Tag: economy

#rsrh 1.2 trillion is a lot of money.

That number represents, apparently, the amount of money Americans spend every year on stuff we don’t actually need.  And, of course, you can take that one bit of particular information any way you like: even the article that it comes from manages to use it to argue both for the inherent power of capitalism and for the need of a value-added tax.

On the other hand, Instapundit’s reader is right: Best Buy is a toy store for adults (I paraphrase).  Which is another, I’ve-had-some-wine way of saying that the aforementioned 1.2 trillion being pumped into the economy could easily disappear if people get worried enough.

Moe Lane

Some depressing benchmarks on the country’s economic status.

There are two very simple questions that need to be asked over the next eighteen months. The first is, Are you better off than you were four years ago?

If the answer is “Yes,” the second question is even more blunt: Really? How are you managing that?

March ’07 March ’11
Unemployment Rate 4.40% 8.80%
Gas price (per gallon) $2.56 $3.60
National Debt 8.84 trillion 14.27 trillion
Monthly deficit 95 billion 189 billion
Median House Price* $262,600 $202,100
S&P 500 Index 1420.86 1332.31
Employment-Population Ratio 63.3% 58.5%
Consumer Price Index* 205.532 221.309

(Items with an * are using February 2011 data)

…because the rest of the country’s kind of getting hammered, here.

Moe Lane (crosspost)

Obama retreats on tax hike.

We won.

It looked that way earlier in the day, and it’s now confirmed.  The ‘deal’ will be that the White House ‘delays’ raising taxes for two more years in ‘exchange’ for getting a thirteen-month extension on unemployment benefits*.  That last is problematical, but given the Democrats’ moral weakness thus far the GOP might still be able to keep pushing a little and get offsets in federal spending elsewhere to make up the difference.  Besides, it’s Christmas: the optics are bad.  Even if we don’t get that, everybody who matters is going to breathe a huge sigh of relief.  The Democratic establishment will have a fig leaf for their cowardice and the Right will have successfully kept the Other Side from delivering another kick to the groin to the US economy; it’s not perfect, but it’ll keep things from getting worse until 2012.

By the way, ‘deal,’ ‘delay,’ and ‘exchange’ were all in scare quotes because this wasn’t really a deal; more like the Democrats finally admitting that they didn’t have the guts to raise taxes in the middle of a sour economy.  And the White House isn’t delaying raising taxes; even assuming that Obama’s in a position to raise them in 2012 he won’t dare do it then, either.  And it’s not an exchange; as noted above, the GOP can give ground on this topic readily enough, particularly if we can take the opportunity to gut some useless spending elsewhere.

In other words, it’s pretty much all over except for the gloating.

Moe Lane (crosspost) Continue reading Obama retreats on tax hike.

Choosing job creation (translation: vote Republican).

I have two observations on this passage by Walter Russell Mead highlighting the long-term problem that the Democrats are facing right now with regard to fiscal policy:

…the only real economic policy today that has any chance of working in the United States today is to promote the emergence of small business. Many of those businesses will fail; some will become thriving though never large enterprises; a few will become world-changing giants like Microsoft and Google.

Unfortunately for Democrats, the policies needed to support the emergence of an entrepreneurial, small-business-fueled society are almost the opposite of the classical policies that 20th-century Democratic ideology supports. Large business usually welcomes government intervention in the economy — if only because large businesses have the power to influence the government policies that affect them most directly. Regulations that raise the cost of entry into the market (everything from minimum wage laws, extensive paperwork requirements, taxes, environmental regulations, health care and other social mandates) benefit well-capitalized, large firms who thrive on economies of scale by making it hard for feisty newcomers to emerge and challenge existing product lines and business models.

Simply put, it is this mistake by the Democrats that make statements like Dick Blumenthal’s (see here and here) so puerile. The one useful thing – absolutely one useful thing – that government can do to benefit job creation is negative; it can prevent others from creating or fostering a hostile environment to new businesses. Government can raise a military to keep invaders from looting the countryside every year (and if you think that this is a trivial matter, then you’re an American who has never read any history). Government can create universal standards of weights and measures (and if you think that this is a trivial matter, then see the previous comment). Government can create and enforce a consistent rule of law (which is not the same as ‘sue everybody that moves,’ Dick Blumenthal to the contrary*). And government can produce a decent public transportation network (not the same as ‘public transit;’ also, the libertarians will eagerly argue that one).

