1946, down 0.4. In 1938 was a significant decline of 6.3, and then more declines in 1933, 1932, 1931 and 1930. No statistics are available before 1930." (http://politifact.com/truth-o-meter/statements/2010/oct/25/tim-kaine/obama-took-office-during-70-year-economic-low-kain/)
Meanwhile, the projections from today indicate a 2.4% GDP increase for the current quarter (http://www.google.com/hostednews/ap/article/ALeqM5g2rmqqtJ39LIJbz861BAif1Arliw? docId=fcbe9f5df9f14a21aaa9d9eb81e21785).
*CBO estimates indicate the stimulus saved millions of jobs and boosted the GDP. "Independent analysts at the Congressional Budget Office and in the private sector roughly estimate that the stimulus boosted the level of gross domestic product by about $400 billion this year and raised the level of employment by about 3.3 million." (http://www.marketwatch.com/story/stimulus-worked-but-not-as-well-as-hoped-2010-10-29).
So in other words, the economy has come back from the abyss under Obama. Times were very tough, and while they aren't awesome now, they are better than before.
So why are Obama and the Democrats in trouble? The facts have been lost in the shuffle.
While the vast right-wing conspiracy can be blamed, the real fault lies in the Obama team for not crafting a clear economic message. Republicans have been better about touting unemployment and the deficit as the only relevant economic indicators. Republicans have been better about winning the battle that the stimulus was a waste of cash. Republicans have won the battle that something--although we're not quite sure what--about "Obamacare" is bad.
Obama and his team lost the discipline that was the hallmark of his run for the Presidency in 2008. The team is way off message, and Democrats are jumping ship as well. If the midterms go the way most predict, will Obama learn the lesson that the problem was the message and not the policies?
Or will the Democrats continue their cowardly retreat into the kinds of policies that led to the economic downturn in the first place.
Then we'll really see what gets lost in the shuffle.
*The Dow Jones is up almost 40% under the Obama administration. Today's close was 11,113.95. The close on January 20, 2009, when Obama took office, was 7949.0. A massive increase.
*Growth is well out of negative territory. To be specific: "during 2008 the economy dropped 1.7 percent compared with the year before. We started looking back through the years, and saw only upticks from 2007 to 1950. In 1949, we found our first decline, of 0.7 percent. There was also small declines in 1946, down 0.4. In 1938 was a significant decline of 6.3, and then more declines in 1933, 1932, 1931 and 1930. No statistics are available before 1930." (http://politifact.com/truth-o-meter/statements/2010/oct/25/tim-kaine/obama-took-office-during-70-year-economic-low-kain/)
Meanwhile, the projections from today indicate a 2.4% GDP increase for the current quarter (http://www.google.com/hostednews/ap/article/ALeqM5g2rmqqtJ39LIJbz861BAif1Arliw? docId=fcbe9f5df9f14a21aaa9d9eb81e21785).
*CBO estimates indicate the stimulus saved millions of jobs and boosted the GDP. "Independent analysts at the Congressional Budget Office and in the private sector roughly estimate that the stimulus boosted the level of gross domestic product by about $400 billion this year and raised the level of employment by about 3.3 million." (http://www.marketwatch.com/story/stimulus-worked-but-not-as-well-as-hoped-2010-10-29).
So in other words, the economy has come back from the abyss under Obama. Times were very tough, and while they aren't awesome now, they are better than before.
So why are Obama and the Democrats in trouble? The facts have been lost in the shuffle.
While the vast right-wing conspiracy can be blamed, the real fault lies in the Obama team for not crafting a clear economic message. Republicans have been better about touting unemployment and the deficit as the only relevant economic indicators. Republicans have been better about winning the battle that the stimulus was a waste of cash. Republicans have won the battle that something--although we're not quite sure what--about "Obamacare" is bad.
Obama and his team lost the discipline that was the hallmark of his run for the Presidency in 2008. The team is way off message, and Democrats are jumping ship as well. If the midterms go the way most predict, will Obama learn the lesson that the problem was the message and not the policies?
Or will the Democrats continue their cowardly retreat into the kinds of policies that led to the economic downturn in the first place.
Then we'll really see what gets lost in the shuffle.
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