Supporting the Poor Stimulates the Economy

Perhaps it is outrageous to non-Democrats because we were told by Obama that we would have a "net spending cut," yet before he entered office, he was talking trillion dollar deficits. It's called hypocrisy. What I wouldn't give to have Bill Clinton back in the White House, even though he didn't completely balance the budget, he made progress. We need to get past the politics of Red vs. Blue and become a nation dedicated to liberty instead of "friendly fascism" (Orwellian term, not mine). Excuses are made often for doing charitable things with other people's money, but it's still the same old power-over politics.

"Excuses are made often for doing charitable things with other people's money, but it's still the same old power-over politics."

Just whose money is it, exactly? God often uses various ways to get His way. He used Cyrus to bring the Israelites back from being oppressed by other nations. Can He not use government for His purposes; in this case to rectify past injustices? Perhaps you should call attention to Christians in the U.S., who tithe at just under 3 percent of income.

Jeff, I think you may want to recheck your facts on that. I'm not criticizing at all, and I'm not an expert on the subject (I'm knee-deep in studying economics), but the one thing that is very clear, as you pointed out: we are not in a free market.

If we were truly in a free market people would be able to choose mutually-agreeable terms and conditions for their exchange. The Fed has done nothing but transfer wealth from the middle class and the lower class to the upper class, all the while deflating our dollar. If we end the Federal Reserve System and establish sound currency instead of fiat money, we'll be well on our way to a more sound economy, and one that isn't "rigged" for the politically well-connected.

There are only two economic options. A free market where every person can choose freely the choices laid before him to further his life; or a controlled/centrally-planned economy where those in power control the supply of money, often in opposition to natural supply and demand factors (which is why we're in this mess).

Thomas Woods' new book "Meltdown" is a good start on this topic.

" I don't see taxcuts as a government give away. " JacobS

Some form of government, whether it be limited or more expansive needs to be funded. You have been talking about mortgaging our childrens' futures. (Would it be that that same level of concern had been shown during the prevous 8 years!) and on some level they may be right. But if that is the concern is sincerely held, then one would have to agree deficits occasioned by excessive spending or deficits occasioned by giving tax cuts that favor any income bracket let alone the top income brackets would have the same net effect- high deficits and more borrowing.

"What policies would you say got us here? The Republicans are responsible for the massive deficits in recent years, but I hope you aren't blaming them for the current economic problems. "

Unfortunately I am going to have to dash your hopes- in much the same way that Obama did. No, Virginia there is no Santa Claus. And yes, I do blame the Republicans for the economic crisis. But, alas, I am not alone. About 53% of the American public did just the same thing in the November elections.

Finally you won't catch me standing up to defend the Fed. I don't care for that institution much either. But I find it very convenient for free market purists to blame ONLY the Fed for our problems. While the Fed most certainly did contribute to the mess we're in, so did banks that made bad loans against any form common sense or wisdom. Yet the free market purists turn that situation on its head and state that it was because banks were over-regulated tha we are in this situation. I don't buy it.

Jeff, thanks for your thoughtful response.

As for "reaganomics," it has certainly got a bad name, but my question for anybody complaining about it is, "Why should the rich pay an unfair and unequal share of the tax burden if we are all to be created and treated as equals?" EVERYBODY should have a lower tax burden because that's the only way to let more people keep more of their money. The problem is that anti-free marketers have this false belief that the rich are evil or don't do good things with their money.

Sound economic principles are very clear: when you have assets galore that are failing, somebody needs to buy them up. The reason we've got troubled assets is that the Fed made money and credit very easy which ran contra sound investing. Now we're up a creek, and those who didn't make those bad investments need to be able to buy up the bad ones, liquidate, and turn everthing around. It's simple econmics here, nothing "voodoo" about it. The only problem is, the only ones who have the money to rescue the troubled assets is those who are wealthy. The US government is $65 trillion in debt and unfunded liabilities.. that is NOT wealth. So if you want to talk about turning the economy around to sound principles, you MUST lower the tax burden on the rich because they are the only ones who actually CAN afford to buy up troubled assets and put them to good/better use.

