What happened to all of the doom and gloom economic threads?

[Sean Renaud]

LOL. Wow Alt. It's amazing how idiotic you are, and even worse that we're stupid enough to keep paying attention to you instead of ignoring you like the idiot troll that you are.

 

[JenAltArmy]

LOL. Wow Alt. It's amazing how idiotic you are, and even worse that we're stupid enough to keep paying attention to you instead of ignoring you like the idiot troll that you are.

is it the drugs, that make you stupid?

 

[mercury14]

There are more crooks working in government than corrupt CEO’s. sorry, get the facts straight. What I will say is that many pay packages are tied to the value of stock so many decisions are based on making the stock more valuable. Not always the best policy.

However, who adds more value to a consumer based economy? The CEO, not some retard in government. Government sucks down resources and spits out crap

I understand your jealousy of “CEO’s” as you can never nor will you ever be in that category due to your mental condition. But thanks for trying! Socialist nut jobber


p.s. CEO's know the value of the dollar, obama only knows how to spend other people's dollar's. just a fact

You just said that someone who makes $155 million dollars regardless as to whether they abysmally fail at their job, knows the real value of a dollar.

 

[JenAltArmy]

You just said that someone who makes $155 million dollars regardless as to whether they abysmally fail at their job, knows the real value of a dollar.

and obama said this, said that, and this year Wall Street is dishing out more "rewards"

EPIC, you fail. drink more tiger juice.

why do you hate the free market? I'm guessing its because you are a miserable failure and unable to COMPETE. I get it, you suck and in a none happy ending kind of way. right?

and "government" is never corrupt or greedy? NEVER? come on, NEVER?

 

[mercury14]

and obama said this, said that, and this year Wall Street is dishing out more "rewards"

EPIC, you fail. drink more tiger juice.

why do you hate the free market? I'm guessing its because you are a miserable failure and unable to COMPETE. I get it, you suck and in a none happy ending kind of way. right?

and "government" is never corrupt or greedy? NEVER? come on, NEVER?

I believe that both government and the private sector can engage in corruption. It's demonstrably true.

And all you've got is that I "suck"? That's it?

 

[Frisco_Slug_Esq]

Carter: Economic Stagnation Explained, at 30,000 Feet
By Stephen L. Carter - May 26, 2011

The man in the aisle seat is trying to tell me why he refuses to hire anybody. His business is successful, he says, as the 737 cruises smoothly eastward. Demand for his product is up. But he still won’t hire.

“Why not?”

“Because I don’t know how much it will cost,” he explains. “How can I hire new workers today, when I don’t know how much they will cost me tomorrow?”

He’s referring not to wages, but to regulation: He has no way of telling what new rules will go into effect when. His business, although it covers several states, operates on low margins. He can’t afford to take the chance of losing what little profit there is to the next round of regulatory changes. And so he’s hiring nobody until he has some certainty about cost.

It’s a little odd to be having this conversation as the news media keep insisting that private employment is picking up. But as economists have pointed out to all who will listen, the only real change is that the rate of layoffs has slowed. Fewer than one of six small businesses added jobs last year, and not many more expect to do so this year. The private sector is creating no more new jobs than it was a year ago; the man in the aisle seat is trying to tell me why.

...

It isn’t just hiring that is too unpredictable, he says. He feels the same way about investing. He has never liked stock markets; he prefers to put cash directly into businesses he likes in return for a small stake, acting, in short, as a small- time venture capitalist.

“Can’t do that now,” he says. For people like him -- people who aren’t filthy rich -- it has become too hard to pick winners. But he doesn’t blame the great information advantages enjoyed by insiders. He blames Washington, once more, for creating a climate of uncertainty.

...

“I think about retirement a lot,” he says. “But I can’t.” I wait to hear about how much he loves the business he founded, or about his responsibilities to his employees, or perhaps to the town, somewhere in the Dakotas, where his factory is located. Instead, he tells me that it’s impossible to make a sensible decision about winding down his firm when he doesn’t even know from one year to the next what the capital gains rate is going to be.

I argue a bit. Surely government isn’t all bad. It protects property, the environment, civil rights . . .

...

My seat-mate seems to think that I’m missing the point. He’s not anti-government. He’s not anti-regulation. He just needs to know as he makes his plans that the rules aren’t going to change radically. Big businesses don’t face the same problem, he says. They have lots of customers to spread costs over. They have “installed base.”

For medium-sized firms like his, however, there is little wiggle room to absorb the costs of regulatory change. Because he possesses neither lobbyists nor clout, he says, Washington doesn’t care whether he hires more workers or closes up shop.

...

