My assessment of the sequester

[Dr. Zaus]

If cutting taxes can create more tax-revenue, then increasing spending can create less deficit. Both concepts work on the same economic assumptions.

 

[shadow9d9]

Of course; the fact that is allows bypassing other Federal requirements for illegals is not a concern.

As I previously stated; items are added to bills that should not be there because such will not stand on there own.

What I bolded was one example and only based on what was published in the reference.

I am sure that there are other items within the bill; the reference was targeting on only the primary bill intentions.

Post up the acual text of these bills and we can discuss/debate the riders.

What in the world are you talking about? Are you arguing that abused illegals shouldn't be allowed to stay here long enough for justice in our court systems to take place?

You could pretend that smaller items added to bills are the excuse behind the record breaking fillibusters, but that has been going on forever. The record fillibusters are still on the Republicans... Guess what else was attached to a bill? The removal of the Feingold Steagull act that single handedly led to the 2008 collapse.. the republicans added that in to a bill around 1998. This is not a unique occurence that would explain record breaking fillibusters.

 

[EagleKeeper]

If cutting taxes can create more tax-revenue, then increasing spending can create less deficit. Both concepts work on the same economic assumptions.

That the extra money will circulate.

Issue is where is that extra money coming from.
Increased taxes (initially taking $$ from circulation) to inject the spending.
this creates a extra few cycling of $$ through the system before the break even point.

By reducing taxes; the money is already available for circulation.

So the added spending may work if properly targetted; but it needs the pump to be primed; that is expensive;
We say the foulups in the last spending pump; poorly targeted and di dnot accomplish what was intended/promised.

People may state that it stopped things from getting worse; I feel all it did was to pull items forward and waste a chunk of $$.

the economy would have been better off by sending everyone half that amount coded on used for Made in America purchases only.

 

[EagleKeeper]

What in the world are you talking about? Are you arguing that abused illegals shouldn't be allowed to stay here long enough for justice in our court systems to take place?

You could pretend that smaller items added to bills are the excuse behind the record breaking fillibusters, but that has been going on forever. The record fillibusters are still on the Republicans... Guess what else was attached to a bill? The removal of the Feingold Steagull act that single handedly led to the 2008 collapse.. the republicans added that in to a bill around 1998. This is not a unique occurence that would explain record breaking fillibusters.

Illegals should not be here period.
Abused or not.

As stated previously, list the actual bill and ALL the riders and we can dissect it.

 

[Dr. Zaus]

T
Issue is where is that extra money coming from.
Increased taxes (initially taking $$ from circulation) to inject the spending.
this creates a extra few cycling of $$ through the system before the break even point.

By reducing taxes; the money is already available for circulation.

Which is part of why spending sans additional taxation is the solution to a down-market; or, more aptly here, why reducing spending sans tax-cuts is the death knell of a slowly growing market.

So the added spending may work if properly targetted; but it needs the pump to be primed; that is expensive;
We say the foulups in the last spending pump; poorly targeted and it did not accomplish what was intended/promised.

You can't judge the theory by idiosyncratic outcomes... I mean you can, but you would be theoretically wrong...

People may state that it stopped things from getting worse; I feel all it did was to pull items forward and waste a chunk of $$.

The biggest problem was paying people to remain un-employed: If it wasn't for that we'd have seen a much greater spike in the economy.

the economy would have been better off by sending everyone half that amount coded on used for Made in America purchases only.

Why is increasing manufacturing in the US a good thing when that's not where jobs come from anymore.

 

[EagleKeeper]

Issue is where is that extra money coming from.
Increased taxes (initially taking $$ from circulation) to inject the spending.
this creates a extra few cycling of $$ through the system before the break even point.

By reducing taxes; the money is already available for circulation.

Which is part of why spending sans additional taxation is the solution to a down-market; or, more aptly here, why reducing spending sans tax-cuts is the death knell of a slowly growing market.
where is the spending money coming from - higher debt - inflation? two issues here; reduce the debt and grow the economy. Debt reduction frees capital; Increased economy generates capital.

So the added spending may work if properly targeted; but it needs the pump to be primed; that is expensive;
We say the foulups in the last spending pump; poorly targeted and it did not accomplish what was intended/promised.

You can't judge the theory by idiosyncratic outcomes... I mean you can, but you would be theoretically wrong...
there is evidence in that the last three-four attempts at priming the pump have been politically handicapped which reduced the effectiveness that was sold to the public for approval

Bush's $500 handout - excluded 1/3 of the country by relying on wage earners only
Bush/Obama Cash for Clunkers - supported NEW vehicle dealers only. Affected used car market and could have been targeted to US vehicles - clearing out the US backlogs.

People may state that it stopped things from getting worse; I feel all it did was to pull items forward and waste a chunk of $$.

The biggest problem was paying people to remain un-employed: If it wasn't for that we'd have seen a much greater spike in the economy.
also, - shovel ready projects - only pulled projects forward and short term work rather than building infrastructure.

the economy would have been better off by sending everyone half that amount coded on used for Made in America purchases only.

