Our president, not many threads about him.

[Scorpion9]

^that is untrue
Greed is not causing the chaos in the housing market right now, its the affects of a recesion and inflation. Because most of us are hurting so bad now, most people want land and homes at cheap prices. Most people want to be thrifty, and therefore are not interested in expensive houses, so prices will fall. The housing market has gone through a boom and bust cycle, and I'm affriad its going through the bust right now.Inflation is contributing to it as well. The stimulus is going to cause more harm than good in time. There are just to many dollars chasing to few products, and with dollars backed by thin air, its a terrible combination. Obama, go be a real hero and start minting gold and silver coins as currency and stop contributing to the national debt!

[00E]

But the Democratic party was desperate for a superstar, so they plucked their superstar from the vine before he was completely ready for the national spotlight.

Who in gods name from the Republican Party would have been a better choice? How I see it Hillary Clinton would have been the next best choice!

Smacky You Don't understand! First I said it will take some time now you say Obama's a lier what the heck dude it's been 10 Months Lets break it down T-E-N! You really expect the Economic Crisis to be over that soon? I may be only 13, but I can understand politics as well as you TT Conservatives... Is everyone a hardcore Anti-Obama dude here? That sure is how it seems to me!

[dad]

OOE, I don't think anyone expected magic, they did want to see some some sort of progress, there has benn none.

[00E]

There hasn't been progress but the fall is slowing!

[dad]

No, wall street is improving, unemployment rates are getting higher....what else is improving.

[Ice mom KT]

Lest face it, Obama is doing a poor job and isn't helping the economy at all. 8 months is plenty of time for the results to show and the lack of said results means that Obama is not doing our nation any good. I find this article to be a very accurate description of how Obama has failed to meet his promises.

Conservatives have correctly declared President Obama’s $787 billion “stimulus” a flop. In a January report, White House economists predicted the bill would create (not merely save) 3.3 million jobs. Since then, 2.8 million jobs have been lost, pushing unemployment toward 10 percent.

Yet few have explained correctly why the stimulus failed. By blaming the slow pace of stimulus spending (even though it’s ahead of schedule), many conservatives have accepted the premise that government spending stimulates the economy. Their thinking implies that we should have spent much more by now.

History proves otherwise. In 1939, after a doubling of federal spending failed to relieve the Great Depression, Treasury Secretary Henry Morgenthau said that “we have tried spending money. We are spending more than we have ever spent before and it does not work. . . . After eight years of this administration we have just as much unemployment as when we started . . . and an enormous debt to boot!” Japan made the same mistake in the 1990s (building the largest government debt in the industrial world), and the United States is making it today.

This repeated failure has nothing to do with the pace or type of spending. Rather, the problem is found in the oft-repeated Keynesian myth that deficit spending “injects new dollars into the economy,” thereby increasing demand and spurring economic growth. According to this theory, government spending adds money to the economy, taxes remove money, and the budget deficit represents net new dollars injected. Therefore, it scarcely matters how the dollars are spent. John Maynard Keynes famously asserted that a government program paying people to dig and then refill ditches would provide new income for those workers to spend and circulate through the economy, creating even more jobs and income. Today, lawmakers cling to estimates by Mark Zandi of Economy.com that on average, $1 in new deficit spending expands the economy by roughly $1.50.

If that were true, the record $1.6 trillion in deficit spending over the past fiscal year would have already overheated the economy. Yet despite this spending, which is equal to fully 9 percent of GDP, the economy is expected to shrink by at least 3 percent this fiscal year. If the spending constitutes an injection of “new money” into the economy, we may conclude that, without it, the economy would contract 12 percent — hardly a plausible claim.

If $1.6 trillion in deficit spending failed to slow the economy’s slide, there’s no reason to believe that adding $185 billion — the 2009 portion of the stimulus bill — will suddenly do the trick. But if budget deficits of nearly $2 trillion are insufficient stimulus, how much would be enough? $3 trillion? $4 trillion?

This is no longer a theoretical exercise. The idea that increased deficit spending can cure recessions has been tested, and it has failed. If growing the economy were as simple as expanding government spending and deficits, then Italy, France, and Germany would be the global economic kings. And there would be no reason to stop at $787 billion: Congress could guarantee unlimited prosperity by endlessly borrowing and spending trillions of dollars.

The simple reason government spending fails to end recessions is that Congress does not have a vault of money waiting to be distributed. Every dollar Congress “injects” into the economy must first be taxed or borrowed out of the economy. No new income, and therefore no new demand, is created. They are merely redistributed from one group of people to another. Congress cannot create new purchasing power out of thin air.