“Invisible,” he says. “I know there are things the government has to do. But they need to find a way to do them without people like me having to bump into a new regulation every time we turn a corner.” He reflects for a moment, then finds the analogy he seeks. “Government should act like my assistant, not my boss.”

...

On the way to my connection, I ponder. As an academic with an interest in policy, I tend to see businesses as abstractions, fitting into a theory or a data set. Most policy makers do the same. We rarely encounter the simple human face of the less- than-giant businesses we constantly extol. And when they refuse to hire, we would often rather go on television and call them greedy than sit and talk to them about their challenges.

Recessions have complex causes, but, as the man on the aisle reminded me, we do nothing to make things better when the companies on which we rely see Washington as adversary rather than partner.

http://www.bloomberg.com/news/print...omic-stagnation-explained-at-30-000-feet.html

 

[Frisco_Slug_Esq]

MAY 28, 2011 6:00 A.M.
Tyrannous Regulation
Equality before the law disappears in rule by regulation.

Cass Sunstein is head of something called the “Office of Information and Regulatory Affairs.” I’ve seen enough conspiracy thrillers to know that when someone has so obvious a blandly amorphous federal-job description as that, it means he’s running some deeply sinister wet-work operation of illegal targeted assassinations in unfriendly nations that the government spooks want to keep off the books and far from prying eyes.

Oh, no, wait. Actually, Covert Operative Sunstein passes his day doing more or less what the sign on the door says: He collects information about regulatory affairs. More specifically, he is charged by the president with “an unprecedented government-wide review of regulations” in order to “improve or remove those that are out-of-date, unnecessary, excessively burdensome or in conflict with other rules.”

How many has he got “removed” so far? Well, last week he took to the pages of the Wall Street Journal to crow that dairy farmers will henceforth be exempted from the burdens of a 1970s EPA-era directive classifying milk as an “oil” and subjecting it, as Professor Sunstein typed with a straight face, “to costly rules designed to prevent oil spills”. But Ol’ MacDonald and his crack team of Red Adair–trained milkmaids can henceforth relax because now, writes Professor Sunstein, Washington is “giving new meaning to the phrase, ‘Don’t cry over spilled milk.’”

That’s a federally licensed joke from Sunstein’s colleagues at the Agency of Guffaw and Titter Regulation, so feel free to laugh.

Did you know milk was an oil? It is to the federal government, and, if a Holstein blows in the Gulf of Mexico and beaches from Florida to Louisiana are suddenly threatened by a tide of full-fat crude, they want to know you’ve got the federally mandated equipment to deal with it. With hindsight, the president’s remark in the early days of the BP oil spill that he was meeting with experts “so I know whose ass to kick” was not just a bit of vulgar braggadocio but the fault of early Department of Energy findings that the spillage was caused by asses’ milk from BP (Burros & Poitous Ltd., a member of the Big Ass cartel). “Your ass is on the line!” as the president told BP’s Tony Hayward after his donkey was found wandering down the first 38 billion-dollar stretch of the federally funded high-speed-rail track.

Whoops, sorry, I made the mistake of hiring Cass Sunstein’s federally accredited “spilled milk” gag writer. Where was I?

Oh, yeah, federal regulation. So this EPA directive requiring milk to be treated the same as petroleum for the purposes of storage and transportation has been around since the ’70s and it’s only taken the best part of four decades to get it partially suspended even though it’s udderly insane? Hallelujah!

At that rate of regulatory reform, we’ll be . . . well, let Sunstein explain it. Aside from his crowing over spilled milk, he cites other triumphs: The Departments of Commerce and State are “pursuing reforms”; the Department of Health and Human Services “will be reconsidering burdensome regulatory requirements”; and the Department of the Interior will be “reviewing cumbersome, outdated regulations.”

Wow! “Pursuing,” “reconsidering,” and “reviewing”? Meanwhile, back at the Department of Bureaus and Agencies, they’re pursuing a review of their reconsideration of reforms. That’s great news, isn’t it? I’ll take a wild guess and bet that the upshot of this frenzied “pursuit” will be a ton of new regulations about streamlining regulatory oversight and improving regulatory harmonization: The big growth area in America’s post-modern Republic of Paperwork is regulations about regulating regulations. For example, in New York City, applying for the “right” to open a restaurant requires dealing with the conflicting demands of at least eleven municipal agencies, plus submitting to 23 city inspections and applying for 30 different permits and certificates. Not including the state liquor license. Recognizing that this could all get very complicated, the city set up a new bureaucratic body to help you negotiate your way through all the other bureaucratic bodies.

