Obama economic plan aims for 2.5M new jobs by 2011

Not true.

Trickle down is what we got with Regan - an economic explosion.

The economic crisis which is the result of interest being extended to those who should have never gotten in over their head is the product of the same Democrats who now say they can fix it.

But of course the fix that they were sreaming for - that we had to have or the world would end - is now just dust in the mirrors as they charge off in different directions with the money.

The lack of regulation and control of excess are the problems that we have with politicians spending our money.

 

So Regan is responsible for today's economy?

Huh?

And it was a Democrat controlled Congress that passed it and set it up so the the Treasury Secretary has sole discretion.

And don't for a second think that the spending spree is over. It's just getting started. A trillion here a trillion there and before you know we're talking about real money. And Congress is getting drunk on it.

 

This is the logic that hasn't been working. Bush has cut and cut taxes yet we're loosing record amounts of jobs per day. If a new job is created, it seems to be overseas because it sure isn't in this country. How long will you guys stick to this economic solution without acknowledging greed has made this theory fail miserable?

 

Quick refresher: supplier products are not counted in GDP. Only final products/finished goods.

http://www.theshortrun.com/classroom/glossary/macro/gdp.html

Second, only American produced resources are counted. Much of the GM, ford, etc. products that are final assembly in other countries and reimported are not counted under most models. Remember that GDP is different from GNP in that the former counts foreign owned entity production. Who knows where our GDP would be without BMW's massive upstate SC factory or Georgetown, KY's Toyota.

Third, our imports tend to outpace our exports. Our export deficit is a major factor that is a detriment from GDP models.

Fourth, look at GM's plant closing/shut-down list recently published and tell me GM is producing significantly. Their X-mas shutdowns in NE Ohio will run into almost February. Their Ontario truch plant may never come back since it's already scheduled to close in 2010. Spring Hill did get spared, though, as a piece of good news. Fewer trucks roll off the line at Ford's Louisville plant. How can anyone say these two are thus adding to GDP?

A final aside: GDP and auto mfg/sales is always dicey due to aggregate utility. Valuation methods are under serious debate right now. Another good reason real estate isn't in GDP :laugh:

I close with Robert Kennedy's prescient observation regarding GDP:

 

Post hoc ergo propter hoc

 

This is why tax cuts won't help in our current economic situation, those who have money will the get tax cuts while those who are in need won't see any relief. I'm thinking most American's see this clearly which is why we voted against the conservative philosophy. I am hoping Obama sticks to his plan to raise taxes on those making over $250K so that money can be used to get the unemployed back to work which will lead to consumers having money to consume and the eagle beginning to shift.

 

But the govt doesn't and you know this. Come on, Ken. You're smarter than this. Cowboys' losing streak got you this down? :laugh:

 

How can you say this, I understand the auto industry only employees around 500K people yet economist predict 2.5 million people will loose their jobs if they go under. This means the auto industry indirectly employs more people than it directly employs. These numbers also don't include the diners outside the GM plant or the department stores who depend on consuming from GM workers. If the auto industry fails it will be catastrophic and the trickle down effect will be endless.

 

I am suspecting the government will cut red tape due to the urgency of the situation. However, we have environmentalist and civil engineers who need jobs also.

 

I guess it depended on where you were standing, I was at the bottom of the economic ladder just graduating high school in 80 and didn't see a fizzle much less an explosion. Reganomics might have been good for the haves but it didn't do a thing for the have nots... They still had not.

 

But that isn't what the snake oil salesmen...er, I mean Obama and McCain told us. Under EGTRRA, the tax burden shifted up the ladder but did nothing to stave off the contraction in our economy thanks to the housing debacle. I do not know how Obama thinks he can do more of the same and get the same result just by pushing things further up the ladder. Anything's possible I suppose, but with no real offset in spending coming soon (in fact, Obama has promised the opposite) I wonder if anything proposed will constructively move us in the right direction going forward. I fear Obama's expressed desire of removing the EGTRRA's tax cuts for working Americans will prove to be detrimental (Don't know how he plans a middle class tax cut and yet a virtual repeal of EGTRRA)

 

Which is another problem conservatives created, eliminating taxes on money made out of this country is why they assemble cars in other countries...

That was Bush tax cut number ?????

 

Which are you denying, Bush cut taxes or jobs are being lost by the millions?

My point is solid, if tax cuts create jobs then we wouldn't be seeing massive job losses after the Bush tax cuts. The reality is tax cuts and job loss/creation has nothing to do with each other. Any company who cuts a job because of a 3% tax increase wasn't stable and there has never been a company in the history of jobs who determines staffing needs by taxes. You add headcount on need for headcount and not on profits or taxes.

 

See above. I'm not saying it will not be a bad thing. I'm just saying GDP measures certain limited things and GM/Ford are not weighty players. Now, if you want to argue whether GDP is an accurate barometer of economic health, I'll be there with bells on.

