Fred Barnes says that it’s clear that the president is an utter economic illiterate:
Obama professes to believe in free market economics. But no one expects his policies to reflect the unfettered capitalism of a Milton Friedman. That’s too much to ask. Demonstrating a passing acquaintance with free market ideas and how they might be used to fight the recession–that’s not too much to ask.
But the president talks as if free market solutions are nonexistent, and in his mind they may be. Three weeks after taking office, he said only government “has the resources to jolt our economy back into life.” He hasn’t retreated, in words or policies, from that view.
…A good example of Obama’s economic shallowness is his unrelenting defense of the $787 billion “stimulus.” Enacted in February, it has had minimal impact on the economy. Yet Obama has no second thoughts. He says he wouldn’t change a thing about the stimulus. It has “already saved jobs and created new ones,” he said at the press conference, neglecting to note that 2 million jobs–a net 2 million–have been lost since it was passed.
That was clear even during the campaign, to those of us who are not. Unfortunately, most people (including most journalists) are in the same boat as the president.
It doesn’t matter if he’s economically literate or not; the stimulus is doing exactly what he intended the stimulus to do… make the democrat party stronger at election time. That’s all it’s intended to do. Which may explain why the bulk of the spending comes right before the midterm. I don’t listen to Rush these days but did hear him say the exact same thing on Greta yesterday.
The other thing that really annoys me is the idea that some company is ‘too big to fail’ when the solution is obvious… break them up into enough smaller companies so that they are not too big to fail. Then sink or swim just like every other company. I don’t want the government telling companies how much capital reserve they need to have. I don’t want the government involved unless the company is screwing up the commons. Even then I’m sure there are solutions better than having the government provide them.
More competition is always better. We need to lower barriers to competition at every turn.
unfettered capitalism of a Milton Friedman
Apart from central banking that is. Something that’s got us into deep, deep trouble.
Enacted in February, it has had minimal impact on the economy.
When Barnes complains about the spending in ARRA, he uses the bogus $787 billion number (it’s actually under $600B, over two years). When he complains about the minimal effects so far, he neglects to mention that most of the money hasn’t been spent yet.
It has “already saved jobs and created new ones,” he said at the press conference
And it has. One example: it has closed 40% of the state budget deficits in some states, preventing layoffs of thousands of workers.
When he complains about the minimal effects so far, he neglects to mention that most of the money hasn’t been spent yet.
In other words, the notion that it was an emergency, and all had to be passed immediately to save the economy, so fast that there was no time to read the bill, was a blatant lie. That “Jim” defended.
In other words, the notion that it was an emergency, and all had to be passed immediately to save the economy, so fast that there was no time to read the bill, was a vicious lie.
No. Any delay in passing the ARRA would have postponed the job savings we’ve seen already, and the ones to come. The fact that it takes a long time to spend the money is an argument for starting sooner, not later.
One other point: It’s one thing for Barnes, an ex-supporter of Dick Gregory for president, who has no personal expertise in economics, to call Obama (who also has no formal economics background) an economic illiterate. But by implication he’s saying the same thing about Larry Summers, Christina Romer, Tim Geithner, Paul Krugman, Joe Stiglitz, and plenty of other acclaimed economists. Does he really want us to believe he understands economics better than those people?
Are you really defending Summer’s grasp of economics, given the sorry state of Harvard’s endowment?! Or Geithner’s grasp of TurboTax?
Holy crap. Astonishing.
Actually, Jim, with interest the cost of ARRA alone is over two trillion dollars. The cost to the economy, far greater.
Have you ever been right in your life?
Why that’s quite a list James. You’ve certainly made a strong point there. Somewhere. Or not.
Any delay in passing the ARRA would have postponed the job savings we’ve seen already, and the ones to come.
They could have passed an emergency bill with the funds that were going to be spent in the near term. There was no need for an $800B bill to be passed without debate. Except, of course, that Rahm didn’t want to “waste the crisis.” They are scoundrels and power-hungry liars, and you are, too for defending them.
Gary C Hudson Says:
My prized Rotary Rocket cap dips its brim in shame….
Are you really defending Summer’s grasp of economics, given the sorry state of Harvard’s endowment?!
