Bush's legacy

Wow, that's scary.

You can't say that Bush's fiscal policy *didn't* contribute to its current state of affairs! It had a direct result on the fact that we have a deficit and how large it is.

And his domestic policies are why there are more uninsured now and why health insurance now costs twice as much for the average family.

His emphasis on tax cuts for the rich while the rest of us get screwed is largely responsible.

How much do you think his current "stimulus package" is going to help the economy? Given that the last one like this didn't do much to stimulate the economy, I would say this is a bust. He gets an "F" for imagination.[/i]

mr. met wrote: source?

I've seen this elsewhere; carnivore, perhaps if you could post a link to the original, as that would render the source links active.

Here is one with the links active:
link

doctorj wrote: [quote=lilbangladesh]How much do you think his current "stimulus package" is going to help the economy? Given that the last one like this didn't do much to stimulate the economy, I would say this is a bust. He gets an "F" for imagination.[/i]

The stimulus package may just help a great deal, by restoring confidence in the financial system and keeping the wheels running. At least it's a one off. And again, since it was hammered out in a bipartisan way in the house, I don't give Bush much credit for its size and shape.


This is a tangential question, I'll admit...

Now, as I understand it, the thinking behind the "rebate" part of the stimulus package is that "hey, if we give people some money, they'll buy things with it, and that will be a shot in the arm for the manufacturers and merchants, and they'll do a little better, and that will 'trickle up', so to speak, and that will help the economy, right"? Is that the basic logic behind it?

If that's the case, then what happens when, as I've heard many people say, a lot of the people take that rebate and use it to pay down existing debt rather than buy a Wii or whatever with it? Would that be the same "trickle-up" principle just in a different place?...

I freely admit that when it comes to economics, I'm an idiot, so feel free to snicker at me as you correct me. :oops:

queencallipygos wrote:
This is a tangential question, I'll admit...

Now, as I understand it, the thinking behind the "rebate" part of the stimulus package is that "hey, if we give people some money, they'll buy things with it, and that will be a shot in the arm for the manufacturers and merchants, and they'll do a little better, and that will 'trickle up', so to speak, and that will help the economy, right"? Is that the basic logic behind it?

If that's the case, then what happens when, as I've heard many people say, a lot of the people take that rebate and use it to pay down existing debt rather than buy a Wii or whatever with it? Would that be the same "trickle-up" principle just in a different place?...

I freely admit that when it comes to economics, I'm an idiot, so feel free to snicker at me as you correct me. :oops:

Now this is a very good question, and one I was thinking over myself the other day when the package was being announced.

I don't think it's necessarily a matter of just spurring the purchase of Wiis etc. In fact, paying down personal debt could be better than immediate consumption, and here's why:
1) the banks, who are worried about other financial institutions running short of cash due to being too highly leveraged, and therefore playing chicken with each other during a credit crunch, improve their balance sheets, which means they're in a better position to lend to consumers and each other again. Oiling the wheels of the credit market.
2) consumers with less debt spend less of their income on servicing that debt, which means they have more money in their pocket next month and the month after, which they'll tend to consume (at least until they run up approximately the same level of debt again).

Now the people who really shouldn't be getting the rebate are people like me: I carry no high-interest debt, and avoid consuming beyond necessities. The cash will go straight into a savings account as a short stop on its way into higher-earning non-US financial instruments. That's because I know that the stimulus package will be paid for by all of us in coming years by a combination of a falling USD and higher inflation. So if not consuming it straight away or paying off debt, self-interest says send the money overseas, which of course doesn't do much to help the US economy, and is part of why the dollar keeps falling.

Actually, I'd support a single federal sales tax (and preferably the abolition of all state sales taxes). That'd bring the US into line with just about every other developed democracy. As for regressive, the rich spend more which means they pay more sales tax which sounds pretty fair to me. Let me see... France, Germany, Denmark, Sweden, Norway, New Zealand, Australia seem to be better when it comes to making sure the poor don't left behind, and all have Federal/National sales tax as a major plank of funding that. In fact, to a first approximation, the higher the sales tax (e.g. Scandinavia) the flatter the wealth curve. I remember people jumping up and down about it being regressive when they were first trying to introduce it in my birth country, but it ended up being a really efficient, and the economy has gone from strength to strength since without major erosion of social services.

You're not listening. The old canard about proportion of income going on sales tax, looking at it in isolation, doesn't do justice to what actually happens in practice when it's done properly. Look at those countries where it's implemented, look at the big picture of what extra services can be funded, and you'll see it doesn't have to be regressive. The rich cannot avoid a sales tax like they can most other taxes (not to mention tourists), whereas the poor can be directly compensated through rebates or indirectly by a social safety net.

Carnivore wrote:

The great fiscal stimulus package ... of 1929

My understanding of this is... too little, too late. No one has devoted themselves to studying this like Bernanke; you could say it was a major contributing qualification for his getting the job. In his opinion, tight monetary policy and not enough cash to combat deflation was the main culprit. We're about to find out whether he's right.

doctorj wrote: ... Let me see... France, Germany, Denmark, Sweden, Norway, New Zealand, Australia seem to be better when it comes to making sure the poor don't left behind, and all have Federal/National sales tax as a major plank of funding that...

I think you make good points. However I'm sure we all agree that the high level of taxation in these countries also accounts for what you're saying. Taxes (of any kind) in this country are a fraction of what they are abroad.

yes, there may be more taxes in european countries, but on the whole, people there are happier, better taken care of by the the government, and they work less.

doctorj wrote: Actually, I've lived in some of these countries, and the taxes in this country are not so much less once you add it all up. They are most certainly not a 'fraction'.

Can you expand a little on this? I've read a lot to the contrary so I'm interested in hearing your thoughts.

doctorj wrote: [quote=mr. met]<added>yes, there may be more taxes in european countries, but on the whole, people there are happier, better taken care of by the the government, and they work less.

That varies quite a bit in the OECD. There's two axes to consider for the amount of work getting done per capita: number of hours worked and productivity per hour. For example, Norway: fewer hours, higher productivity. France, fewer hours, similar productivity. Italy: fewer hours, lower productivity. Australia: more hours, similar productivity. And so on.
Australia isn't generally considered European!

And I'm pretty sure that by "work less" mr. met is referring to hours, rather than productivity, which your data supports.

yea, i was talking about hours

'04 OECD data:

Under the Working Time Directive I understand that the maximum working week in the European Union is limited to 48 hours, although haven't both France and Germany knocked it down into the 30s? Anyway.