And, for every little victory, there are a zillion crankings of the government vise elsewhere. Plucked at random from the Obamacare bill:

“The Secretary shall develop oral healthcare components that shall include tooth-level surveillance.”

“Tooth-level surveillance”? Has that phrase ever been used before in the entirety of human history? Say what you like about George III, but the redcoats never attempted surveillance of General Washington’s dentures. Why not just call it “gum control”?

The hyper-regulatory state is unrepublican. It strikes at one of the most basic pillars of free society: equality before the law. When you replace “law” with “regulation,” equality before it is one of the first casualties. In such a world, there is no law, only a hierarchy of privilege more suited to a sultan’s court than a self-governing republic. If you don’t want to be subject to “tooth-level surveillance,” you better know who to call in Washington. Teamsters Local 522 did, and the United Federation of Teachers, and the Chicago Plastering Institute. And, as a result, they’ve all been “granted” Obamacare “waivers.” Rule, Obama! Obama, waive the rules! If only for his cronies. Americans are being transferred remorselessly from the rule of law to rule by an unaccountable bureaucracy of micro-regulatory preferences, subsidies, entitlements, and incentives that determine which of the multiple categories of Unequal-Before-the-Law Second-Class (or Third-Class, or Fourth-Class) Citizenship you happen to fall into.

And yet Americans put up with it. According to the Small Business Administration, the cost to the economy of government regulation is about $1.75 trillion per annum. You and your fellow citizens pay for that — and it’s about twice as much as you pay in income tax. Or, to put it another way, the regulatory state sucks up about a quarter-trillion dollars more than the entire GDP of India. As fast as India’s growing its economy, we’re growing our regulations faster. Oh, well, you shrug, it would be unreasonable to expect the bloated, somnolent hyperpower to match those wiry little fellows back at the call center in Bangalore. Okay. It’s also about a quarter-trillion dollars more than the GDP of Canada. Every year we’re dumping the equivalent of a G7 economy into ever more ludicrous and wasteful regulation.

As my fellow columnists Charles Krauthammer and Victor Davis Hanson like to point out, decline is not inevitable; it is a choice. The voters of New York’s 26th district chose it just the other day, presumably on the basis that it will be relatively pleasant, as it has been in certain parts of Continental Europe. But genteel Franco-Italian decline is not on the menu. As those numbers suggest, the scale of American decay is entirely different: a trillion-and-three-quarter dollars in regulatory costs, a trillion dollars in college debt, four-and-a-half billion dollars spent by Washington every single day that we don’t have, 70 percent of which the United States government “borrows” from itself because nobody else wants to lend it to us — and a governing party whose Senate leader boasts about not passing a budget and whose plan for Medicare is not to have a plan at all and whose crusading regulatory reformer’s greatest triumph is getting Daisy the cow moved out of the same federal classification as the Exxon Valdez.

Stand well back, that Holstein’s about to blow.

Mark Steyn, NRO

 

[Frisco_Slug_Esq]

One sausage or two?

You may be lucky to get half at this weekend's Memorial Day cookout, which is set to cost 29 per cent more than last year, thanks to inflation.

Those thinking of hosting a BBQ - even a modest one - can expect to fork out an extra $45 on food to serve a dozen guests.

The total cost comes to $199, or around 29 per cent more than last year... and that's before soda and alcohol, according to the latest data for metro New York.

Lettuce has sky-rocketed 28 per cent since last year's traditional BBQ, while an ear of sweet corn is now 50 cents, up from 20 cents last year.

Those who don't like tomatoes are in luck though: they're up a staggering 86 per cent on last year.

Nationwide the story is the same.

Ground beef is up 12.1 per cent on last year and sausages are up 6.2 per cent, according to the U.S. Bureau of Labor Statistics.

And don't even think about potato salad. The apple of the ground is up 13.4 per cent.

Ice cream is up 5.1 per cent, beer up 2.4 per cent and coffee has increased by 13.8 per cent nationwide.

The ever increasing price of gasoline is being blamed for the hike in food prices. Over the past year the cost of gas has increased by 33.6 per cent, along with similar diesel hikes nationwide.

http://www.dailymail.co.uk/news/art...ay-cookout-cost-29-year-thanks-inflation.html

NEW YORK – There's less money this summer for hotel rooms, surfboards and bathing suits. It's all going into the gas tank.

High prices at the pump are putting a squeeze on the family budget as the traditional summer driving season begins. For every $10 the typical household earns before taxes, almost a full dollar now goes toward gas, a 40 percent bigger bite than normal.