Yes. But I’m not sure my math ability is up to counting all the errors in this short sentence. Here’s an attempt:
1) “Grasp of economics” and “skill as an investor” are not remotely the same thing. Warren Buffett has no medal from Stockholm, but I’d rather have him invest my money than Nobel or Clark prize winner in economics. For economics expertise, I’d take Summers over Buffett any day, not to mention Summers over Fred Barnes.
2) The “sorry state of Harvard’s endowment” is that it is by far the largest university endowment in the country. Under Summers its annual growth alone was larger than all but a handful of university endowments. Its performance during that time was much better than the market in general; since then it seems to be reverting to the mean, but it remains an obscene amount of money.
3) The president of Harvard does not invest its endowment; as it happens, the people who do are paid much more than the president.
4) His name is “Summers”, not “Summer”.
Or Geithner’s grasp of TurboTax?
Again, what does that have to do with grasp of economics? My calculus teacher in high school used to groan about people asking him to help them with their taxes, as if math expertise (and not familiarity with tax law) was the thing required. I suspect an economist would feel the same way.
Do you really think Fred Barnes is in a position to call Larry Summers (winner of the Clark medal, tenured Harvard economics professor at 28, on Reagan’s Council of Economic Advisers, former chief economist of the World Bank, former secretary of the treasury) an economic illiterate?
Do you really think Fred Barnes is in a position to call Larry Summers (winner of the Clark medal, tenured Harvard economics professor at 28, on Reagan’s Council of Economic Advisers, former chief economist of the World Bank, former secretary of the treasury) an economic illiterate?
Do you really think that it’s not time to stop beating your wife?
They could have passed an emergency bill with the funds that were going to be spent in the near term.
No:
* Much of the spending is for projects that need assurances of funds long before they actually need funds. States could not plan road projects, get necessary permits, etc., until they knew the money would be there — even if the money isn’t going to be there until next year. Delaying ARRA would mean not having those projects next year, when we will still need their stimulus effect.
* Private industries could not be assured of continuing demand for their products if the funding fueling that demand might expire in a few months.
* States could or would not adjust things like unemployment relief time periods if the funds were scheduled to evaporate in a few months.
* States could not plan their fiscal 2010 budgets without knowing what federal aid might be arriving.
* There would not be time in the legislative calendar for follow-on stimulus spending, which it’s clear we need.
They are scoundrels and power-hungry liars, and you are, too for defending them.
As always, the ad-hominem.
Do you really think that it’s not time to stop beating your wife?
Very mature. This is Summers’ policy (and Romer’s, and Geithner’s). Obama didn’t come up with it himself. If you and Fred Barnes think it’s an illiterate policy, face up to what that says about Summers et al.
The socialists currently in charge are not all that interested economics anyway. What they are interested in is using and/or creating crises by which they can further their grasp on power and weed out those who individualists and not communitarians like Obama.
If you and Fred Barnes think it’s an illiterate policy, face up to what that says about Summers et al.
I repeat the question. But I know you’ll just repeat the straw man.
I guess you have to live through it to understand how fascists anywhere can grab and consolidate power. Otherwise it seems impossible to understand how a free people could allow it to happen.
If history is any guide, it’s going to get unimaginably worse before it get’s any better. Even with people waking up I’m afraid the midterm is going to be an amazing disappointment. Fascists can maintain control even with a majority against them.
Then, if we really weren’t funding “shovel ready” projects, and the “stimulus” bill was all about protecting states from the folly of their rosy budget forecasts, why NOT take a couple more weeks to do a proper debate and analysis on it?
Rand approvingly says:
Fred Barnes says that it’s clear that the president is an utter economic illiterate
The evidence is the president’s policies, which were crafted by (among others) Larry Summers. Rand doesn’t think he’s calling Larry Summers an economic illiterate; but if those policies prove Obama is economically illiterate, they prove the same about Summers, Romer and Geithner, not to mention outsiders who approve of those policies (e.g. Krugman).
Then, if we really weren’t funding “shovel ready” projects, and the “stimulus” bill was all about protecting states from the folly of their rosy budget forecasts, why NOT take a couple more weeks to do a proper debate and analysis on it?
The recession had been going for 15 months when ARRA passed. You could always ask for another 2 weeks, and delay its effects even further, but there would be a real human cost.
The evidence is the president’s policies
No, the evidence is the president’s statements.