This is intuitively clear in the case of funding new spending with new taxes. Yet funding new spending with new borrowing is also pure redistribution, since the investors who lend Washington the money will have that much less to invest in the economy. The fact that borrowed funds (unlike taxes) must later be repaid by the government makes them no less of a zero-sum transfer today.

Even during recessions — when total production falls, leaving people with less income to spend — Congress cannot create new demand and income. Any government spending that increases production at factories and puts unemployed individuals to work will be financed by removing funds (and thus idling resources) elsewhere in the economy. This is true whether the unemployment rate is 5 percent or 50 percent.

For example, many lawmakers claim that every $1 billion in highway stimulus will create 47,576 new construction jobs. But Congress must first borrow that $1 billion out of the private economy, which will then lose a roughly equivalent number of jobs. As transportation-policy expert Ronald Utt has explained, “the only way that $1 billion of new highway spending can create 47,576 new jobs is if the $1 billion appears out of nowhere as if it were manna from heaven.” Removing water from one end of a swimming pool and dumping it in the other end will not raise the overall water level. Similarly, moving dollars from one part of the economy to the other will not expand the economy. Not even in the short run.

Consider a simpler example. Under normal circumstances, a family might put its $1,000 savings in a certificate of deposit at the local bank. The bank would then lend that $1,000 to the local hardware store. This would have the effect of recycling that spending around the town, supporting local jobs. Now suppose that, induced by an offer of higher interest rates, the family instead buys a $1,000 government bond that funds the stimulus bill. Washington spends that $1,000 in a different town, creating jobs there instead. The stimulus bill has changed only the location of the spending.

The mistaken view of fiscal stimulus persists because we can easily see the people put to work with government funds. We don’t see the jobs that would have been created elsewhere in the economy with those same dollars had they not been lent to Washington.

In his 1848 essay “What Is Seen and What Is Not Seen,” French economist Frédéric Bastiat termed this the “broken window” fallacy, in reference to a local myth that breaking windows would stimulate the economy by creating window-repair jobs. Today, the broken-window fallacy explains why thousands of new stimulus jobs are not improving the total employment picture.

Keynesian economists counter that redistribution can increase demand if the money is transferred from savers to spenders. Yet this “idle savings” theory assumes that savings fall out of the economy, which clearly is not the case. Nearly all individuals and businesses invest their savings or put it in banks (which in turn invest it or lend it out) — so the money is still being spent somewhere in the economy. Even in this recession, with tightened lending standards, banks are performing their traditional role of intermediating between those who have savings and those who need to borrow. They are not building extensive basement vaults to hoard cash.

Since the financial system transfers savings into investment spending, the only savings that drop out of the economy are those dollars literally hoarded in mattresses and safes — and there is no evidence that this is occurring en masse. And even if individuals, businesses, and banks did distrust the financial system enough to hoard their dollars, why would they suddenly lend them to the government to finance a stimulus bill?

Once the idle-savings theory collapses, so does all the intellectual support for government spending as stimulus. If there are no idle savings to acquire, then the government is merely borrowing purchasing power from one part of the economy and moving it into another part of the economy. Washington becomes nothing more than a pricey middleman, redistributing existing demand.

Even foreign borrowing is no free lunch. Before China can lend us dollars, it must acquire them from us. This requires either attracting American investment or raising the Chinese trade surplus (and the American trade deficit). The balance of payments between America and other nations must eventually net out to zero, which means government spending funded from foreign borrowing is zero-sum.

I’ve purposely ignored the Federal Reserve, which actually can inject cash into the economy, but not in a way that constitutes stimulus. Congress can deficit-spend; Treasury can finance the deficit spending by issuing bonds; and the Federal Reserve can buy those bonds by printing money. Any economic boost is then due to the Federal Reserve’s actions, not the deficit spending — and of course the Federal Reserve will have to raise interest rates, slowing the economy again, to bring the resulting inflation under control.

If government spending doesn’t cause economic growth, what does? Growth happens when more goods and services are produced, and the only true source of this is an expanding labor force combined with high productivity. High productivity in turn requires educated and motivated workers, advanced technology, adequate infrastructure, physical capital such as factories and tools, and the rule of law.

Government spending could boost long-run productivity through investments in education and infrastructure — but only if politicians could target those investments better than the private sector would. And it turns out that politicians cannot outsmart the marketplace. Mountains of academic studies show that government spending generally reduces long-term productivity.

Furthermore, most government programs that could increase productivity don’t work fast enough to counteract a recession. Education spending cannot raise productivity until its student beneficiaries graduate and enter the work force. It can take more than a decade to build new highways and bridges.

