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Say goodbye to the economic recovery. (If it existed at all)

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storyyeller More like giant cherries from Appleloosa Since: Jan, 2001 Relationship Status: RelationshipOutOfBoundsException: 1
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#126: Dec 4th 2010 at 9:20:53 PM

valued their property for its highest worth use such as condos rather than its appraised value for say a cattle ranch.

Odd, I thought you were in favor of a free market. Or is that a free market in everything except farmland?

Blind Final Fantasy 6 Let's Play
MajorTom Since: Dec, 2009
#127: Dec 4th 2010 at 9:23:59 PM

That's government who values the land especially for taxation purposes, not the market.

It's why for example a cattle ranch of 400 acres valued at just more than a million dollars total as a cattle ranch is taxed as a 20 million dollar housing development when the estate tax comes into play. The government sets the tax according to their tables of highest worth use, not its appraised and documented value.

Aprilla Since: Aug, 2010
#128: Dec 4th 2010 at 10:10:05 PM

It's a little late to point this out, but it needs to be said with all due relevance. A common misconception about many sectors of the welfare system is that most welfare recipients, by and large, are unemployed. While it is true that many unemployed individuals receive government aid, it's a truth that tends to be exaggerated in anti-nanny state arguments.

In many states and under many circumstances, you have to be employed or have a verifiable higher education enrollment status (at least part-time student enrollment) in order to qualify for food stamps, daycare vouchers, and subsidized housing projects. My mother has had to use these welfare programs to get by in more than one occasion, and now all four of her children, myself obviously included, are college educated, at least mildly successful, and more or less devoid of a criminal record aside from a couple of traffic violations. And we're not the only ones. I know I'm using the "well, what about me" argument, but I know plenty of families, especially single mothers, who have no desire to take what many opponents call "handouts". Being on welfare sucks, but sometimes it's needed. And sometimes it's not.

I agree with arguments that welfare applicants should receive background checks, but doing so requires time and money from the government, so deregulation doesn't really work in this case. Also, there is a bizarre irony in the economic recession in that it has produced many temporary jobs in public schooling, medical care, and rehabilitation. In other words, the recession is so bad that it has created a market for financial strategists, educators, legal officials, child healthcare officials, and social workers. Say what you want about the nanny state premise versus the anarchist state premise, but getting people off drugs and ensuring the education and health of impoverished children is big business. I would raise questions about the cyclical self-fulfilling nature of the medical-industrial complex, the prison-industrial complex, and the poverty chain, but that's a different topic for a different day.

Addendum: People always abuse an institution, regardless of the size and nature. This has less to do with principle flaws in the system (although they should not be dismissed) and more to do with flaws in human nature which, again, is the reason my point is beyond the scope of this discussion but still economically significant. I'm of the opinion that welfare programs should be modified to suit individual applicants much more rather than having a fixed income status that determines eligibility. Cutting welfare isn't really the answer, but dispute that all you want with yourself if you disagree. I understand that a case-by-case screening process is expensive, but letting honest, hard-working people starve and work themselves into an early grave is not what I'd call the American Dream.

If we can brag about self-accountability, then we shouldn't shy away from the burden of helping those in true need. That's why we need welfare screening programs to see who really needs it. The conundrum here is that you have to spend money to make money, so that opens up another debate on the issue of compromised sovereignty and the sanctity of personhood for the individual citizen.

edited 4th Dec '10 10:18:30 PM by Aprilla

Tangent128 from Virginia Since: Jan, 2001 Relationship Status: Gonna take a lot to drag me away from you
#129: Dec 4th 2010 at 10:16:27 PM

  • Temporary extension (~2 years) of ALL Bush-era tax cuts. Until the economy is on more solid footing, taxes cannot be hiked.
Haven't they tried to extend most of the cuts?

  • Terminate many of the restrictions surrounding domestic energy production both fossil fuel and nuclear. (Unrelated but expanding America's energy self-sufficiency can only bring a net positive benefit economically) Meaning allow new nuclear reactors (add incentives to use newer reactor designs like pebble beds and fast breeders to reduce waste) to be speedily built and allow things like petroleum and natural gas extraction to be expanded across the US. (I also mean offshore as in shallow water drilling. If you want to avoid a repeat of Deepwater Horizon open up shallow water.)
I've little problem with the nuclear idea. But isn't part of the point of nuclear power to switch away from the waste of burning valuable petroleum?

