Tuesday Open Thread

Filed in National by on October 27, 2009

What is there to look forward to on a Tuesday? A fresh, shiny new open thread that’s what. Also, Drinking Liberally on Thursday at the Homegrown Cafe in Newark!

Republican economist Bruce Bartlett has advice for the Republicans, not that they’ll take it. The advice is that the economy needs spending, not cuts:

According to the Council of Economic Advisers, as of August the actual budgetary effect of the February stimulus was to reduce revenues by $62.6 billion and raise spending by $88.8 billion. Of the spending, the vast bulk went to transfers such as extended unemployment benefits and aid to state and local governments, which may have prevented cuts in spending that would otherwise have occurred but probably didn’t do anything to increase spending. Only $16.5 billion in stimulus funds went to investment outlays for things such as public works. This is a trivial amount of money in a $14 trillion economy.

As if we needed further evidence that transfers have virtually no stimulative effect, the Bureau of Labor Statistics just issued a report on the 2008 tax rebate showing that only 30 percent of the money was spent; the rest was saved, thus providing no stimulus to short-run growth. (See also this CBO report and this new working paper from the National Bureau of Economic Research confirming this analysis.) On January 24, 2008, George W. Bush assured the country that a tax rebate was just the right medicine to prevent an economic downturn.

It continues to amaze me that no one on the left or right seems to have noticed that the essential factor causing the economic downturn is a decline in velocity: the number of times that money turns over in the economy, which is measured as the ratio of the money supply to GDP. In 2006 and 2007 this ratio was 1.9. I take that as normal. In 2008, velocity fell to 1.76 and currently is 1.69. (I divided end of year M2 into 4th quarter GDP; the latest figure is 2nd quarter GDP divided by end of June money supply.)

If velocity were 1.9 instead of 1.69, 2nd quarter GDP would have been $1.6 trillion higher. Therefore, no recession. The output gap would have simply disappeared. From this I conclude that a lack of spending in the economy is the central problem and the only policies that will help are those that increase spending – consumer spending, investment spending, net exports or government spending. How tax cuts would have helped – or at least the type of tax cuts advocated by Republicans – is a mystery to me.

Thank you Bruce. It looks like good advice for the Democrats, too. Go read the whole article if you can, it’s that good.

Also worth reading is TPM’s interview with Chuck Schumer about how the opt-out public option compromise came together and the White House role.

This evening I spoke with Sen. Chuck Schumer (D-NY), who was in that infamous Thursday night meeting with President Obama and other Senate leaders–and who has been one of the most persistent advocates of a public option on Capitol Hill. As Schumer explains it, the disagreement between the White House and Senate wasn’t substantive so much as it was tactical: The White House had its doubts that Senate Majority Leader Harry Reid could really get 60 votes for a public option with an opt out for states.

“The President listened very carefully,” Schumer said in an interview moments ago. “He wanted to make sure that the strategy upon which we were embarking had the ability to carry through.”

Schumer has been at the center of the fight over the public option from the earliest days of the health care debate–always there to pull it back from the brink when it at times seemed on the verge of collapse. This situation was no different. After the Thursday meeting, four sources in different Democratic offices told me that the White House had suggested they believed a strategy of pursuing Sen. Olympia Snowe’s preferred compromise–a triggered public option–might be an easier path to 60 votes. In the end, though, Schumer and the rest of leadership seem to have prevailed upon President Obama that they’ve picked the right strategy.

“I think substantively the White House probably preferred a stronger public option than a trigger,” Schumer said. “We talked about this for a while in leadership and the White House wanted to hear our thoughts–and when they heard them they thought that this was the right strategy to get our caucus together.”

Again, this is from the progressive caucus coming together and collectively saying “no” to anything but a public option. There were at least 30 senators who signed a letter saying “no” to no public option.

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Opinionated chemist, troublemaker, blogger on national and Delaware politics.

Comments (47)

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  1. Progressive Mom says:

    We interrupt this Tuesday Open Thread with a word from today’s FlufferNutter….

    Randall Terry of Operation Rescue, who has sent out a press release on: “Who Can make the best “Nancy Pelosi and Harry Reid BURN IN HELL!” video?”

    Yes, those life-is-sacred folks are offering a reward (all expenses paid to a march weekend in DC) to those who can best depict two legally elected, non-abortion-having, Democrats burning. The entry rules even refer to being careful when you light the match and start the fire….

    You are now returned to your regular Tuesday Open Thread, and the sane real world.

    Be careful out there.

  2. Brooke says:

    Randall Terry is a nasty man.

    And, how do I find the open threads? The only way I’ve found so far is to wait for someone to post on it and follow them back. If another thread is more popular, I’m out of luck.

  3. Bruce is wrong. He started to hit the truth and fell off the wagon. The problem with the economy is not that government is spending too little. It is that it is borrowing too much. There is not private capital to increase the velocity of the economy. What we need to do is stop paying the banks interest on their bailout money and encourage them to send it into the economy.

