conservatism

AP Writer Martin Crutsinger at The Washington Times

Federal Reserve Chairman Ben Bernanke said Wednesday that the central bank is prepared to provide additional stimulus if the economic lull persists.

This guy needs to be fired. QE1 and QE2 clearly did not work as intended. If they did, we would not be in an “economic lull”. In what way is it logical to try this again? I understand that conservative free market principals don’t jive with Keynesian economic theory, but how much more evidence to you need? Say what you want about Reagan but the facts are he lowered taxes and just about doubled revenue to the Federal Government. This Quantitative Easing B.S. is doing nothing but taking money from one part of the economy and passing it to another.

Andrew Stiles at National Review Online:

House Majority Leader Eric Cantor (R., Va.) told reporters outside the House chamber that Wednesday afternoon’s meeting at the White House ended with President Obama “abruptly walking out” of the room. Cantor expressed a growing frustration over the rapidly dwindling spending cuts believed to have been agreed to in the Biden negotiations, having gone from about $2 trillion in savings to less than $1.4 trillion over the course of several days.

Mr. President. You don’t get to run away from hard decisions. You signed up for this.

User Virginia Tech 4ever at Wall Street Oasis:

Consider a robber who steals a purse containing $500, who then uses the money to buy himself a new TV. It is categorically undeniable that the theft has created a sale for the TV store. Conservatives who pretend the stimulus has not created any jobs whatsoever stand in the position of an observer trying to deny the TV has been sold.

Yet the liberal analysis lacks any recognition that the purse owner now has $500 less to spend on the laptop computer she was going to buy. The theft has generated one sale only by destroying another.

The first effect is easily seen. The second is not. But only the economically illiterate would conclude that just the first effect occurred, and that therefore the way to increase consumption is to encourage more purse-stealing. So in addition to looking at the number of jobs created or saved by the stimulus, shouldn’t we also consider the number of jobs destroyed or forestalled?

Fantastic analogy about government spending.

Fred Lucas at CNS News:

“Now, without relitigating the past, I’m absolutely convinced, and the vast majority of economists are convinced, that the steps we took in the Recovery Act saved millions of people their jobs or created a whole bunch of jobs,” Obama said at his Monday press conference.

There’s a couple things wrong with this. First, relitigating isn’t a real word. Now I’m not one to nitpick the president’s grammar, but given the way the media had a cow over every Bush gaffe, I think it’s relevant to point out. Second, Obama makes an assertion without citing any evidence. Just because you’re the president, doesn’t mean you get to make up facts. The assertion he made is flat out wrong. You can find plenty of economists on both sides of the aisle, but there is far from a “vast majority of economists” convinced of anything. As the saying goes: ask two economists a question and you’ll get at least three opinions.

Third—and most important—the assertion is completely moot, you can’t say the stimulus worked or didn’t worked based on what might have happened. There are too many variables. It’s impossible to say what the economy would look like had the stimulus not passed. So, the only way to judge the stimulus is based on the current economic conditions (pro tip: they suck). At last, the stimulus has failed based on the standards set by Obama’s own Council of Economic Advisers:

Their report projected that the stimulus plan proposed by Obama would create 3 million to 4 million jobs by the end of 2010. The report also included a chart predicting unemployment rates with and without the stimulus. Without the stimulus (the baseline), unemployment was projected to hit about 8.5 percent in 2009 and then continue rising to a peak of about 9 percent in 2010. With the stimulus, they predicted the unemployment rate would peak at just under 8 percent in 2009.

(Via George Will at Politifact)

So, which part of the stimulus worked?

Via The Foundry.