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Obama infrastructure plan destined for failure?

boomerang

boomerang

Lifer
According to the author, we'll be repeating the mistakes of Japan by embarking on a path to improve our infrastructure.

http://www.heritage.org/Research/Economy/bg2222.cfm

Although the benefits of a costly, infrastructure-focused stimulus package based on massive gov­ernment spending may be intuitively attractive, past evidence suggests that the impact of govern­ment spending programs that are intended to encourage economic growth is very modest and unlikely to enhance recovery or deter recession. As noted above, the Japanese government imple­mented such a program during the 1990s, and the consequence was two decades of economic stagna­tion. Less ambitious infrastructure stimulus pro­grams have been implemented in the United States over the past few decades, and numerous indepen­dent and government studies have concluded that these programs had little impact on economic activity or jobs.
Click to expand...

It's a lengthy article, but the cliffs are that the New Deal was successful in increasing the scope of the federal government, yet had little impact on unemployment, the same was tried by Japan and it too resulted in failure.

Are we destined to repeat history without having learned from it? I guess only time will tell.
 
Japan's problem had a lot more to do with Banking problems(as I recall) and the lack of any Reform in the Banking Industry. It had nothing to do with Infrastructure spending.
 
Originally posted by: sandorski
Japan's problem had a lot more to do with Banking problems(as I recall) and the lack of any Reform in the Banking Industry. It had nothing to do with Infrastructure spending.
Click to expand...
Well, I have no intimate knowledge of the true nature of Japan's problems, however if your thoughts are correct, well, we've got banking problems of our own here. I've seen little discussion of any reform either.

Infrastructure spending (at least according to the article) was the means employed by the Japanese government to help pull them out of their financial mess.

A lot of parallels here.
 
Originally posted by: boomerang
Originally posted by: sandorski
Japan's problem had a lot more to do with Banking problems(as I recall) and the lack of any Reform in the Banking Industry. It had nothing to do with Infrastructure spending.
Click to expand...
Well, I have no intimate knowledge of the true nature of Japan's problems, however if your thoughts are correct, well, we've got banking problems of our own here. I've seen little discussion of any reform either.

Infrastructure spending (at least according to the article) was the means employed by the Japanese government to help pull them out of their financial mess.

A lot of parallels here.
Click to expand...

Reform is the key. Japan basically did nothing to correct the issues that caused their lengthy Recession.
 
Well nobody talks about the opportunity costs that are lost when govt spends the capital to build something due to having to tax from private industry or borrow. Am I opposed to infrastratture spending? No, provided we can afford it. We are goingt o drop 1 trillion. And it will have to be repaid eventually. And I have seen a few editorials that are showing what is being submitted for this stimulus package from mayors and govenors around the country. This is starting to look like a boondoggle for local politicians to keep their positions of power by making the tax payer pay for their pet project.

This stimulus packag may or may not actually stimulate demand. We will have to wait and see. The question becomes even if it does, is it worth 1 trillion in deficit spending to do it?
I find it amazing the people who always rail on Bush tax cuts which amounted to about 60\billion a year in lost revenues are pushing for a 1 trillion dollar spending project over 2 years. That dwarfs the tax cut and will be felt far more over the next few decades and may prove even less fruitful than permanent tax cuts.

Time will tell. I just hope if it fails we can finally put the demand side economic plan to bed like we are putting supply side economics.
 
Originally posted by: sandorski
Originally posted by: boomerang
Originally posted by: sandorski
Japan's problem had a lot more to do with Banking problems(as I recall) and the lack of any Reform in the Banking Industry. It had nothing to do with Infrastructure spending.
Click to expand...
Well, I have no intimate knowledge of the true nature of Japan's problems, however if your thoughts are correct, well, we've got banking problems of our own here. I've seen little discussion of any reform either.

Infrastructure spending (at least according to the article) was the means employed by the Japanese government to help pull them out of their financial mess.

A lot of parallels here.
Click to expand...

Reform is the key. Japan basically did nothing to correct the issues that caused their lengthy Recession.
Click to expand...
I'm hoping to see some action on banking reform here when the new Congress is in session. I know we can't trust the bankers to do it themselves. The SEC needs a major overhaul too.
 