…which were crafted by (among others) Larry Summers. Rand doesn’t think he’s calling Larry Summers an economic illiterate; but if those policies prove Obama is economically illiterate, they prove the same about Summers, Romer and Geithner, not to mention outsiders who approve of those policies (e.g. Krugman)
No, he’s calling them political hacks. As am I, if they support those policies.
Anonymous “Jim,” you have so many non sequiturs, evasions and obfuscations in your responses – not to mention ad hominem attacks that are clearly pathetic attempts to suppress dissent – that it is fruitless to attempt to reason with you.
I won’t try, since I might misplace an apostrophe and thus invalidate my arguments.
And by the way, we never made any Rotary hats, so if you have one, please send it to me. I’d like to wear it.
…we never made any Rotary hats…
Gary, surely you aren’t insinuating that a leftist is a liar? I mean, who could imagine such a thing…?
One other point: It’s one thing for Barnes, an ex-supporter of Dick Gregory for president, who has no personal expertise in economics, to call Obama (who also has no formal economics background) an economic illiterate. But by implication he’s saying the same thing about Larry Summers, Christina Romer, Tim Geithner, Paul Krugman, Joe Stiglitz, and plenty of other acclaimed economists. Does he really want us to believe he understands economics better than those people?
There are two things to consider here. First, formal training doesn’t imply that the person thinks rationally. I’d go as far as to say (without naming names) that we have plenty of examples even on this website.
Second, once again, you ignore the effects of conflicts of interest on economist viewpoints. All of the above (with the sole possible exception of Krugman) benefit greatly from endorsing the administration in its activies, whether or not those activities make economic sense.
I’m sure I can kick up a few economists who are steeped in Republican or conservative ideology and just so happen to oppose the current economic policies. It’s not a useful exercise and I view it as largely irrelevant to the current discussion.
heh. real human costs of two more weeks of debate.
Please! How about the “real human costs” of the “stimulus” package? The debt service payments; the shaking of confidence in the federal government; the rosy predictions of its effects, now shattered?
Jim, do you actually subscribe to the stuff you write, or are you just throwing out possible arguments that one of the President’s toadies might try out?
No, the evidence is the president’s statements.
Which have been echoed by leading economists in and out of the administration.
No, he’s calling them political hacks. As am I, if they support those policies.
Of course they support those policies, they created them!
What, then, is the point of calling Obama an economic illiterate? The people shaping his policies are economic superstars, so clearly economic literacy isn’t an interesting variable to consider.
And by the way, we never made any Rotary hats, so if you have one, please send it to me. I’d like to wear it.
I got mine by joining the Space Frontier Foundation; maybe they still have a few?
First, formal training doesn’t imply that the person thinks rationally.
Okay, but the question is whether Obama’s policies (crafted by the likes of Summers, Romer, et al) and statements (echoed by Summers, Romer, et al) indicate economic illiteracy — not whether they are thinking rationally. I don’t think you can reasonably argue that Summers and Romer are economically illiterate.
How about the “real human costs” of the “stimulus” package? The debt service payments; the shaking of confidence in the federal government; the rosy predictions of its effects, now shattered?
Those don’t sound like “human costs” to me; they sound like politically-inspired hot air. I’ll take those imagined costs over thousands more people on the street any day.
The people shaping his policies are economic superstars
Hilarious.
Jim, look up the phrase “appeal to authority” under fallacies…
Tell you what, give me some evidence that the stimulus has actually saved jobs (citations, please, and spare me the usual lefty sites…I want real numbers with real analysis, not rhetoric) then we can talk.
Right now, what I see is a huge amount of money (you claim $600B over 2 years instead of $787B…BIG improvement…) and a host regulatory changes (always ignored by the stimulus backers) and nothing at all to show for it. The Obamoids made a host of promises about what their proposals would do, and now that they have failed to meet their targets, they are trying to weasel out of being called on it.
Jim, look up the phrase “appeal to authority” under fallacies…
Scott, pay attention to the argument being made: that Obama’s advisers are not economic illiterates. That’s a case where appeal to authority is perfectly appropriate, because it’s authority itself that is being questioned.
Right now, what I see is a huge amount of money
Little of which has actually been spent.
you claim $600B over 2 years instead of $787B…BIG improvement…
For all your concern about spending, you seem pretty casual about $200 billion.
nothing at all to show for it
One example: New York state filled 40% of its budget deficit with stimulus funds. Without those funds, thousands of people would have been laid off.