Households spent an average of $369 on gas last month. In April 2009, they spent just $201. Families now spend more filling up than they spend on cars, clothes or recreation. Last year, they spent less on gasoline than each of those things.

http://news.yahoo.com/s/ap/20110527/ap_on_bi_ge/us_gasoline_summer_squeeze

Housing has yet to rebound, in fact, it's getting worse, this affects durable goods orders.

Retailers and manufacturers are practicing deflation just to keep up sales; eventually, as the Walmart CEO keeps telling us, that will have to end and we will see the inflation in soap and more in clothing...

But, as U_D assured me yesterday, Paddy O'bama is doing a great job on the economy simply because its not getting worse, he's working, and thanks to the inflation of QE and QEII, his 401K appears to have recovered all its losses under the evil, evil, and did I say EVIL, GW...


__________________
Barry 2012 Says: Oh No! We Didn't!
http://pajamasmedia.com/tatler/files/2011/04/obama-wide-grin80.jpg

 

[Frisco_Slug_Esq]

According to the Bureau of Labor and Statistics, overall prices have increased on average .5% per month, for the last five months. The slow and anemic growth in our economy, the lack of jobs being created, and poor numbers in vital markets, like housing, suggest that the rise in prices is not the result of higher demand but a decline in buying power from a falling dollar. This is further evidenced by the extraordinary rise in commodities like gold, oil, and food. Over the last 12 months, energy prices have risen 32% and Gold has risen 27%, while average wages increased by less than 1%. These numbers reflect a dangerous trend that the Federal Reserve would normally want to reverse or, at the very least, slow for fear of rampant runaway inflation; but that is not the case today. Indeed, the rise in prices was the desired result of the Federal Reserve to avoid what it considers to be more dangerous, deflation. The problem with high inflation, and the solution to high inflation, is that it will cause another recession.

The sharp rise in prices means the ability of each consumer to purchase goods or services is reduced proportionately. Your reduced buying power translates into reduced tourism, reduced spending on luxury items, fewer restaurant visits, less travel, and, for most Americans, less savings and investing. Businesses will try to lower prices by cutting cost, through: reducing wages and benefits, reducing investments, and/or reducing the size of its workforce. Normally this would result in a short term recession, followed by a fairly quick recovery. Today, that is not the case. Prices are not rising as a result of higher demand and thus will not fall with lower demand. If left unchecked, higher prices will drive consumers out of the economy and force businesses to close; another recession.

Ironically, the only solution to inflation is recession. The Federal Reserve has caused prices to rise by flooding the markets with cash by buying treasuries, known as quantitative easing. Furthermore, it has lowered the interest rate it charges banks, the federal funds rate, to historic lows just above 0%. To cure inflation, the Federal Reserve would simply do the opposite, sell treasuries and raise interest rates. Once again, they have a problem. Raising interest rates will make it even harder for businesses and consumers to get loans for cars, housing, or expanding a growing business. Consumers and businesses alike will be forced to cut back on spending as the cost of borrowing rises. These cut backs will cause the economy to shrink and America will enter another recession.

The last time America experienced this was in the early 1980s, when interest rates hit double digits and unemployment peaked at 10%. Today, with cheap and easy money, unemployment is hovering around 9%. When the Federal Reserve reins in the extra cash and raises interest rates, unemployment will surely jump to heights we have not seen since the Great Depression. America is about to get a first hand lesson on the failures of Keynesian economics and government intervention.

Frank Gutting
The American Thinker

I remember Jimmy Carter!

I kept saying, a new generation has to SEE Jimmy Carter to BELIEVE Jimmy Carter.

I keep hoping and praying that the Democrats don't come to their senses and that they run Jimmy QEII again; the shiny new black smell is off the bloom...

 

[Ulaven_Demorte]

Frank Gutting
The American Thinker

I remember Jimmy Carter!

I kept saying, a new generation has to SEE Jimmy Carter to BELIEVE Jimmy Carter.

I keep hoping and praying that the Democrats don't come to their senses and that they run Jimmy QEII again; the shiny new black smell is off the bloom...

Sounds like Frank is hoping for the worst, and you're right there cheering him on. Why do you hate America so much that you would rather see failure than progress simply because you can't stand the President?

I'll tell you what Cap'n..

Want to place a friendly little wager on the outcome of the 2012 Presidential race? I'll take Obama to win over anyone that runs against him.

As a side wager we can guess how many seats the GOP will lose in the upcoming elections due to backlash against their corporate bootlicking and freshman TeaParty congresspersons suckling at the pork trough while trying to punish the working man, elderly, and infirm.

 

[RightField]

That Steyn article was hilarious. Thanks for posting it.

Happy Memorial Day Weekend to you.

