Obama’s Stimulus Is Killing Jobs, Depressing The Economy

Proof • June 1, 2009

In other words, the exact opposite of its intent:

Most of the $800 billion stimulus package has yet to be spent, but it’s already harming the economy, both by triggering trade wars that have cost at least 40,000 jobs, and by driving up interest rates for businesses that need to borrow money to expand or create jobs. (The government is keeping down interest rates on its own debt by printing vast sums of money to buy its own bonds, in order to finance the exploding national debt, which will result in massively higher taxes).
As economist Arnold Kling explains, “most of the stimulus spending does not take place until next year and beyond, so the short-run gains are puny. On the other hand, the big increase in the projected deficit creates the expectation of higher interest rates, which raises interest rates now. These higher interest rates serve to weaken the economy. According to this standard analysis, the stimulus is going to hurt GDP now, when we could use the most help. Much of the spending will kick in a year or more from now,” when the economy will already be in recovery, and “when the economy will need little, if any, stimulus. This is the flaw with using spending rather than tax cuts as a stimulus. The lags are longer when you use spending. Of course, if the real goal is to promote government at the expense of civil society” through “political favoritism, then the stimulus is working exactly as intended.”

I actually disagree that the “stimulus” spending spree will create jobs even in the long term when more of it is spent. There’s no doubt that it’s hurting the economy in the short term, as the looming debt that spending has created casts a shadow over the economy as a whole, but even when the spending happens and employs people the net impact to the economy is going to be negligible, at best.
Keep in mind that anything the government spends must ultimately – be it sooner or later – come from the economy. What we gain in jobs under the “stimulus” spending spree will be offset by what we lose in jobs once the bill for the spending spree hits the economy.
So in the short term, the “stimulus” hurts us. And in the long term, thanks to the new debt the stimulus represents, it hurts as as well.
Obama has put us in a lose-lose situation.

Tags: Asshats, Domestic Issues, Politics

http://sayanythingblog.com/entry/america_is_back/#c397018 DINO

PS. When things improve, an indicator improves and someone credits Obama you people rush to say that the stimulus hasn’t been implemented enough to make a difference.

Yet here you are trying to blame negative developments on Obama’s stimulus.

Obama has put us in a lose-lose situation.

The situation we find ourselves in was there before Obama.
http://sayanythingblog.com/entry/america_is_back/#c397018 DINO

Your ideas have failed. We tried them for 30 years and have ended up in ruins.

Go ahead, tell me conservatism didn’t reign for 30 years.

Small government is for third world countries. Civilized, advanced people require public institutions to organize, prioritize and direct resources. The weakening of government has led to our current crisis.

Do you advocate corporations with weak leadership? Schools with weak authority? Why do you think a society can function with no one in charge?
carrick

Brent:

It is the typical keynesian lite supply-sider analysis we always get from his crowd.

???

Since when did John Maynard Keynes become an advocate of supply-side economics?
http://sayanythingblog.com/ likwidshoe

We need conservatism. Anybody who looks at the ballooning and strengthening government and proclaims that this is in any way “conservative” needs his or her head examined. Conservatism naturally hasn’t even been tried because conservatism goes against the very nature of government.
robert108

Econ 101: Economic growth requires the creation of value, and simply moving money around will never accomplish that. In fact, taking money away from those who earned it is generally harmful to economic growth, as we are finding out.
http://ndgoon.blogspot.com/ goon

People are dumping GM and Chrysler stock, and buzzed thinks that is a good thing. What a fucking moron. But hey, I’m being redundantly redundant.

The reason trolls like Buzz and Dino (1, 2) like this is because the government is redistributing wealth and picking winners and losers. GM and Chrysler should have been allowed to wither and die on the vine.
robert108

Brent: You also forget that every time there have been significant tax rate reductions, revenues to the Treasure have increased, so your reasoning is just wrong.
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2Hotel9

People are dumping GM and Chrysler stock, and buzzed thinks that is a good thing. What a fucking moron. But hey, I’m being redundantly redundant.
Buzz

This is working out really well. GM and Chrysler just disappeared today. But on a positive note, removing them from the dow made it go up.