The spiderweb effect is hard to measure and even more difficult to predict. Many suppliers are multi-line suppliers. That is, they build Honda bumpers and GM bumpers. While there will be inevitable contraction, some of those who make GM bumpers will start making them for Hondas (happening at one local plant). With GM's reduced footprint in mfg, you don't have that many diners or stores that are wholly dependent on the local GM plant. You don't have too many towns that are like the town in "Gung Ho" as most of them have already had their losses in the 90s or retooled. I lived in a suburb of Cincinnati that was decimated by the loss of one of GM's prize plants. That said, there was recovery, though nothing ever really replaces a monstrous facility like that. But smaller towns are a different story. Whatever this economy does to manufacturing based towns, it's a drop in the bucket compared to what happend thanks to NAFTA. (Anyone else notice that Obama is reassembling the Clinton team that embraced NAFTA with such open arms?)

Sure. And the Tooth Fairy, Santa, and the Easter Bunny will all join the Supreme Court. :laugh:

Bingo

 

I'd like to see chapter and verse.

I'm not denying either. I'm asking you to prove that one caused the other. Good luck with that :laugh:

You assume the decrease in taxes is the bene esse in job creation. It is but one factor.

Whoa! Then you just untied your own ribbon there.

This is a baffling contention. The single greatest cost to an established enterprise is wage/benefit costs. This is hardly argued. I've seen some companies that have these costs run up to 70% although the norm is lower. And you hire people to produce goods/services only if those goods/services make a profit. If they don't, guess what the other alternative is? Produce less? Well, that means you probably have people who are no longer working to produce.

For the record, post hoc ergo propter hoc is a logical fallacy that describes a depiction that, because one thing occurred, another followed. The two events however are not necessarily related though causation is assumed and unproven. It is a fallacy that is rarely ever true. I guess that's why it's a fallacy :laugh:

Economics, philosophy, accounting....that's a day, folks!

 

EGTRRA (if I recall the specifics) was only one part of the formula, yes it cut the lower end income taxes but Bush then turned around and gave corporations even larger tax cuts and loopholes through the tax code. Net gain, $10 trillion deficit and CEO's making record bonuses while laying off Millions of workers.

Obama plans to close those loopholes and raise taxes on those making over $250K then use that money to put American's to work rebuilding our infrastructure.

Why will this work differently you ask? Because those who make less than $250K do almost all of their spending in the US economy. Those who make more than $250K spend more globally. By putting more dollars in the hands of those making less than $250K then putting 2.5 million unemployed back to work he will not only add to tax revenue but will also get the eagle churning by giving consumers the means to consume.

 

I edited the previous post. Be sure to check this.

Now, as for this latest piece:

Boy, you have your party talking points down pat. Problem is, there's a logical set of gymnastics there that I just don't get. EGTRRA is not the primary cause of a blossoming deficit. Bush has some other whoppers, wholly supported by the Dem congress, that exploded our deficit. Not to mention that wartime deficits are the norm. But that's another story.

He has said he wants to repeal ALL of EGTRRA. That means school teachers, bus drivers, etc will likely see a tax increase. and that household income number has changed a bit, so we're not really sure the net impact. Remains to be seen.

Proof? Or is this something you heard on MSNBC? :laugh: Go to your local WalMart, Target, or Meijer. Tell me where most of the TVs are made. Or the phones. The stereo I'm presently listening to was bought my income was $25,000 a year...for my whole household. It's foreign made. Am I some sort of cataclysmic anamoly? :laugh:

We have to get past the partisan nuggets on either side and do rational discouse and analysis if we ever plan to get out of the philosophical and economic quagmire that the hacks have led us into and seem incapable of wishing to see us out of.

 

I think we'd be on the same side of this discussion.

This is a very limited success story, Honda is selling many cars either so it's not like they will increase production. Also, the plants making both GM and Honda bumpers will have to downsize with the loss of GM business. Add to that fewer consumers consuming because of GM layoffs and the end result is not a pretty picture.

True, but GM does account for a percentage of consumption and that percentage will go away. This may or may not lead to these companies having to adjust their staffing to account for the reduced business.

I agree that NAFTA was a Clinton debacle and hurt American industry very badly. What's worse is the small towns pay the largest price because they are usually centered around the one industry. I am hoping alternative energy can revive some of these small towns and give the people a job with a since of pride that will carry from generation to generation.

I envision an improved power grid where wind from small towns will light nearby major cities. Farmers growing corn and sugarcane which will keep our cars burning cleaner fuels. I see a new revolution on the horizon and this is just the beginning. Who knows what new industry will come from the corn and sugarcane waste or when atomic energy cells will finally rid us of foreign oil.

 

Exactly, you hire people because you have a company need and not because your taxes were cut. This is why I don't agree cutting taxes creates jobs. Consuming goods and services creates jobs and you do that by putting people to work.