In today’s NY Times, Robert Schiller laments the lack of jobs brought by the “stimulus”. Essentially, he posits, government focus is on the wrong thing. Instead of boosting the GDP, the “stimulus” should be focused on creating jobs. And where should government be focusing that effort?
Why not use government policy to directly create jobs — labor-intensive service jobs in fields like education, public health and safety, urban infrastructure maintenance, youth programs, elder care, conservation, arts and letters, and scientific research?
Would this be an effective use of resources? From the standpoint of economic theory, government expenditures in such areas often provide benefits that are not being produced by the market economy. Take New York subway stations, for example. Cleaning and painting them in a period of severe austerity can easily be neglected. Yet the long-term benefit to businesses from an appealing mass transit system is enormous. (This is an example of an “externality,” which the market economy, left to its own devices, will neglect.)
The problem with this idea, of course, is nothing is really produced. In fact, the focus on kicking up the GDP isn’t the wrong focus. And trying to produce make-work jobs or “service” jobs don’t help with that. They certainly would keep those who got the jobs busy, but a clean subway will not lead to more jobs elsewhere.
The tendency to think like this is apparent among a certain set who believe that spending money on jobs, whatever the sector and whatever the labor, make a difference. A job is a job is a job.
But it isn’t. Government jobs are not jobs that “produce wealth”. They consume wealth. And they don’t certainly don’t produce jobs that do produce wealth.
That comes in the private sector where people produce things – to include services – that other people want and that old “voluntary exchange of value between two people” takes place and produces wealth, which in turn kicks up the GDP.
It is wrong-headed to think the government can “stimulate” employment by employing people in non-productive, busy work jobs.
If government has a role in a recession or depression it should be to clear the way with less regulation and provide the incentives through tax breaks for businesses to hire and expand.
What is hold all of this up at the moment is the unsettled tax picture and regulation regime as well as new legislation the business world is still trying to digest and pending legislation which would further complicate recovery. It isn’t rocket science. Until the marketplace is much more settled than it is now, no jobs are going to be created and now businesses are going to expand.
You can paint and clean all the subway systems in the US and it won’t make any difference. The mid-term elections, however, may. If the GOP takes the House and closes the gap in the Senate, you may start to see some hiring and some expansion, based on the belief that the worst is over – governmentally that is – and perhaps it is now safe to begin the long, slow process of recovery.
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In this podcast, Bruce, Michael and Dale discuss the possibilities of Revolution, Secession, and Constitutional conventions.
The direct link to the podcast can be found here.
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So you say you want a revolution? – IBD wonders if we’re on the brink.
Within their rights, but it is right? – Ground zero mosque debate.
Stupidity and EJ Dionne – How Dionne demonstrates the shallowness, and, well, “stupidity” of the left’s arguments.
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William Gale regales us with what he calls "Five myths about the Bush tax cuts" , in the Washington Post today.
Highlights, or lowlights if you will, of a couple of them are as follows. “Myth” one:
Extending the tax cuts would be a good way to stimulate the economy.
And the ammo that makes it a myth:
According to the Congressional Budget Office and other authorities, extending all of the Bush tax cuts would have a small bang for the buck, the equivalent of a 10- to 40-cent increase in GDP for every dollar spent.
So a 10% to 40% increase in GDP – at this time – is something to sniff at? Note how he worded the increase. He used the word “cent” instead of “percent”. Yeah, no attempt to shade the point at all, huh?
As the CBO notes, most Bush tax cut dollars go to higher-income households, and these top earners don’t spend as much of their income as lower earners.
Right. A) they’re the ones who actually pay taxes – many lower income earners do not. B) “Spending” is a loaded term. The high income earners don’t bury their money in the back yard safely tucked into a coffee can. They invest it. And, for those paying attention, it is investment in the economy that’s lacking at this time.
The rest of the “myths” are as pathetically argued as the first.
In reality, this is just another in a long line of liberal justifications for taking your money based in the premise that it isn’t really yours to begin with.
If you don’t believe me, look at “myth” 3 which states “Making the tax cuts permanent will lead to long term growth. Gale says:
A main selling point for the cuts was that, by offering lower marginal tax rates on wages, dividends and capital gains, they would encourage investment and therefore boost economic growth. But when it comes to fostering growth, this isn’t the whole story. The tax cuts also raised government debt — and higher government debt leads to higher interest rates.
Note that Gale tacitly admits that the "myth" is actually true. However he tries to caveat that with a horrible result that I assume he believes effectively destroys the point. The tax cuts “raised” government debt.