Everything else is picking winners; and as Mead notes in the essay above, government is pretty bad at that. So if you’d like to maybe get our economy off of neutral, your choice is pretty clear. Besides, remember this: when you’ve put your car in a ditch, keeping it in ‘D’ and gunning the engine usually won’t help nearly as much as putting the car in ‘R’ and backing up. I know that the President likes to say otherwise… but that’s because he’s an urban public sector type, which means that he’s stereotypically unlikely to have much practical experience with automobiles.

Moe Lane Continue reading Choosing job creation (translation: vote Republican).

#rsrh I like Byron York’s stuff…

…but I have to take some umbrage at this point in an otherwise excellent piece on why the vaunted pivot to the economy is too little, too late for this administration.  While discussing the way that the President has… well, voted ‘present’… on jobs and the economy, Byron wrote:

It’s hard to overstate just how surprised Republicans have been by Obama’s performance.

I’m actually not surprised at all.  The man’s been a member of the legislative branch all his political life; he has no executive experience worth mentioning, and it shows.  Isn’t this largely why we don’t usually elect Senators President anymore? – And it’ll be a long time before we elect another one President, huh?

Moe Lane

PS: Via Hot Air Headlines.

#rsrh SA for our (Democratic) elected officials.

Do you know what happens when paragraphs like this (via here) are written?

At the end of last month I proffered three potential explanations for the continued fall in the US savings rate.   The first explanation was that the economy was in a cyclical recovery predicated on asset price inflation and this gave enough troubled debtors breathing space to spend more freely. The second explanation was the opposite, that distress amongst those troubled debtors was leading them to spend a larger percentage of income. The third explanation was that strategic defaults were giving a lot of people money in their pockets that would have otherwise gone to servicing debt and this had increased consumption.

The people out there who read it, and who actually pay their mortgage every month, get mad.  Then they start wondering why one political party messed around with a health care bill that the public didn’t want while the financial situation got worse – and why politicians are bailing out cynical consumers who decide to play the ‘strategic default’ game.  And then they get madder when other (typically urban-elitist) cynics tell them to suck it up, because it’s completely unreasonable to expect people to honor an inconvenient contract.  Only unsophisticated rubes actually care about something as un-hip as respect for contractual obligations.

It’s that last attitude that really motivates people to go out and vote, by the way.

Moe Lane Continue reading #rsrh SA for our (Democratic) elected officials.

Slowly it shifts…

Rust never sleeps, ladies and gentlemen:

Nearly two years into the recession, opinion about which political party is responsible for the severe economic downturn is shifting, according to a new national poll.

A CNN/Opinion Research Corporation survey released Friday morning indicates that 38 percent of the public blames Republicans for the country’s current economic problems. That’s down 15 points from May, when 53 percent blamed the GOP. According to the poll 27 percent now blame the Democrats for the recession, up 6 points from May. Twenty-seven percent now say both parties are responsible for the economic mess.

(H/t: Yid with Lid & Hot Air) And to quote Solomon Short: Rome didn’t fall in a day, either.  So keep reminding people about just who’s been in charge of the purse strings since January of 2007, and the whole blessed government since January of 2009.  Every little bit helps, and we’ve still got a year to correct the historical record.

Crossposted to RedState.

White House predicts 3.5% growth by year’s end.

I’m sure that they mean well.

The White House is promising solid economic growth by the end of this year:

White House Sees 3.5% Growth by Year-End, Exceeding Forecasts

May 11 (Bloomberg) — The Obama administration projected that the U.S. economy will expand at a 3.5 percent annual rate by year-end, a rebound that would be almost twice as strong as private forecasters expect.

[snip]

As early as the end of this year, GDP may rise at a 3.5 percent annual rate, the same pace projected for all of next year, helped by a $787 billion stimulus package, the administration said in the report today. That’s more optimistic than the 1.8 percent fourth-quarter growth estimate in the monthly Blue Chip Economic Indicators survey released May 10.

Of course, this White House promised ‘only’ a $1.2 trillion dollar deficit this year; it’s now going to be $1.8 trillion, and probably rising. And it calculated an 8.1% unemployment rate for 2009 (last month’s was 8.9%, thanks largely to government seasonal work*). And then there’s this (via here): Continue reading White House predicts 3.5% growth by year’s end.

Gibbs: ‘Sound’ is completely different than ‘strong!’

Let me summarize Gibbs’ position, here:

…we’re in better shape now than we were last year. Which is to say, we are better off than we were on September 15th, 2008, when the national debt was 9.63 trillion (it’s 10.98 trillion now), the unemployment rate was 6.1 (it’s 8.1 now), and the Dow was at 10,918 (it closed today at 7,217).  Yes.  We are doing so much better right now, I am tempted to max out my credit cards. Continue reading Gibbs: ‘Sound’ is completely different than ‘strong!’