Why is increasing manufacturing in the US a good thing when that's not where jobs come from anymore..

force manufacturing to come back will bring back jobs that have been sent away. Many were done becuase of costs.
by placing the requirement of spending US $$ on US goods; you force the recycling of $$ at least twice.
Goods
Labor.
then the labor can decide where to send their paychecks.

Also on the handouts; if they were setup up that only 50% could be used in the first year and 50% in the second - that will allow time for rampup of the manufacturing for US made goods.

 

[Craig234]

A little told story is the explosive growth of robotics so that many jobs returning to the US are being filled by robots, not workers.

 

[Dr. Zaus]

two issues here; reduce the debt and grow the economy. Debt reduction frees capital; Increased economy generates capital.

Also on the handouts; if they were setup up that only 50% could be used in the first year and 50% in the second - that will allow time for rampup of the manufacturing for US made goods.

Your solution works, (maybe a monthly-paycheck-bonus ala EIC for everyone but capping at a %; over a two year period) but why do we want manufacturing? robots >> humans and society is all the better for it.

where is the spending money coming from - higher debt - inflation?

inflation doesn't happen if efficiency in the market (ie robots & out-sourced slavery) has made it so that maximal wealth (all the Iphones you can eat) is achieved without as much spending. That is, if debt-inflation-tendencies are offsetting the deflationary tendencies of technology.

there is evidence in that the last three-four attempts at priming the pump have been politically handicapped which reduced the effectiveness that was sold to the public for approval

this is a good point; the political reality can interfere with the theoretical rationality; that said, political interference is usually in the form of favoritism, not in the form of negation of the benefits of added spending. Even the millions in stimulus send to over-seas corporations are peanuts compared to the trillions spent here.

also, - shovel ready projects - only pulled projects forward and short term work rather than building infrastructure.

shovel-ready was a BS term to begin with; doomed to fail. If you think of education as the infrastructure of the countries intellect, the only place where we win on an international level, then making sure teachers were paid properly may well have been the best infrastructure investment possible.

My assumption is that technology changes the way society must necessarily work, and by not facing this and instead relying on old economic models that fail to incorporate these kinds of dynamics, we end up making major errors (Such as cutting spending, or raising taxes) when what society needs is more money in the economy, and for the government to behave as the employer of last resort.

In our situation (which defies common sense, because it's an entirely novel situation)

lower taxes + higher spending = minimizing the long term debt.

 

[EagleKeeper]

A little told story is the explosive growth of robotics so that many jobs returning to the US are being filled by robots, not workers.

Robots have to be designed, built, maintained.

Jobs; at lest two are high quality positions.

 

[EagleKeeper]

<snip> In our situation (which defies common sense, because it's an entirely novel situation)

lower taxes + higher spending = minimizing the long term debt.

Properly tempered:thumbsup:

 

[Dr. Zaus]

Properly tempered

Haza! A meeting of the minds

 

[Craig234]

Robots have to be designed, built, maintained.

Jobs; at lest two are high quality positions.

It's a huge net loss of jobs.

There are a few made in the robot industry.

 

[cwjerome]

In our situation (which defies common sense, because it's an entirely novel situation)

lower taxes + higher spending = minimizing the long term debt.

It's not super novel. In rough times you must adjust taxes a little lower and spending a little higher. Which sucks for us because our spending was already quite high and our taxes already relatively low. In better times you raise taxes slightly and cut spending to pay down the debt/deficit from the rough time. It does seem somewhat counter-intuitive to do that now, but you have to get things back on track before you can realistically service the deficit/debt.

My concern is we keep taxes lower and spending higher in an effort to pull out of the malaise, but we never really do get out and stagnate for possibly a very long time. Then your "cure" has inadvertently made the situation worse.

 

[Fern]

What is particularly sad about this business is that it appears that the austerity policies enacted this year will shave about 1.25% off of annual growth and particularly in the case of the sequester, may be self defeating in terms of government debt ratios.

When growth slows to a crawl or the US re-enters recession later this year I'm sure that people will once again argue that somehow this situation shows the failure of stimulative fiscal policy, not the failure of austerity. That will be a really depressing conversation to have.

The last quarter already saw a contraction in GDP.

Our national spending will still increase even after the sequestration cuts.

Fern

 

[fskimospy]

The last quarter already saw a contraction in GDP.

Our national spending will still increase even after the sequestration cuts.

Fern

Nah, probably not. It will likely be revised up to a small growth. It was also subject to a number of one time factors that are unlikely to repeat.

Our spending will increase, but not at the rate it needs to, and this will negatively impact growth. In fact the US has already enacted significant austerity measures and appears ready to enact more with this. We already know how foolish this plan is, we've seen the failure of austerity in Europe.

I just don't want conservatives to try and wiggle out of the consequences of their policy preferences when not only do economic conditions worsen but the deficit doesn't close by as much as predicted due to the self defeating nature of austerity.

 

[ElFenix]

infographic:
http://econintersect.com/b2evolution/blog1.php/2012/04/21/infographic-discretionary-federal-spending