Heritage Foundation (along with AEI) a joke. Not sure how anyone can take them seriously after the last 8 years of their policies channeled through the GOP. Anyways, people should go to Japan to appreciate how much better their infrastructure is, especially public transportation, before you draw any conclusions.
Also, their argument is that it's going to take too long to get new projects started is completely off mark, because there are projects already in progress that will get mothballed without federal spending if states have to balance budgets.
If you want some better thinking than from the morons who came up with the "ideas" for the last 8 years, try Paul Krugman. He had a great article on the subject called "50 Herbert Hoovers"
http://www.nytimes.com/2008/12...on/29krugman.html?_r=1
 
Originally posted by: senseamp
Heritage Foundation (along with AEI) a joke. Not sure how anyone can take them seriously after the last 8 years of their policies channeled through the GOP. Anyways, people should go to Japan to appreciate how much better their infrastructure is, especially public transportation, before you draw any conclusions.
Also, their argument is that it's going to take too long to get new projects started is completely off mark, because there are projects already in progress that will get mothballed without federal spending if states have to balance budgets.
If you want some better thinking than from the morons who came up with the "ideas" for the last 8 years, try Paul Krugman. He had a great article on the subject called "50 Herbert Hoovers"
http://www.nytimes.com/2008/12...on/29krugman.html?_r=1
Click to expand...

Excellent cite, and thanks for that.

Not only do we NEED infrastructure spending, we are in DIRE NEED of infrastructure spending. Our bridges are in a calamitous state, our electric grid in the Northeast/Midwest corridor is in tatters, we have at least 50 large national and state highways that need repair/replacement, and we have no viable NATIONAL form of transportation. Hell, Orlando couldn't even pull off a simple little local high speed railway, principally because the state and county didn't have the money. We have enormous water issues in the West and Southeast, we have several large SuperFund style sites that need immediate attention, to say nothing of about 10,000 smallish environmental issues in all the states. We have sewage and water supply/safety problems in every state that need attention. Need I go on?

Is this the time to do all of this? I think so, and at least one Nobel Prize winning economist agrees. Look here: http://www.ourfuture.org/blog-entry/age-infrastructure

The right wing nuts have let our infrastructure fall into disrepair. Eight years of Bush has been catastrophic at levels as yet unappreciated by the masses. When the Verrazano Narrows Bridge, or the Golden Gate Bridge collapse, or New York City to Detroit have no electricity for a week (again), then America will wake up. Why wait?

-Robert
 
Originally posted by: chess9
The right wing nuts have let our infrastructure fall into disrepair. Eight years of Bush has been catastrophic at levels as yet unappreciated by the masses. When the Verrazano Narrows Bridge, or the Golden Gate Bridge collapse, or New York City to Detroit have no electricity for a week (again), then America will wake up. Why wait?
Click to expand...

Infrastructure neglect is not a really a partisan issue and has occurred for decades on all levels from federal to municipal.

Spending money on maintenance or replacement just isn't as sexy as building new ball parks or a thousand other projects that are also in line for money.
 
Originally posted by: chess9

The right wing nuts have let our infrastructure fall into disrepair. Eight years of Bush has been catastrophic at levels as yet unappreciated by the masses. When the Verrazano Narrows Bridge, or the Golden Gate Bridge collapse, or New York City to Detroit have no electricity for a week (again), then America will wake up. Why wait?

-Robert
Click to expand...

All the spots you mentioned are run by Democrats, so I don't see how you can blame their poor condition on "right wing nuts." Places like New York State have set high tax rates for years and could have spent on infrastructure but didn't, so why should the federal taxpayer bail you out now? You made your spending choices, now deal with the consequences. If this means you face financial meltdown and need to raise taxes yet again or live with dangerous infrastructure, then so be it.
 
Originally posted by: glenn1
Originally posted by: chess9

The right wing nuts have let our infrastructure fall into disrepair. Eight years of Bush has been catastrophic at levels as yet unappreciated by the masses. When the Verrazano Narrows Bridge, or the Golden Gate Bridge collapse, or New York City to Detroit have no electricity for a week (again), then America will wake up. Why wait?

-Robert
Click to expand...

All the spots you mentioned are run by Democrats, so I don't see how you can blame their poor condition on "right wing nuts." Places like New York State have set high tax rates for years and could have spent on infrastructure but didn't, so why should the federal taxpayer bail you out now? You made your spending choices, now deal with the consequences. If this means you face financial meltdown and need to raise taxes yet again or live with dangerous infrastructure, then so be it.
Click to expand...