The only policy proven to increase productivity in the short term is to lower tax rates and reduce regulation. Businesses can grow only through consistent investment and an expanding, skilled workforce. Cutting marginal tax rates promotes these conditions, by creating incentives to work, save, and invest.

It’s happened before. In 1981, President Reagan inherited an economy stagnating under the weight of 70 percent marginal income-tax rates. Under Reagan, the top rate fell to 28 percent, and the subsequent surge in investment and labor supply created the strongest 25-year economic boom in American history.

Such tax-rate reductions are superior to tax rebates designed to “put money in people’s pockets.” Rebates — like government spending — simply redistribute existing dollars. They don’t increase productivity because they don’t change incentives: No one has to work, save, or invest more to get a tax rebate. The 2001 and 2008 rebates failed because Congress borrowed money from investors and foreigners and redistributed it to families. Not surprisingly, any new personal-consumption spending was matched by corresponding declines in investment spending and net exports, and the economy remained stagnant.

If conservatives wish to provide economic leadership, they must get this argument right. The stimulus is not failing because it is too small or because too much of it is being saved. It’s failing because Congress can only redistribute existing demand, not create new demand. This recession will eventually end. The more serious, long-term danger is that President Obama’s Europeanization of the economy will bring the same slow growth, stagnant wages, job losses, high taxes, and lack of competitiveness that have plagued Western Europe, leaving the United States at an ever-growing disadvantage with Asian countries not so afflicted.

To prevent this, conservatives and free marketeers will need to promote policies that support long-term prosperity. The first step will be articulating why big government does not bring economic growth.

[Cloud]

00E- The diversity on TT is quite big considering how small the game really is. People play from all around the world, so it is expected for there to be different opinions. Not all folks that play TT are conservatives. I am happy that the younger generation is paying closer attention politics. I am 19, and after growing up in the GWB era, its hard not to look at politics but I am not nearly as educated on politics than I would like.

I voted for Obama and frankly after growing up in the Bush admin, I think I made the right decision. I could NOT pull myself together to vote for Mccain because of Palin. Palin's ignorance astounded me. How McCain could chose somebody like that to lead our great country if something horrible happen to Mccain? Again his decision making skills. (Oh right, to snag Hillary supporters) There were also other bits and pieces which made Mccain not a good choice for me. He was a POW and to my understanding, he had the option to get out of the POW camp, but decided not for some reason or another. If you are given the chance to leave a POW camp. Take it. The time he spent in the POW camp affected his brain it appears.
Obama was fresh, and promised many things he CAN not do. I was aware of this. He has somewhat restored the vision of the USA around the world. The rest of the world didn't particularly like GWB or Mccain. Folks around the world used to look up to the USA. GWB flushed that one down the toilet. Something of the magnitude of GWB era will take many decades to fix. We saw a continuous growth in the economy, so a plunge was expected. We are moving into a new era. Republicans are going to have to change their attitude. I doubt it will work very well in the future.

[stiffler]

No, wall street is improving, unemployment rates are getting higher....what else is improving.

Baby steps did the Wright brothers fly as soon as they thought of it no it took time smack how would you make a differ. how about you all right down your plan as to help and we will see if thats any better then Obamas.

[stiffler]

I understand you 100%. Its just annoying how people think this will take a year. When it takes years to get in this mess it usely takes longer to get out. What happened to no victory with out sacrifice...Also it scares me that i can vote also to the fact i dont know much on politics. Hell i can even goto the casino here(wonn 1 grand already there) gotta love the slots. i am just stating that its gonna take time.

[jedirieb]

^ Based on your last line, I'm not so sure you did understand Smacky 100%. If you do understand it, then you'd realize that his point is the following: we should be seeing results by now. If Obama was going to make good on his promises, he would have had plans in mind for when he became President, right? Now, those plans may not be completed in ten months, but the groundwork should be laid and such plans should be beginning to bloom after ten months. Instead, we see wasted government money for "plans" which do no good for the average person.

People in general seem to have this notion that the government is inefficient and incapable of doing much in a small time frame. Yet the government is only what the people expect it to be. If they expect it to take a long time to fix the economic crisis, then it will. After all, the government is made of people, and people in general to not go above and beyond their job expectations. Now, if the people have a low expectation of the government, it will work to meet, not surpass, that expectation. In reality, Obama is a Democratic president who has a Democratically controlled House and Senate. He has ample opportunity to get new things passed quickly, and he has. The problem is not that Obama has had too little time, but rather, the problem is that he has not passed anything to actually help the average person and recover the economy.