Doug; Thanks for the link. very cool looking blog site. We have much in common but arrive at different conclusions in some instances. When I referred to your "Options" I was referring to this quote and not your blog's "options"-
"There are only two economic options. A free market where every person can choose freely the choices laid before him to further his life; or a controlled/centrally-planned economy where those in power control the supply of money, often in opposition to natural supply and demand factors (which is why we're in this mess)."
The reasons I believe that the rich should be "taxed" more are two-fold. 1-They benefit more from government services. This is especially true in the case of corporations such as Wal-Mart, sometimes referred to as corporate welfare. They also benefit disproportionally from infrastructure. and 2-They are unfairly granted loopholes not equally granted to other tax payers (note: I purposely did not refer to the poor, because I am well aware that they are not relevant to this discussion except that they pay user rather than income taxes)
They (the rich) can afford to buy them (toxic assets) but will they?

"What is offensive to many progressives, and I would count myself in that number, is that while the money was being spent on wars and military actions and tax cuts for the rich, it seemed to be okay to many conservatives. And then once the money is being spent on something like heath insurance for kids (God forbid!) or programs for the poor, the banner of wasteful spending is dusted off."

What about the idea of giving tax breaks and tax credits to private people and organizations that help people with health care and programs for the poor.

I've personally had times when I had to deal with government welfare systems. I wouldn't wish them on my worst enemies. When a person has to go in and apply for aid, they are treated all too often in degrading ways, as if they were lowly beggars with their hands out. Even those case workers who strive to be kind and helpful are hemmed in with all sorts of bureaucratic laws that prevent any real help for the poor.

I voted for Obama because of his views on getting us out of Iraq and because of his stances that opposed discrimination, especially because of sexual orientation. And also because McCain wanted to raise my taxes (he wanted to tax my employer-based health benefits). I do want to give Obama a chance on domestic issues. But if it's more of those horrible bureaucratic programs where people essentially have to come with begging basket in hand: these are the sorts of policies I would oppose, even if Obama supports them.

When I was in need, I got more compassionate help from private organizations rather than from the government. I want to see policies that would help these private organizations give help, all while maintaining their independence from government bureaucracy. I want them to receive tax breaks and tax credits for giving out this help.

"The debate reminds me of the warning of Hosea 4:6 that the "people are destroyed for lack of knowledge." This quote from Adam is getting more ironic by the minute. Our representatives are admitting that they have not even read the stimulus bill. Also the Dem. leadership has resisted publishing drafts of the bill for the reps and senators to look at until the last minute. All signs that they fear the bill would not receive the support of the American people. We were promised transparency, instead we get secrecy. If they are this afraid of the American people, what's next? Maybe censorship, hello Censorship Doctrine.

"I think you touched on one of the fundamental differences between liberals and conservatives. I don't see taxcuts as a government give away."

The main problem with the so-called "supply-side " people is that they want to give tax cuts to businesses. But they have a very poor record in supporting tax cuts to individuals, particularly those who need to work for a living.

I'm also bothered by all the spending that many of the supply-siders have imposed to finance military adventurist missions in foreign countries. Paying for these foreign military interventions plus cutting taxes to businesses -- all while taxing Unemployment benefits and employer-based health premiums and keeping the same high tax rates for middle class people -- will lead to more deficits and disasters.

I'm not sure where this puts me on the spectrum of "liberals" and "conservatives." Some of us seem to be round pegs being put into square holes.

Do you discount the likelihood or expectation that these social welfare programs are not going to be temporary, but rather an addition to ongoing budgeting of the HHS, HUD and other social programs? CBPP et al will be there at the budget table this summer making the case that temporary help through the various programs is inhumane and immoral, and the impacts of "downsizing" them back to affordable, (i.e, not paid for by foreign investment in increasingly questionable Treasury issues) will hurt too many people.

Thank you, James. This was my exact thoughts yesterday on another thread, for which I was docked a point. Maybe they were upset because I threw in the tax cuts and Bush stimulus plan. And these are the same people that have a "free-market" solution to it all. We have the biggest deficit spenders in history (the party of Reagan, and both Bushs) accusing the party under which we have most recently balanced the budget for, of all things, fiscal irresponsibility. These guys have lost most of their economic credibility and the remainder will be completely vaporized when/if the stimulus actually works. The conservatives are marching the Republican party into irrelevancy.