  4. Brooke,

    The open threads should appear every weekday at noon. I’m not sure how you’re browsing, but the threads appear in order of when they’re posted, except “featured” threads that appear in the top scroll.

    You can also click on a contributors’s name to get their posts. I usually post the open threads, so you can click on my name to find them. Does this help?

  5. anon says:

    The current open thread should be at the top of the list when you click on the Open Thread categ- D’Oh!!!

  6. nemski says:

    anon, we don’t have an Open Thread category, but that’s an idea.

    In the meantime Brooke, scroll to the bottom of the page and click the link that says Older Posts. We host some 25 posts on our front page, so sometimes yesterday’s open thread goes to Page 2.

    Feel free tomorrow morning to find today’s Open Thread and comment there.

    Thanks for commenting here by the way.

  7. Brooke says:

    Thank you, anon. When I find the “Open Thread category” that will doubtless be helpful. 😉

    Right now, UI, the screen I arrive on has the logo at the top, and a tan bar with featured/local/national etc. When I go to “featured” I get a rotating menu of stories, and I have a “recent comments” bar on the right. Often I leave the screen up and navigate from the comments bar next to last night’s post, whatever is is, but I’m sure there’s a simpler way.

    And thank you, nemski. I’m trying…in all senses of the word. 😉

  8. David obviously didn’t read Bartlett’s post. Did he miss this part?

    From this I conclude that a lack of spending in the economy is the central problem and the only policies that will help are those that increase spending – consumer spending, investment spending, net exports or government spending. How tax cuts would have helped – or at least the type of tax cuts advocated by Republicans – is a mystery to me.

    Brooke,

    Under the Featured stories, it should read “Other Recent Articles.” The posts are in the order that they’ve been posted. At the bottom there’s a link called “Older entries” which will take you back further.

  9. anon says:

    we don’t have an Open Thread category, but that’s an idea.

    Maybe more of a tag than a category, but same idea.

  10. Good point anon. There’s another way to search. Under the recent comments, there is a search menu. If you hit “tag” you can search for Open Thread among the tags. It should give the most recent first.

  11. Brooke says:

    Really? I’ve assumed that was a search for the blogroll. Silly me. :p Thanks.

  12. Today’s second moment of Republican crazy:

    But this morning, House Minority Leader John Boehner (R-Ohio) decided to not only complain about today’s resolutions, but to argue that they’re evidence of Democratic negligence.

    “These are your hard-earned tax dollars at work: with millions of Americans looking for jobs and the nation’s unemployment rate nearing 10 percent, the U.S. House of Representatives today will take up a grand total of four non-controversial ‘suspension’ bills. Four,” Boehner’s statement read. He added, “It’s unacceptable for Congress to take it easy at a time when out-of-work families struggling to make ends meet are asking ‘where are the jobs?'”

    Yes, Boehner is speaking out against Congressional resolutions. I think Obama Derangement Syndrome is eating his brain. Boehner did this on the same day Republicans proposed a resolution to honor the 9/12 protestors (all 1.7 million of them).

  13. nemski says:

    Wait, UI, I can do you one better.

    Up and coming star in the New York Republican party makes Jew jokes and ends his career.

    Erie County Executive Chris Collins has irreparably damaged his prospects for statewide office after he compared Assembly Speaker Sheldon Silver to Adolf Hitler and an Antichrist during a Saturday speech in Buffalo.” The best part is that Sheldon Silver is a Jew, and Jews are terrified of Hitler and Christians calling them Antichrists. No, wait. The best part is that Chris Collins meant this as a “joke,” when he called the Jew those awful names. No, wait. The best part is after the jump! Oh ho ho!

    Click on the link above, trust me, it gets better.

  14. Wow, nemski, that is much crazier, though not as crazy as Randall Terry. I used to live in Erie County NY. I’m embarrassed for my former home.

  15. Progressive Mom says:

    What IS the republican fascination with Hitler? Republicans bring him up all the time. Didn’t Scalia just mention Hitler today in his speech in some rambling, incoherent analogy (something about Hitler making good cars?)

    Is it puppy love?

  16. RSmitty says:

    Oh, damn it, Scott. I was just now going to put that same link in here. In her game, though, once you get a 2-0 count (that would be “two balls”), then you’re guaranteed a “line drive up the middle.”

    Delaware Liberal family content just updated to less-than-zero.

  17. Scott P and Smitty both get the over-the-glasses look of disapproval.

  18. cassandra_m says:

    You have to admit, though, that Scott and Smitty are shaping up to be a fine comedy team!

  19. Brooke says:

    I don’t suppose one of you lefty geek types can help me do something perfectly simple to my dratted itunes, can ya?

  20. Scott P says:

    Sorry, Smitty. I guess I beat you. That’s what she said.

  21. nemski says:

    Brooke, what are you trying to do in itunes?

