Daily Archives: June 19, 2012
The following statistics were released today on the state of the US economy:
Housing starts declined in May by 4.8%, at a below-expected pace of 0.708 million. That is up 28.5% on a year-ago basis, however. Housing permits rose a better-than-expected 7.9%, to an annual rate of 0.780 million units. That mixes up the picture a bit, and hits at improvements over the next month in the housing sector.
Redbook’s same-store index shows a 2.4% sales increase. That’s up 0.4% from the prior week, but still soft. ICSC-Goldman Store Sales are also soft, with sales unchanged from last week. The year-on-year increase is 3.6%, the highest since mid-May, but the 4-week average is 3.1%, a 3-month low.
Yesterday, this came out (and, most surprisingly, on Ezra Klein’s blog, although not by Ezra Klein):
What’s the real harm of a massive government deficit? Carmen Reinhart, Vincent Reinhart, and Kenneth Rogoff find that high public debt is associated with a significantly lower level of GDP in the long run.
In a new paper for the National Bureau of Economic Research, the researchers examined the historical incidence of high government debt levels in advanced economies since 1800, examining 26 different “debt overhang episodes” when public debt levels were above 90 percent for at least five years.
And what do you suppose they found?
The debt episodes included everything from Netherlands’ Napoleonic War debts and the Japan banking crisis of the 1990s to Greece’s current fiscal crisis. On average, the researchers found that growth during these periods of high debt were 1.2 percent lower on average, consistent with Reinhart and Rogoff’s findings in 2010. What they also found, however, was these episodes of high debt and lower growth were quite lengthy, averaging 23 years. And the accompanying long-term drag on GDP was substantial. “By the end of the median episode, the level of output is nearly a quarter below that predicted by the trend in lower-debt periods,” they explain.
Japan’s “lost decade” has lasted much more than a decade, hasn’t it?
And the policies being pursued by this president seem to be offering up an attempt to see if this country can’t move that average beyond 23 years.
Need a picture?
We’re at 101% of debt/GDP so, according to these folks, we’ll actually perform below the red line.
But hey, more spending please. Because, you know, we need more government jobs (the private sector is doing fine).
Forward (into economic oblivion)!
Are you wearing a cotton shirt? Undies? Neal Boortz is wondering:
Now while you’re sitting there surrounded by all that cottony comfort, I thought you might like to hear about the $20 million dollars that was spent last year by the Cotton Council International. Spent where? Spent in India, that’s where. Spent on what? Well …how about a reality show? Sounds like a good idea, doesn’t it? $20 million for an Indian reality show.
Not much right? But here’s the point. This is something repeated over and over and over again through unnecessary programs such as this using your tax dollars. Crony capitalism. The Cotton Council International needs your tax money like you need a hole in your head. They have members, let them finance the Cotton Council International. My bet is you wouldn’t see money spent like that.
Want to cut waste? Here’s a perfect example of where to begin cutting. As Boortz emphasizes:
Oh … and the $20 million? That came from YOU. It’s taxpayer money. Part of the Department of Agriculture’s Market Access Program.
Now just remember that $20 million. That $20 million represents the entire federal income tax liability of about 2000 American families. That money is money taken from these families that could have been used to pay some past-due bills, get a home out of foreclosure, pay for a family vacation, or put that new roof on the house. But those families didn’t have that money to spend. They didn’t have it because some sharp lobbyist for the Cotton Council managed to talk some political types to seize that money instead and send it to India to swath some Indian babes in brightly colored sarongs for an Indian TV reality show.
Then there’s this little beauty for you to consider.
Amtrak, the heavily government subsidized and controlled passenger rail system, sent out this email to its customers:
Yes, it says exactly what you think it says. If you join a lobbying group that works to increase Amtrak subsidies, you will get a discount. Those who don’t join the lobbying group will pay full fare (such that it is). Or as the recipient of this email says:
Whatever you think of government funding for train travel in the United States, is it problematic that a government corporation will give people discounts if they pay to join an organization that will lobby the government for more subsidies?
Put another way, Americans who pay to support more subsidies get charged less to travel on subsidized trains than those who oppose the subsidies. Two classes of citizens, based on political beliefs, when riding the train?
Apparently that’s fine.
But remember, any cuts we make in spending will lay off police, teachers and fireman. Because everything else that’s being spent right now is both critical and necessary.
Robert Redford again makes the point that the left simply won’t accept the fact that it is their message that most of the country rejects. Instead, it is believed that the problem is the means, the messaging, the way they present their message, that’s the problem:
“It’s about storytelling,” Redford tells Abe Streep. “The Democratic Party has a good story to tell, but they don’t know how to tell it. And the other side has no story to tell and they tell it loud and clear. People listen to the loud barking dog more than the mewing cat. But one of the advantages of the GOP debate — I’m speaking personally now — as horrible as it is to watch, as horrible as it is to see, at least people who have any sense at all can see, ‘This is what we’re getting? This is what we’re going to get if we elect somebody from that mob? Whoa—’”
The left has a story to tell but doesn’t know how to tell it while the right has no story but somehow tells “it” loud and clear?
Brilliant. Keep on believing that, brother.
Sounds like a sound bite you might hear from, oh I don’t know, Joe Biden?