http://econintersect.com/b2evolution/blog2.php?disp=comments en-US http://backend.userland.com/rss 60 Sun, 18 Sep 2011 23:36:22 +0000 Patrick M [Visitor] c2052@http://econintersect.com/b2evolution/ The pundit and market verdict was more right than your take. At a time when we already are shovelling $1.2 trillion more dollars out than we take in at the Federal level, it should considered well past disproved that large deficits are an economic elixir. Yet you and others like Mark Zandi drink the koolaid. Obama's proposals are job-destructive, not job-creative:<br /> - he has hidden giveaways to tort lawyers<br /> - he has done nothing to stop the regulatory overreach of his administration<br /> - he has not proposed pro-energy policies to get us drilling more<br /> - he has nothing in terms of getting production back in the USA from places like China<br /> - most noxious, he has temporary tax cuts, which most businesses are saying will not change their hiring behavior, and will 'pay for them' with tax increases that are permanent. Those tax hikes will destroy more jobs than the tax cuts will 'create' and net negative. Taking from one pocket to another doesnt create wealth!<br /> - likewise, his spending is more of the same failed over-spending and bailouts of big govt that does nothing to actually build wealth, but as the example of solyndra shows, often is just wealth-destructive overall<br /> - He rewards non-work - aka long-term unemployment - which may be a nice bandaid for those in need, but certainly will not create jobs. If that ewre the case, every welfare state would be a full employment (in fact, the job disincentive effect probably ADDS to unemployment).<br /> <br /> These bad ideas are 'justified' through the fantasy of keynesian accounting that pretends a $1 spent will magically multiply activity. Never do they contemplate that $1 as being taken out of the bond market or from a taxpayers pocket or from the next generation - but it is. This is taxpayer, generational and economic money shifting. We a compliant monetary policy, they can pretend it came from nowhere, but in the end rational expectations trumps the chicanery.<br /> <br /> Not ony does this fiscal policy not work, but the policy is the opposite of what a successful policy to grow the economy long-term needs. We need less govt debt, less govt spending, freeze on regulations, and a tax system that lower tax rates across the board (the only good bipartisan idea lately is the idea to lower corp tax rates in exchange for loophole closure). <br /> <br /> Our economy is weak, and the Obama prescription is like blood-letting. he starves the productive sector a bit more via tax and regulation squeezes, to prop up the less-productive govt sector. No free lunch, and worse: the markets distrust of a government policy that is overwhelming in its drive to spend and regulate has created the 'wet blanket' of corporate inaction - Obamacare, Frank-Dodd, and other policies have deterred job creation, and stagnation has resulted.<br /> <br /> I am writing this on sept 17th, and tomorrow Obama will unveil how he will get productive taxpayers to pay for his tax-and-borrow-and-spend extravaganza.<br /> market will likely like this no better than they did his speech.<br /> - he has hidden giveaways to tort lawyers
- he has done nothing to stop the regulatory overreach of his administration
- he has not proposed pro-energy policies to get us drilling more
- he has nothing in terms of getting production back in the USA from places like China
- most noxious, he has temporary tax cuts, which most businesses are saying will not change their hiring behavior, and will 'pay for them' with tax increases that are permanent. Those tax hikes will destroy more jobs than the tax cuts will 'create' and net negative. Taking from one pocket to another doesnt create wealth!
- likewise, his spending is more of the same failed over-spending and bailouts of big govt that does nothing to actually build wealth, but as the example of solyndra shows, often is just wealth-destructive overall
- He rewards non-work - aka long-term unemployment - which may be a nice bandaid for those in need, but certainly will not create jobs. If that ewre the case, every welfare state would be a full employment (in fact, the job disincentive effect probably ADDS to unemployment).

These bad ideas are 'justified' through the fantasy of keynesian accounting that pretends a $1 spent will magically multiply activity. Never do they contemplate that $1 as being taken out of the bond market or from a taxpayers pocket or from the next generation - but it is. This is taxpayer, generational and economic money shifting. We a compliant monetary policy, they can pretend it came from nowhere, but in the end rational expectations trumps the chicanery.

Not ony does this fiscal policy not work, but the policy is the opposite of what a successful policy to grow the economy long-term needs. We need less govt debt, less govt spending, freeze on regulations, and a tax system that lower tax rates across the board (the only good bipartisan idea lately is the idea to lower corp tax rates in exchange for loophole closure).

Our economy is weak, and the Obama prescription is like blood-letting. he starves the productive sector a bit more via tax and regulation squeezes, to prop up the less-productive govt sector. No free lunch, and worse: the markets distrust of a government policy that is overwhelming in its drive to spend and regulate has created the 'wet blanket' of corporate inaction - Obamacare, Frank-Dodd, and other policies have deterred job creation, and stagnation has resulted.

I am writing this on sept 17th, and tomorrow Obama will unveil how he will get productive taxpayers to pay for his tax-and-borrow-and-spend extravaganza.
market will likely like this no better than they did his speech.
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