Reddit reviews End This Depression Now!
We found 6 Reddit comments about End This Depression Now!. Here are the top ones, ranked by their Reddit score.
Winner of the Nobel Peace Prize in Economics
Reddit reviews End This Depression Now!We found 6 Reddit comments about End This Depression Now!. Here are the top ones, ranked by their Reddit score.
On the day of the vote, Representative Claudia Tenney (R) swore up and down that the bill would reduce the deficit; and even bring about a surplus.
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Initially she claims that the tax cuts will fix everything:
> Tax cuts make growth happen. Almost all economists are now saying: if we're to continue the 3% growth we're seeing now (without even having the tax cuts passed) - we're going to be eliminating that deficit. And not only eliminating, we could see even larger growth; as we:
>
> - see the stock market continue to grow
> - see more labor participation
> - we're seeing unemployment go down
>
> And those things are going to be happening in the larger scale, and we could be seeing even greater than 3% growth. Which in a short period of time we're going to reduce the deficit, and we're also going to be reducing the long term debt of this nation. Finally growth is going to catch up.
First of all, that's all bullshit. All of it.
But it sounds absolutely great if it were true:
This tax cut will put the budget into surplus - something not seen since Bill Clinton raised taxes triggering the largest economic boom in 50 years. This means there will be plenty of cash to protect Medicare, Medicaid, public services!
But then she notes that all of that is a lie.
> Next year we're going to be reducing spending, which is going to be another aspect of this.
Ari Shapiro then noted that the AARP is concerned that with this tax cut, the deficit will in fact not shrink, and the government will then try to cut in entitlement programs.
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> Aside: The rule long known by economists is for dealing with a depression is:
>
> - in tough times: the government has to prime the pump with large deficit spending
> - and when times are good, it's time to raise taxes to pay it back
>
> And this /r/punchableface (who sits on the Financial Services Committee) doesn't understand that.
>
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She responds to the concerns about the need to cut spending after the tax cut fails to improve the economy:
> I just marvel at the sudden concern in deficit spending by the democrats and liberal organizations after eight years of unprecedented debt growth. If we do nothing we're going to see spiraling into increased debt, and into increased deficits
Pick one.
And then, as a bonus, she concedes a major selling point of the tax plan. It was supposed to simplify the tax code (the idea being save costs, and then cut taxes to make it revenue neutral). Instead the tax cuts just cut taxes, with the complicated tax plan remaining:
> Ari Shapiro: Part of the original goal was to simplify the tax code and eliminate loopholes. Why didn't that happen?
>
> Noise Hole: I think that one of the issues as we wanted to have deeeper cuts, and deeper cuts of the lower and middle income taxpayers, we had to make a decision between:
>
> - simplification
> - and deeper cuts
So the goals for the tax plan:
That leaves tax cuts for businesses and the rich, all while increasing the deficit, and requiring cuts to entitlement programs, social security, Medicare, Medicaid.
The ink wasn't even dry on the bill that was supposed to give the US Federal Government oodles of money to work with, and they're already in on the need to cut spending because of the deficits they're going to be experiencing next year.
RemindMe! 1 year "Republicans full-of-shit tax plan failed to deliver, and now they want to cut spending"
It's still nowhere near as high as has been historically though.
I mean look at this yearly GDP vs Debt graph, we're nowhere near what we were post WW2 and we survived that quite nicely.
This government needs to stop pretending that we're in the shit here and start to move the emphasis away from deficit reduction and towards job creation. We don't need bullshit austerity measures, we need to kick start the economy, constantly complaining about national debt being out of control is having exactly the opposite effect, it's stagnating our economy.
We'll end up in a depression here if we're not careful by continuing to follow this rhetoric.
Edit: I will add that if you really want an overview of why then I recommend two books. One is "Economics in one lesson" Henry Hazlitt's book on free market economics. One for its insight into how free markets work, but also its American view of why welfare states don't work ( which I guarantee will have you wanting to rip the damn thing up) It's also a good insight into our own governments right wing economic thinking. In fact it'll leave wondering if our government are not writing their own policies straight after reading this.
And two: Pual Krugmans Book "End this depression now" which demonstrates why deficits don't matter because when you put into action policies that stimulate as opposed to stagnate an economy what seems like a huge amount of debt now, disappears in the overall economic expansion i.e. all you have to do is look after the debt interest payments and the actually debt amount takes care of itself. The part about America never actually paying back its WW2 debt because the amount they borrowed shrank in monetary terms as their economy expanded is a real eye opener.
> Nobody is talking depression anymore
Exactly.
Well, unless you count the Vice President: "It's a depression for millions and millions of Americans. It's a depression." (June 27, 2012)
Oh, and the ranking member of the Committee on Energy and Commerce, Henry Waxman: "The economy has not recovered — some people call it a recession, I think it’s a depression." (July 1, 2012)
Oh, and Nobel Prize winning economist Paul Krugman: End This Depression "All indications are that the economy will remain weak for a very long time unless our policy makers change course." (Released April 30, 2012)
Edit: mispelling.
Higher demand leads to more required workers. Think about all those stores that closed or cut back their hours. They closed because their sales could not support their staff. More demand -> more sales -> can support more locations, hours, and staff.
>But if him upping his consumption makes the economy stronger, wouldn't it make sense for the government to pay him to consume stuff, so that he gets a paycheck for buying clothes and going to movies? But that doesn't seem to make sense.
Welcome to Keynesian Economics. It's counter intuitive, but the basic idea is that a govt can get out of certain kinds of recessions with a temporary increase in spending. It's been argued that what ended the great depression was all the spending required by WWII. There are some other funny quotes about ways to end times of economic hardship by digging holes or having aliens attack. The counter intuitive nature of Keynesian economics and what it means about govt spending tend to make it very controversial (see the comments in the provided links to see what I'm talking about).
This was the goal of the stimulus. The problem with it (if you ask a Keynesian anyway) is that it was too small. It was enough to stop the economic free fall but not enough to put the economy back where it was. If want to learn more about this theory on the current crisis check out Paul Krugman's recent book End This Depression Now!. It goes in to how this would work for our current recession in great detail.
The problem with adding jobs by govt funding is that it raises the debt. This raises the question, is it better to lower the govt's debt during these times by cutting spending (Austerity and Austrian Economics) or to raise the govt now by creating as many jobs as possible and then pay if off later once the economy recovers(Keynesian Economics)?
I recommend this guy, also a Nobel Prize winner, who thinks that the economic situation is terrible.
http://2012.presidential-candidates.org/Obama/Social-Security.php
Some quick Googling will get you to these answers. Also, I'd highly recommend you read some of Krugman's books, including his newest: "End This Depression Now!" If you're unsure about the Democratic stances on fiscal policy (including PPACA, Medicare, and Social Security) Krugman actually lays out liberal fiscal policy in a very strong, understandable manner.