here comes....Another Economic Stimulus Plan ?

Obama Advisor Urges Another Economic Stimulus Plan
By Michael Bowman
Washington
07 July 2009


The Obama administration appears to be sending mixed signals on whether a second stimulus package will be needed to pull the U.S. economy out of a deep and prolonged recession. Democrats and Republicans are expressing dissatisfaction with the impact of the $787 billion stimulus package President Barack Obama signed into law in February.
Obama economic advisor Laura Tyson says the federal government should begin crafting a second package to stimulate the U.S. economy on what she termed a "contingency basis," Tyson said.

"We are in a situation where the economic outlook is very uncertain and the risks are all on the downside [conditions could worsen]. It looks like the economy is weaker than expected. Why not begin to think about, over the next several months, whether we need a stimulus package and what it should include, so that we are ready [to act] as we get more information?"


Vice President Joe Biden in Washington (File)
Tyson spoke at a conference in Singapore. Her remarks raised eyebrows among economists and political analysts, coming two days after Vice President Joe Biden downplayed the suggestion that another stimulus package is needed.

"I think it is premature to make that judgment," Biden said.

Biden spoke on the "Fox News Sunday" television program. He admitted that, when President Obama entered office, the administration had "misread" the economy and how severe U.S. job losses would become. But the vice president said February's stimulus package, the biggest-ever federal effort to jumpstart the U.S. economy, was the proper tool to promote growth.

The $787 billion package includes infrastructure projects, energy initiatives, educational programs, aid for struggling state governments and tax cuts spread over a two-to-three year period.

House of Representatives Majority Leader Steny Hoyer helped craft an early version of the bill.


House Majority Leader Steny Hoyer
"I do not think anybody can honestly say that we are satisfied with the results so far. But we believe that the stimulus was absolutely essential," Hoyer said. We need to get the money that is already in the stimulus bill out [spend it]."

But appropriating federal funds takes time. And many of the lawmakers who championed the bill are frustrated by the lag between enactment of the stimulus plan and getting the money into the economy.

Republicans say the fact that unemployment continues to mount more than four months after the stimulus package was signed into law shows that the plan was flawed from the start.

House Minority Leader John Boehner also appeared on Fox News Sunday.

"This [stimulus plan] was supposed to be about jobs, jobs and jobs. And the fact is, it turned into nothing more than spending, spending and more spending," Boehner said.

In February, President Obama said the stimulus plan would save or create more than two million jobs. Success or failure is hard to prove, given that no one knows how much worse the economy would be if no stimulus had been undertaken, according to former Congressional Budget Office Director Douglas Holtz-Eakin.

"We will never know what the world would have looked like without the stimulus package,"Holtz-Eakin said. "So we will never be able to put numbers on exactly what the impact was."

Holtz-Eakin appeared on Bloomberg television. He said America's worsening employment picture illustrates the limits of the federal government's ability to generate economic activity quickly.

He said he is skeptical of the current stimulus package and would opposed to a second one.

"We should hold off and really be cognizant of the fact that the U.S. has a very daunting fiscal outlook,"Holtz-Eakin said. "We cannot afford to be spending money without thinking what we will get for it."
Other economists argue that at a time when businesses and consumers are cutting back on spending, the federal government is the only entity capable of jolting the economy out of recession

To soon both to judge the effectivness of the first stimulus (although it apeears to have been quite succesful in staving off total economic disaster), and too early to consider whether anyother is needed.

I agree that it is entirely sensible to consider potential future measures now though as opposed to waiting until they are needed.

razor said:

razor said:

razor said:

The slippery slope.....never ENDS.

Graycap23 said:

JellyBean said:

I am seeing circumstantial evidence that the economy is getting better, my sales are finally picking up and friends and associates are feeling the same.

I just read an article stating that only 20% of the original stimulus package has been spent, so calling for another one now before the dust settles is crazy.

The businesses and institutions that were being held together by toothpicks and legal pyramid schemes have failed, the ones that were booming or only in existence because of the housing bubble have pretty much crashed.

Let the dust settle, see what the stimulus package accomplishes first.
I have always felt it is beyond stupid to believe the economy would recover in less than one year, and question the sanity of anyone making definitive statements about the "results" of this spending only six months in.

This is what the economy will be for the next two years at least, we should just adjust. The government is not and should not create new permanent jobs for those who lost jobs when the bubble burst, that’s up to businesses that can adjust and innovate.
I think the government should take a long term approach and not cave in to doling out more idiotic $500 stimulus checks to everyone, a complete waste of money and oppotunity, something that has always offended me beyond imagination.
The government should stick to infrastructure spending, something that is in vital need, something that every state county and local community desperately needs but cannot afford. Something that will not just employ short term, but long term, something that will lead to better productivity and better safety for all us citizens.
We need to be more practical, we need to see actual improvements to our way of life, not just for those that can afford to hire lobbyists or bribe. I am tired of the eat and shit mentality that has set in over the last 8 years, enough.
[Edited 7/9/09 9:01am]

First of all, you need to know that Douglas Holtz-Eakin isn't just a former CBO director, he was John McCain's senior economic advisor last year. For some reason, the "liberal media" that presented this story forgot to mention that.

