‘American Jobs Act’ Not Enough For Economic Recovery

Unemployment graph
Source: Calculated Risk

Here’s the situation: Recovery from Bush’s Great Recession has been very slow and painful. America’s unemployment rate is stuck at 9.1% and almost 14 million Americans are unemployed. The alternate measure of unemployment (U-6) is at 16.2%, with 6 million workers unemployed for more than 6 months. There are 6.9 million fewer payroll jobs than at the beginning of the recession in 2007.

Tonight, President Obama will unveil “The American Jobs Act,” which consists primarily of extending the current payroll tax cuts, unemployment insurance, and tax breaks for business. Only about $100-$200 billion of the proposal goes beyond the status quo. Assuming the Republicans agree to this bill, it might be enough to narrowly avoid a double-dip recession. But there is no way Obama’s plan is going to fix the 6.9 million jobs deficit in time for the next election.

Will the emergency jobs bill introduced by Rep. Jan Schakowsky (D-IL) get a mention tonight? Don’t bet on it. Only a Democrat would propose something like that.

The Bush-Obama Tax Cuts For The Rich are causing an ongoing a budget crisis that Obama wants to solve by cutting Social Security and Medicare. The SuperCongress is meeting right now to plan these cuts. Why is this administration pushing Republican policies?

Scarecrow on FDL:

We don’t need, and the country cannot survive, two Tea Parties or two wings of the Corporate Party. The age we live in demands just the opposite of the austerity delusions the Democratic leaders and the President have ignorantly, recklessly embraced. And come 2012, voters will have every reason to show them all what the phrase “you’re fired” means.

A commenter adds:

At least one choice is becoming more clear. If we’re going to get Republican policies straight down the line it’s far better to have the results labelled Republican. The lesser evil argument really is falling away. Maybe there will be something to build out of the rubble. Maybe not.

From another comment:

If America is going to fail based on these policies, let them be correctly named: GOP, conservative, teabagger. The best way for that to happen is to have a GOP president who’s elected under their banner, not the Democrats’.

UPDATE: From the advance text of the President’s speech tonight. He actually thinks that proposing Republican policies is a good thing.

“I am sending this Congress a plan that you should pass right away. It’s called the American Jobs Act. There should be nothing controversial about this piece of legislation. Everything in here is the kind of proposal that’s been supported by both Democrats and Republicans – including many who sit here tonight. And everything in this bill will be paid for. Everything.”

UPDATE: Robert Reich:

Republican Senate leader Mitch McConnell scoffs “This isn’t a job plan. It’s a reelection plan.” That’s precisely the problem. McConnell and company have stated publicly that their number-one objective is to unseat Obama and regain the presidency in 2012. They don’t want to give the President anything he could possibly claim as a victory. And they’re not terribly worried if the economy stays awful through Election Day because that’s the best way to fulfill their number-one objective.

UPDATE: Obama is Coming to Cut Medicare

  1. #1 by james farmer on September 8, 2011 - 5:39 pm

    It may not be enough, but Obama is making a lot of rethuglican congress critters squirm in their seats.

    One of Obama’s classic speeches; it just may get him reelected.

  2. #2 by brewski on September 8, 2011 - 5:45 pm


    Obama agrees with me on tax reform? He must be wrong.

  3. #3 by Richard Warnick on September 8, 2011 - 6:20 pm

    Any domestic policy President Obama wants will be bitterly opposed by every last Republican. Maybe Obama should propose extending the tax cuts for the rich next year, permanent elimination of the corporate income tax, etc.

  4. #4 by cav on September 8, 2011 - 9:00 pm

    Mellow down everybody, we all know any effective jobs program must be processed by that sub-human piece of excrement Mitch McConnell.

    Ooops, a partisan statement if ever one slipped my keyboard.

  5. #5 by cav on September 9, 2011 - 8:25 am

    “Did he announce a 100% tax on products made outside the US, abrogation of NAFTA and CAFTA, moratorium on all immigration until unemployment drops to 4%, closing foreign military bases and cutting aid to Israel, Egypt and Pakistan? Did he say we were through with our foreign military adventures and was calling our troops back from Afghanistan and Iraq?

