Legit Question for the More Liberal on Here

#26
#26
I'm pretty indifferent at the moment, I'll get back to you on that near the end of the third quarter.
 
#27
#27
vol_in_ar said:
i was being sarcastic



Director of the CIA, he has zero intelligence background
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my comment was not intended for your overtly sarcastic remark. I gathered that one in fairly well. my remark was intended for the lack of posters trying to say all is well in hope and change world.
 
#30
#30
volinbham said:
Hence every budget appropriations bill ever passed is stimulative by definition. (since none reduce spending)
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I think that depends on how much "stimulating" is needed....but in general spending is stimulative. If no one spent anything, the economy wouldn't go very far...but spending a lot when a good growth rate is already being achieved isn't going to be all that stimulative - proper long-term investments would make more sense in those cases, wouldn't you say?
 
#31
#31
TennTradition said:
I think that depends on how much "stimulating" is needed....but in general spending is stimulative. If no one spent anything, the economy wouldn't go very far...but spending a lot when a good growth rate is already being achieved isn't going to be all that stimulative - proper long-term investments would make more sense in those cases, wouldn't you say?
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But you're debating new spending. Our gov't is already spending like a drunken sailor on dollar night. This shiz is 100% additive to the garbage for which we hate Bush.
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#32
#32
TennTradition said:
I think that depends on how much "stimulating" is needed....
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Disagree - part of the rationale in this bill is that spending is stimulative. If that's the case, is it only stimulative during recessions?

Is it a matter of intent? Me thinks the "economy" doesn't know what was intended so if spending is stimulative; spending is stimulative.

Is it a matter of state of the economy - is spending in a growing economy not stimulative? I'd have to see a convincing argument of when spending is stimulative and when it is not. Further, it begs the question of how do we know the inflection point where spending will stimulate and when it will not.

If the relationship isn't so clear cut (e.g. some spending is not stimulative) then we are back to legitimate criticisms of this bill. If this is the case, the bill compromised needed stimulation for political rewards/ideology.
 
#33
#33
TennTradition said:
.but in general spending is stimulative. If no one spent anything, the economy wouldn't go very far...but spending a lot when a good growth rate is already being achieved isn't going to be all that stimulative - proper long-term investments would make more sense in those cases, wouldn't you say?
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This was added after I responded so here's my response.

It's not a matter of what makes more sense (although it should be). It's a question of is spending stimulative. Does spending not stimulate in a growing economy?

My problem with the spending = stimulus argument is that it is a veil hiding what "ought" to be done. It's a convenient argument to suggest why ANY spending program is justified in the name of stimulation.

Looking towards a growth economy, we've seen cases where over stimulation (too rapid growth) creates the next recession. Will the spending = stimulus crowd agree to cut spending during growth periods? No way. For some reason, spending doesn't stimulate then (in their minds).

There is a difference between stimulus and spending (or tax cuts for that matter). Treating them as equivalent removes the ability to use stimulative tools properly.
 
#34
#34
BigPapaVol said:
But you're debating new spending. Our gov't is already spending like a drunken sailor on dollar night. This shiz is 100% additive to the garbage for which we hate Bush.
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So - does that mean that we bought ourselves time through Bush's spending, or was it too sector-specific and couldn't stimulate anything but a few isolated areas of the economy, or does tax and monetary policy mean ten times more than spending? I would say that in general tax and monetary policy are more important, but when you find yourself in the middle of a pretty big recession, do you not think additional spending is necessary to pick yourself up out of it?

On first look, the primary problem I have is the creation of programs that will require new, annual funding, thus expanding the governments liabilities year in year out.
 
#35
#35
Wanton spending as stimulation is pure pyrite. It adds to GDP for sure, but some is clearly more efficient than others.
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#36
#36
volinbham said:
This was added after I responded so here's my response.

It's not a matter of what makes more sense (although it should be). It's a question of is spending stimulative. Does spending not stimulate in a growing economy?

My problem with the spending = stimulus argument is that it is a veil hiding what "ought" to be done. It's a convenient argument to suggest why ANY spending program is justified in the name of stimulation.

Looking towards a growth economy, we've seen cases where over stimulation (too rapid growth) creates the next recession. Will the spending = stimulus crowd agree to cut spending during growth periods? No way. For some reason, spending doesn't stimulate then (in their minds).

There is a difference between stimulus and spending (or tax cuts for that matter). Treating them as equivalent removes the ability to use stimulative tools properly.
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Well, obviously I am far from an economist, so my views could easily be completely wrong. I see government spending directly into the economy as having diminishing returns during periods of large growth. It would seem that a better use of the tax revenue would be to reduce future liabilities (social security/medicare blowing up in the face of the government or paying down principle on our debt to lower interest payments for future tough times). Maybe that is a stupid strategy, but it is what makes sense from my (fairly uneducated and inexperienced) perspective.

However, it would seem to me that when credit markets are seized up (and the fed rate is essentially already at zero), money isn't being spent, and money will continue to be spent at a slowing pace because job loss continues - that direct spending across wide sectors of the economy by the government would be quite stimulative. No one but the government can borrow money at such a cheap rate, and therefore it would seem to me that they would be the ones to do the spending necessary to lubricate the economic gears.
 