  • If you want to talk stimulus and this is open for debate. Create an infrastructure only program that is paid for with cuts to other services. If you want stimulus, it's gotta be paid for. Otherwise don't think about doing it again. Key condition on this idea: Any and all funds allocated are by contract and by law allocated for use in infrastructure projects alone such as roads, bridges, airports and seaport facilities. The last stimulus bill basically plugged state budgets and lined the pockets of unions. We cannot allow that to happen again.
Which other services do you cut, and how do you enforce the use of the money without restrictive regulation?

  • Repeal the health insurance mandate. It likely won't survive the court challenges currently pending and it's one of the driving factors of uncertainty right now. If you want to reform health care, bring forth better ideas than saddling people with an extra bill they have to pay by law whether they can afford it or not.
Is a single-payer system back on the table again, then?

  • Permanently abolish legislative earmarks (which is a big agenda item on many incoming Republican Congressmen's plate) for both the House and Senate. Not only does this curb pork barrel spending. But it helps economic confidence by showing the people that the US government has gotten smarter. Confidence in the economy and confidence in the government are more influential on the economy than any stimulus bill or tax cut. Right now present ideas floated about in the last 2 years have eroded confidence in both the government and the economy, not built it. That needs to change.
How can you enforce this?

  • Thoroughly go through and clean out the wasteful spending in programs like Medicare and welfare. There's hundreds of billions in fraud losses alone in those programs and it's bleeding us dry for no economic benefit. Cap growth in such programs to that of the GDP. (Which incidentally over the long run saves us hundreds of billions per year on those programs. Thank you New York Times article "Can you fix the deficit?"!)
Hundreds of billions in fraud? Source?

Do you highlight everything looking for secret messages?
Linhasxoc Since: Jun, 2009
#130: Dec 4th 2010 at 10:41:33 PM

Permanently put to bed the "death tax". For every 1 "old money" estate you collect from you drive dozens of poor farmers and ranchers out. That was the reason Bush called for its repeal, the fact that farmers, ranchers, old homesteaders and more who owned large volumes of land but didn't qualify even as a six figure salary had to sell everything because the death tax valued their property for its highest worth use such as condos rather than its appraised value for say a cattle ranch.
Do you have any evidence that this has actually happened? And if that was actually a problem, couldn't you solve it and still keep the estate tax (EDIT: fixed redlink) by raising the exemption limit? I remember when the original phase-out was in Congress Senator Feingold proposed that instead of repeal, to raise the exemption cap to $100 million. It failed.
No more bailouts. EVER. "Too big to fail" is too high a price to keep propped up. It does more damage in the long run to our economy to prop up failures like we did with GM than it is to repair a short term collapse. [[quoteblock]]No more bailouts. EVER. "Too big to fail" is too high a price to keep propped up. It does more damage in the long run to our economy to prop up failures like we did with GM than it is to repair a short term collapse.
And how do you enforce this? Keep in mind that the reason that bailouts existed was not because individual businesses were failing, but entire sectors of the economy. I agree that the idea of bailouts is distasteful (it reeks of "wealthfare") but contrary to your assertation, I actually think the costs of not bailing out the banks would have been worse than the cost of bailing them out (I'm a little more ambivalent on the auto bailout, but that seems to have turned out well as GM is doing pretty well nowadays). Honestly, the only way you can really get what you're proposing is to return to Glass-Stegall or something like that.
Permanently abolish legislative earmarks (which is a big agenda item on many incoming Republican Congressmen's plate) for both the House and Senate. Not only does this curb pork barrel spending. But it helps economic confidence by showing the people that the US government has gotten smarter. Confidence in the economy and confidence in the government are more influential on the economy than any stimulus bill or tax cut. Right now present ideas floated about in the last 2 years have eroded confidence in both the government and the economy, not built it. That needs to change.
I agree with you that earmarks are a bad idea, but earmark reform won't make a serious chink in the deficit.
Cap Federal spending to 20 percent or less of GDP per year. (It's only been recent that Federal spending has exceeded that level) Cap National Debt holdings to 20 percent of GDP as well. (Which means big cuts to big programs like Social Security will sadly be necessary.) The net positive in the short term to help the economy is fiscal stability. The question of whether we'll be bankrupt within 20 years is more pressing than spending our way out of recessions today. Create fiscal stability through this method and confidence in the economy and government will improve thus improving the economy as people become more willing to take risks.
I'm just going to go out and say this sounds like a terrible idea, especially in the long term (perhaps it could work short term, but I'm doubtful). The thing is, the gross amount of spending is not actually what causes deficits, it's the amount of spending relative to taxes. 20% of GDP in spending could just as easily result in a deficit as a surplus, depending on how much in taxes you take in. Better to implement something like PAYGO, where you can't add new spending or decrease revenues without making up for it somewhere else.
Shift resources away from welfare checks and get some hiring agencies going. People need jobs not handouts. If you want to help reduce unemployment don't give people a check, help them find a job.
This has been covered above, but many welfare recipients are people who have a job, but it isn't enough to cover cost of living. Also, you can't help people find jobs that don't exist.