    If the $150 billion stimulus package of George W. Bush in early 2008, plus the $700 billion stimulus of Barack Obama did not do the job, why would this latter-day Goldilocks proposal do the trick?


  6. #6 by Richard Warnick on September 9, 2011 - 8:46 am

    It’s painfully obvious that the extension of existing tax cuts won’t boost the economy. We need to create jobs by hiring people to work. What we don’t need are more budget cuts, especially cuts to the social safety net.

  7. #7 by cav on September 9, 2011 - 9:00 am

    What a difference social democracy makes.

    As unemployment lines shorten and the population shrinks, industrial companies face a skilled labor shortage that may restrain growth.

    German unemployment fell to an 18- year low in January, stoking concerns that the world’s second- largest exporter is running short of skilled labor after the fastest economic expansion since reunification in 1990.

    The number of people out of work declined a seasonally adjusted 13,000 to 3.135 million, the lowest since November 1992, the Nuremberg-based Federal Labor Agency said today. Economists forecast a drop of 10,000, according to the median of 32 estimates in a Bloomberg News survey. The adjusted jobless rate fell to 7.4 percent from 7.5 percent.


  8. #8 by cav on September 9, 2011 - 9:47 am

  9. #9 by Ronald D. Hunt on September 9, 2011 - 9:58 am

    “Obama agrees with me on tax reform? He must be wrong.”

    We have yet to see what he means by “reform”. Or if this is more wish washy let congress figure it out(even know its ran by nihilistic idiots atm).

    Personally I don’t think this will go anywhere anyway and is just being proposed now to setup the optics for the upcoming election.

  10. #10 by brewski on September 9, 2011 - 10:24 am

    He said close loopholes and lower rates. It isn’t as complete as I would go, but it is in the right direction.

  11. #11 by cav on September 9, 2011 - 11:17 am

    ‘Optics’ = slam a shot!

  12. #12 by Ronald D. Hunt on September 9, 2011 - 12:17 pm

    Depends on what loopholes and whether or not the different from the lower rate actually generates any revenue(this would be against the Groover Norquist suicide pact err I mean no taxes pledge).

    Recklessly ending certain tax expenditures without policy to replace the function of those “deductions/credits” in many area’s would be very damaging to your average American. Especially sense I haven’t seen anything from congress that would make me believe that they will leave the system alone after the next election. It will be like when Reagan tried it, congress will reinstall all of the crap 6months down the road when all of the campaign funders complain about it.

  13. #13 by brewski on September 9, 2011 - 12:55 pm

    Huntsman said his plan is revenue neutral. Obama put a number on his plan. Any plan needs to be number crunched to figure out all of the effects. This is pretty hard to do since there are static effects and dynamic effects. The dynamic effects could be hard to quantify and also longer term in nature.

    My plan exchanges deductions and exemptions, as well as taxing all income and not just some income, for a large 0% bracket amount.

    But I can still hear people whining about “losing” their home mortgage interest deduction when in fact with a large 0% bracket they may not be paying any tax at all.

    Also, you give more credit to the “policy” behind all the tax expenditures. For the most part the “policies” are to get contributions from the Mortage Bankers Association and the Life Insurance Lobby, and the AMA and then package them to suckers telling them that they are all for noble purposes.

    There is a very simple answer to your tired refrain that Congress will just put all the loopholes back in; veto.

  14. #14 by Ronald D. Hunt on September 9, 2011 - 2:33 pm

    $450 billion in 2007 for the health care related deductions, $106 billion in 2007 for 401k related deductions.

    The mortgage deduction could be converted to a credit and phased out over time, Fannie and Freddi are likely enough to promote responsible home ownership(as they deal with 15 and 30 year fixed rate loans).

    But the health care deductions would have to have a policy replacement, It is silly to think otherwise.

    Also how in your magical plan do businesses deal with loses?, right now those are a deduction(I won’t agru that their corrupt as hell, as they are) The point stands simply ending them would be reckless.

    The huntsman plan would be a giant increase in taxes for most people, Generally most of these tax simplification plans end up taxing the lower income levels higher then they currently are. And most of the plans don’t address issues that allow upper income payers to hide much of their income(huntsman would end capital gains taxes for example, making the issue much worse) .