#37
#37
TennTradition said:
So - does that mean that we bought ourselves time through Bush's spending, or was it too sector-specific and couldn't stimulate anything but a few isolated areas of the economy, or does tax and monetary policy mean ten times more than spending? I would say that in general tax and monetary policy are more important, but when you find yourself in the middle of a pretty big recession, do you not think additional spending is necessary to pick yourself up out of it?

On first look, the primary problem I have is the creation of programs that will require new, annual funding, thus expanding the governments liabilities year in year out.
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If spending = stimulus then yes Bush's policies had to be stimulative by definition. Find me a Bush critic that would agree with that!

We are mixing issues here. One is what SHOULD be done to nudge the growth direction of the economy. The other is the relationship between spending and stimulus.

I'm discussing the latter. Equating them is misleading. One is an independent variable (spending) and the other is a dependent variable (stimulus). Using the claim (as many bill proponents have) that all spending is stimulative implies that the variability in the dependent variable is perfectly (highly) dependent on changes in the independent variable. Further it assumes that the independent variable is defined simply on amount rather than kind. Rise in spending (of any kind) = rise in stimulation.

The natural conclusions that follow are:

1. Bush's spending spree was stimulative and economic growth would have been less without it.

2. Increases in spending in growth economies are stimulative and lead to higher than desired growth.

I repeat that I doubt you could find a bill proponent that would agree with 1 or 2 let alone both.

Therefore, I conclude that many of the proponents of this bill desired spending based on non-economic reasons and are cloaking their views under the simplified notion of spending = stimulus.
 
#38
#38
BigPapaVol said:
Wanton spending as stimulation is pure pyrite. It adds to GDP for sure, but some is clearly more efficient than others.
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As for efficiency, is a smaller but less careful emergency bill followed up by a more efficient spending bill something that would make sense - or is an efficient spending bill impossible considering the powers that be and the way the process works?
 
#39
#39
TennTradition said:
Well, obviously I am far from an economist, so my views could easily be completely wrong. I see government spending directly into the economy as having diminishing returns during periods of large growth. It would seem that a better use of the tax revenue would be to reduce future liabilities (social security/medicare blowing up in the face of the government or paying down principle on our debt to lower interest payments for future tough times). Maybe that is a stupid strategy, but it is what makes sense from my (fairly uneducated and inexperienced) perspective.

However, it would seem to me that when credit markets are seized up (and the fed rate is essentially already at zero), money isn't being spent, and money will continue to be spent at a slowing pace because job loss continues - that direct spending across wide sectors of the economy by the government would be quite stimulative. No one but the government can borrow money at such a cheap rate, and therefore it would seem to me that they would be the ones to do the spending necessary to lubricate the economic gears.
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Then, as many economists suggest, we should figure out how to free up bank capital rather than piss Way money.
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#40
#40
TennTradition said:
I see government spending directly into the economy as having diminishing returns during periods of large growth. It would seem that a better use of the tax revenue would be to reduce future liabilities (social security/medicare blowing up in the face of the government or paying down principle on our debt to lower interest payments for future tough times). Maybe that is a stupid strategy, but it is what makes sense from my (fairly uneducated and inexperienced) perspective.
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Perhaps stimulative effect is diminished but I don't think that's the argument.

Your second point is the point I'm trying make - by calling all spending stimulative it removes the "better use of" argument. That's the point.

I agree with you on what "ought" to be done but viewing all spending as stimulative we obscure what ought to be done.

I repeat - if all spending is stimulative, it ought to be cut back in high growth periods (e.g. late 90s) to keep the economy from over heating. I guarantee none of the spenders viewed spending as stimulative then. :ermm:
 
#41
#41
volinbham said:
I'm discussing the latter. Equating them is misleading. One is an independent variable (spending) and the other is a dependent variable (stimulus). Using the claim (as many bill proponents have) that all spending is stimulative implies that the variability in the dependent variable is perfectly (highly) dependent on changes in the independent variable. Further it assumes that the independent variable is defined simply on amount rather than kind. Rise in spending (of any kind) = rise in stimulation.
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So, is the Keynesian view that paying people to dig holes and then fill them again is fine use of money as long as the money is spent a view that is just wrong?

I hear the points you are making - and they certainly seem valid. To assert that there is perfect dependence of the dependent variable on all forms of dependent spending variables seems to be a dubious assertion at best. However, I would think that in most cases there is a positive, not negative correlation. So, this would drive at the notion that there are more efficient spending patterns than others.

Also, I would think that the coefficient of correlation between the various spending variables and the dependent stimulus variable is also a function of rate of growth. It is hard for me to imagine that you could stimulate 1% growth in a 7% growth/year economy by spending several hundred billion dollars, while that seems like a possibility in an economy that is in recession.
 