edited 5th Dec '10 4:51:45 PM by Linhasxoc

Barkey Since: Feb, 2010 Relationship Status: [TOP SECRET]
#131: Dec 5th 2010 at 1:54:13 AM

I'm just going to pop in and say, maybe there's a time and place for elements for both strategies? You don't take aspirin to cure everything, you take it to cure headaches. You don't take antibiotics to cure a headache, you use it to cure an infection.

Anybody ever think both strategies have their merits and perhaps a bipartisan common sense approach might be the best outcome?

Deboss I see the Awesomeness. from Awesomeville Texas Since: Aug, 2009
TheyCallMeTomu Since: Jan, 2001 Relationship Status: Anime is my true love
#133: Dec 5th 2010 at 6:56:27 AM

Personally, I wretch whenever anyone goes to great efforts to try and protect the American farmer.

That's not how things are done anymore. The idea of the American farmer is a myth. It's all corporate now.

This is probably a huge Citation Needed though. DOWN WITH CORN SUBSIDIES AND SUGAR TARIFFS!

RadicalTaoist scratching at .8, just hopin' from the #GUniverse Since: Jan, 2001
scratching at .8, just hopin'
#134: Dec 5th 2010 at 7:24:53 AM

An interesting piece on the vote.

^If you want to protect the north american farmer, can the product-based subsidies and replace them with payments for environmental stewardship - i.e., pay farmers for keeping the land in shape rather than for just producing more and more food to flood the world markets with. This will reward farmers for a very important job no one recognizes they do and encourage them to grow multiple varieties of multiple crops, protecting us from mass crop failure that is risked when everyone puts their symbolic eggs in one genetic basket. You may remember me recommending this in that other thread about the poverty of 3rd world farmers, another problem that this policy would fix too.

I find my suggestion oddly relevant to this thread, as it's a pragmatic solution that could sell with both the right (it protects farmers and would cost a significantly smaller amount of money than current subsidies) and the left (it helps the environment and aids the poor in other countries). It's only weakness is that there's no way in God's green earth or Satan's red hell that the agribusiness interests wouldn't pour phenomenal amounts of money into fighting it. This may provide an answer to Barkey's question - why don't we try pragmatic stuff that everyone can agree on? Because there are interests that benefit from the status quo, dysfunctional as it is.

Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.
storyyeller More like giant cherries from Appleloosa Since: Jan, 2001 Relationship Status: RelationshipOutOfBoundsException: 1
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#135: Dec 5th 2010 at 8:09:24 AM

Anybody ever think both strategies have their merits and perhaps a bipartisan common sense approach might be the best outcome?

Everyone does.

