Thursday, July 09, 2009

More Stimulus Needed

Paul Krugman says that another stimulus is needed to get the economy moving. (from July 2nd)

O.K., Thursday’s jobs report settles it. We’re going to need a bigger stimulus. But does the president know that?

Let’s do the math.

Since the recession began, the U.S. economy has lost 6 ½ million jobs — and as that grim employment report confirmed, it’s continuing to lose jobs at a rapid pace. Once you take into account the 100,000-plus new jobs that we need each month just to keep up with a growing population, we’re about 8 ½ million jobs in the hole.

And the deeper the hole gets, the harder it will be to dig ourselves out. The job figures weren’t the only bad news in Thursday’s report, which also showed wages stalling and possibly on the verge of outright decline. That’s a recipe for a descent into Japanese-style deflation, which is very difficult to reverse. Lost decade, anyone?

Wait — there’s more bad news: the fiscal crisis of the states. Unlike the federal government, states are required to run balanced budgets. And faced with a sharp drop in revenue, most states are preparing savage budget cuts, many of them at the expense of the most vulnerable. Aside from directly creating a great deal of misery, these cuts will depress the economy even further.

So what do we have to counter this scary prospect? We have the Obama stimulus plan, which aims to create 3 ½ million jobs by late next year.
So let me see if I get this. The current stimulus plan will not create its jobs for about a year and a half. If you believe it will create any jobs at all. So another similar plan with results probably two to two and a half years in the future will fix things? You need a lot of faith in HOPE and CHANGE to believe that.

If there was to be another stimulus, I like the Republican plan better.

Is it any wonder Obama's numbers are tanking?
The public's disenchantment with Barack Obama continues to rise. Rasmussen reports:
33% of the nation's voters now Strongly Approve of the way that Barack Obama is performing his role as President. Thirty-six percent (36%) Strongly Disapprove giving Obama a Presidential Approval Index rating of -3.
Rasmussen cautions that this could be just statistical noise, and notes:
Tomorrow (Wednesday) will be the first update based entirely upon interviews conducted since last week's report showing higher than expected job losses in June.

Just 27% of voters nationwide favor passage of a second economic stimulus package. Sixty percent (60%) are opposed.

Fifty-four percent (54%) say the average Democrat in Congress is more liberal than they are, while 36% believe the average Republican congressman is more conservative.
Just a statistical blip? The new numbers are out and they are worse for Obama.
Dear Leader's approval numbers continue to tank.

His approval index number has now dropped 38 points in less than 200 days in office. And, that's with 1,000% support from the state-run media!
Rasmussen reported:
The Rasmussen Reports daily Presidential Tracking Poll for Thursday shows that 30% of the nation's voters now Strongly Approve of the way that Barack Obama is performing his role as President. Thirty-eight percent (38%) Strongly Disapprove giving Obama a Presidential Approval Index rating of –8. The President’s Approval Index rating has fallen six points since release of a disappointing jobs report last week (see trends).
So Obama's support has dropped 5% in just a week. So let me see. It is little under a year and a half to the next election. How will our Fantastic President's Party be doing then? Well I have more poll numbers.
Gallup has released a special report that puts the lie to Democrat claims that America has delivered a mandate for vast changes in our political economy along liberal-left lines. The data is worth examining, but the narrative itself is surprisingly direct in its conclusions:
Despite the results of the 2008 presidential election, Americans, by a 2-to-1 margin, say their political views in recent years have become more conservative rather than more liberal, 39% to 18%, with 42% saying they have not changed. While independents and Democrats most often say their views haven't changed, more members of all three major partisan groups indicate that their views have shifted to the right rather than to the left. ...
I don't think things are looking good for the Democrats in 2010. It is true that the Republicans did a lousy job with government when they controlled it. The deal for the Democrats is that they are doing an order of magnitude worse. Changes of that magnitude are hard to hide.

If Obama gets us into a war with his international weakness the Democrats will not only lose ground in 2010, the elections will be a blood bath.

No matter what this country is in for a world of hurt.

Cross Posted at Classical Values


kurt9 said...

Krugman is a leftwing hack with pretensions of being an economist. He is not worth listening too, except to understand the thinking of the parasites.

Joshua said...

David Hirschleifer (via Tyler Cowen) makes an interesting point about these calls for another stimulus (my emphasis added):

Regardless of who's right on the economics, clearly the 'stimulus' language captures the pro side perfectly, and the con side not at all. Indeed, the term immunizes the mind to opposing evidence. After a cup of stimulus from Starbucks, if I'm still drowsy, by definition I need another jolt.

Persuasion via psychological button-pushing being pretty much SOP for the Left, this doesn't come as much of a surprise.