  15. #15 by brewski on September 9, 2011 - 3:55 pm

    Most of the $450 billion for health care is not for deductions per se, but the revenue that is lost due to the special treatment for employer provided insurance. Under my plan the wealthy would pay taxes on this income and the middle and lower classes would not. So my plan is a tax increase on the wealthy.

    For the 401k deduction, my plan would allow middle and lower income people to contribute to their savings plans tax free, but the wealthy would not.

    I am sorry you don’t understand the arithmetic of how taxes work. My plan would lower taxes dramatically on all middle and low income people.

  16. #16 by Ronald D. Hunt on September 9, 2011 - 6:51 pm

    $150 billion of that $450 billion is from individual write off’s, most of those people will be in the 15%-20% brackets mean that the real spending behind that deduction is 5times higher, and the employer side of the deduction most I would think are in the top bracket of 35% meaning the real spending behind that deduction is 3times higher.

    Their is a very long list of employers that without the deduction would simply drop coverage entirely. And without some sort of real alternative is just going to push a lot of people our of the insurance system.

    And the 401k deductions are mostly employer related, employers simply wouldn’t offer a plan in many cases without the deduction. And while moving away from employer based plans would be a good thing, that is a policy position that has to be put in place before or at the same time as removing tat deduction.

    The entire problem with your proposal is that as broken as our tax system is, the loop holes still do things, without reasonable policy to replace the tax code based social services system that is incompetently ran by private corporations leaving us with the most expensive health care in the world by double while at the same time leaving us in 37th place behind former soviet block euro nations. It is ignorant to think that without encouragement that private corporations will ever make the “right” choice by their workers, and even more ignorant to think the middle class is in any position to fund these things themselves without encouragement of their employers to leverage the buying power of large groups. A guy making 40k a year simply has no leverage to negotiate good health care rates or on average the knowledge required for investment needed for retirement by himself, however a company with couple 100 guys making 40k a year is in a position to negotiate better rates in both cases.

    And the arithmetic is real simple, (health costs per year) – (savings from group coverage due to employer deduction) – (savings from individual deduction) – (employer covered cost) == (employee cost),

    Last year my dad wrote off $7k for health insurance and misc other health expenses,(from his $700month plan with $3k deductible). I can image his work is writing off a similar amount, without these deductions, even with a large 0% bracket the encouragement for the employer to be involved will be gone and they will become unaffordable. Before these things can be cut we need policy to replace their function.

  17. #17 by brewski on September 10, 2011 - 11:42 am

    You clearly don’t understand tax law or my plan.

  18. #18 by Ronald D. Hunt on September 10, 2011 - 12:13 pm

    “but the revenue that is lost due to the special treatment for employer provided insurance.”

    Because we allow employers to deduct paid benefits in the same way they are allowed to deduct salaries. However their are health care specific deductions as well, And their is nothing fancy pants about the $150 billion in lost revenue from deductions taken on individual health care costs, those are pretty simple deductions that allow individuals to write off their premiums and any out of pocket costs.

    I understand tax law more then well enough to understand these points.

    You seem to not understand cause and effect, we have an employer based health care insurance system, any policy that damages this without a reciprocating policy is just plain stupid.

    All these Euro nations which have better tax systems that you point out all of the time, also in fact have in place the needed policy to support their needed social/industrial programs outside of their tax system. Simply put we don’t, right now all of our social and industrial policy is drive by our tax code. deductions that encourage corporations to be involved in order to use their buying power to obtain these benefits as no individual has the leverage to obtain good rates.

    You want your tax system fine, pass single payer health care, a national pension plan(via expanding SS), a program for promoting the expansion of our industries(1 time grants instead of tax breaks like Europe does), etc and so forth.

  19. #19 by brewski on September 10, 2011 - 11:01 pm

    Because we allow employers to deduct paid benefits in the same way they are allowed to deduct salaries.