 

[Frisco_Slug_Esq]

I'll tell you what Cap'n..

Want to place a friendly little wager on the outcome of the 2012 Presidential race? I'll take Obama to win over anyone that runs against him.

As a side wager we can guess how many seats the GOP will lose in the upcoming elections due to backlash against their corporate bootlicking, teaParty suckling at the pork trough while punishing the working man, elderly, and infirm.

So, you don't deny a stagnant economy despite Obama getting the fixes he demanded on top of the Bush fixes he voted for, so now your only hope is proving how much worse Republicans are? It's 2002, 2004, 2006, 2008 vu all over again!

I'd say the working man, elderly and infirm have been punished plenty under Paddy O'Bamanomics...

QEIII?
__________________
Sideshow Barry Barker 2012 Says: "It's NOT the economy, Stupid!" It's the Birthers! The Tea Party! SARAH PALIN!
http://pajamasmedia.com/tatler/files/2011/04/obama-wide-grin80.jpg

 

[Ulaven_Demorte]

So, you don't deny a stagnant economy despite Obama getting the fixes he demanded on top of the Bush fixes he voted for, so now you're only hope is proving how much worse Republicans are? It's 2002, 2004, 2006, 2006 vu all over again!

I'd say the working man, elderly and infirm have been punished plenty under Paddy O'Bamanomics...

QEIII?

So, that would be a big no on a friendly little wager on both counts?

Now if I were one to point fingers where they belonged.. I could point out that any stagnation started happening after the recent congress took office..

But we're leaps and bounds ahead of where we were when Obama took the reigns.

 

[Frisco_Slug_Esq]

That Steyn article was hilarious. Thanks for posting it.

Happy Memorial Day Weekend to you.

And you too sir!

It's nice to be around electricity again...

 

[Frisco_Slug_Esq]

So, that would be a big no on a friendly little wager on both counts?

Now if I were one to point fingers where they belonged.. I could point out that any stagnation started happening after the recent congress took office..

But we're leaps and bounds ahead of where we were when Obama took the reigns.

The stagnation began in 2006...

So far, the old guard has just been the party of NO! when it comes to the New Congress...

This is the economy of an UNDIVIDED Washington DC.
__________________
Barry 2012 Says: Oh No! We Didn't!
http://pajamasmedia.com/tatler/files/2011/04/obama-wide-grin80.jpg

 

[Ulaven_Demorte]

The stagnation began in 2006...

So far, the old guard has just been the party of NO! when it comes to the New Congress...

This is the economy of an UNDIVIDED Washington DC.
__________________
Barry 2012 Says: Oh No! We Didn't!
http://pajamasmedia.com/tatler/files/2011/04/obama-wide-grin80.jpg

As a result of "conservative" economic policies. We had a pretty nasty recession that we are still climbing out of, although the rate has slowed considerably since the last election.. When the people who put us there were inexplicably voted back into the majority.

Undivided? You really have no ties to reality do you?

 

[Frisco_Slug_Esq]

As a result of "conservative" economic policies. We had a pretty nasty recession that we are still climbing out of, although the rate has slowed considerably since the last election.. When the people who put us there were inexplicably voted back into the majority.

Undivided? You really have no ties to reality do you?

Again. The recession occurred under the watch of Nancy Pelosi who did nothing to stop it and produced nary a budget when the shit hit the fan, preferring to leave that to the "conservative" element of Congress so that she could continue to blame them as if she, and her party, were in the minority. Well, sir, they soon were again in Congress after four short years, two with near-absolute dictatorial powers over the economy, but alas, they punted the hard choices...

 

[Frisco_Slug_Esq]

Just some food for thought

Myth 1: Millionaires who favor of an income tax increase are fiscal heroes.

Fact 1: No, they’re not. Many of the rich get the majority of their income in the form of capital gains and dividends rather than ordinary income. They are essentially advocating a tax increase on those making much less money than they do.

Myth 2: Big government means more redistribution to the poor.

Fact 2: Large governments tend to have less progressive taxation than smaller ones.

Myth 3: The doomsday projections about unfunded Social Security and Medicare obligations are overstated.

Fact 3: The unfunded liabilities for Social Security and Medicare exceed one full year of the United States’ gross domestic product. That’s on top of the spending that’s supposedly funded.

Veronique de Rugy
http://reason.com/archives/2011/05/27/the-facts-about-taxes-and-spen

 

[Frisco_Slug_Esq]

On Wednesday, the Commerce Department announced that durable goods orders dropped 3.6 percent, worse than economists’ expectations for a 2.2 percent fall. They also announced that driven by the lack of buyers, the price of new homes continued to deflate. Thursday, it was announced that weekly first-time unemployment claims rose to 424,000 (in February that number was 375,000 — lower, but still very high).



