Saturday, December 26, 2009, 5:05AM ET - U.S. Markets Closed.
Worried about the U.S. deficit? Think the government should reduce spending?
Well, that's exactly the "worst possible" approach to solving our economic dilemma, according to William Black, Associate Professor of Economics and Law at the University of Missouri-Kansas City.
"If you want to reduce deficits you have to get people back to work [and] you can't do that just by slashing rates," says Black, an author and former federal regulator. "The key now is to have fiscal stimulus, spending, and perhaps tax cuts."
President-elect Barack Obama has pledged to tackle the economic crisis "head on" after being inaugurated on Jan. 20 and on Saturday outlined his plan to create 2.5 million jobs. The country is "facing an economic crisis of historic proportions," Obama said in the weekly Democratic radio address.
“We’ll be working out the details in the weeks ahead,” Obama said, but aides say "the proposal would go beyond the $175 billion stimulus plan he proposed in October," the New York Times reports. The plan could be a big as $500 billion, according to The WSJ.
The plan will likely feature:
Still, Black says the lame-duck Congress, where Democrats have been calling for a package of up to $300 billion, should act now given America is facing the worst recession since the Great Depression.
Fiscal stimulus needs to be in the "hundreds of billions to be even remotely credible," says Black, who notes state and local governments are facing an "acute" crisis because most cannot engage in deficit spending, like the Federal government.
Damned if you do and damned if you don't!
Perhaps they should just reallocate.. put some of the government workers to work building roads and bridges instead of counting the hours til they go home.. then they won't actually have to spend more.. ha ha
if we increase spending, while jobs are being lost all over the country, and tax cuts are being discussed, how will the government pay for all these things? What amazes me is these so called experts that are the same ones who for months now have been saying we are not in a recession, that the economy is strong. Read the head lines folks, job cuts, credit tightened, businesses closing, consumer spending down., all these point to what the experts refuse to say; DEPRESSION. More people are using cash and buying only what is needed like our Grand parents did for ever, instead of charging everything on credit, getting into huge debt. For some of us we can remember when paying of our mortgage was a reason to celebrate, buying a washer or dryer, a new car, a T.V., were huge milestones, it showed we accomplished something in our lives. In 1929 we saw the Great Depression wreak havoc on society, we did not learn our lesson from history, so now comes the Great Depression of 2009 when we get a chance once again to learn, the HARD WAY.
Here is a bio on Mr. Black: "Black developed the concept of “control fraud” – frauds in which the CEO or head of state uses the company or nation as a “weapon” of fraud. Control frauds cause greater financial losses than all other forms of property crime combined. He recently helped the World Bank develop an anti-corruption initiative." Wonder how that World Bank Initiative is going? Perhaps he should be focusing on his specialty instead of adding to our debt..
If we increase spending, while jobs are being lost all over the country, and tax cuts are being discussed, how will the government pay for all these things? What amazes me is these so called experts that are the same ones who for months now have been saying we are not in a recession, that the economy is strong. Read the head lines folks, job cuts, credit tightened, businesses closing, consumer spending down., all these point to what the experts refuse to say; DEPRESSION. More people are using cash and buying only what is needed like our Grand parents did for ever, instead of charging everything on credit, getting into huge debt. For some of us we can remember when paying of our mortgage was a reason to celebrate, buying a washer or dryer, a new car, a T.V., were huge milestones, it showed we accomplished something in our lives. In 1929 we saw the Great Depression wreak havoc on society, we did not learn our lesson from history, so now here comes the Great Depression of 2009 when we get a chance once again to learn, the HARD WAY.
I suppose an Associate professor from Podunk U couldn't do any more damage than Paulson, Bernanke, and the Corporate Butt Kissers in Congress...
"Moral certainty is always a sign of cultural inferiority. The more uncivilized the man, the surer he is that he knows precisely what is right and what is wrong. All human progress, even in morals, has been the work of men who have doubted the current moral values, not of men who have whooped them up and tried to enforce them. The truly civilized man is always skeptical and tolerant, in this field as in all others. His culture is based on "I am not too sure." - H.L.Mencken, writer, editor, and critic (1880-1956)
The idea that you can help make America energy independent by developing wind and solar power to offset natural gas / coal generated electricity, is pure bunk. Less than 12% of our hydrocarbon useage is to generate electricity. What will Obama's plan do to deal with the other 88% ? The idea of energy independence is nice, if the alternative medicine is not worse than the initial illness. Unfortunately, a few more high efficiency vehicles on the road, even combined with other initiatives, will not help much either. Another wasted opportunity.
I have direct deposit. Where do I send my ABA and Routing code.
Theft and Fraud!! Our goverment officials pulled the largest Ponzi scheme in history off and stole the future and hopes of Americans. The government advised Americans to save more and even gave them "catch up" privledges, only to watch their retirement dreams fail, not just profits but the prinicipal too! Treason charges for all O's and Gov't upper echelon!
I was under the Impression that the Increased spending was supposed to make jobs...They will need workers to fix the Roads & Bridges. They will need worker to invent more fuel efficient products & people to build those as well. You cannot tell that we are in a recession by going into the stores. People are whipping out those Charge cards like there is No Tomorrow. I'm not so sure that our Spoiled young people CAN learn a lesson. Most of them don't even know how to even cook anything more than microwave meals. And they feel so Entitled that when everything starts to dry up, they will prolly turn to robbery & murder to get what they consider Their Due. People today do not know what being poor is. It ain't gonna be pretty if we can't pull out of this anytime soon.
Advise for this idiot. Don't stick a fork in your eye.
Obama will HAVE to cut spending as there is a lack of confidence in rating agencies from foreign investors. As the government spends billions buying bad debt from banks, no one really knows how much they are worth. It is simply being transferred from the private sector to the public sector. If the market could not value Citigroup, how can Moody’s maintain a triple-A rating on US bonds? With the European Union’s economy being the largest in the world with less overall public debt, foreign countries will purchase less US Bonds or will ultimately demand higher rates. THAT IS FACT!
Dig more oil in our Soil,and Shore and sea,Like Claifornia,Texas, Gulf of Mexico,Alabana,Florda,Alaskan Costline,Pacific Coatline,Atlantic Coastline,Arizona,......... Is that discoveries and stimulus..........
If you rearrange the letters in the words "Stimulus Needed" you can spell "Deludes Minutes".. or "Seems Undiluted".. ha ha
You do realize that "stimulus" is the same thing as "taxpayer support", don't you? This money comes from somewhere. Revenue sharing on revenues artificially generated from taxpayer support is a joke. We *MUST* deflate.
Hope they do exactly what he says so my gold stocks hit the moon...
Open all our frontiers for oil and gas exploration and give more tax concession.........to make the private and public capital to move ahead in this venture..........
Wait.. there are a few more anagrams for "Stimulus Needed".. one is "Unseemliest Dud".. the other is "Denudes Litmuses".. this is great.. buy anything but his advice...
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__A_YAHOO_USER__ - Monday November 24, 2008 07:14AM EST
Stimulus......is badly needed.,.........Why not.......is it.........