Thankfully that's not what politicians who actually won elections think.
 
Originally posted by: boomerang
According to the author, we'll be repeating the mistakes of Japan by embarking on a path to improve our infrastructure.

http://www.heritage.org/Research/Economy/bg2222.cfm

Although the benefits of a costly, infrastructure-focused stimulus package based on massive gov­ernment spending may be intuitively attractive, past evidence suggests that the impact of govern­ment spending programs that are intended to encourage economic growth is very modest and unlikely to enhance recovery or deter recession. As noted above, the Japanese government imple­mented such a program during the 1990s, and the consequence was two decades of economic stagna­tion. Less ambitious infrastructure stimulus pro­grams have been implemented in the United States over the past few decades, and numerous indepen­dent and government studies have concluded that these programs had little impact on economic activity or jobs.
Click to expand...

It's a lengthy article, but the cliffs are that the New Deal was successful in increasing the scope of the federal government, yet had little impact on unemployment, the same was tried by Japan and it too resulted in failure.

Are we destined to repeat history without having learned from it? I guess only time will tell.
Click to expand...

The extent of the success/failure of the New Deal always seems to be in argument. But one big difference with the New Deal is that the national debt did not significantly change under it, the government did not actively start deficit spending until WWII. So today, the government is much more willing to inject a larger amount of capital, for better or for worse, into these programs. Personally, they can probably and should make the case about the need for infrastructure projects. The continued healthy state of our infrastructure is necessary for business and commerce, letting this to continue to erode can have large effects in the future. So regardless of whether or not it does succeed in reinvigorating economies, this is something that we need to stay on top of and hopefully they can try to be intelligent in how they invest the improvements (not holding my breath though).
 
Originally posted by: glenn1
Originally posted by: chess9

The right wing nuts have let our infrastructure fall into disrepair. Eight years of Bush has been catastrophic at levels as yet unappreciated by the masses. When the Verrazano Narrows Bridge, or the Golden Gate Bridge collapse, or New York City to Detroit have no electricity for a week (again), then America will wake up. Why wait?

-Robert
Click to expand...

All the spots you mentioned are run by Democrats, so I don't see how you can blame their poor condition on "right wing nuts." Places like New York State have set high tax rates for years and could have spent on infrastructure but didn't, so why should the federal taxpayer bail you out now? You made your spending choices, now deal with the consequences. If this means you face financial meltdown and need to raise taxes yet again or live with dangerous infrastructure, then so be it.
Click to expand...

When a highway starts with an "I", its a federal highway and thus they pay for it including the bridges that run over it.
 
The right wing nuts have let our infrastructure fall into disrepair. Eight years of Bush has been catastrophic at levels as yet unappreciated by the masses. When the Verrazano Narrows Bridge, or the Golden Gate Bridge collapse, or New York City to Detroit have no electricity for a week (again), then America will wake up. Why wait?
Click to expand...

What an utterly ridiculous post. Infrastructure has been put on the back burner for decades transending multiple administrations both republican and democrat.

The fact is infrastructure just isnt pretty. People like 'social' feel good programs. A bridge or highway isnt sexy and hasnt been since the 60's. And often times gas taxes that are supposed to be allocated for these infrastructure upgrades are put into the general fund and siphoned off for pet projects. It doesnt matter which party or ideology is in control. Both have failed completely.

And now both want you to beleive a crisis is upon us and dire wide ranging spending needs to be done to correct it. So they want us to give them more money to fix a crisis they created. Govt is truely giving a drunk a drink. We are the bartenders giving drink after drink hoping the drunk can give us a safe ride home after our shift ends.


 
Well, the right wingers can blame the Dems all they want, but regardless of who is to blame, we need to fix this country. If it takes a Democratic administration to finally do it, then why should anyone be surprised? No one expects the Republicans to fix anything...EVER. They just break things.

-Robert
 
Originally posted by: chess9
Well, you right wingers can blame the Dems all they want, but regardless of who is to blame, we need to fix this country. If it takes a Democratic administration to finally do it, then why should anyone be surprised? No one expects the Republicans to fix anything...EVER. They just break things.

-Robert
Click to expand...

I blamed both, why cant you? Put the partisan crackpipe down.
 
