The Final Nail in the Stimulus Coffin

[onmyknees]

Can we finally put the folly of Obama's stimulus to bed now ? For months I've had to listen to the likes of Bluegrass Cat, Indeda, Hippie, and others ( you know who you are) as they chirped about all the wonderful things the stimulus did...posting wild tales about it's efficacy, and backed up by all the bilge Media Matters could shovel their way. All those jobs "saved" ! Pick a number and plug it in....there's no way to disprove a negative ! Those of us on the other side felt it was nothing more than payola to supporters and contributes and an excuse for massive government expansion. Even when you all heard Obama joke about shovel ready jobs, it didn't dissuade you from your Keynesian dogma. Well now there's evidence from "the highest levels of government" to support those of us who saw this as pure folly. In a leaked 57 page memo from Larry Summers ( Head of Obama's National Economic Council, and one of the authors of the "Recovery Plan".) We see in his own words what the real intent of the stimulus and it's effect on the debt. This memo was marked "Sensitive and Confidential". Recall when they told us if we dumped a cool billion into the economy, unemployment would not rise about 8%. Here's a few paragraphs from the memo. They are direct quotes. Doubt it's existence or authenticity? Google it. And just so you can see who Larry Summers is, and his relationship to Obama...I've included a picture. Read that first paragraph twice!

The short-run economic imperative was to identify as many campaign promises or high priority items that would spend out quickly and be inherently temporary. … The stimulus package is a key tool for advancing clean energy goals and fulfilling a number of campaign commitments.

Closing the gap between what the campaign proposed and the estimates of the campaign offsets would require scaling back proposals by about $100 billion annually or adding new offsets totaling the same. Even this, however, would leave an average deficit over the next decade that would be worse than any post-World War II decade. This would be entirely unsustainable and could cause serious economic problems in the both the short run and the long run.

Constructing a package of this size, or even in the $500 billion range, is a major challenge. While the most effective stimulus is government investment, it is difficult to identify feasible spending projects on the scale that is needed to stabilize the macroeconomy. Moreover, there is a tension between the need to spend the money quickly and the desire to spend the money wisely. To get the package to the requisite size, and also to address other problems, we recommend combining it with substantial state fiscal relief and tax cuts for individuals and businesses.

[giovanni_hotel]

I think you're confusing campaign promises made in running for POTUS and payoffs to corporate campaign contributors.

Obama promised to promote green energy technology, solar and wind development. No surprise that stimulus dollars were dedicated to these industries. Obama also had to to prop up state budgets to keep public sector employees working.

Temporary measures in part, but the alternative, nationwide local governments slashing public employees by half doesn't seem to be a much better alternative.

Do conservatives oppose how the stimulus dollars were allocated, or are they against the total idea of there being any need whatsoever to 'stimulate' the economy with federal spending after the housing market collapsed and the DJIA fell through the floor??

$300 bil of the stimulus package went towards tax cuts and credits.
$225 bil went towards federal contracts, grants and loans.
$219 bil went towards entitlement spending.

A more detailed breakdown can be found here.
http://www.recovery.gov/Transparency...breakdown.aspx

Sorry, but there is no 'conspiracy'.

[Faldur]

Think its easily stated most conservatives are against a government spending $1.2 trillion more per year than it takes in. I don't care if its being deposited directly in my bank account, its just wrong.

[giovanni_hotel]

So conservatives in principle were in favor of letting the economy collapse in 2009. Consequences be damned. Let the free market put out their own fires even if we all burn up in the process.

Got it.

The Federal government took in just over $2 trillion dollars in taxes in FY 2010.
The Feds did NOT spend over $ 3.1 trillion dollars in expenditures in 2011.

[Faldur]

So conservatives in principle were in favor of letting the economy collapse in 2009. Consequences be damned.

Yes! Failure is part of a free market economy, remove failure and you remove freedom.

[giovanni_hotel]

I don't seriously believe you would have been willing to risk a global financial collapse for the sake of upholding the 'divinity' of free market ideology.

It's easy to talk tough about how strong a swimmer you are after you've been rescued from a sinking ship.

Nice try.lol

[onmyknees]

I think you're confusing campaign promises made in running for POTUS and payoffs to corporate campaign contributors.