    That is not special treatment. That is called calling an expense an expense. So GAAP accounting and tax accounting is the same, as it should be. The special treatment of employer provided health insurance is that it is in-kind income to the employee, but the health insurance lobbyists and the unions which have the most generous health insurance plans have kept that income tax free to the employee. That is the special treatment and that is where the revenue is lost. It this was made to be taxable and then the 0% bracket was increased, there would be no additional tax incurred by lower income workers, but it would be a tax increase on the wealthy.

    Also, if low income people were paying no income tax at all due to the large 0% bracket, then they would not be losing one penny if the itemized deduction for medical expenses was removed.

    So, no, you don’t understand tax law at all.

  20. #20 by Ronald D. Hunt on September 11, 2011 - 4:15 am

    “Also, if low income people were paying no income tax at all due to the large 0% bracket, then they would not be losing one penny if the itemized deduction for medical expenses was removed. “

    Yes we all already know you want to have the same broken tax system Ireland does.

    “but it would be a tax increase on the wealthy.”

    No it would remove the employers encouragement to use their buying power to leverage savings for their employees. Without a policy replacement this would be a disaster. tossing another 50 million Americans off of their insurance by removing their employers group coverage savings and the system would collapse. The increase in rates from the amount of uncompensated care costs being shifted onto private insurance would be astronomical.

    Individuals simply don’t have the leverage to get good rates, and you can’t get around that. The individual market is a joke costing more then group plans often by double.

    deductions do things as much as you want to hide from that, their are area’s where we HAVE to have replacement policy before we can do down the route of a “fairer” tax system.

  21. #21 by cav on September 11, 2011 - 6:47 am

    Thank you both for the stimulating discussion.

  22. #22 by cav on September 11, 2011 - 7:41 am

    Happy Nine One One everybody!!

    “It’s the most wonderful time of the year…”

  23. #23 by cav on September 11, 2011 - 7:54 am

    Imagine flying sharks crashing into the twin towers!


    Now you don’t have to.

  24. #24 by cav on September 11, 2011 - 8:11 am

    George pulls his nose out of the Fuzzy Caterpillar for a moment and flashes back to the briefing…’Ben Ladin Determined to Study Ballet in the United States!’

  25. #25 by brewski on September 11, 2011 - 3:03 pm

    Without a policy replacement this would be a disaster. tossing another 50 million Americans off of their insurance by removing their employers group coverage savings and the system would collapse. The increase in rates from the amount of uncompensated care costs being shifted onto private insurance would be astronomical.

    Since ObamaCare requires companies to provide health insurance to their employees, then isn’t this “policy replacement” already done? So what are you bitching about? The whole premise of ObamaCare is that everyone will be covered by their employers or by their mandated policies purchases via the “exchanges” so there will be no uncompensated care at all, and all of our premiums will go down by $2500 per year. James ‘racist’ Farmer keeps insisting this will happen in 2014.

  26. #26 by Ronald D. Hunt on September 11, 2011 - 8:09 pm

    Obamacare is hardly a policy replacement, its got a few good things in it, but overall it is designed to supplement the current tax encouragement system not replace it.

    The employer mandate is a $2,000 fine, Not a hard choice for along of employers if they lose their other tax goodies related to health care. Also the small business health care tax goodies put in place by Obamacare come in the form of a 50% credit(you know a loophole).

    The exchanges are only open to those without an employer option or where the employer option is considered “unaffordable”, And sadly this is based on the monthly premium of the plan and not take into account the amortized benefit of the plan,(aka any junk mega deductible plan is enough).

  27. #27 by brewski on September 11, 2011 - 8:57 pm

    That rocket scientist James Farmer said that ObamaCare will save each of us $2500. And he is never wrong. He promised!!!

  28. #28 by Ronald D. Hunt on September 11, 2011 - 11:17 pm

    Obamacare certainly will help, but its still built around the employer based health insurance system. Good chunk of Obamacare is merely the use of tax policy to achieve the desired outcomes, tho the grant programs for hospital efficiency are already helping clearly showing that one time grants can be very good use of policy(CBO shows that as pushing down the cost of medicare already),

  29. #29 by brewski on September 12, 2011 - 9:30 am

    I am totally against having healthcare tied to one’s employer. It makes no sense at all. As you know, the history of this connection goes back to WWII when the government barred employers from attracting employees on with higher wages, so employees threw non-wage benefits at them. Then after WWII the insurance lobby got Congress to make those benefits tax free, which ended up enshrining them. So as usual, the unintended consequences of government intervention and regulation gave us outcomes which are suboptimal.