Uh, no, they didn’t. Excessive government spending without the revenue raised government debt. These tax cuts have now been in place for years and government debt has grown exponentially. How is that the fault of a tax cut or the tax payer?
Of course it’s not – unless you believe that money, all money, really belongs to government and it gets to decide how much you can or can’t have. How else do you claim allowing an earner to keep more of what he earned as a cause for "increased government debt?"
Of course Gale forgets one of the aspects of letting the tax cuts expire – but I suppose that’s because it’s not a "myth" in his book. A recent study finds the following to be true as a result of letting the Bush tax cuts expire:
The study found that raising just the lowest income tax rate from 10 percent to 15 percent would cost 88 million taxpayers an average of $503 next year.
Lowering the child tax credit from $1,000 to $500 per child would cost 31 million families an average of $1,033 in 2011; the reinstatement of the so-called marriage penalty, a peculiarity in the tax code that forces some married couples to pay more for income tax than they would if they were single, would cost 35 million couples an average of $595 each, according to the preliminary numbers.
Income tax rates will rise for almost every bracket, with the bottom rate going from 10 to 15 percent and the top rate going from 35 percent to 39.6 percent. Dividends and capital gains taxes also are expected to rise.
So the “your taxes won’t increase by a single dime” pledge for the gullible 95% was a crock and they should have known that when Obama promised to end those tax cuts. But it’s hard to do that when you’re also gulled into believing that they were only tax cuts “for the rich”.
In fact, they were across the board tax cuts and now the middle-class will discover that at the end of the year as they crank up the Turbo Tax and are shocked, shocked I tell you, that their taxes have increased.
And that’s no myth, my friend.
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Investor’s Business Daily is asking "Will Washington’s failures lead to a second American revolution?"
Good question. I don’t see it in the offing at the moment, but if the course continues – i.e. governmental overreaching coupled with increasing cost and incompetence – anything is possible.
People are asking, "Is the government doing us more harm than good? Should we change what it does and the way it does it?"
Sure they’re asking that. And sure they’re wondering if they should change it. But that’s really all they’re doing at the moment. There’s no impetus – other than talk – to make the fundamental change that is necessary to rein in this government. Not yet anyway.
That’s because most of us are still comfortable enough that we’re not willing to do what is necessary (and destabilizing) to make those changes. We’d rather complain and threaten politicians.
I’m not saying I’m any better or any more prepared than anyone else – I’m just putting forth an observation.
Nope – unfortunately, things will have to get even worse than they are now before I can imagine a “second revolution”. And I’d wonder what form it would take. Peaceful but determined overthrow of the system? A new “Constitutional Convention” where the “people” again try to limit government to a specific and downsized role in our lives?
Or would it incorporate the enshrinement of certain “entitlements” and various programs that much of the libertarian right find unconstitutional and intrusive?
IBD seems to think Obama is driving us toward such a revolution. Yet somehow, as unpopular as George Bush was, it didn’t happen then. Perhaps its the cumulative effect of having two relatively unpopular presidents, one from each side, which will trip the trigger?
Again, I’m not seeing it or feeling it.
I’d love to see a second “Constitutional Convention” if I was assured that its intent would be limiting government. But in today’s political climate and with the decades of “entitlements”, I have no faith that’s what it would be. I also have no faith that the outcome of a Constitutional Convention would be acknowledged, much less followed by this government.
It’s a real thought to ponder. How, short of a bloody revolution – which may or may not come out the way freedom loving people would prefer – do we get government under control?
If there is a 2nd revolution, what form would it take? What would be the tipping point? Would we survive it?
Looking out over the political landscape today, I simply don’t know the answers to any of those questions.
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This “Ground Zero” mosque controversy has begun to rankle me. It is my understanding that those who want to build the "ground zero" mosque own the property there.
Secondly, it really isn’t adjacent to the old World Trade Center site, but a few blocks away.
Even if it is adjacent, however, if the first part is true, then it is theirs to build what they wish. I may or may not be happy about it, but they are the property owners and what is built there is their business.
The Anti-Defamation League seems to understand that as well, however, under the guise of "doing what is right" it acknowledges the mosque builder’s rights but then dismisses them in favor of the bigotry of those who oppose them. In a statement they said:
Proponents of the Islamic Center may have every right to build at this site, and may even have chosen the site to send a positive message about Islam. The bigotry some have expressed in attacking them is unfair, and wrong. But ultimately this is not a question of rights, but a question of what is right. In our judgment, building an Islamic Center in the shadow of the World Trade Center will cause some victims more pain – unnecessarily – and that is not right. So the bigotry expressed in this is "unfair, and wrong", but to hell with rights, we’ll side with the arbitrary and subjective "what is right".