It's "racism..."

http://pajamasmedia.com/blog/top-black-democrat-declares-opposition-to-obama-based-on-race/

 

[Frisco_Slug_Esq]

Have you noticed that the economy is slowing down once again? The data of late has been pretty unequivocal on that front. In the last few weeks, we've seen monthly reports from Fed regional banks that show local economic growth stalling. Industrial production for April was flat. The housing market is in a double dip, despite the fact that mortgage rates are at bargain basement levels. Weekly jobless claims have bounced back up. And while the top-line number of April's unemployment report showed somewhat good news, though it also revealed clear signs that wages are not keeping pace with inflation, which is bad news, considering how dependent the economy of today is on consumer spending. Looking ahead, the major firms are already starting to cut their growth forecasts for Q2. Japan's economy slowed more than expected last quarter, and the sovereign debt crisis of Europe is back with a vengeance. Belarus just devalued its currency, Greece remains in very real danger, and China's now thinking of bailing out Portugal.

The economy is relevant to the political discourse in so many ways, and I've reviewed its impact on this page regularly over the last few months. One element that I have touched on just briefly is the fact that slower growth could have significant, deleterious effects on the nation's budget deficit. Over the previous decade (2001-2010), economic growth averaged just 1.7 percent per year, yet the CBO projects an average growth rate over the next decade (2011-2020) of 2.9 percent. If we come in closer to the last decade rather than CBO's projections, federal revenue collections will inevitably be hampered, as the tax code is highly progressive and a lower rate of growth will keep people out of the higher income brackets. Meanwhile, federal spending would not fall at a corresponding rate, as appropriations are set by the political cycle and not the business cycle.

All told, weak growth -- the kind that we've been stuck with since 2001 -- could produce a 10-year budget deficit that is trillions more than what CBO currently projects as the baseline. And that baseline is already at about $7.5 trillion, plus it assumes away many important spending/revenue adjustments like the Medicare "doc fix," the unlikelihood of Democrats getting their tax hike (they call it, "repealing the Bush tax cuts," but there is no real difference from an economic standpoint), the extreme unlikelihood that Obamacare will reduce the deficit, and more.

In other words, when we take a sober, fair-minded look at what the baseline budget would be under realistic political and economic conditions, we are faced with a terrifying truth: the status quo in American fiscal policy is no longer sustainable.

The bulk of political commentators, and the political class in general, have yet to wrap their minds around this fact, although there are several notable exceptions to the general tendency. These farsighted few now see the bad moon rising over the nation's capitol, and they know it portends a dramatic, painful change in the way things work in D.C.

Since the end of World War Two, the political class has basically had to manage the country's rapid economic growth. That hasn't been a cakewalk, but managing growth has been relatively easy: you can spend billions on guns or butter, without taking too much from the average middle class American taxpayer. Yet these days are over. Now, our political leaders have to manage decline -- for even if the economy continues to grow, it likely will not grow fast enough to pay for all the financial obligations the elites made when they foolishly assumed that the days of 4 percent growth would last forever.

...

Any partisan who thinks their side has an inherent advantage in the battle of assigning losers is deluding himself. The Democrats have long argued for increased taxation to distribute more income to the lower classes. The Republicans have long argued for decreased taxation to spur business, coupled with free-market mechanisms to make social welfare more efficient. The response of the American public over the last thirty year? Regularly divided government, so that one side inevitably checks the grand ideological ambitions of the other, and nothing really changes. In other words, the public has consistently voted for the status quo over the Democratic plan and the Republican plan.

Sooner rather than later, this status quo must give way. No more guns, butter, and low taxes. At least one of them has got to go, and millions of Americans are going to lose something on the deal. How will that play out politically? Honestly, I do not know. But I can say two things for sure:

One, the political process, which has been ugly for some time, is going to get a whole lot uglier. You thought the Republicans and Democrats were vicious when they were fighting over a growing pie? Just wait until they finally catch on that the pie has to start shrinking.

Two, anybody who tells you what is likely to happen in 2012 is fooling themself. One way or the other, the country has voted for the status quo in just about every election for the last thirty years. What do they do when they realize that they can't vote for the same thing anymore? The tiresome pundits don't know, the statistical "gurus" don't know, and the wonky poseurs don't know. If they say otherwise, it's simply proof that they don't really get it.

Jay Cost
http://www.weeklystandard.com/blogs/morning-jay-bad-moon-rising_571563.html?nopager=1

 

[Frisco_Slug_Esq]

The funniest thing is...