    And this is the same government you want to craft some wise forward looking industrial policy?

  30. #30 by Ronald D. Hunt on September 12, 2011 - 9:53 am

    I keep telling you single payer is the best policy replacement. And yes employer based health insurance sucks, but its how it works atm making everyone pay much higher rates on the individual market through reckless abandonment without replacement policy would be a disaster.

    “And this is the same government you want to craft some wise forward looking industrial policy?”

    The rest of the world is kicking our collective asses because we we do this area so poorly. We badly need to dump the tax system games and move to a one time grant system like most other Nations run. It’s cheaper and in reality businesses are more interested mitigated capital investment liabilities then marginal differences in the tax rate.

    It doesn’t have to be perfect, but it has to be their. The alternative is watching foreign nations sovereign wealth funds, and better outlook on industrial policy play the “freemarket” by rules they define themselves and beat the crap out of us while we plug our ears believing the invisible hand will someday give them the spanking they so deserve(of course this never happens) .

  31. #31 by Ronald D. Hunt on September 12, 2011 - 12:56 pm

    ohh found this interesting,



    Shame we won’t do the same thing!,

    Tho this is being passed by conservatives, I am assuming that Greece’s next government likely is going to drop from the Euro and tell their bond holders they are going to take a large haircut. I predict that Ireland, Italy, Spain, and other Euronations will follow. The house of cards is coming down!

  32. #32 by brewski on September 12, 2011 - 2:38 pm

    Wow banks would be limited to that safe acticivity known as mortgage lending. Gee, if only our banks had only kept to mortgage lending then the only banks which would have failed would have been all of them.

  33. #33 by cav on September 12, 2011 - 2:56 pm

    The ‘bald’ bankers will be looking to us to cover this twisted sh*t-pile.

  34. #34 by Ronald D. Hunt on September 12, 2011 - 4:37 pm

    Brewski, It’s the ability for a bank to detach itself from the liability a mortgage(or any loan for that matter) that created the environment that allowed bad mortgage loans.

    If that consumer bank can’t create CDO derivatives to sell on the open market and then sell CDS’s betting that the mortgages will fail then banks will be more careful about who they lend to.

    All of the derivatives and other nonsense created to separate the banks from the liability of the very loans they created is what created the problem, Then low rates and unlimited leverage provided by a supply side ideologue running the fed push everything from stupid to plain destructive.

  35. #35 by brewski on September 13, 2011 - 9:07 am

    You forgot to mention deposit insurance where no one is responsible for lending money to instituions who make risky decisions. That is the same phenomenon as your describe in #34.

  36. #36 by Ronald D. Hunt on September 13, 2011 - 3:05 pm

    The banks have shown the ability to gamble and cause massive loses with both insured and uninsured money. And really executives are using other peoples money either way anyway what do they have to lose from the difference in loses between say a 401k and a savings account?

    You speak as though you had the expectation that their was some sort of liability difference between loses in FDIC insured accounts and other non-insured “investments” that are managed by the executive staff of a bank. Hate to tell you no, their is no difference in liability, both situations leaves the poor abused executive staff with millions in executive pay that are outside the reach of any consequences.

    The reality is that the organisers of the corporation that is a bank are not the depositors that fill that bank with assets, This is a situation where they will personally benefit from pump and dump tactics and access to information is sufficiently difficult for even the well educated to understand that enforcing “fiduciary responsibility to the shareholders” becomes difficult. And further because of the source of a banks deposits are not necessary the same as that banks shareholders you have a second conflict of interest inherit in the structure of a banking corporation as well.

  37. #37 by brewski on September 14, 2011 - 9:35 am

    You missed my point. It isn’t that the bankers behave differently with insured funds or uninsured funds. The point is that depositors don’t care what bankers do since their deposits are insured. The moral hazard problem is with the depositor, not with the banker.