Consider the source when you are being docked points. Consider it blessing that you're offending the right people.

Are Ron Paul and Pat Buchanan irrelivant? Both certainly left their mark on the Republican primaries. The liberals have been almost as quick as the neocons to deride them as isolationists and are, in fact, much more likely to support ill-advised military action.

How does citing irresponsible Republican spending justify irresponsible Democratic spending? Especially when we're pracitcing the politics of hope.

"What is offensive to many progressives, and I would count myself in that number, is that while the money was being spent on wars and military actions and tax cuts for the rich, it seemed to be okay to many conservatives."

James stereotypes often have some validity to them . And yes , many people will defend their side no matter what . But I believe you give too much credit to President Obama and the liberal democrats now in office . They are not ALL there because of their views or their leadership , they are their because the republicans sold out . The conservatives you believe it appears to have little sincerity jumped ship because of that and allowed much of what happened in the last election ,
I quit the republican party. Just because we conservatives still see the democrats and liberal views as wrong , does not mean conservatives in general supported the pork spending of the last 8 years . The democrats still offer nothing better , and thats sad . In fact from my perspective , the folks in charge of Congress now really should be of concern to all liberals in my opinion if sincerity and justice are really concerns or just talking points. Have you really investigated this stimilus package ? Its not like these kinds of packages can be writtien every year .
Much more job creation and much more focus on the poor could have been given instead of what the special interest directed our Congress to write .

To me DC has not changed that much , just liberals are now defending what they use to screaming about , and republicans are now complaining as Obama stated what they were doing for the pas 8 years .

I think you touched on one of the fundamental differences between liberals and conservatives. I don't see taxcuts as a government give away. Whether the tax cuts were responsible or not, ultimately, people were just allowed to keep their own money. To say that money is spent on tax cuts implies that our money is not ours, or God's, but the government's and it is only by their generousity that we are allowed to keep it.

I'm not in a position to disagree that we shouldn't have borrowed money to fight a war with Iraq, but at least Congress has the Consitutional authority to raise money for the military. I think its time for Republicans to admit we screwed up, but a broken clock is still right twice a day. Spending nearly a trillion dollars on anything short of WWIII is unacceptable and, I would say immoral. We do need a culture of responsibility and there is no better time to start than now, when we are on the verge of enslaving our children and grandchilren with our debt. I would love to see President Obama bring spending under control, but I think its going to be like that diet that you're always going to start next week.

What policies would you say got us here? The Republicans are responsible for the massive deficits in recent years, but I hope you aren't blaming them for the current economic problems. President Obama suggested in his press conference that it was George Bush's fault, but he has thus far failed to provide any evidence. Occupying the oval office is not sufficient cause to blame him for everything that went wrong with the economy. It was the Fed, not George Bush that pursued a policy of easy credit; and it was the Fed, not George Bush that inflated the housing market; and it is the Fed, not Barack Obama that is planning and controling our economy now.

"It was the Fed, not George Bush that pursued a policy of easy credit; and it was the Fed, not George Bush that inflated the housing market; and it is the Fed, not Barack Obama that is planning and controling our economy now."

ABSOLUTELY CORRECT!!! The Fed is an abomination of a banking institution and has devalued our dollar 95% since 1912 when it was founded. GWB was responsible for not reigning it in, or abolishing it since he could have fought to do that, so he was complicit in it.

What many fail to understand or admit, especially anti-free marketers, is that we haven't had a free market since the 1912 (some say even prior to that), and especially since we went off the gold standard. That is not a free market, it is gov't intervention and interference. So this talk of "failed capitalism" is a straw man to get people to believe that the free market failed, when in reality a centrally-planned bank with a monopoly on the money supply was the source of the problem.

Doug; To follow up on our most recent exchange re the Fed- I agree with much of your analysis except I believe that the Fed is the outcome of free(unregulated) money markets rather than the inhibitor of same. The government and, by extension, we are under the delusion that the political powers are controlling the economic when, in reality, our system is completely at the mercy of the ultra-rich banking families. The markets are exactly as the powers that be would have them. The only thing more profitable than a free market winner is a free market winner backed by the government.

