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"Stimulus too small" was treated the same as "Invading Iraq is crazy"

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Kurt_and_Hunter Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-07-09 10:05 AM
Original message
"Stimulus too small" was treated the same as "Invading Iraq is crazy"
Edited on Sat Mar-07-09 10:07 AM by Kurt_and_Hunter
One-sided debate
Paul Krugman
March 7, 2009

One major sin of news coverage, especially on TV, is the way certain points of view just get excluded from consideration even if many of the best-informed people hold those views. Most famously and disastrously, the case against invading Iraq was just not heard in the months before the war.

And still it happens. According to the invaluable Media Matters ( http://mediamatters.org/items/200903060025?f=h_latest ) the idea that the Obama stimulus plan might be too small a view held by many well-known economists basically went unreported on broadcast news during the stimulus debate. Out of 59 broadcasts addressing the plan, only 3 mentioned concerns that the plan was inadequate. And its actually even worse than that: one of those three involved Harry Reid talking about longer-term goals on health and education and one of the other two was me.

Meanwhile, its rapidly becoming clear that yes, the plan was too small. ( http://www.talkingpointsmemo.com/archives/2009/03/bleak... )

http://krugman.blogs.nytimes.com/2009/03/07/one-sided-d... /


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Kurt_and_Hunter Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-07-09 01:06 PM
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1. ...
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Peace_Sells Donating Member (130 posts) Send PM | Profile | Ignore Sat Mar-07-09 01:30 PM
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2. Yes.
Yes I definitly agree. The media does this with everything. Thats why I stopped watching except for Keith and Rachel sometimes.
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Occam Bandage Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-07-09 05:36 PM
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3. When one party is pushing the line, "this is way too big," and the other party
is pushing the line, "no, this isn't too big, this is what we need right now," it's not a surprise that the media would only focus on those two viewpoints. And, you know, I understand why the Dems said "this is just right" instead of "this is actually way too small but we can't get what we need, so we're doing a halfassed plan now and we hope we can do a bigger one in a little bit."
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Kurt_and_Hunter Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-07-09 07:00 PM
Response to Reply #3
7. Bills that are never proposed have a terrible track record of passage
I am often too sure about one thing or another but I am genuinely mystified why so many people have firm ideas about what would or would not have passed.

No effort was made to pass anything larger because the President and most of his party believed his target size was correct.

Had the Democratic Party proposed something different I see no reason to assume it could not have passed.

Snowe, Collins and Specter were going to vote for the conventional wisdom. The nature of the conventional wisdom was managed by the administration to be relatively small.

IMO.



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ProSense Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-07-09 05:50 PM
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4. The situation is fluid, and even Obama said that the stimulus is just the first part. Still
Krugman knows this:

Kudos, by the way, to the administration-in-waiting for providing this it will be a joy to argue policy with an administration that provides comprehensible, honest reports, not case studies in how to lie with statistics.

That said, the report is written in such a way as to make it hard to figure out exactly whats in the plan. This also makes it hard to evaluate the reasonableness of the assumed multipliers. But heres the thing: the estimates appear to be very close to what Ive been getting.

The key thing if you want to do comparisons is to note that I made estimates of the average effect over 2009-2010, while they do estimates of effect in the fourth quarter of 2010, which is roughly when the plan is estimated to have its maximum effect. So they say the plan would lower unemployment by about 2 percentage points, I said 1.7, but their estimate may actually be a bit more pessimistic than mine. They have the plan raising GDP by 3.7 percent, but thats at peak; I thought 2.5 percent or so average over 2 years, again not much difference.

So this looks like an estimate from the Obama team itself saying as best as I can figure it out that the plan would close only around a third of the output gap over the next two years.

One more point: the estimate of what would happen to the economy in the absence of a stimulus plan seems kind of optimistic. The chart above has unemployment ex-stimulus peaking at 9 percent in the first quarter of 2010 and coming down through the year; the CBO estimates an average unemployment rate of 9 percent for 2010, so the Obama people are more optimistic than the CBO, and a lot more optimistic than I am.

Bottom line: even if I use the Romer-Bernstein estimates instead of my own there really isnt much difference this plan looks too weak.


It still remains to be seen.



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glowing Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-07-09 06:18 PM
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5. I just told my husband today when we were discussing things that there
would be a second sometime late summer or fall. Literally, dig a hole and fill the hole up.. put one piece of paper on one pile and move it to another.. just give people jobs that pay their bills to get some demand going in the economy...
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Better Believe It Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-07-09 06:37 PM
Response to Reply #5
6. A second stimulus plan is needed. It won't get 60 votes in the Senate
no matter how much sense it makes.

So the Democrats will have to end the Republican fake phantom filibusters if they want to pass any more economic legislation.

It appears that Senator Reid is prepared to allow the Republicans to continue their obstructionist behavior without challenging them to filibuster against legislation they oppose.

And Senator Reid hasn't even suggested changing Senate rules so that only 51 votes are required to pass legislation.

When the Republicans threatened that change in 2005, Senator Reid surrendered to Republican demands.

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Kurt_and_Hunter Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Mar-08-09 10:58 AM
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8. Kicking for the 'unexamined life' crowd
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