  22. Brooke says:

    Virus killed my old computer, now on imac. I have an ipod with music, an iphone with music, and a… exterior hard drive? that they just put my files on. I need to get stuff ON to itunes from these, and there’s probably some hilariously simple apple-type way to do it, but I’m afraid if i plug in anything it’ll be overwritten … which is one of those Luddite fears like using escalators, I know. *blush*

    Just for the record, I’m bleeding McGyver until the invention of electricity loused me up.

  23. RSmitty says:

    You have to admit, though, that Scott and Smitty are shaping up to be a fine comedy team!

    Yeehaw! Yesterday it was about manhood (wherein Geek shouted out “LARGE!”) and today it’s about 2-0 counts, line drives up the middle, and beating others.

    Oh, this is going on the American Family Association’s watch list real quick.

  24. nemski says:

    Let me see if I have this correct.

    Old computer — gone.

    iMac with external hard drive.

    iPod and iPhone which are a-okay.

    First problem I can see is that your old computer was a Windows machine, correct. If so, then your iPhone and iPod were formatted to be read by a Windows machine.

    think think think think think, doing my winnie the pooh imitation

  25. RSmitty says:

    I think the first thing you may want to do Brooke, if I understand your plight correctly, is open the I-Tunes app BEFORE you hook up your iPod. Be certain to disable (un-check) the auto-sync option. That will at least keep the app from automatically syncing your iPod to probably nothing. After that, it would probably take hands-on assistance, or at least a careful walk-through specific to your request.

  26. RSmitty says:

    Nemski…I use my iPod with my pos windows, but I don’t recall any specific formatting of windows vs mac for the iPod unit. Of course, it was a gift for me, so I didn’t have to buy it. If that’s an option at the store, then I honestly don’t know about it. How sad.

  27. nemski says:

    Brooke, follow Smitty’s advice but STOP if it says it needs to format the iPhone or iPod.

  28. I didn’t have any trouble transferring my itunes library between computers, even PC to mac. I simply saved my library on a thumb drive and put it into the itunes library on the new computer.

  29. RSmitty says:

    Typical. Takes two men to confuse the issue and one woman to clean up the man’s mess. Tsk.

    Hey, waiiiit a minute… 👿

    I think I want to go back and talk World Series tickets with Scott.

    So, there is this 2-0 count and a woman wanting to sell her World Series tickets. What happens next?

  30. nemski says:

    That’s why my wife doesn’t ask me to do anything around the house.

  31. nemski says:

    Rachel’s segment on Boxwood and the smart grid was called, “Moment of Geek”!

  32. Brooke says:

    just for the record, i hate how everything in Apple shows up on a gray bar at the top of my screen. I’m working on this, thanks all.

    What’s a thumb drive?

    (if someone says “a handtruck”, I’ll… I’ll … never buy anyone a drink at Drinking Liberally) 😀

  33. liberalgeek says:

    It’s one of those new-fangled USB devices that you can use to transfer files. Think of it as a really small external hard drive.

  34. RSmitty says:

    … I’ll … never buy anyone a drink at Drinking Liberally

    If I show up, you have to. It’s been written into the rules of the October-version of it.

  35. It’s like a tiny portable hard drive. You can get them some place like Best Buy.

  36. nemski says:

    Also, worse case Brooke, is that you can make an appointment online to bring your iMac into the Apple Store and they will help.

  37. Another judge wipes out a mortgage debt related to the MERS paperwork problem. This time in New York. Perhaps judges have found a new way around the cramdown problem?

  38. RSmitty says:

    UI – I just read some of that article…yes, I am guilty of skimming, I need to go to bed…but one thing that was touched on and I wonder about is the title. Sure, the judge rules that the mortgage is effectively an unsecured loan quite simply because MERS is to mortgages as Homer Simpson is to nuclear facilities; however, clearing all that off of a title has to be painful. The new-outright-owner who just was more-or-less gifted the house may actually be stuck with that house and unable to sell it. If that title isn’t wiped clean along with that MERS mess, then that dude remains in a heap of mess, just a more affordable heap.

  39. RSmitty says:

    Last one of the night…

    Well.
    Andre “Gack” Agassi.
    Holy crap, I can be naive.

  40. nemski says:

    Wow, he rocked, I rolled.

  41. Brooke says:

    zip drive?

    I know people in loud shirts would fix it for me. INTJ. worship competence. Want to know how. 😉

  42. Scott P says:

    I think the moral of the Agassi story is, “Never trust a man named ‘Slim'”.

    So, there is this 2-0 count and a woman wanting to sell her World Series tickets. What happens next?
    A 2-0 count? Obviously, you have to come in with the high, hard one. (OK, I promise that’s enough for me.) 🙂

  43. Does anyone use zip drives anymore?

  44. RSmitty says:

    Does anyone use zip drives anymore?

    I think the woman wanting the World Series tickets prefers the un-zip drive.

    OK, I promise that’s enough for me.
    It’s never enough!

  45. RSmitty says:

    Whoa! New feature? You can ‘request deletion’ of comments?

  46. liberalgeek says:

    Hmmm. That’s what I get for upgrading plugins on the fly… That option has been disabled.