    Right now my bank has a sticker on the door telling me that I will get all my money back no matter how stupid the management of the bank is. So what do I care who I lend my money to?

    But if the bank’s were required to have a huge sticker on the door which read “BE CAREFUL WHERE YOU DEPOSIT YOUR MONEY SINCE IF THE MANAGEMENT OF THIS BANK MAKES BAD DECISIONS YOU COULD LOSE ALL YOUR MONEY”.

    That would cause depositors to act quite differently. In fact, if you look at bank advertisements from the 1800’s (before both deposit insurance and before the Fed), banks would advertise their capital amount, strength and prudence.

    So if depositors cared about what banks did with their money then banks would need to attract depositors by demonstrating their prudence. Right now all bankers do to get deposits is to talk about how their tellers smile a lot.

  38. #38 by Ronald D. Hunt on September 14, 2011 - 2:30 pm

    Traditional FDIC insured savings accounts where supposed to be only be used for safe lending, and it worked from 1935 until 1982. And its not that banks worked better before the FDIC was created, far from it scams where the norm, people didn’t put money into savings they would put it under their mattress.

    People simply don’t have access to the needed information, or often enough the understanding needed to tell the difference between a good bank and a bad bank in the modern world. Management changes, changes in the market, the day to day scale of changes in the world is not something that any person can be expected to keep track of for the change you desire.

    Insured deposits where heavily regulated for a reason, When those regulations where removed the model broke. It isn’t that every person should be required to know how the wind of a American butterfly wing effects the price of tea in China, Its the model under which our economy is organised needs to create an environment that normal persons can operate in.

    From this nations founding until the FDR banking reforms we had a major depression almost every decade. From the FDR reforms until 1986 we only had minor economic problems. From 1986 on we have averaged a major recession or depression every decade. The roll back of the great depression regulations was a mistake.

    “In fact, if you look at bank advertisements from the 1800?s (before both deposit insurance and before the Fed), banks would advertise their capital amount, strength and prudence.”

    Name 10 banks that existed from the founding until now. Name 10 banks that have existed for at least 100 years.

    Maybe in magic land, every person has an economics PHD and 36 hours a day to process the day to day changes in the world so that they can move their money to banks that are a safe and move their money out when that changes. In reality however that is a level of prudence beyond the abilities of most people. What your asking for a non functioning system calling back to an era of robber barons, gilded gates, and movement of commerce limited by the speed of a horse or telegraph.

  39. #39 by brewski on September 14, 2011 - 2:48 pm

    The entire S&L system was insolvent in 1980 due to (again) mismanagement by the Fed. All banks and S&L’s have an inherient asset/liability mismatch since they are funded by short term (essentially floating rate) deposits and they invest in long term fixed rate mortgages. So when the Fed created inflation in the 1970’s they created the insolvency of the S&L’s long before any deregulation.

    5 BANKNEWPORT 1819
    8 LIBERTY BANK 1825

    • #40 by Glenden Brown on September 14, 2011 - 2:59 pm

      You really don’t understand either the S&L crisis or inflation in the 1970s do you?

      S&L’s were deregulated in 1980 – giving them many of the same functions as banks without the regulations. Hence, the S&L crisis.

      Inflation in the 70s can also be attributed to among other things rising energy prices and the increases in other prices (Brad DeLong makes an interesting argument that the Fed in the 70s was so afraid of a return of 30s deflation that it failed to act with regard to inflation but that didn’t cause inflation.)

  40. #41 by brewski on September 14, 2011 - 3:15 pm

    The S&L’s were insolvent long prior to the deregulation.

    But as interest rates became more volatile, particularly in the late 1970s, the S&L industry failed to tackle the risk inherent in the funding of long-term, fixed-interest mortgages by means of short-term deposits.

    One problem was that regulation intended to help the S&L sector in the 1960s had put a ceiling on the interest rate that S&Ls could offer to depositors. This measure succeeded for a while in dampening competition for depositor funds between banks and S&Ls. But as new money market funds began to compete fiercely during the 1970s for depositors’ money by offering interest rates set by the market, S&Ls suffered significant withdrawal of deposits during periods of high interest rates – a process known as disintermediation.