Obama promised to promote green energy technology, solar and wind development. No surprise that stimulus dollars were dedicated to these industries. Obama also had to to prop up state budgets to keep public sector employees working.

Temporary measures in part, but the alternative, nationwide local governments slashing public employees by half doesn't seem to be a much better alternative.

Do conservatives oppose how the stimulus dollars were allocated, or are they against the total idea of there being any need whatsoever to 'stimulate' the economy with federal spending after the housing market collapsed and the DJIA fell through the floor??

$300 bil of the stimulus package went towards tax cuts and credits.
$225 bil went towards federal contracts, grants and loans.
$219 bil went towards entitlement spending.

A more detailed breakdown can be found here.
http://www.recovery.gov/Transparency...breakdown.aspx

Sorry, but there is no 'conspiracy'.

Oh no you don't. I'm not confusing them at all. The only campaign promises he's seen fit to keep are the ones that involve taxpayer funded goodies to contributors and bundlers. ( Solyndra, Fisker, Beacon Power, and the colossal failure of the Volt) That's the extent of his energy policy promises...unless you want to include cap and tax which is DOA. He certainly hasn't kept his promises to "cut the deficit in half by the end of his first term" or any other fiscal goals he promised.
The second part of the payola (aka Stimulus) goes directly to the teachers unions and other public employee unions. That part of it was a bailout to the states....The States that had thier fiscal matters in order got nothing. All it did was kick the can down the road for fiscally troubled, irresponsible states for a year or 18 months. It's a matter of public record that Richard Trumka and the leaders of SEIU ( Andy Stern) are the most frequent visitors to the White House.... but maybe they were just talkin' sports?
Either way....the payback involves tax payer money. Conspiracy is your word...not mine. Mine would be failure, and deeper in debt that consumes more of the GNP to keep paying off the credit card. It's all there in the Summers memo. He tells you it will cause huge deficits as far as the eye can see, and that it will be extraordinarily difficult to even spent that amount of money...but hey ...why worry? The Fed will just crank up the printing presses . You are correct that approximately 1/3 went to tax cuts. The average was 400 for single payers, more for married couples. I'm not against tax cuts, but that's about 8 bucks a week. Let's not throw a party just yet. And that small amount as nice as it might have been, was eaten up but the offsetting increase in health premiums due to ObamaCare, and increased energy costs.

Faldur is absolutely correct.
Free market capitalism plays no favorites, and failure is as much a part as success is.....Crony Capitalism however picks and chooses and puts good money over bad into failing industries and companies. What you libs don't understand and never will, is that the market must decide. Here's how government intevention skews the market...


Let's say you're a small upstart solar panel company. You have a patent on your design, and feel it's design is superior to other manufacturers. You are vying for venture capitol to fire up your factories and expand production. Then here comes the government with a gunny sack filled with money and dumps it on Solyndra. In this case....a cool half billion. What type of effect do you think that has on venture capitalists who might potentially be interested in your company? I'll tell you....it has a disastrous effect. They're not going to invest in a company that's competing with the government's winner. They'll find another industry to invest in. So...the government picks the winner, and the small business guys gets nothing despite the fact his design and manufacturing methods are superior. Solyndra gets the money, and fails miserably. That's why the market must decide. It play no favorites.

[Odelay]

Let's say you're a small upstart solar panel company. You have a patent on your design, and feel it's design is superior to other manufacturers. You are vying for venture capitol to fire up your factories and expand production. Then here comes the government with a gunny sack filled with money and dumps it on Solyndra. In this case....a cool half billion. What type of effect do you think that has on venture capitalists who might potentially be interested in your company? I'll tell you....it has a disastrous effect. They're not going to invest in a company that's competing with the government's winner. They'll find another industry to invest in. So...the government picks the winner, and the small business guys gets nothing despite the fact his design and manufacturing methods are superior. Solyndra gets the money, and fails miserably. That's why the market must decide. It play no favorites.

OMK, do you have any personal experience or deep personal knowledge of venture capital? Because the above paragraph makes me think you probably don't. VC's love going into industries where government money is going. It's practically a flies on shit kind of relationship.