Tag: Great Depression

If a gaffe can cost an election…..

…… then I think Obama just lost

Last night, President Barack Obama dropped the biggest campaign gaffe of the season – only the media wasn’t watching. It happened during his testy exchange with Mitt Romney over gas prices. First, Obama denied that he’d done anything about denying licenses on oil and gas; he backed off of that shortly. Then he denied that production on federal land was down; he was lying. Finally, Romney hit him with this devastating line:

The proof of whether a strategy is working or not is what the price is that you’re paying at the pump. If you’re paying less than you paid a year or two ago, why, then, the strategy is working. But you’re paying more. When the president took office, the price of gasoline here in Nassau County was about $1.86 a gallon. Now, it’s $4.00 a gallon.

Obama’s response was horrendous: 

Barack Obama
Obamanomics 101 high gas prices good, low gas prices bad

Well, think about what the governor — think about what the governor just said. He said when I took office, the price of gasoline was $1.80, $1.86. Why is that? Because the economy was on the verge of collapse, because we were about to go through the worst recession since the Great Depression, as a consequence of some of the same policies that Governor Romney’s now promoting. So, it’s conceivable that Governor Romney could bring down gas prices because with his policies, we might be back in that same mess.

In other words, bringing down gas prices by drilling creates economic recession. That was Obama’s argument.

Does anyone think this president understands basic economics?

To me this is the worst type of gaffe, because it involves substance, not some brain fart or slip of the tongue. Also recall that in 2008, Democrats, including, I believe, then candidate Obama hammered President Bush over high gas prices. Of course the media completely missed this gargantuan gaffe.

Candy Crowley, who moderated the debate like she has a poster of Obama over her bed, should have given this response

Chris at Wyblog pours even more scorn on President Clueless

There is so much sand-pounding stupidity in that statement, I don’t know where to start. FortunatelyElizabeth Price Foley guest-blogging at Instapundit schools The Smartest Guy In The Room using words even an Obamabot can understand.

Gas prices, like anything else, are a function of supply and demand. A recession or depression reduces demand. If supply stays constant, gas prices will fall. But if the supply side of the equation is also negatively affected/reduced — as, for example, the reduction of leases and drilling on federal land, as pointed out by Romney — gas prices should rise (as they have). The bottom line? Gas prices should have — probably would have — fallen in our current recession, due to decreased demand. But since the Obama Administration’s anti-carbon, anti-fossil fuel policies have taken hold, the negative impact on supply has outpaced the reduction in demand, leading to significantly higher prices.

How bad is Obama’s record on job creation?

It is so bad that the Washington Post says it is awful! Via William Teach

Someone at the Washington Post will surely have received a phone call from the White House today to have a conversation with Josh Hicks, who compares and contrasts the economic records of George Bush and Barack H. Obama (I added the H because it’s raaaaacist): Obama’s remarks on worst job growth: Did he end it or should he own it?. Josh spends quite a bit of time going through numbers and such, and finally concludes

There’s no doubt that Bush owns an unimpressive record on job creation. But Obama comes in either last, second-to-last or in the bottom half among presidents since the Great Depression, depending on which way you look at the numbers.

The president said that policies from 2000 through 2008 produced the “most sluggish job growth we’ve ever seen.” Perhaps so, but the worst numbers on record occurred under his watch.

Obama chose a poor metric for measuring past administrations. To make his point with jobs data, he has to point to his own numbers and completely disavow much of them, or else ignore public-sector losses. We came close to thinking this was worth Three Pinocchios, but ultimately decided he was not necessarily including his record in the statement. Still, it’s a very fine line. The president should be much more careful about making such a sweeping claim.

This is, of course why Team Obama is focusing on anything except the economy. Oh, and about those lobbyists President Obama vowed NOT TO HAVE in the White House….

The Washington Post calls our attention to the number of lobbyists who visit the White House, despite the promise of President Obama to reduced the influence of lobbyists on his administration. In all fairness, it’s mostly Democrat lobbyists and those with close ties to Obama and his buddies that are granted access, so not all lobbyists have influence.

Before 9 a.m., a group of lobbyists began showing up at the White House security gates with the chief executives of their companies, all of whom serve on President Obama’s jobs council, to be checked in for a roundtable with the president.

At 1 p.m., a dozen representatives from the meat industry arrived for a briefing in the New Executive Office Building. At 3 p.m., a handful of lobbyists were lining up for a ceremony honoring the 2011 World Series champions, the St. Louis Cardinals.

And at 4 p.m., a lobbyist for Goldman Sachs arrived in the Old Executive Office Building for a meeting with Alan B. Krueger, chairman of the Council of Economic Advisers.

