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[jtown1123]

This message was self-deleted and locked by jtown1123.

[girl gone mad]

1. I think his knowledge of economics in general is extremely lacking,

and he is not being served well by his advisers.

[jtown1123]

3. Either they have an agenda or they are clueless. Either way, it's concerning. n/t.

[mmonk]

8. Money men are never good advisors contrary to what many Americans think.

They are always in the political sphere to game the system.

[Ninga]

2. Our President is over his head and exhausted by the game playing the GOP is

conducting.

The President blinked when he had both houses and is paying dearly.

His actions and decisions reveal that he is very moderate, conservative and overly cautious.

[jtown1123]

4. True. It's just baffling such a mistake isn't even acknowledged by the press...

[Pisces]

48. This is a Repuke meme that the Pres. is incompetent. Post this shit on FR.

[leeroysphitz]

5. if Obama doesn't start talking about jobs he wont need to worry about the deficit much longer. n/t

[ProSense]

6. Policy wonkdom at its worst

Here's what the President said in a speech to the American public:

"For the last decade, we have spent more money than we take in. In the year 2000, the government had a budget surplus. But instead of using it to pay off our debt, the money was spent on trillions of dollars in new tax cuts, while two wars and an expensive prescription drug program were simply added to our nation’s credit card.

Here's what Dean Baker thinks he should have said:

...He apparently believes that there was a huge deficit on an ongoing basis as a result of the policies in place prior to the downturn. In fact, the deficits were relatively modest. The huge deficits came about entirely as a result of the economic downturn brought about by the collapse of the housing bubble.

Yeah, the President should have gone on television and said that the Bush tax cuts and the wars have nothing to do with the deficit, even though they're the largest driver.

[jtown1123]

15. Dean never said those didn't add to the deficit.

[girl gone mad]

23. You put a lot of effort into that straw man.

[dawg]

25. I agree with ProSense.

While Baker is technically correct that the poor economy is the largest contributor to the deficit, when you look at the long-term picture, the President's narrative addresses the main components of the "permanent" deficit. I think he is using political spin to some degree, and in this case, doing so in order to further a center-left view of the economy rather than a center-right one.

[girl gone mad]

36. Deficit reduction during a serious economic downturn..

is not a center left position, it's a hard right position.

Every progressive economist since Keynes has understood the importance of automatic stabilizers.During periods of private sector deleveraging and high unemployment, government spending on social safety net programs picks up, reducing the severity of economic shocks. Simultaneously, tax revenues decline. This has the net effect of dramatically increasing deficits over the short term, which is a very good thing. We're trying to avoid severe depression here.

[dawg]

44. Agreed.

Deficit reduction in a downturn is counter-productive. I was only agreeing that it makes little sense to criticize the President for pointing out that the Bush tax cuts and the wars are the major components of the permanent part of the deficit.

[jtown1123]

46. Seconded.

[ProSense]

50. "is not a center left position, it's a hard right position."

Then FDR was a RW tool.

<...>

FDR’s initial response to the Great Depression provides an interesting case in point, for Roosevelt came into office as something of a fiscal conservative. In keeping with the fiscal orthodoxy of the time, he called for a balanced budget during his campaign, was reluctant to deficit spend once in office, and even pressed for the successful passage of the 1933 Economy Act as one of his first major pieces of legislation-an act which cut federal spending by nearly 250 million dollars during the first months of his administration.

<...>

Further evidence of FDR’s inherent fiscal conservatism can be seen in his decision to cut federal spending at the start of his second term-a move which resulted in the so called “Roosevelt recession” of 1937-38 and which led to the first increase in the unemployment rate since his assumption of office in 1933. Stunned by this unfortunate turn of events, FDR began to heed the advice of those who advocated the economic policies of John Maynard Keynes. In 1938, therefore, the President would submit a budget that called for an increase in federal spending but without any concomitant increase in federal taxes. The resulting deficit, the President argued, was necessary to enhance “the purchasing power of the nation” so as to expand the economy-and the tax revenues that would flow from it-and reduce unemployment.

link

[enough]

7. k&r (nt)

[potone]

9. This article is incorrect.

Read the comments on the original article and you will see the flaws in this argument.