    The biggest problem, though, was more fundamental. When S&Ls tried to compete for funds by offering relatively high rates or by offering interest rates in line with or above market rates, an unsustainable gap opened up between the cost of their funding liabilities (short-term interest rates) and the income generated by their assets (long-term, fixed-rate mortgage repayments).

    Worse, as interest rates moved higher, the economic value of existing S&L portfolios of long-term, low interest rate residential mortgages moved sharply lower, threatening institutions with insolvency.

    By 1980, with interest rates on US government debt hitting 16%, many S&Ls had already been fatally wounded.

    Luckily for the owners of thrifts, regulators in the early 1980s lacked the political, financial or human resources to close large numbers of institutions. Rigorous enforcement would have meant paying out much more money to insured depositors than was held in the industry-funded FSLIC insurance fund. It would also have meant working with literally hundreds of insolvent institutions, and overcoming numerous political obstacles at a federal and state level to radical S&L industry reform.

    All of this was before any deregulation was enacted.

    So you have no fucking clue as to what you are talking about. Seriously. You are way out of your depth.

    • #42 by Glenden Brown on September 14, 2011 - 3:20 pm

      You have a source for that or did you just blockquote it to make it look like something valid?

      You claimed the Fed caused inflation in the 70s and you say I don’t know what I’m talking about? Yeah, seriously?

  41. #43 by brewski on September 14, 2011 - 4:12 pm

    Economists generally agree that monetary policy performed poorly during this period. In part, this was because policymakers, in choosing what they believed to be the appropriate setting for monetary policy, overestimated the productive capacity of the economy. I’ll have more to say about this shortly. Federal Reserve policymakers also underestimated both their own contributions to the inflationary problems of the time and their ability to curb that inflation. For example, on occasion they blamed inflation on so-called cost-push factors such as union wage pressures and price increases by large, market-dominating firms; however, the abilities of unions and firms to push through inflationary wage and price increases were symptoms of the problem, not the underlying cause. Several years passed before the Federal Reserve gained a new leadership that better understood the central bank’s role in the inflation process and that sustained anti-inflationary monetary policies would actually work. Beginning in 1979, such policies were implemented successfully–although not without significant cost in terms of lost output and employment–under Fed Chairman Paul Volcker.

    Ben Bernanke

    • #44 by Glenden Brown on September 14, 2011 - 4:25 pm

      You got a source for that?

  42. #46 by brewski on September 14, 2011 - 4:36 pm

  43. #47 by brewski on September 14, 2011 - 4:37 pm

    I look forward to your stinging rubuke sourced from the Hugo Chavez speechwriter.

  44. #48 by Joe on September 15, 2011 - 1:58 am

    GREAT articlle. A really good independent news source i know of has more info on this as well.

    Keep up the good work at oneutah boys!

  45. #49 by cav on September 16, 2011 - 12:06 am

    Obama is a fricking zen genius!

    See, the president’s proposal is merely to shift the tax breaks – it would change it so that these so-called ‘job creators’ wouldn’t be able to get the breaks just for the privilege of being called that. They would actually have to create jobs to get the credits! The oil and gas industry wants to earn that $40 billion in tax breaks back? All they have to do is create 10 million jobs for the long term unemployed, or hire enough new workers to get enough of the payroll tax break on the employer side, or some combination of it. The rich want their tax breaks back? Fine, let’s see you actually create jobs and you can get the credits back.

    This is an incredibly smart move on the president’s part. Plus, it has the added benefit of being substantive. As the president said, we no longer have the luxury of both investing in our future and wasting taxpayer money on giveaways to multinationals. We no longer have the luxury to both incentivize small businesses to create jobs and incentivize ubercorporations to horde cash. We no longer have the luxury to both rebuild America and coddle corporate jet owners.

    So the president us calling the Republicans’ bluff and challenging the “job creators” meme the GOP has invented to protect special interest boondoggles for the rich. He is basically saying through his proposal: You want tax breaks because you are the job creators? Fine, let’s see you actually create jobs and you can keep your tax breaks. Otherwise, STFU.

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