The Obamoids made a host of promises about what their proposals would do, and now that they have failed to meet their targets
Their “target” for this point in time was slightly lower unemployment than would have been the case if no stimulus had been enacted. There’s no proof they have failed to meet that target, and plenty of evidence that they have (i.e. all the people whose salaries are being paid by ARRA funds).
Jim,
You suggest that Obama’s advisers are not economic illiterates because….? Krugman (for instance) may indeed be a talented writer (he certainly fumes better than most), but his ability to transcend his ideological blinkers is limited at best. Please don’t wave the Nobel at me…any organization that hands out prizes to the likes of Yasir Arafat and Al Gore long ago forfeited any degree of credibility. The sole criteria for credibility is the ability to offer predictions (and analysis) that sync up with reality, and the rather dismal group you appeal to as authorities has done neither….
Little of the money in the porkulus has been spent because most of it is oriented towards paying off Dem special interests, and it takes time to line up those payoffs. If the point of a stimulus is to stimulate (hence the name), then it seems odd that most of the money is targeted for outyears (2011+) when the need for the stimulus is presumably past.
Sadly, when one is talking about 2 trillion dollar deficits (and possibly increases in the federal debt of over an order of magnitude greater than that), 200 billion is not a big number. Worse still, it is only about 25% of the total size of the stimulus package, so suggesting that this makes everything all right is simply nonsense on stilts…
NY paid for its budget deficit with stimulus money. Not sure that I see how that is different than you or I taking a tax cut and paying down our debts with it…something you have stated earlier was a reason NOT to give tax cuts. Aside from the fact that those thousands of public sector vampires would have been laid off (this is a bad thing why?), it is likely that next year those same deficits are likely to be in place, and more money will be needed to pay off those deficits again. Hence the stimulus not only fails to stimulate, it fails to resolve the problem in any sort of permanent fashion, rather it simply masks the symptoms.
The target that the Obamoids set was 8%, now they are admitting that unemployment will top 10%, and I might guess that it will go even higher. This is a 25% error, not ‘slight’ by any means. In fact not a single prediction made by Obama’s intellectual giants (who you feel compelled to defend) has been validated by events, despite your desparate efforts to spin some sort of success.
I was particularly amused by your suggestion that ‘all the people whose salaries are being paid by ARRA funds’ is a sign that things are working…those salaries are almost exclusively public employees, most of whom do little more than contribute to ongoing deficits in the states in which they work. More to the point (as I mentioned earlier) those salaries will have to be paid next year, and the next, and so on…long after the stimulus spending will have disappeared. So unless you postulate a permanent increase in federal spending to support these states (I suspect you do, and I am positive that The One (PBUH) does), all the stimulus money does is kick the problem down the road.
The stimulus (even by its own internal logic) has been a failure, precisely because it has failed to stimulate. That the overwhelming bulk of its focus lies in the future simply illustrates how poor its initial design was…presuming that its aim was to stimulate and not simply provide the Dems with a wishlist of initiatives and spending options for their preferred constinuents.
Really Jim, is this the best you can do?
Here we have a perfect example of leftist ‘reason’ and lack of perspective…
New York state filled 40% of its budget deficit with stimulus funds. Without those funds, thousands of people would have been laid off.
Let’s ignore your lack of credibility and just say this statement is true.
At what cost? A transfer of wealth from private to public. Is this good for the economy? Is this the genius economic policy the ‘authorities’ are trying to make us buy?
It only makes sense to a leftist because they are focused on retaining power and those NY public workers are likely to continue to vote them power. Even after the economy gets so bad they are unemployed (and unemployable.)
I’ll take one dissenting economist speaking the truth to all the Nobel winners in history.
What makes someone an “economic superstars”?
The same thing that makes anyone else a star — favorable media attention. Nothing more.
I prefer Paul Volker, who lent his respectability to the Obama “team”, and has been heard from since only to acknowledge that he hasn’t had anything to do yet.
But, hey, the country is in the very best of hands. Just ask Jim.
Top Men MG, “Top Men!”
What makes someone an “economic superstars”?
The same thing that makes anyone else a star — favorable media attention. Nothing more.
No, it’s recognition from their peers in the form of tenure at elite universities, the Clark medal, the Nobel prize, influential publications in peer-reviewed journals, etc. By those standards, Summers and Romer and Krugman are superstars.