Now that you know that, you will remember that DH-E's idea of a stimulus plan was a tax cut for the rich. And, of course, he was also behind McCain's comment, "I can name $100 billion in spending cuts right off the top of my head". Naturally, neither McCain nor Holtz-Eakin ever got anywhere near that number. You've got to know who's talking and what their background is.

Secondly, the article correctly mentions that getting federal money out takes time. At least, it does if it's not a welfare payment, like Bush's first stimulus in 2008. Remember that $100 billion giveaway? THAT took four - six months to get out, and it was nothing more than sending checks to taxpayers.

So if it took half a year just to mail out checks, imagine how long it will take to actually fund projects that need budgets, bids and oversight.

Right now, I am in Angel Fire, New Mexico. There are signs around promoting roadwork projects that are the result of the stimulus plan. But so far, all we have are the signs. The actual work hasn't begun - they're still bidding it out.

I wish there was a magic wand that could be waved and all this money would get put to work in days, but it doesn't work like that.

Well, they tried that in Iraq in 2003, but as you remember, $12 billion in CASH immediately went missing and was never, ever found. If anyone thinks Iraq was the model for getting a lot of money put to work real fast, ummmmm....please stay away from sharp objects.

Print print print... spend spend spend.

Print print print... spend spend spend.

Print print print... spend spend spend.

Print print print... spend spend spend.

Graycap23 said:

But this was a HUGE economic recession which requires the same effort to recover from. It's best to do MORE than it is to do LESS and have the country fall further into recession - depression. This wasn't gonna turn around overnight. Hell, I just heard an economics professor from Wharton say Europe went through a 30 year recession, and I certainly don't think the U.S. wants THAT shit.

JellyBean said:

MuthaFunka said:

SUPRMAN said:

MuthaFunka said:

thepope2the9s said:

MuthaFunka said:

RodeoSchro said:

First of all, you need to know that Douglas Holtz-Eakin isn't just a former CBO director, he was John McCain's senior economic advisor last year. For some reason, the "liberal media" that presented this story forgot to mention that.

Now that you know that, you will remember that DH-E's idea of a stimulus plan was a tax cut for the rich. And, of course, he was also behind McCain's comment, "I can name $100 billion in spending cuts right off the top of my head". Naturally, neither McCain nor Holtz-Eakin ever got anywhere near that number. You've got to know who's talking and what their background is.

Secondly, the article correctly mentions that getting federal money out takes time. At least, it does if it's not a welfare payment, like Bush's first stimulus in 2008. Remember that $100 billion giveaway? THAT took four - six months to get out, and it was nothing more than sending checks to taxpayers.

So if it took half a year just to mail out checks, imagine how long it will take to actually fund projects that need budgets, bids and oversight.

Right now, I am in Angel Fire, New Mexico. There are signs around promoting roadwork projects that are the result of the stimulus plan. But so far, all we have are the signs. The actual work hasn't begun - they're still bidding it out.

I wish there was a magic wand that could be waved and all this money would get put to work in days, but it doesn't work like that.

Well, they tried that in Iraq in 2003, but as you remember, $12 billion in CASH immediately went missing and was never, ever found. If anyone thinks Iraq was the model for getting a lot of money put to work real fast, ummmmm....please stay away from sharp objects.

Tremolina said:

MuthaFunka said:

But this was a HUGE economic recession which requires the same effort to recover from. It's best to do MORE than it is to do LESS and have the country fall further into recession - depression. This wasn't gonna turn around overnight. Hell, I just heard an economics professor from Wharton say Europe went through a 30 year recession, and I certainly don't think the U.S. wants THAT shit.

MuthaFunka said:

Tremolina said:

Hey, it shocked me and pops when he said it, too.

Not to play the advocate, but in Obama's effort to clean up Washington's mess with the stimulus plan, you do wonder in the back of your mind how is that money really being spent. Are corporations and banks taken advantage? On the other hand, we have been warned by him that the economy is not going to turn around overnight. Therefore, we do need to be patient for its been seven months.

Tremolina said:

MuthaFunka said:

razor said:

Tremolina said:

MuthaFunka said:

SoulAlive said:

razor said:

MuthaFunka said:

Explain.

Not even a please?

Europe has suffered no such recession in modern times. So either this professor is entirley mistaken or he is referring back to pre-20th century Europe. If so, then the economic, social, and political circustances from that period are so far off what we have now that using that as an example from which to draw conclusions to apply to current problems would be an exercsie in futility. hence the analogy is redundant.