An amazing statement coming from a group which was founded to fight bigotry against Jews.
Thankfully not all Jews feel that way. They also understand how profoundly wrong headed the ADL’s statement is. From J-Street:
The principle at stake in the Cordoba House controversy goes to the heart of American democracy and the value we place on freedom of religion. Should one religious group in this country be treated differently than another? We believe the answer is no.
As Mayor Bloomberg has said, proposing a church or a synagogue for that site would raise no questions. The Muslim community has an equal right to build a community center wherever it is legal to do so. We would hope the American Jewish community would be at the forefront of standing up for the freedom and equality of a religious minority looking to exercise its legal rights in the United States, rather than casting aspersions on its funders and giving in to the fear-mongerers and pandering politicians urging it to relocate.
Exactly right. Another way of saying all of this is “grow up”. You either have religious freedom and ownership rights or you don’t. It isn’t a “right” if it can be selectively applied under the arbitrary rubric of “what is right” fueled by bigotry.
And, as inevitable as the rising sun, you can count on politicians gearing up for a run for office to grab the populist opportunity to chime in and side with the bigots because it is the popular thing to do. Newt Gingrich issued this statement:
Throughout its nearly 100 year history, the cause of religious tolerance has had no better friend than the Anti-Defamation League. The organization’s stand today in opposition to the proposed 13-story Islamic Center near Ground Zero is entirely in keeping with that tradition. They recognize the provocative nature of the proposal, that its construction will only result in more pain for the families of 9/11 victims and fan the flames of inter-religious strife. Abe Foxman and the leaders of the Anti-Defamation League deserve praise for taking such a careful look at this issue and arriving at the right conclusion.
And Gingrich’s spokesman had this to say:
Newt Ginrich’s spokesman told Salon in a phone interview today that building a mosque at Ground Zero "would be like putting a statue of Mussolini or Marx at Arlington National Cemetery."
That’s pure crap unless you want to make the same comparison to, oh I don’t know, a Catholic church in Spain following the Inquisition.
Look, this is manufactured “outrage” and pure and simple bigotry. We are either a nation of religious tolerance and property rights or we’re not. There’s no in-between. It’s like every other right – you may not like all of what it brings, but that’s just the price of freedom.
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As a Halo player, I sometimes think back to the book that started the “armored super soldier” genre, Starship Troopers. Published in 1959, it was ground-breaking, and won a well-deserved Hugo award for Robert Heinlein. I think Heinlein would recognize elements of his story in the Halo series.
I’m happy, though, that he didn’t live to see Paul Verhoeven make a complete mess of the movie based on Starship Troopers, because the only thing he would recognize in that movie are some character names.
Some consider it a decent action flick in its own right, but Verhoeven had about as much understanding of Heinlein’s underlying story and philosophy as our resident imbecilic political science professor has understanding of economics, i.e., none to speak of. Verhoeven just dusted off the traditional Nazi metaphors, gave his soldiers from 200 years in the future the same basic weapons soldiers use today, and added some space ships and sex.
This year’s candidate for the Starship Troopers treatment is Atlas Shrugged.
To forestall a whole lot of redundant comments, let me first say the following about Atlas Shrugged:
1. It’s an important book. In surveys, it often finishes #2 behind the Bible as the book people say was most influential in their lives.
2. It’s got some valid points. If you don’t see parallels between Rand’s characters and situations and much of what we see around us today, I have to question your astuteness.
3. It’s so-so as literature. The characters are mostly cardboard-cutout quality. The heroes are super-human and the villians are pure evil (except for Dr. Stadler, who symbolizes the mushy middle). This gives the story-line a comic book feel. The long diversions into philosophical preaching can be tedious. One sermon by John Galt comes in at over sixty pages, and might as well be a book in it’s own right, though I’m guessing it wouldn’t sell much.
All that said, I respect the book. I’ve read it twice, and actually got more from it the second time around. I do recommend it as required reading if you want to understand the psychology of leftism, as analyzed by someone who was all too aware of it’s ultimate effects in the Soviet Union.
Now, on to the movie version.
You can see the director discuss the movie in this five minute video.