That last year, at this same time, U_D was saying the same thing about orders and hiring to prove the summer of recovery was about to explode...



... making President Obama a lock for reelection!
__________________
Barry Says: You have that one nailed A_J!
http://pajamasmedia.com/tatler/files/2011/04/obama-wide-grin80.jpg

 

[Frisco_Slug_Esq]

Sorry U_D, we think you are burnishing your progress reports a bit...

House Majority Leader Eric Cantor turned the policy temperature down on austerity this week by rolling out a strong economic-growth agenda. Headlined by a 25 percent top tax rate for individuals and business, the Cantor package includes regulatory relief, free trade, and patent protection for entrepreneurs. It’s job creation and the economy, stupid.

Sounds Reaganesque? Well, Eric Cantor has a lot of Reagan blood in him. Back in 1980, while Cantor was still in high school, his father was the Virginia state treasurer of the Ronald Reagan presidential campaign. So the apple never falls far from the tree.

In fact, it looks like Cantor is restoring the supply-side incentive model of economic growth. Forget tax-the-rich class warfare. Throw out wild-eyed government-spending stimulus and dollar-depreciating Fed money-pumping. Make it pay more after tax to work, produce, and invest. Go for a growth spurt, something the economy badly needs. And — my thought — crown such a growth strategy with a stable King Dollar re-linked to gold.

When I interviewed Cantor this week, he made it clear that faster economic growth was crucial to holding down spending, deficits, and debt. As scored by the CBO, every 1 percent of faster growth lowers the budget gap by nearly $3 trillion from lower spending and higher revenues. “Grow the economy,” Cantor said. “It will help us manage-down the deficit and it will help get people back to work.”

This is not to say that spending cuts and structural entitlement reforms aren’t necessary. They are. But it is to argue that lately the GOP has forgotten the growth component that is so essential to spending restraint and deficit reduction.

The GOP should say: In return for substantial federal-spending cuts, we’re gonna more than make it up to you with large tax cuts. You will win. Big government will lose.

I suggested to Cantor that the GOP adopt a 5 percent national growth target, which President John F. Kennedy had when he launched his across-the-board tax cuts in the early 1960s. “That is a fantastic goal,” he told me.

Cantor’s growth plan is very timely as the U.S. economy is once again sputtering. In what is already one of the weakest post-recession recoveries in the postwar era, first-quarter GDP came in at a tepid 1.8 percent. Many economists believe the second quarter will be no better.

And consider this: Between 1947 and 2000, average real economic growth registered 3.4 percent yearly — an excellent prosperity baseline. Yet over the past ten years — amidst boom-bust Fed policy, a collapsing dollar, and soaring gold — the stock market on balance hasn’t moved as the economy has averaged only 1.7 percent annually. Because of the ongoing slump, actual real GDP growth from the early 2000s through the first quarter of 2011 has dropped nearly 17 percent below the long-run historical trend. That translates to a massive output gap of $2.7 trillion.

In order to close that gap in five years the economy would have to grow 7.3 percent annually (roughly Reagan’s two-year recovery rate in 1983-84). To close the gap in ten years, the economy would have to grow near 5.3 percent annually.

Alright, so why not establish a national economic growth target of over 5 percent? That might wipe out the current spirit of economic pessimism and decline.

A 5 percent growth target might give some hope to the roughly 15 million unemployed. Or the 12 to 15 million homeowners who can’t meet their mortgages, are in foreclosure, or have upside-down property values. Or the disappointed investors who haven’t made any real cash in ten years. Or the families who are suffering from rising gas and food prices.

A 5 percent growth target might wipe out the sense that we can’t seem to right the economic ship.

For all these reasons, according to the polls, jobs and the economy are the number one political issue today. Entitlements are going to have to be fixed. But that day of reckoning is nearly 20 years away. Right now folks want work and income to pay the bills.

The brilliance of Mr. Cantor’s effort is his attempt to move the GOP back to the economic-growth high ground. It is our most urgent priority.

Larry Kudlow
NRO
__________________
Sideshow Barry Barker 2012 Says: "It's NOT the economy, Stupid!" It's the Birthers! The Tea Party! SARAH PALIN!
http://pajamasmedia.com/tatler/files/2011/04/obama-wide-grin80.jpg

 

[RightField]

It's clear that the economy is sputtering again and there's worries of inflation and higher unemployment.

The dems attribute this to one of two causes; 1) It's still Bush's fault and 2) It's a vast right-wing conspiracy to make them look bad.

Neither argument holds much weight. When there's a drought in Somalia, it's Bush's fault, but when Bush's interegation processes and well-funded better-integrated intelligence services find Bin Laden, his name isn't mentioned.