[jtown1123]

13. So you're going to believe anonymous commenters to an economist?

[Bandit]

10. What total absolute bullshit

"In fact, the deficits were relatively modest." The Deficits in the Bush* years were each and everyone a Record Deficit. There was not a single year in which we did not have HUGE
deficits during the Bush* debacle.. Obama knows full well the nature of our economic nightmare we were placed into..

[girl gone mad]

12. Our "economic nightmare" is unemployment, not the deficit.

If Obama knows this, he certainly isn't letting on that he knows it.

[Bandit]

38. They are intertwined and feed into each other.

Imagine if we had no Debt? Right now we are paying more to Service our National Debt than we spend on almost all decretionary spending other than Defense and SS/Medicare, COMBINED. If we did not have that HUGE Interest Expense we could spend more on Infrastructure and other IMPORTANT Projects and Research and Development.. That would mean JOBS, lots and lots of JOBS...But noooo, then the money people would not be getting their pound of flesh....

[girl gone mad]

49. We could eliminate most of the "debt" if we wanted to.

I suspect you wouldn't like the result.

Debt issuance by the Treasury is a monetary operation for draining reserves to permit the Central Bank to hit its target rate. A treasury bond basically functions like a savings account, you could think of the government debt as private sector savings if it makes you feel better. Most of it is owned by our fellow Americans. Interest on these bonds adds to the budget deficit. Our interest rates are low and the inflationary event occurred pre-issuance.

The only thing keeping us from investing in jobs, infrastructure, research, etc. is our politicians' unwillingness to do so.

[jtown1123]

18. He doesn't acknowledge the housing bubble, which is what Dean takes issue with.

[Kahuna]

11. That is so stupid. nt

[ProfessorGAC]

14. Dancing With Numbers

The deficits values described in this article are laughable. First, it's bad research. The revenue downturn (technically speaking, revnues "increasing" at a statistically significantly lower rate than the spending)began in 2003. They did not ring up only $200 billion in deficits over those 5+ years.

Secondly, it is awfully convenient that the author doesn't bring up that the Iraq and Afghanistan wars were off budget. Add those numbers in, and you'll see the entire premise is fatally flawed. What a buffoon.

But, the writer clearly had an agenda and wasn't going to let facts interfere.
GAC

[jtown1123]

16. Dean is very progressive, so sticking up for people is his agenda.

If you're familiar with his work, he always talks about the costs of wars. What he is saying is that the President makes a mistake here in that he claims the debt is cause by us spending too much.

[ProfessorGAC]

19. Then I Don't Agree With Him

His numbers are still wrong.
GAC

[jtown1123]

20. You don't agree with the CBO's numbers?

[ProfessorGAC]

21. Read My Post

The CBO numbers are cooked. Everybody who was paying attention during the Bush years knows that.

THE WARS WERE OFF BUDGET! So, the deficits were WAY bigger than those being used by Dean's analysis.

The basic premise is flawed because there are HUNDREDS of BILLIONS not including in those CBO numbers.
GAC

[Ninga]

27. Although you may be right one one level, on another one, the OP generated discussion that goes

beyond numbers when it comes to our President's decisions and positions.

It has been a long time coming for me, but my conclusion is that I wanted to see in President Obama something that I haven't found, and that is the wisdom and respect for past events that make up the financial history of our country.

His Hebert Hoover-ish leaning positions are one such indication.

[ProfessorGAC]

39. Sorry, Don't Agree With That Either

Hoover was complicit in what happened. Obama inherited a plane with no pilot and low on fuel.
GAC

[jtown1123]

17. Also a reminder that Debt and Deficits are two different things, which is why some may disagree...

[mfcorey1]

22. I think in the hot seat where he is that he understands it better than we do.

[VeryConfused]

24. Just an example of liberal racism

the smartest President in modern times "doesn't understand"? I got news for you Dean, don't assume our President is stupid and incapable of understanding just because he is black.

[Romulox]

26. Um, Confused? The economy STINKS. I mean, pseudo-depression level terrible.

If the President understands, then why isn't he doing something constructive? :hi:

[VeryConfused]

30. The President is not a miracle worker

he can only work with the Congress the voters stuck him with. You want to see more improvement improve Congress

[Ninga]

33. He blinked when he had both houses, and turned conservative instead of seizing

the bully pulpit during the health care debate. If he would have rallied the voters that put him into office then, as he did last night, the switchboards would have been on fire with cries demanding "public option"...and the blue dog Dems would have towed the line.....it is not in his DNA to be bold.