Except that with the current congress, "bipartisanship" means the Democrats, since the Republicans will vote against anything, even their own policies.

edited 5th Dec '10 8:10:24 AM by storyyeller

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AC the Devil will fear me. Since: Jan, 2001
the Devil will fear me.
#136: Dec 5th 2010 at 1:45:11 PM

I think it's interesting that radical right-wingers insist on cutting programs that help the poor and unemployed, and insist vehemently on cutting taxes for 2% of the population, and strongly oppose cutting taxes for 98% of the population, and also oppose making any cuts to our defense budget, which nearly outweighs the combined defense budgets of most of the rest of the world. You simply cannot talk about budget, deficit, and spending cuts without considering defense. It's bloated. It's full of waste. That is an undeniable fact. Yet when wingers talk about waste, all I hear about is welfare, social security, and other entitlements. Isn't that interesting?

But all this mythology surrounding tax cuts and welfare, it's...well, it's mythology. All I've ever heard as far as evidence of welfare queens, or of trickle-down actually working, has been anecdotal. No facts, no figures, and definitely nothing from the non-partisan CBO (who are in favor of the supposedly evil and wasteful stimulus, as well as most actual economists). Talking points, however, abound. It's socialism, it's redistribution of wealth, it's big government, blah, blah, blah. Please, spare me. Tell me why the consensus of economists is wrong on this one.

Linhasxoc Since: Jun, 2009
#137: Dec 5th 2010 at 2:50:02 PM

The CBO is in favor of economists? I hope so...
The thing about the right isn't so much that it's opposed to tax cuts for 98% of the country as it won't go with those cuts unless it can get the cuts for the remaining 2% as well.

AC the Devil will fear me. Since: Jan, 2001
the Devil will fear me.
#138: Dec 5th 2010 at 3:16:01 PM

To me, that's the same thing as being opposed to tax cuts for everyone else. I mean, hell. If fox news has no problem spinning this into a deliberate effort on the democrats' part to hike taxes, then I have no problem throwing some of their spin right back at them.

storyyeller More like giant cherries from Appleloosa Since: Jan, 2001 Relationship Status: RelationshipOutOfBoundsException: 1
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#139: Dec 5th 2010 at 3:38:10 PM

Basically they're playing chicken with your taxes to score political points. And they're winning.

edited 5th Dec '10 3:38:37 PM by storyyeller

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pvtnum11 OMG NO NOSECONES from Kerbin low orbit Since: Nov, 2009 Relationship Status: We finish each other's sandwiches
OMG NO NOSECONES
#140: Dec 6th 2010 at 12:58:11 PM

I'm hearing stuff about enacting a payroll tax holiday. Even if such a thing would be temporary...

DO WANT.

Happiness is zero-gee with a sinus cold.
Karmakin Moar and Moar and Moar Since: Aug, 2009
Moar and Moar and Moar
#141: Dec 6th 2010 at 1:00:06 PM

Now personally I think both outlooks have merit depending on the economic circumstances. For example, if we were in the middle of a technology boom and there was a lack of money to go towards investments in new Rand D, VC funding, etc. I think steps would have to be taken to loosen up that money.

But for right now, that idea is laughable. Investment is a huge bubble. There's actually too much of it. Far far far too much of it. Everything needs to be on the demand side. Now, I'm personally in favor of things such as background checks for welfare recipients.....

AFTER we get the economy straightened out in such a way as to ensure full employment on an ongoing, permanent basis. It's putting the cart before the horse, basically. There simply isn't enough jobs, nowhere close to it. Unemployment and underemployment (which is important too but rarely counted) are far far too high for any sort of austerity measure..to even think about it. Once we start talking about labor shortages for a while, that's when the direction can be changed.

Edit:^A payroll tax holiday, along with a cramdown process to spread losses around (and to punish financial fraud) are great steps in getting the economy going again.

edited 6th Dec '10 1:01:39 PM by Karmakin

Democracy is the process in which we determine the government that we deserve
pvtnum11 OMG NO NOSECONES from Kerbin low orbit Since: Nov, 2009 Relationship Status: We finish each other's sandwiches
OMG NO NOSECONES
#142: Dec 6th 2010 at 1:05:45 PM

Unofficial is something like 17 percent, right? I couldn't get to the DOL report that would contain the data. Few Google news hits on it, either. I wouldn't be surprised if the unofficial unemployment and underemployment rate was over 20 percent.