The growth strategy is exactly what is needed. We need to get rid of these democrat no-growth policies and get the economy humming again.

 

[Frisco_Slug_Esq]

It's clear that the economy is sputtering again and there's worries of inflation and higher unemployment.

The dems attribute this to one of two causes; 1) It's still Bush's fault and 2) It's a vast right-wing conspiracy to make them look bad.

Neither argument holds much weight. When there's a drought in Somalia, it's Bush's fault, but when Bush's interegation processes and well-funded better-integrated intelligence services find Bin Laden, his name isn't mentioned.

The growth strategy is exactly what is needed. We need to get rid of these democrat no-growth policies and get the economy humming again.

You mean there's a danger of a double-dip recession?

Better fire up the presses!

 

[Frisco_Slug_Esq]

USA Today shocked and surprised!

Unexpectedly!

As megablogger Glenn Reynolds, aka Instapundit, has noted with amusement, the word “unexpectedly,” or variants thereof, keeps cropping up in mainstream-media stories about the economy.

“New U.S. claims for unemployment benefits unexpectedly climbed,” reported cnbc.com May 25.

“Personal consumption fell,” Business Insider reported the same day, “when it was expected to rise.”

“Durable goods declined 3.6 percent last month,” Reuters reported May 25, “worse than economists’ expectations.”

“Previously owned home sales unexpectedly fall,” headlined Bloomberg News May 19.

“U.S. home construction fell unexpectedly in April,” wrote the Wall Street Journal May 18.

Those examples are all from the last two weeks. Reynolds has been linking to similar items since October 2009.

The mainstream media may finally be catching up. “The latest economic numbers have not been good,” David Leonhardt wrote in the May 26 New York Times. “Another report showed that economic growth at the start of the year was no faster than the Commerce Department initially reported — ‘a real surprise,’ said Ian Shepherdson of High Frequency Economics.”

Which raises some questions. As Instapundit reader Gordon Stewart, quoted by Reynolds on May 17, put it: “How many times in a row can something happen unexpectedly before the experts start to, you know, expect it? At some point, shouldn’t they be required to state the foundation for their expectations?”

One answer is that many in the mainstream media have been cheerleading for Barack Obama. They and he both naturally hope for a strong economic recovery. After all, Obama can’t keep blaming the economic doldrums on George W. Bush forever.

I’m confident that any comparison of economic coverage in the Bush years with the coverage now would show far fewer variants of the word “unexpectedly” in stories suggesting economic doldrums.

It’s obviously going to be hard to achieve the unacknowledged goal of many mainstream journalists — the president’s reelection — if the economic slump continues. So they characterize economic setbacks as unexpected, with the implication that there’s still every reason to believe that, in Herbert Hoover’s phrase, prosperity is just around the corner.

A less cynical explanation is that many journalists really believe that the Obama administration’s policies are likely to improve the economy. Certainly that has been the expectation as well as the hope of administration policymakers.

Obama’s first Council of Economic Advisers chairman, Christina Romer, whose scholarly work is widely respected, famously predicted that the February 2009 stimulus package would hold unemployment below 8 percent. She undoubtedly believed that at the time; she is too smart to have made a prediction whose failure to come true would prove politically embarrassing.

But unemployment zoomed to 10 percent instead, and is still at 9 percent. Political pundits sympathetic to the administration have been speculating whether the president can win reelection if it stays above the 8 percent mark it was never supposed to reach.

Administration economists are now making the point that it takes longer to recover from a recession caused by a financial crisis than from a recession that occurs in the more or less ordinary operation of the business cycle. There’s some basis in history for this claim.

But it comes a little late in the game. Obama and his policymakers told the country that we would recover from the deep recession by vastly increasing government spending and borrowing. We did that with the stimulus package, with the budget passed in 2009, back when congressional Democrats actually voted on budgets, and with the vast spending increases scheduled to come (despite the administration’s gaming of the Congressional Budget Office scoring process) from Obamacare.

All of this has inspired something like a hiring strike among entrepreneurs and small businessmen. Employers aren’t creating any more new jobs than they were during the darkest days of the recession; unemployment has dropped slowly because they just aren’t laying off as many employees as they did then.

In the meantime, many potential job seekers have left the labor market. If they reenter and look for jobs, the unemployment rate will stay steady or ebb only slowly.

We tend to hire presidents who we think can foresee the future effects of their policies. No one does so perfectly. But if the best that sympathetic observers can say about the results is that they are “unexpected,” voters may decide someone else can do better.

Michael Barone
NRO