As you can tell, he doesn’t say much. Almost everything he says is generic “You have to cut stuff out of anything this long to make a movie.” Well, yeah. But what you cut and what you leave is what’s important. Not to mention what gets what gets changed, as Starship Troopers demonstrated.
There was a danger sign when he said “I’m still figuring things out as I shoot this.”
I thought it was interesting that John Galt’s face isn’t going to be seen in the movie. The credits at this point list that same director as playing the part of Galt (presumably just giving him a voice).
He does spend a bit of time about the theme of taking responsibility. So maybe I’m just being overly pessimistic, and he’s being coy about where he’s really going with the movie to forestall catcalls from our politically correct media.
However, what I see in the video doesn’t give me much confidence. The book is about hard edges, and black-and-white morality. These characters look soft-edged. Rearden needs a Harrison Ford type, though Ford is way too old. It was long rumored that Angelina Jolie would be Dagny, and while she may also be up against the age barrier, she was in the ballpark for the right type.
These people are supposed to be tough, independent, and prepared to take on the whole world. Maybe that’s what they’re chatting about, but somehow I doubt it. Based on what the Rearden actor said, they’re exploring their “relationship”. Oh, goody.
It is possible to make good books into good movies. Hopscotch, Catch 22, some of the episodes of Harry Potter series, Lord of the Rings, and some of the better movies from Jane Austen novels would be examples. What these books do well is capture the spirit of the book. Catch 22, for example, has to leave out a lot of stuff because the book is pretty long, but Buck Henry and crew do a great job of capturing the surrealistic spirit of the book.
Based on what I’m hearing from this director, I’m pessimistic that he can do the same for Atlas Shrugged.
Now you could argue that the hard-edged spirit of Atlas Shrugged just doesn’t work for modern audiences. I think that’s silly; I think that’s what audiences are craving in today’s gooey, politically correct world. I’m in serious doubt that we’ll get it in this movie. Here’s hoping I’m wrong about that.
I guess today is "stupidity day", for lack of a better phrase. In an piece at the New Republic, Jonathan Cohn laments "The stupidity of liberal apathy".
This seems totally nuts, purely on the merits. Obama and the Democrats passed a major stimulus that cut taxes for the middle class and invested heavily in public works. They saved the auto industry, created a new regulatory framework for the financial industry, and enacted comprehensive health care reform. Compromises watered down each of these initiatives, to say nothing of the ideas (climate change!) that aren’t going to pass. And still this was the most productive liberal presidency in a generation or maybe two.
He, of course, is focused on the “liberal” agenda and what has been accomplished, such that it is. And he’s somewhat amazed that liberals in general aren’t incredibly impressed and energized by what has gone on these past 18 months.
But, as he admits, much of it has been watered down through compromise and, of course, it is that he sees as the problem that has deflated liberals around the country.
What he doesn’t seem to understand is only he and the liberal community consider what he lists in that paragraph as “accomplishments”. It’s a matter of perspective and, if the polls are correct, most don’t see the “stimulus” as an investment, but instead a product of pure pork. They consider it spending money we don’t have in places the government doesn’t need to be spending money.
And then there’s the car industry. A majority doesn’t see what was done as “saving” anything. Again, they see what was done as government in places it doesn’t belong throwing their good money after bad. They’re also sophisticated enough to understand why it was done – and the word “union” finds its way into those conversations.
Other majorities see the health care bill as a costly abomination unlikely to deliver on its promise of better health care at a lower cost and they also recognize the “financial regulation bill” as just another in a long line of governmental power grabs.
Most are surely sighing in relief that cap-and-trade, aka climate change legislation, failed to find its way into law.
So perhaps the liberals aren’t just in the dumps about the compromises that watered down what was passed. Perhaps they realize the lie they’ve been telling themselves for years, decades even, that they knew what America wanted badly. Here is “the most productive liberal presidency in a generation” and over half the country is up in arms about what has been passed into law during his watch. And as a result, an energized electorate which isn’t friendly toward liberals or those who represent their ideas is gearing up for a November electoral bloodbath for Democrats.
Heck Mr. Cohn – that would depress even the most rabid of liberals. To finally understand that your views are a minority view and not popular has to be devastating. And understanding that what you now have is all you’re going to get is equally as devastating. The stupidity in all of this is to be found in the pretense that if liberals shook of the apathy it would matter.
It won’t. November is not going to be a month you like. Apathetic or energized, the liberal day is setting and there aren’t enough of that type to make a difference in the mid-terms. Independents, finally scared away from the liberal extremists, will make sure of that.
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