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Russian prof. predicts US fall

Thursday, January 01, 2009

Oy. This guy is quite the idiot. This guy clearly has zero intellectual integrity.


Another government handout?

Seriously. If this didn't work the first time, what makes the Obama team think it'll work this time? When are these free-marketeers going to get it through their thick skulls that this sort of economics does not work. The best way to stimulate economic job growth is by raising wages and creating middle-class jobs. Never, and I mean NEVER, has this Freidmanite form of economics worked. Everywhere it's been tried, it has been a complete and utter failure.
By John Aravosis
America Blog

I thought we tried this last year, and it didn't work.
The incoming administration is considering tax cuts of $1,000 for couples and $500 for individuals that will be delivered by reducing the tax withheld from paychecks. That plan has been estimated to cost about $140 billion over 2009-2010.

The lump-sum rebates issued earlier this year were used by many people to pay down debt, rather than spending the money and boosting the economy as the administration had hoped.

"People need money in their pockets to spend," Axelrod said. "That'll get our economy going again."
The first handout didn't do much because it was too much money in one fell swoop, leading people to use it to pay off debts, rather than buying goods and services, which is what we want them to do in order to help the economy (reportedly, only a third of the earlier $300/person handout was actually spent). This time, the money will be spread out throughout the year in the form of a reduction in your withholding taxes (actually this would be a permanent tax cut). So I did the math. Say you get a paycheck every two weeks, so over a twelve month period that makes 26 paychecks. If you spread the $500 per person tax cut over 26 paychecks, that puts $19 more in your pocket per paycheck.

I'm not an economist, but I've studied economics, and have worked at the World Bank with the big brainy (and arrogant) economists, and something here doesn't quite add up. People didn't spend $300 on goods and services, but they're going to find $19 a sufficient incentive to increase their spending on goods and services beyond what it already is? What's more likely to happen is that someone who earns $750 a paycheck now, who will then earn $769 under the new handout, isn't going to notice the difference, and thus won't adjust their spending habits. And if they do notice the increase, why assume that this time they're going to spend that $19 windfall on goods and services, rather than sock it away in the bank, or, as they did last time we handed out free money, simply use it to pay off their mounting debt?

The approach taken for this new handout seems counter-intuitive. If you want people to spend the money, i.e., spend more than they would normally (rather than just use this money to buy what they already would have, and sock away the rest), I'd think you'd need to give them a sizable lump sum in order to make them feel "rich" enough to splurge on something extra, even though the tough times would warrant prudence. The worst thing you could do, if your goal is to increase consumer demand and consumption, is to give the consumer the extra money in such a way as to effectively hide it. But that seems to be exactly what this plan would do....(Click for remainder).


MoveOn has had it with Politico

By John Aravosis
America Blog

A few of you had written to me about an article in Politico claiming that MoveOn had abandoned gay rights and basically sided with Obama over the Rick Warren affair. MoveOn says that's a flat out lie. Here's a statement they just released:
We've had disagreements with Politico's reporting in the past. But even we were surprised by the shoddy reporting in Andie Coller's recent article, "Will MoveOn Live Up To It's Name?" which raises new questions about the Politico's rumored bias to the right.

Though we went over it with her, Coller omitted the historical context of our organization advocacy. MoveOn members have consistently prioritized universal health care, building a green economy/stopping climate change, and ending the war in Iraq since 2005--long before President-elect Obama was even a widely known player on the national political stage. The new priority that has emerged--economic recovery and job creation--is an obvious reflection of the dire situation so many American's face due to eight years of mismanagement on Wall Street.

To claim, as Coller does, that these priorities represent "leaving some of [MoveOn's] high-minded ideals behind" is nothing short of journalistic malfeasance. That our members recognize that the battle field has changed after this historic election shows strategic smarts, not retreat.

As for her claim that our silence on Rick Warren's inaugural invocation represents some sort of compromise, Coller misses the point. There are few Americans who would suggest that the statements of an inaugural speaker are one of the top four issues facing the country – egregious though they may be. Our members contributed over $350,000 to defeat Proposition 8 last month and are deeply committed to fighting for the civil rights of all Americans. Rather than focus on contrived division, Coller and Politico would serve their readers, and the truth, much better if they would do some homework before writing their articles.
MoveOn is right. If you asked me what are the top issues facing the nation this year, I'd say the economy and the war, followed by health care. I wouldn't call Rick Warren one of the top issues facing America. That doesn't mean I'm giving Obama a pass, or that the Rick Warren fiasco doesn't matter.

(Click for original post).


Interviewing for the Job of U.S. Senator

By Jeremy W. Peters

Perhaps not since the last season of Donald J. Trump’s NBC series “The Apprentice” was filmed in Manhattan have New Yorkers seen more competition for a single job.

And all that vying — for the seat that Senator Hillary Rodham Clinton is expected to give up if she is confirmed as secretary of state — has made Gov. David A. Paterson’s office a very busy place these days.

Enter the latest contender to sit down face to face with the governor: Assemblyman Daniel J. O’Donnell, a Democrat who represents the Upper West Side. Mr. O’Donnell met with Mr. Paterson for about 45 minutes on Monday afternoon in the governor’s Midtown office for what Mr. O’Donnell said was his formal interview for the Senate seat.

To say Mr. O’Donnell, known for his active support of gay rights issues, including same-sex marriage, was overly optimistic about his chances would be a stretch. He put his odds of getting the seat at about one in 10, or “about the same as the population of gay people in the world.” But Mr. O’Donnell did offer that he believes the governor has yet to settle on a final choice.

“I didn’t get the impression that a decision was coming anytime soon,” Mr. O’Donnell said. “I have the sense that he was really weighing what people were saying. I can tell when people are listening to me and actually listening, and listening to me just because they’re supposed to listen. He seemed to be very intent on focusing on and absorbing what I think my strengths might be.”...(Click for remainder).



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