#42
#42
volinbham said:
My problem with the spending = stimulus argument is that it is a veil hiding what "ought" to be done.
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I want to single out this quote to make that point that it appeals to every practical bone in my body. I think that you are making a good point, one that highlights the dangers of equating any spending to stimulus. That is not a good road to go down. It is hard to imagine a situation where there aren't better or worse ways to do this.

I will also say that if it is honestly viewed as something that must be done very quickly (i.e., an emergency), that less than optimal routes are acceptable to me - but I would rather see those hammered out in a smaller spending bill...and then spend what else you need to later in a more optimal way. But, I don't have a lot of faith in that second bill ever happening in that way.
 
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#43
#43
TennTradition said:
So, is the Keynesian view that paying people to dig holes and then fill them again is fine use of money as long as the money is spent a view that is just wrong?

Is it stimulative? I think it's a too simplistic view of the economy (including the human factor) as is the notion that spending is by default stimulative.


I hear the points you are making - and they certainly seem valid. To assert that there is perfect dependence of the dependent variable on all forms of dependent spending variables seems to be a dubious assertion at best. However, I would think that in most cases there is a positive, not negative correlation. So, this would drive at the notion that there are more efficient spending patterns than others.

In most cases there likely is a positive correlation. However, specific spending is likely to vary greatly in stimulative effect. I would argue that "spending" is not the correct independent variable - it's too crude. To use more stats stuff, it's likely composed of types of spending, some of which is highly stimulative and some of which is virtually non-stimulative or possibly negative in effects on economic growth. So is all spending stimulative? But using that mentality hides the search for the really stimulative spending.

Also, I would think that the coefficient of correlation between the various spending variables and the dependent stimulus variable is also a function of rate of growth. It is hard for me to imagine that you could stimulate 1% growth in a 7% growth/year economy by spending several hundred billion dollars, while that seems like a possibility in an economy that is in recession.
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On the last issue - this is likely true. It begs the question though: Does spending ever become non-stimulative? Does spending ever have a negative effect on growth? We are talking about contractions of 3 - 4% as being highly recessive and growth rates above 3% as being too rapid. That's a pretty tight window to predict the real inflection points. It becomes exacerbated when we use the crude tool of "spending".

My real point (that everyone is tired of hearing) is that the political cover offered by saying spending = stimulation is conducive to bad policy.
 
#44
#44
TennTradition said:
I want to single out this quote because to make that point that it appeals to every practical bone in my body. I think that you are making a good point, one that highlights the dangers of equating any spending to stimulus. That is not a good road to go down. It is hard to imagine a situation where there aren't better or worse ways to do this.

I will also say that if it is honestly viewed as something that must be done very quickly (i.e., an emergency), that less than optimal routes are acceptable to me - but I would rather see those hammered out in a smaller spending bill...and then spend what else you need to later in a more optimal way. But, I don't have a lot of faith in that second bill every happening in that way.
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I agree with the need for speed and am not against government spending being a major part of an emergency stimulus plan.

I'm disturbed that:

1. A bunch of crap was rushed through under the guise of emergency stimulus.

2. We have a standard budget appropriations process that is coming in the next month - much of the crap in this bill could have come that way and be more open to public scrutiny.

3. The speed and process which yielded this bill compromised the quality to a much higher extent than necessary.

4. Targeted action in the financial and housing sectors should have been the priority over this package. It's being promised but had it received a greater focus since the beginning, much of this stimulus bill would not have been necessary.

5. A repeat of number one with a twist. After the last guy in office, I'm tired of our government hyping a crisis to implement things it's wanted implemented anyway.
 
#48
#48
I really can't judge in 1 month of service. But, if you were holding a gun to my head, I'd be on the fence with him so far. He's closed Gitmo(one reason I voted for him), and not much else. I'm not sure how this next stimulus will go, so I can't judge too much on that.

However, I really thought he'd be bringing our troops home, and redeploying to Afghanistan, so that would be my negative(s) at this point.

Unless I wasn't your intended target.
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Please tell me you're kidding about voting for Obama because he would shut down Gitmo.

I'm not a liberal, but right now I would give Obama a 50 on a grading scale of 0-100. When his Spending Bill fails and America suffers another terrorist attack, it will be a -125.
 
#49
#49
Vol_4_Life said:
Please tell me you're kidding about voting for Obama because he would shut down Gitmo.

I'm not a liberal, but right now I would give Obama a 50 on a grading scale of 0-100. When his Spending Bill fails and America suffers another terrorist attack, it will be a -125.
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Not my main reason, but something I knew he would do.
 
#50
#50
Vol_4_Life said:
Please tell me you're kidding about voting for Obama because he would shut down Gitmo.

I'm not a liberal, but right now I would give Obama a 50 on a grading scale of 0-100. When his Spending Bill fails and America suffers another terrorist attack, it will be a -125.
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So you are conceding these things are going to happen. Nice......


I would give him a C at the moment. He has only been in office one month. Cries of gloom and doom from the right are ridiculous at this point. Closing Gitmo was a good thing. There was too much pork in the stimulus bill, but there are parts of it that are very good. The children's healthcare package is good. We needed it, regardless of what some of the right leaning experts in here think.
 
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