It only makes sense to a leftist because they are focused on retaining power and those NY public workers are likely to continue to vote them power.
So it makes sense to you for New York to lay off 14,000 teachers because of the economic downturn (which had nothing to do with them)? That’s 14,000 more people collecting unemployment, spending less money, at risk for home foreclosure, furthering the down spiral. Meanwhile the student/teacher ratio goes up.
It is cheaper to preserve an existing job than it is to create a new one, but the economic benefits are similar. It’s very smart of the Obama administration to use ARRA funds to protect jobs that would otherwise be collateral damage from the recession’s effect on state budgets.
Please don’t wave the Nobel at me…any organization that hands out prizes to the likes of Yasir Arafat and Al Gore long ago forfeited any degree of credibility.
The people who selected Krugman, and the people who selected Arafat and Gore, are not the same people.
Jim, Jim, Jim…
In NY, the move was to layoff 14,000 people in the education bureaucracy, NOT merely teachers. This includes all sorts of parasites and hangers on (diversity coordinators, etc.), most of whom could be well dispensed with in the first place. So please, spare us the ‘its for the children’ dreck…
As for the impact of 14000 unemployed, I agree that any lost jobs are regrettable, but at what cost? NY will still have to find a way to pay those people next year (I note you never did respond to that point in my previous post…), so what we have done is merely buy a year’s salary, and I repeat…at what cost? How much did each of those ‘saved’ jobs (if they were saved) cost…and what impact upon the economy (which might in fact lower the propensity for other jobs to be created) occur?
Saving an existing job is often MORE expensive than creating a new one, since with government jobs, saving them costs the full amount (salary/benefits/graft/etc.) while private jobs are generated at a cost below that of full payment (i.e. if the total compensation package and taxes of a job is say, $100K, that cost would be largely borne by a private employer, not by the govt), and it is likely that the job in question would be productive, not simply another sinecure for government drones.
Finally, it is obvious that the Nobel Peace Prize committee is different than that of the Nobel Economics Prize committee, but both are subject to politics, and both have bad reputations for giving out awards based upon ideology, not actual accomplishment. Stiglitz (who won an award in 2001? – might be 2002, I don’t have it in front of me right now – for work he did in the mid 80s that almost directly contradicts much of what he says now) is an excellent example.
This is really too easy you know…I am beginning to believe that you really cannot do better than this…
Of course Obama is an economic illiterate. He’s a Democratic politician, isn’t he?
Of course Obama is an economic illiterate. He’s a politician, isn’t he?
Okay, but the question is whether Obama’s policies (crafted by the likes of Summers, Romer, et al) and statements (echoed by Summers, Romer, et al) indicate economic illiteracy — not whether they are thinking rationally.
I’d say it’s pretty obvious that Obama policies aren’t being crafted by the economic literates in the party. For starters, cap and trade would not be introduced this year. The universal health care efforts would be curtailed. Nobody would be banning incandescent light bulbs. A considerable portion (I’d say at least half) of the Stimulus would be spent by now.
NY will still have to find a way to pay those people next year (I note you never did respond to that point in my previous post….
The stimulus provides funds over multiple years. For example, local towns here received stimulus funds to hire a police officer; the grant covers three years of salary, benefits, etc. In three years either the towns will be able to afford the officer, or they can lay him off in a post-recession environment where layoffs don’t hurt the overall economy so much.
I’d say it’s pretty obvious that Obama policies aren’t being crafted by the economic literates in the party.
In other words, it’s pretty obvious to you that you are more economically literate than Summers and Romer. No doubt you also know better than the coach of your favorite sports team which players should be starting. Such a pity we don’t have you on the Council of Economic Advisers….
In other words, it’s pretty obvious to you that you are more economically literate than Summers and Romer.
I may well be more literate than Romer. I wasn’t at all impressed by the notorious forecast of this January that bears her name. But that’s not the issue. They aren’t crafting the policies I mentioned, otherwise the policies would have been different.
So it makes sense to you for New York to lay off 14,000 teachers because of the economic downturn
Yes. Do you need it explained to you? Oh, I forgot… You’re not interested in fiscal responsibility. Responsibility is about choices and you are presenting a false choice. The choice isn’t lay off 14,000 or steal from the tax payers. The choice is what do we spend a responsible budget for and what do we not. It may be for example that laying off 6000 workers and cutting the budget in other areas is the most responsible choice.