EDIT: I think I'd pick up 140 bucks a week in take home pay with a payroll tax holiday (unless OASDI/EE wasn't touched, I'm a bit fuzzy on all that). Definitely want - that's my Razer Megalodon headset for Christmas!

edited 6th Dec '10 1:10:53 PM by pvtnum11

Happiness is zero-gee with a sinus cold.
Karmakin Moar and Moar and Moar Since: Aug, 2009
Moar and Moar and Moar
#143: Dec 6th 2010 at 1:10:48 PM

I'd be shocked if it was under 20 percent to be honest, unemployment by itself is something that from what I can tell has always been underreported in the US. It doesn't count people who normally would be looking for work but for one reason or another have given up and are no longer collecting unemployment. (Which I think should be counted).

Things are really that bad.

Democracy is the process in which we determine the government that we deserve
MajorTom Since: Dec, 2009
#144: Dec 6th 2010 at 2:38:12 PM

AFTER we get the economy straightened out in such a way as to ensure full employment on an ongoing, permanent basis.

No such thing. There is no such thing as permanent prosperity in economics. Why do you think so many people call things cycles when talking economics? Boom, bust you know the drill. Everything is cyclical economically and despite what the hardest of hardcore Keynesians and socialists/communists will tell you, nothing ensures permanent prosperity. You can have permanent downturn and/or null growth aka economic stagnation, but never permanent prosperity. Economics is a human system and like all things human it is never perfect. All boom cycles will come to an end one way or another.

Tangent128 from Virginia Since: Jan, 2001 Relationship Status: Gonna take a lot to drag me away from you
#145: Dec 6th 2010 at 2:47:48 PM

I'm pretty sure Keynesian economics do acknowledge cycles- isn't the main idea, "deficit spending during downturns to reduce their impact, followed by making it up through taxation during the high swings"?

Do you highlight everything looking for secret messages?
CommandoDude Since: Jun, 2010
#146: Dec 6th 2010 at 3:31:24 PM

Ohhh, learned an interesting tidbid.

<80% of all jobs are service based industry.

Yea, see, we give tax cuts to the rich, then they go create jobs overseas.

What we should be doing is slapping huge taxes on companies that ship their manufacturing base to China because the labor is criminally cheap. Hell, maybe even raise tariffs.

Also, instead of paying farmers not to grow crops, we should be buying those extra crops from them at a smaller amount and giving them to impoverished families that need to feed their family. Food costs make up a big percentage of expenses for the poor.

edited 6th Dec '10 3:33:49 PM by CommandoDude

TheyCallMeTomu Since: Jan, 2001 Relationship Status: Anime is my true love
#147: Dec 6th 2010 at 3:32:21 PM

Meh. I'm not a big fan of subsidies and tariffs as a general principle.

Linhasxoc Since: Jun, 2009
#148: Dec 6th 2010 at 3:32:42 PM

despite what the hardest of hardcore Keynesians and socialists/communists will tell you, nothing ensures permanent prosperity.
I can't speak for socialists and communists, but as far as Keynesians go I consider that a strawman position, and any Keynesian who actually believes that doesn't understand Keynesianism. The point is not to ensure permanent prosperity, but rather to blunt the booms (through higher taxes and lower spending, reducing the national debt) so that the nation can afford to minimize the busts (through higher spending and lower taxes).

Karmakin Moar and Moar and Moar Since: Aug, 2009
Moar and Moar and Moar
#149: Dec 6th 2010 at 3:49:40 PM

^

Never really said anything about prosperity anyway. I'm more thinking of something like automatic triggers where if unemployment rises above a certain level for a certain amount of time that unemployment benefits are increased and extended, that the SS retirement age is reduced, etc. The only way to rebalance the economy is for a sustained period of full employment in order to bring wages, and thus demand back up.

The big problem with this is blocking out all the inflation hawks who will start Q Qing like mad.

Democracy is the process in which we determine the government that we deserve
storyyeller More like giant cherries from Appleloosa Since: Jan, 2001 Relationship Status: RelationshipOutOfBoundsException: 1
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#150: Dec 6th 2010 at 5:07:57 PM

I don't think you should change SS retirement age with the state of the economy like that. Retirement age should depend on demographics only.

But people who worry about inflation with the economy in the state it's in right now are just silly.

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