Ofcourse it's destined to fail. It's mainly just a pay off to another group of unions(you know...the ones who get the road contracts by locking out other competition).

Unfortunately it doesn't matter what anyone thinks beforehand because BHO and his minions will spend spend spend and tax tax tax no matter what the public thinks.
 
Infrastructure is not a good return for a stimulus package because there is such a long lag time between getting the money and starting the work.
Plus it only helps a small segment of the economy (those who working in construction)

The best way to help the economy is to lower taxes.
 
Originally posted by: chess9
Originally posted by: senseamp
Heritage Foundation (along with AEI) a joke. Not sure how anyone can take them seriously after the last 8 years of their policies channeled through the GOP. Anyways, people should go to Japan to appreciate how much better their infrastructure is, especially public transportation, before you draw any conclusions.
Also, their argument is that it's going to take too long to get new projects started is completely off mark, because there are projects already in progress that will get mothballed without federal spending if states have to balance budgets.
If you want some better thinking than from the morons who came up with the "ideas" for the last 8 years, try Paul Krugman. He had a great article on the subject called "50 Herbert Hoovers"
http://www.nytimes.com/2008/12...on/29krugman.html?_r=1
Click to expand...

Excellent cite, and thanks for that.

Not only do we NEED infrastructure spending, we are in DIRE NEED of infrastructure spending. Our bridges are in a calamitous state, our electric grid in the Northeast/Midwest corridor is in tatters, we have at least 50 large national and state highways that need repair/replacement, and we have no viable NATIONAL form of transportation. Hell, Orlando couldn't even pull off a simple little local high speed railway, principally because the state and county didn't have the money. We have enormous water issues in the West and Southeast, we have several large SuperFund style sites that need immediate attention, to say nothing of about 10,000 smallish environmental issues in all the states. We have sewage and water supply/safety problems in every state that need attention. Need I go on?

Is this the time to do all of this? I think so, and at least one Nobel Prize winning economist agrees. Look here: http://www.ourfuture.org/blog-entry/age-infrastructure

The right wing nuts have let our infrastructure fall into disrepair. Eight years of Bush has been catastrophic at levels as yet unappreciated by the masses. When the Verrazano Narrows Bridge, or the Golden Gate Bridge collapse, or New York City to Detroit have no electricity for a week (again), then America will wake up. Why wait?

-Robert
Click to expand...

Last time I checked, I pay $10 to cross the Verrazano. Of course, Democrats in New York and New Jersey continuously funnel that money into worthless causes....
 
Originally posted by: CADsortaGUY
Ofcourse it's destined to fail. It's mainly just a pay off to another group of unions(you know...the ones who get the road contracts by locking out other competition).

Unfortunately it doesn't matter what anyone thinks beforehand because BHO and his minions will spend spend spend and tax tax tax no matter what the public thinks.
Click to expand...

Which unions get road contracts?
 
ahhh yes the heritage think tank. the same ones that appealed to bush after his first election "the Office of Presidential Personnel (OPP) must make appointment decisions based on loyalty first and expertise second, and that the whole governmental apparatus must be managed from this perspective."

http://www.heritage.org/Resear...nmentReform/BG1404.cfm

bunch of right-wing cooks and crooks for the most part.
 
Originally posted by: CADsortaGUY
Ofcourse it's destined to fail. It's mainly just a pay off to another group of unions(you know...the ones who get the road contracts by locking out other competition).

Unfortunately it doesn't matter what anyone thinks beforehand because BHO and his minions will spend spend spend and tax tax tax no matter what the public thinks.
Click to expand...



Unions don't get hired to do road construction, contractors do...
 
Originally posted by: dartworth
Originally posted by: CADsortaGUY
Ofcourse it's destined to fail. It's mainly just a pay off to another group of unions(you know...the ones who get the road contracts by locking out other competition).

Unfortunately it doesn't matter what anyone thinks beforehand because BHO and his minions will spend spend spend and tax tax tax no matter what the public thinks.
Click to expand...



Unions don't get hired to do road construction, contractors do...
Click to expand...

Its probably going to even hurt him even more when he finds out that you don't have to use unionized labor on projects. The only thing that needs to be done is to pay the preassigned prevailing federal wage rate which can be found here http://www.access.gpo.gov/davisbacon/
 
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