It was an unremarkable January day, with a steady stream of lobbyists among the thousands of daily visitors to the White House and the surrounding executive office buildings, according to a Washington Post analysis of visitor logs released by the administration. The Post matched visits with lobbying registrations and connected records in the visitor database to show who participated in the meetings, information now available in a search engine on the Post’s web site.

The visitor logs for Jan. 17 — one of the most recent days available — show that the lobbying industry Obama has vowed to constrain is a regular presence at 1600 Pennsylvania Ave. The records also suggest that lobbyists with personal connections to the White House enjoy the easiest access. (Read More

Darn, this seems to be politics as usual, another thing Obama vowed to end

Now I get Obamanomics! First we have to give up hope of new jobs, then….

More and more Americans have given up on finding employment. As that number grows, the lower that pesky unemployment rate drops. So, once everyone just throws in the towel, the sooner we can all revel in a o% rate of unemployment! See, Obmanomics does work! At least that is what the Left thinks apparently

According to the AFP, President Obama “shrugged off” this morning’s miserable economic news, and instead focused on thephony unemployment rate which keeps falling as more and more Americans despairingly give up on looking for work.

“After the worst economic crisis since the Great Depression, our businesses have now created more than 4.2 million jobs over the last 26 months (and) more than one million jobs in the last six months alone,” Obama said at a school in the crucial election swing state of Virginia.

Of course he didn’t mention the news that the number of new companies created has hit an all time low.

The rate of new company creation in the United States dropped to a record low in 2010, according to a survey by the US Census Bureau’s Center for Economic Studies and the Ewing Marion Kauffman Foundation.

Researchers found the business startup rate fell to 7.87 percent,Reuters reported. It’s the first time it’s dipped below 8 percent. The startup rate was at its highest in 1987, when it was 13.02 percent.

New firms as a percentage of all firms also decreased in 2010, the data, published on Wednesday, show. New companies – defined as firms less than five years old – were 35 percent of all companies in 2010, down from 49 percent in 1982, CNN reported.

Only 12 percent of US employment in 2010 was at new companies, compared with 20 percent in the 1980s, Reuters reported.

What else would we expect from a Marxist who does not believe in American Exceptionalism?

So, how nutty IS Paul Krugman? Nutty enough to be the Marxist Moron of the Day

Paul Krugman, Laureate of the Sveriges Riksban...
Image via Wikipedia

So nutty he thinks Amanda Marcotte is a good sane source

See “Conceder In Chief (via Memeorandum):

Amanda Marcotte is right: of course the big problem is the craziness of the GOP. That said, I am among those in a state of suppressed rage and panic over the president’s negotiating strategy.

So here is the column or part of it, that Krugman, who considers himself rational and wise thinks is spot on!

So, I posted earlier today about what jackass crazy fuckwits run the Republican party and that’s why we’re in this current crisis,

You are welcome to read it all, but it does get any more lucid, Marcotte is a far Left loon, and I suppose we have to assume that Krugman is to.

 

There is over the top rhetoric, then there is this guy

Only Chris “Crazy Legs” Matthews could come up with this much absolute inanity!

Suddenly one day we’ll find ourselves like Greece or Ireland or Portugal, one of those countries at the periphery of the strong economies — Germany, China, India. Suddenly we’ll be one of those countries that the strong world looks at with disdain, looks down on really. We’ll become objects of pity, pity not for what was done to us like on 9/11, but for the pathetic sight of what we’ve done to ourselves.

Yes, if we don’t raise the debt ceiling, it’ll be a greater horror for our country than the Civil War, World War I, World War II, the Great Depression, and 9/11.

Even worse, we might become the MSNBC of the International Community. Now THAT would be truly sad.

Government Handouts Top Tax Revenues For First Time Since Great Depression

Government Handouts Top Tax Revenues For First Time Since Great Depression – Fiscal Times

* Households received $2.3 trillion in government income support in 2010.

* Government cash accounts for79 percent of household income growth since 2007.

* Since 2007, household tax payments have fallen by $312 billion.

With President Obama’s deficit-reduction plan now on the table, the political left, right and center are ready to rumble over how to assure long-term fiscal stability. The big questions are where to slash and by how much, but over the next year or two, the most important question for the economy might well be how quickly the cutting should begin. Households have become unusually dependent on the government for income support and removing that prop too fast could put the recovery at risk.

For the first time since the Great Depression, households are receiving more income from the government than they are paying the government in taxes. The combination of more cash from various programs, called transfer payments, and lower taxes has been a double-barreled boost to consumers’ buying power, while also blowing a hole in the deficit. The 1930s offer a cautionary tale: The only other time government income support exceeded taxes paid was from 1931 to 1936. That trend reversed in 1936, after a recovery was underway, and the economy fell back into a second leg of recession during 1937 and 1938.

