Category Archives: The Economy

I get so annoyed that the media never really calls attention to this…

Republican leaders insist, despite all the evidence to the contrary, that President Obama’s $800-billion-or-so stimulus package from last year hasn’t accomplished anything. (This is driving top White House economic adviser Jared Bernstein absolutely crazy.)

Progressive groups — and most leading economists — say the problem with the stimulus was that it didn’t do enough, because it wasn’t nearly as big as it should have been.

Lost amid those arguments is what exactly the American Recovery and Reinvestment Act did accomplish — which, by comparison to almost anything except the massive output gap it was supposed to fill, is a lot.

On Tuesday, the nonpartisan Congressional Budget Office estimated that the act added from 1.4 million to 3.3 million jobs during the second quarter of 2010.

In addition to $288 billion in tax cuts, the Recovery Act funded all sorts of worthy projects that created jobs, backstopped a number of safety-net programs, and made huge investments in infrastructure, energy independence, mass transit and other public goods.

Here are 11 projects that got stimulus money. Do you think they deserved your tax money?

via 11 Very Reasonable Places Your Stimulus Dollars Went.

I eagerly await each Paul Krugman column.  He’s a Noble Prize winning economist and one of the few people who seem to really be looking at the economy from an economists view point as opposed to a politicians.  Here is an excerpt from his latest column in the NY Times.  Link to full column at the bottom.

As I look at what passes for responsible economic policy these days, there’s an analogy that keeps passing through my mind. I know it’s over the top, but here it is anyway: the policy elite — central bankers, finance ministers, politicians who pose as defenders of fiscal virtue — are acting like the priests of some ancient cult, demanding that we engage in human sacrifices to appease the anger of invisible gods.

Hey, I told you it was over the top. But bear with me for a minute.

Late last year the conventional wisdom on economic policy took a hard right turn. Even though the world’s major economies had barely begun to recover, even though unemployment remained disastrously high across much of America and Europe, creating jobs was no longer on the agenda. Instead, we were told, governments had to turn all their attention to reducing budget deficits.

and

But, in America, we do have a choice. The markets aren’t demanding that we give up on job creation. On the contrary, they seem worried about the lack of action — about the fact that, as Bill Gross of the giant bond fund Pimco put it earlier this week, we’re “approaching a cul-de-sac of stimulus,” which he warns “will slow to a snail’s pace, incapable of providing sufficient job growth going forward.”

It seems almost superfluous, given all that, to mention the final insult: many of the most vocal austerians are, of course, hypocrites. Notice, in particular, how suddenly Republicans lost interest in the budget deficit when they were challenged about the cost of retaining tax cuts for the wealthy. But that won’t stop them from continuing to pose as deficit hawks whenever anyone proposes doing something to help the unemployed.

So here’s the question I find myself asking: What will it take to break the hold of this cruel cult on the minds of the policy elite? When, if ever, will we get back to the job of rebuilding the economy?

via Op-Ed Columnist – Appeasing the Bond Gods – NYTimes.com.

This fact seems somewhat under reported.  I keep reading bits and pieces about this…

This recession is really hitting the younger generation the hardest.  College educated, older workers, statistically speaking, seem to be the least impacted.

This is the type of thing that’s going to stick with these kids forever.  Just like the Great Depression did to our Grandparents…

The report from the ILO says 81 million out of 630 million 15-24 year olds where unemployed at the end of 2009, some 7.8 million more than at the end of 2007.

Thursday marks the first day of the UN International Youth Year; the ILO warned these trends will have “significant consequences for young people as upcoming cohorts of new entrants join the ranks of the already unemployed.”

The world risks a crisis legacy of a “lost generation” of young people who dropped out of the job market, the organization added in its report.

The report also points out that the unemployment rates of youth have proven to be more sensitive to the crisis than the rates of adults and that the recovery of the job market for young men and women is likely to lag behind that of adults.

It indicates that in developed and some emerging economies, the crisis impact on youth is felt mainly in terms of rising unemployment and the social hazards associated with discouragement and prolonged inactivity.

“In developing countries, crisis pervades the daily life of the poor” said ILO Director-General Juan Somavia.

“The effects of the economic and financial crisis threaten to exacerbate the pre-existing decent work deficits among youth,” Somavia said. “The result is that the number of young people stuck in working poverty grows and the cycle of working poverty persists through at least another generation.”

Investment in education will be lost and governments will not receive contributions to social security systems, while at the same time being forced to raise spending on services to correct the problem, if the situation continues, he warned.

“Young people are the drivers of economic development,” Somavia said. “Foregoing this potential is an economic waste and can undermine social stability.”

via Youth Unemployment Hits Record High – CNBC.

I found this article extremely interesting.  Here is an excerpt and link to the full post:

As he tells this story, the veteran lawmaker is sitting in his congressional office, which he will have to vacate in a few months. On June 22, he was defeated in the primary runoff by Spartanburg County 7th Circuit Solicitor Trey Gowdy, who had assailed Inglis for supposedly straying from his conservative roots, pointing to his vote for the bank bailout and against George W. Bush’s surge in Iraq. Inglis, who served six years in Congress during the 1990s as a conservative firebrand before being reelected to the House in 2004, had also ticked off right-wingers in the state’s 4th Congressional District by urging tea-party activists to “turn Glenn Beck off” and by calling on Rep. Joe Wilson (R-S.C.) to apologize for shouting “You lie!” at Obama during the president’s State of the Union address. For this, Inglis, who boasts (literally) a 93 percent lifetime rating from the American Conservative Union, received the wrath of the tea party, losing to Gowdy 71 to 29 percent. In the weeks since, Inglis has criticized Republican House leaders for acquiescing to a poisonous, tea party-driven “demagoguery” that he believes will undermine the GOP’s long-term credibility. And he’s freely recounting his frustrating interactions with tea party types, while noting that Republican leaders are pushing rhetoric tainted with racism, that conservative activists are dabbling in anti-Semitic conspiracy theory nonsense, and that Sarah Palin celebrates ignorance.

via Confessions of a Tea Party Casualty | Mother Jones.

Interesting article in today’s New York Times from Reagan Budget Director David Stockman.

Here is quote and a link to the full article:

IF there were such a thing as Chapter 11 for politicians, the Republican push to extend the unaffordable Bush tax cuts would amount to a bankruptcy filing. The nation’s public debt — if honestly reckoned to include municipal bonds and the $7 trillion of new deficits baked into the cake through 2015 — will soon reach $18 trillion. That’s a Greece-scale 120 percent of gross domestic product, and fairly screams out for austerity and sacrifice. It is therefore unseemly for the Senate minority leader, Mitch McConnell, to insist that the nation’s wealthiest taxpayers be spared even a three-percentage-point rate increase.

via Op-Ed Contributor – Four Deformations of the Apocalypse – NYTimes.com.