What a tard. GM is selling for .92 right now with over 145M sold.
http://ndgoon.blogspot.com/ goon

Chairman Obama Stimulus is only going to the people he wants it to go to Union thugs, Leftwing wacos and has nothing to do with job creation.
sayanything-4625

Dino,

Since you have publicly stated you want to see America destroyed I have to conclude you support the stimulus because it will destroy America.
robert108

That should be: “revenues to the Treasury“
jimmypop

Your ideas have failed. We tried them for 30 years and have ended up in ruins.

source? i count 6. and they were mostly liberal years as rubs are too cowardly to do anything. the economy failed under bush and liberal congress.
mc

‘Buzzed’ (good name Hotel) is a perfect example of why this man is able to kill our ecomony for many generations to come. Clueless, lazy and uninformed dolts who continue to blindly adore him. What will it take??
robert108

Tax cuts are great, but the idea of cutting taxes while continuing to increase spending is a disaster.

The truth is, reducing marginal tax rates, especially on capital formation, helps generate the economic growth necessary to pay off the debt. It would, of course, be fiscally conservative to both reduce marginal tax rates and reduce govt spending, but one good thing is better than none.

So, it’s far less a disaster to have tax rate reductions and increased spending than it is to have increased tax rates and increased spending, which is what Obama is doing now. He’s disabling the ability to pay for the debt he is massively increasing. Now, that’s a disaster.
http://sayanythingblog.com/entry/america_is_back/#c397018 DINO

Conservatism naturally hasn’t even been tried because conservatism goes against the very nature of government.

Of course it has. And it failed. Miserably. Perhaps you are confusing conservatism with anarchy. That’s what people who call themselves conservatives advocate.

Some believe in this mythical form of society where there are no rules and no controls but everything magically works together in creating Utopia. Since it’s never been achieved, least of all through the policies conservatives implement, the excuse is that it’s “never been tried.”

What conservatism has done is dismantle government, destroying it’s effectiveness from the inside. That tactic accelerated greatly under republicans, particularly bush who intentionally made government weak and inept to reinforce the peoples’ disgust with government. Of course the private sector was given free rein to completely fuck us over leading us to the awful place we’re at right now.

Conservatives are like the guy who takes the helm of a company and intentionally destroys it for personal gain- a buyout, stock manipulation or to please some outside liquidators. In that way conservatives are far, far worse than any enemy this country might have. You could call them interrnal terrorists.
2Hotel9

Had they filed Chap 11 last summer they would be coming out the other side now, the same number of layoffs would have happened and rehiring would be starting about now.
SigFan

From Fox News:

Trading of GM shares was halted early Monday after they plunged Friday as low as 74 cents. GM will be kicked out of the Dow Jones Industrial Average because rules of the index prohibit it from including companies that have filed for bankruptcy.

The whole article is here:

http://www.foxnews.com/politics/2009/06/01/general-motors-files-bankruptcy-protection-new-york/
Mickey

Spainsh studies indicate that for every Green Job created 2.5 other jobs will be destroyed.
2Hotel9

“Obama’s Stimulus Is Killing Jobs, Depressing The Economy”

And who did not know this was going to happen. Barri told the world he was going to bankrupt American businesses and drive up the cost of all energy and food. And now leftards are surprised he is doing exactly that. What a bunch of fucking morons.
badlands4

I dread the inflation I think will be coming
Brent

Yeah, I don’t like Arnold King’s analysis. It is the typical keynesian lite supply-sider analysis we always get from his crowd.

We don’t just need tax cuts, though we need tax cuts. We also need spending cuts — and more spending cuts than tax cuts, given our deficit situation.
rog

This is working out really well. GM and Chrysler just disappeared today. But on a positive note, removing them from the dow made it go up. Maybe obama should go on another $200,000 date again.
robert108

Ignorant little dino: it’s not “small” govt, it’s “limited” govt. You fail again.
Brent

Supply-side types always muddle the important part of the message. The government spending money is the problem. Period.

Tax cuts are great, but the idea of cutting taxes while continuing to increase spending is a disaster. The government borrows and prints the difference and what exactly does that accomplish? Whatever you want to call it, it isn’t conducive to economic growth.

I like EconLog and I like Cato, but some members of Cato & EconLog are supply-siders (typically neoclassical microeconomists who adopt keynesian lite views as far as macroeconomics). That’s fine for 90% of economic analysis, but then you read stuff like this from Kling and, like Rob said, it doesn’t make sense, because it is wrong.
http://sayanythingblog.com robport

There’s nothing wrong with being a supply-sider per se, but the idea that government spending can stimulate any economic activity is nonsense given that government spending is, by definition, the expenditure of money taken away from someone else.

And you’re right about tax cuts not being the only problem. What we need to be concerned with is the overall size of government. If we cut taxes but spending stays high we still run up debt. And debt means future high taxes, because we eventually have to pay that debt off with interest.

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