Uh Oh! You didn't! You used the "F" word on this blog. The word "Fascism", that is. Brace yourself for a virulent reaction from some here about not fostering dialogue and lacking class.

Oh, dumb me! You're advocating a conservative position. Forget what I just said. You will get a pass. No worries.

Do you discount the likelihood or expectation that these social welfare programs are not going to be temporary, but rather an addition to ongoing budgeting of the HHS, HUD and other social programs? CBPP et al will be there at the budget table this summer making the case that temporary help through the various programs is inhumane and immoral, and the impacts of "downsizing" them back to affordable, (i.e, not paid for by foreign investment in increasingly questionable Treasury issues) will hurt too many people.

Jeff, thanks for your thoughtful response.

As for "reaganomics," it has certainly got a bad name, but my question for anybody complaining about it is, "Why should the rich pay an unfair and unequal share of the tax burden if we are all to be created and treated as equals?" EVERYBODY should have a lower tax burden because that's the only way to let more people keep more of their money. The problem is that anti-free marketers have this false belief that the rich are evil or don't do good things with their money.

Sound economic principles are very clear: when you have assets galore that are failing, somebody needs to buy them up. The reason we've got troubled assets is that the Fed made money and credit very easy which ran contra sound investing. Now we're up a creek, and those who didn't make those bad investments need to be able to buy up the bad ones, liquidate, and turn everthing around. It's simple econmics here, nothing "voodoo" about it. The only problem is, the only ones who have the money to rescue the troubled assets is those who are wealthy. The US government is $65 trillion in debt and unfunded liabilities.. that is NOT wealth. So if you want to talk about turning the economy around to sound principles, you MUST lower the tax burden on the rich because they are the only ones who actually CAN afford to buy up troubled assets and put them to good/better use.

Doug; Thanks for the link. very cool looking blog site. We have much in common but arrive at different conclusions in some instances. When I referred to your "Options" I was referring to this quote and not your blog's "options"-
"There are only two economic options. A free market where every person can choose freely the choices laid before him to further his life; or a controlled/centrally-planned economy where those in power control the supply of money, often in opposition to natural supply and demand factors (which is why we're in this mess)."
The reasons I believe that the rich should be "taxed" more are two-fold. 1-They benefit more from government services. This is especially true in the case of corporations such as Wal-Mart, sometimes referred to as corporate welfare. They also benefit disproportionally from infrastructure. and 2-They are unfairly granted loopholes not equally granted to other tax payers (note: I purposely did not refer to the poor, because I am well aware that they are not relevant to this discussion except that they pay user rather than income taxes)
They (the rich) can afford to buy them (toxic assets) but will they?

Do you feel the same sense of urgency and concern over the over-sized military industrial complex the Eisenhower was worried about when he left office.

Why is that programs to hele the lest fortunate in society bring such a response when high deficits to bankroll ill-advised military action barely raises an eyebrow in this country?

I love Adam's last line in this article; "The debate reminds me of the warning of Hosea 4:6 that the "people are destroyed for lack of knowledge." The President is doing his best to rush this through before the details of the bill are revealed and debated.

I do agree that money in the hands of the poor will be put back into the economy faster (though most of the products bought will be made in China). But why not be honest about it? Obama has called it a tax cut since the election. This is a flat out lie and is politics as usual. Change we can believe in? No, this is more of the same old politics times ten.

I am most likely to trust anyone who starts out by saying, "Nobody knows for sure."

Then I would like to hear,

"But here is a summary of the very best information.
Here is what we are sure about.
Here is what we are not sure about..
A diverse group of experts have summarized three basic approaches; with a best-case and worst scenario on each."

And then I would like to hear 535 congresspersons stahd up together and say, "We too have reviewed this information. And we have now actually read the proposed legislation. We are all going to spend 24 hours in silence and a fast. Then we will vote."

I am not trying to be cute or snide. Why do we have to endure days and weeks of endless propogandized arguing and punditry and expert analysis that fits in a 90 second media slot? Doesn't the president get a daily economic briefing. Aren't there people around Congress and the President who spend all of life analyzing and summarizing information. Why is it such a difficult matter for our government to make a simple, transparent, presentation to the people?