[VeryConfused]

35. The President passed a bill that over half a dozen Presidents failed to pass

how is that a failure?

[Ninga]

42. I did NOT use the word failure. I assert he misread the historic election and was not bold,

Results and was not bold but but conservative. The messaging out of the WH during the health care debate was weak and was not taken directly to the voters, and the health care bill is not a reality in most voters lives because it hasn't been implemented yet.

[Ninga]

29. So far, he is more conservative than any Democratic President in my memory and I am 67. I am not

ready to hang the mantle of "smartest President in modern times" on him.

[VeryConfused]

34. How does your opinion of the President's ideology

have anything to do with his intelligence. Plus how could the President that has done more for GLBT rights than all the presidents before him be considered conservative?

[Ninga]

37. Point well made, I cannot argue. I am happy that his struggles with the issue has allowed

him to support the GLBT communities. One issue does not make him more or less conservative, it's collectively all issues along with the people he chooses as cabinet and close advisors, and commissions.

[kenny blankenship]

43. how could the President that has done more for GLBT rights ... be considered conservative

Because letting gay people have their civil rights doesn't cost any money, and consequently, as a legal and social change, it isn't opposed by any bloc of industry lobbyists, just by some Jesus nutters. If the Clean Coal mongers and Goldman Sachs were against gays in the military, Obama's nuanced position would be even more nuanced - to the point of being indistinguishable from opposition. His position on gay marriage is classic southern segregationist conservatism: Let the states decide what fundamental rights human beings -uh, certain human beings, that is- will receive.

And the only reason the Democrats have done anything on our rights, including Obama whose DOJ has doggedly fought to resist change, is because gay people were winning them already through the court system. After decades of vague promises, years of stringing us along, Democrats were on the verge of being judicially bypassed forever, and they would never be able to take credit for doing anything. At the same time they were losing the ability to say "vote for me, gay people, because you need this legislation we passed repealed."

[jtown1123]

47. Wow, way to go out on a limb there. nuts.

[swilton]

28. Obama may be a legal scholar

who has been handled (or manufactured) brilliantly to the extent that he is where he is.

But I believe he is no economist.

But then one could argue does he need to be - no and yes - by the time one is this senior in political office, one is mostly handled anyway.

Yet Obama is young and his political resume was relatively thin and made him extremely dependent s on his economic team (Rubin, Bernacke, Geitner) - Geitner has a record of being anti 'entitlements' have left him a short rope with which to hang himself.

[Ninga]

31. Spot on.

[dionysus]

32. hit piece fail...

[DevonRex]

53. How many more times

(hey, that's a song!) are we gonna see this hit piece anyway? My new favorite thingy for these posts is:

[blindpig]

40. What ridiculous excuse making.

Jesus, it's a sales pitch.

[kenny blankenship]

41. So Obama doesn't want to remind people of the recession, which many people feel has never ended.

I'm not making excuses for the President, it's just slurping political cyanide on live TV to admit in effect that we've been in recession every year he's been President.

Yes, you can't understand the deficit without understanding the effects of recessions on federal REVENUES (they go way down) and on EXPENSES (they go way up due to unemployment claims and increased utilization of the safety net (like food stamps) and because of govt. efforts to put a floor in under consumer demand. Yes, it's true Obama omitted any mention of the recession's role in the ballooning deficit.

But Obama doesn't need the people to actually understand the deficit. He just needs them to understand that it's the Republican's fault. That's all he was trying to accomplish there with that mini-narrative preface to his discussion of the state of debt ceiling negotiations.

[Fire1]

45. Epic fail. n/t

[denverbill]

51. The CBO estimate excluded war costs. Those were 'off budget'.

Obama forced them into the budget early on. Adding that and the emergency bank rescue and the deficit was over $1 trillion.

[DevonRex]

52. Well bless your heart...

[Islandlife]

54. He does not draw these conclusions by himself

He is not alone at his desk crafting his speeches. His administration must have agreed on the narrative.

Is this another example of 11 dimensional chess?

Or...

Is he in a position to have a unique understanding of the situation?

Or...

Is he in denial?

Or...?