The Bizarro World of Politics

Obama is being attacked by the idiot right, the do-nothing Republicans, for actions which actually helped the country: stimulating the economy as the country was nose-diving into a Great Depression. (This from Republicans who under Bush funded a $170 billion "stimulus" plan in early 2008 which was a "tax rebate" plan and then in October 2008 gave $700 billion to bailout Wall Street). But Obama puts up the most idiotic "defense" of his own stimulus policies. Pathetic...

Here's Obama's spokesman, Robert Gibbs, claiming "success" at job creation by Obama:

MR. GIBBS: We know that 2 million people would not be receiving paychecks that are now.

...

Q In spite of those 2 million jobs and in spite of all the talking you’ve done about the opportunities the stimulus spending has created, the fact remains, as we discussed about the poll, people don’t see it. They don’t see $800 billion worth of job creation.

MR. GIBBS: Well, we haven’t spent $800 billion yet.

By my simple-minded math, you spend $800 billion and "create" 2 million jobs, that means you are paying $400,000 for each job! That is insane. A WPA-style jobs program could create well over 20 million jobs for the same amount of money, i.e. $40,000 per "created" job.

I don't get the 2009 "stimulus" bill. The 'tax cuts' portion didn't directly create any jobs. The 'state and local governments aid' did "save" some jobs, but these are high priced jobs and rewarded states that were financially profligate. The 'money to "extend" unemployment benefits' is paying people to be unemployed. That makes no sense to me. You should pay people to work, not to sit on their duff and collect dole. Seems to me the role of government is not to pick winners but to provide a framework. Providing a WPA-style work program at minimum wage ensures nobody starves and doesn't favour any special interest group. It would be far cheaper and spread the benefit around to a larger number of people.

Here is an interview by George Stephanopoulos with the Council of Economic Advisor chair, Christine Romer, giving a positive spin to Obama's stimulus "plan".

What I don't like is her going along with the "cut the deficit" crowd. She knows the following facts (from Wikipedia):

The common view among mainstream economists is that Roosevelt's New Deal policies either caused or accelerated the recovery, although his policies were never aggressive enough to bring the economy completely out of recession. Some economists have also called attention to the positive effects from expectations of reflation and rising nominal interest rates that Roosevelt's words and actions portended. However, opposition from the new Conservative Coalition caused a rollback of the New Deal policies in early 1937, which caused a setback in the recovery.

But she is playing politics and pretending that being "tough on deficits" is what is needed. That very same policy caused a loss of almost 7 million jobs and a 37% slump in manufacturing in 1937-38 (see Wikipedia):

By the spring of 1937, economic indicators had regained the production, profits, and wage levels of 1929, except for unemployment, which remained high, although it was considerably lower than the 25% unemployment rate seen in 1933. In June 1937 some of Roosevelt's advisors urged spending cuts to balance the budget. WPA rolls were drastically cut and PWA projects were slowed to a standstill. The American economy took a sharp downturn in mid-1937, lasting for 13 months through most of 1938. Industrial production declined almost 30 per cent and production of durable goods fell even faster.

Unemployment jumped from 14.3% in 1937 to 19.0% in 1938, rising from 5 million to more than 12 million in early 1938. Manufacturing output fell by 37% from the 1937 peak and was back to 1934 levels. Producers reduced their expenditures on durable goods, and inventories declined, but personal income was only 15% lower than it had been at the peak in 1937. In most sectors, hourly earnings continued to rise throughout the recession, which partly compensated for the reduction in the number of hours worked. As unemployment rose, consumers' expenditures declined, leading to further cutbacks in production.

I despise the Republican hypocrites. But I've also come to despise Obama as an inept leader too busy trying to mold "compromise" to be bothered to lead. He has picked people who favour the bankers and who indulge in the old political spin. What the US needs is straight talk, so that when you claim "change you can believe" that slogan really means something and not "politics as usual".