As then, the pattern now reflects two factors: the severe depth of the 2007-09 recession and the massive fiscal policy response to it. The recession cut deeply into tax payments as more people lost their jobs, and it boosted payments for so-called automatic stabilizers, such as unemployment insurance, that ramp up payments as the economy turns down. Plus, policy actions, including the Recovery Act, boosted payments to households by expanding and extending jobless benefits and creating other income subsidies while extending the Bush-era tax cuts and adding new reductions in income and payroll taxes.

Government transfers of income to households started to overtake personal taxes at the start of 2008, and the gap has been widening. In 2010, households received $2.3 trillion in income support from unemployment benefits, Social Security, disability insurance, Medicare, Medicaid, veterans’ benefits, education assistance and other cash transfers of government funds to individuals. Also last year, households paid $2.2 trillion in income, payroll, and other taxes. The difference was $125 billion, equivalent to 1 percentage point of overall personal income and about three times the amount Republicans and Democrats agreed to cut from government spending through Sept. 30.

Since the onset of the recession, government direct payments have increased by $579 billion, accounting for 79 percent of the growth in overall personal income. As job growth has picked up, that contribution has diminished, but during 2010, government cash still accounted for 28 percent of the increase in income. Not surprisingly, Social Security, including survivors’ and disability benefits, accounted for a significant portion of the increased payments and the amount paid out in unemployment benefits more than tripled over that period. At the same time, tax payments since the recession began have fallen by $312 billion, also providing a boost to consumers’ purchasing power.

Government Transfers of Income to Households
(In Billions of Dollars, seasonally-adjusted annual rates)

2007 Q4

2010 Q4

Change

Federal Social Benefits to Households

1275.9 1742.1 466.2

Social Insurance Funds

1071.8 1383.5 311.7

Social Security, Survivors,
and Disability

581.1 699.8 118.7

Medicare

437.0 532.9 95.9

Unemployment

35.1 129.0 93.9

Other Federal Social Insurance

18.6 21.9 3.3

Veterans Benefits

41.1 61.5 20.4

Supplemental Nutrition Assistance

32.5 69.8 37.3

Earned Income Credit

54.8 73.0 18.2

Supplemental Security Income

37.9 45.3 7.4

Other Federal Benefits

37.8 109.0 71.2

State & Local Benefits

444.0 556.8 112.8

Medicaid & Other Medical Care

344.9 442.1 97.2

Other State & Local Benefits

99.0 114.7 15.7

Total Government Transfers to Households

1719.9 2298.9 579.0
Data: Bureau of Economic Analysis

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Typically, the gap between transfers and taxes runs the other way – and by a wide margin. “In normal times the household sector gives about 8 percentage points more of its income in taxes than it receives in direct transfers,” says J.P. Morgan economist Michael Feroli. The potential problem over the next few years is the enormous drag on household income as stimulus measures such as the payroll tax cut and extended unemployment benefits expire. Even if unemployment declines from its current level, the labor markets may not be strong enough to generate the wage and salary income needed to offset that drag.

Feroli says that if the net flow of taxes and transfers even partly returns to normal, the resulting drag on incomes would be significant. The size of the drag would be especially sensitive to how fast that flow is reversed. A shift all the way back to the average 8 percentage point difference between taxes and transfers would be equivalent to about $1.2 trillion in income. To put that in context, half that amount is equal to the total increase in personal income over the past year.

The Inflation Factor

Consumers needed support in the first quarter, as inflation from surging energy costs ate into the buying power of their incomes. Energy helped push the Consumer Price Index in March up 0.5 percent, with prices during the first quarter rising at a 6.1 percent annual rate, gobbling up most of last quarter’s increase in income. Even with a reduced tax burden of about $60 billion last quarter, mainly reflecting the 2 percent cut in payroll taxes, inflation-adjusted spending appears to have grown only half as fast as the fourth quarter’s 4 percent pace. A tepid rise in March retail sales implies little momentum heading into the second quarter.

An increasing number of economists are downgrading their expectations for first quarter economic growth, to be reported on Apr. 28, and for the rest of the year. The drag from costlier energy is lasting longer than expected, and uncertainties over the impact of Japan’s struggles and the ongoing turmoil in the Middle East are weighing on growth. Obama’s recent deal with the GOP to cut nearly $40 billion from the federal budget for fiscal 2011 is equivalent to about 0.5 percentage points of GDP over the next six months, although the timing of those cuts is not yet set.

All this should be a yellow flag for the White House and Congress as they work toward reducing the deficit. Until the labor markets are strong enough to power consumer spending without the outsized income support from the government, withdrawing that support too quickly could put spending and the economy at risk to some unexpected shock.

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