Plan B Forum

Pretty stark contrast:

http://www.offthechartsblog.org/without ... -last-year



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I pointed out earlier this week that six recession-fighting initiatives enacted in 2009 and 2010 kept nearly 7 million people out of poverty in 2010 — under an alternative measure of poverty that takes into account the impact of government benefit programs and taxes.

Our report also shows that if the government safety net as a whole — these temporary initiatives (all were featured in the 2009 Recovery Act) plus safety-net policies already in place when the recession hit — hadn’t existed in 2010, the poverty rate would have been 28.6 percent, nearly twice the actual 15.5 percent (see graph).

Poverty Rate Would Have Been Nearly Twice as High in 2010 Without the Safety Net

This shows the powerful anti-poverty impact of policies ranging from tax credits like the Earned Income Tax Credit and Child Tax Credit to unemployment insurance, SNAP (food stamps), Social Security, Supplemental Security Income, veterans’ benefits, public assistance (including Temporary Assistance for Needy Families), and housing assistance.

The safety net was responding to the downturn even without the Recovery Act initiatives. Between 2007 and 2010, the share of Americans that the safety net kept out of poverty rose from 9.5 percent to 10.8 percent. This increase mostly reflects the growth of programs like unemployment benefits and SNAP, which expand automatically to help people hit by the recession and then shrink as the economy recovers.

But these automatic increases wouldn’t have been enough by themselves to prevent a large increase in poverty in the recession. Without the temporary Recovery Act initiatives, the poverty rate would have jumped from 14.9 percent to 17.8 percent between 2007 and 2010, and 6.9 million more people would have become poor than actually did.
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yrs,
rubato

It is no secret that the United States government can keep people employed - in the short term - by borrowing money to pay government employees and to fund government contracts. There is no magic to it. Nobody doubts it.

In fact, the same principle applies to household budgets. As long as you have good credit, you can borrow sufficient money to live quite well, even at times when your current income is insufficient to pay your day-to-day expenses.

But there are two significant downsides to this "strategy." First, you are accumulating a mountain of debt that will eventually have to be paid off, and second, if you continue doing this, lenders will begin to lose confidence that the loans will be repaid. Interest rates will increase, and eventually the lenders will stop lending you money. (Parenthetically, it might be said that governments (and large corporations) don't actually have to pay off these loans or retire the debt, as long as the interest cost is tolerable).

And because of the two stark downsides, the "strategy" of continuing to borrow at unprecedented levels might well be called a "house of cards" strategy.

People (and governments) with sufficient maturity recognize that the most urgent task when faced with expenditures that far exceed revenues is bring expenditures and revenues into equilibrium - NOT STRATEGIZE ON HOW TO BORROW MORE MONEY TO FINANCE MORE EXTRAVIGANT EXPENSES.

Clearly, these obvious facts and principles are lost on rubato and people of his political ilk. Despite what is becoming a mountain of evidence to the contrary, they continue to believe that by paying excess government employees and government contractors with borrowed money, the money will somehow begin to reproduce, like little green rabbits with pictures of dead presidents on them, so that people who are NOT government employees or employees of government contractors can get a taste.

It's amazing, actually, that they continue to believe what their eyes and ears tell them is false.

well not exactly, buyout letters went out two days ago, the target being 10% of the workforce.

dgs49 wrote:People (and governments) with sufficient maturity recognize that the most urgent task when faced with expenditures that far exceed revenues is bring expenditures and revenues into equilibrium - NOT STRATEGIZE ON HOW TO BORROW MORE MONEY TO FINANCE MORE EXTRAVIGANT EXPENSES.

So (yet again) why did the radical right subvert the economic policies which were actaully working -- the bipartisan, conservative economic policies which had eliminated the budget deficit and were starting to pay off the national debt?

Why did the radical right undertake a program of deliberately making the government insolvent?

Oh, I seem to have answered my own question ....