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History tells us...

Submitted by davidfarrar on Thu, 01/22/2009 - 07:32
in

throw

...you can't stop a recession by doing more of what caused the recession in the first place, i.e., by spending more money which you ain't got.

Let's face it, there is only one entity that has the experience, the know-how and opportunity to restart the economy and that's the marketplace itself. All Obama's stimulus packages will actually do is artificially inflate the economy thereby delaying the market from doing what it has to do, what it will eventually do.

In my humble opinion, it would be much better to have whatever authority that had the power to tax individual labor as profit in the first place, to now cease and desist from doing so.

I have recently read somewhere that for every dollar cut in government income, five dollars will be gained in the GDP over five years. Of course, state budgets would initially take a hit, what with their wildly inflated union wages and pension plans and the like, and in those cases the states could increase taxes at the local level, if voters approved. But I firmly believe, if the government allowed consumers to keep more of their hard earned money in their own pockets, the economy will pick up in the shortest amount of time. And who knows, we my even get rid of some wasteful government programs in the process.

After all, it was the government which caused this recession, it is only fair the government pay the price for fixing it, not the taxpayer.

ex animo

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davidfarrar

 

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Let's look at this another

Submitted by In between on Thu, 01/22/2009 - 09:28.

Let's look at this another way.

1. This is not only a recession but you also have a financial crisis around the world. They are trying to fix the crisis with putting more money into the system. What is the right way, I do not know. What we do know is that they are fighting an "uncontrollable downward spiral." 

2. Your tax cuts that you got from Bush for 8 years was borrowed money from other countries and that is one reason you have deficits and debt. You cannot have tax cuts, a war, and not cut spending. So as we have gone into the recession Bush has already racked up a 500 billion dollar yearly deficit and has added 4 trillion dollars of debt . 

3. We did not have to go to war in Iraq. That war is draining at least 10 billion dollars out of the economy every month. We also have a military stretched thin.

4. The democrats, the republicans, and Alan Greenspan falsely targeted the housing industry to stimulate the economy, when our real worries is globalization. Now we have an excess of housing.

5. We have done nothing in globalization. We cannot compete with third world countries. The factories are closing down, cities and states are going broke, people losing jobs, pressure on wages, healthcare coverage, and loss of pensions. Without jobs you cannot solve any problems in this country, as you need the tax base. You will need to compete with other countries in the form of keeping up with our infrastructure, energy independence, mandatory vocational training, embryonic stem cell research, science, innovation, and research and development. We may need alliances with government and corporations to build a battery that will go 100+miles to a charge. China already has a car that will go 63 miles to a charge. We have 700,000 patents backlogged. 

In any case, Bush has not prepared our country for the future. He has spent all the money on tax cuts and a war creating deficits and debt. He has not invested in our infrastructure and the sciences in the future. And when you talk about the private economy, the factories are closing down due to China and other countries. In the private economy, the goods are becoming more Chinese. So all the tax cuts and all the stimulus will not fix globalization. We have to invest in the future and that has not been done.

So Bush has left us with deficits and debt, the middle class is losing jobs, factories are closing permanently, our money is going to Iraq, you have a banking crisis, and cities and states are going broke. 

A lot of us saw this years ago, and we kept wondering when Bush was going to fix anything and he never did. This is what the anger was about. And while I am on the subject. Bush is a social conservative and practiced laissez-faire. So the problems piled up as we awaited for Jesus to fix things and it never happened. The republicans abandoned the middle class and we are where we are. 

Hedge funds broke the fucking system.

Submitted by RisingTide on Thu, 01/22/2009 - 10:11.

they ARE the market, and the market went bad.

Surely you won't say that after bankrupting Home Depot, it was a GOOD idea for the CEO class to vote the man into managing one of the Big 3?

Corruption is everywhere in the system, and if you trust the computers in the back to fix our economy... well, even I"M not that much of a technocrat. Nobody knows what their company is invested in... only the computers know. And the computers make mistakes (black monday ring a bell?)

How nice it would be if you could cite even one credible

Submitted by NextRightNando on Thu, 01/22/2009 - 11:14.

source for your fist line.

No less an authority than FDR's Treasury secretary

Submitted by davidfarrar on Thu, 01/22/2009 - 12:04.

...and close friend, Henry Morganthau, conceded this very fact to Congressional Democrats in May 1939: "We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong ... somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises ... I say after eight years of this Administration we have just as much unemployment as when we started ... And an enormous debt to boot!"

FDR's market-suffocating policies is what put the "Great" in "Great Depression."

 ex animo

colbert

davidfarrar

How unfortunate for your argument that he was demonstrably wrong

Submitted by NextRightNando on Thu, 01/22/2009 - 12:15.

How unfortunate for your argument that he was demonstrably wrong.

Here is an overview of unemployment rates 1920 - 1940. Recall that The Crash happened in 1929; FDR took office in March, 1932. Then what happened? The unemployment rate started dropping.

Year Rate
1920 5.2 %
1928 4.2
1930 8.7
1932 23.6
1934 21.7
1936 16.9
1938 19.0
1940 14.6

 

The Great Depression didn't actually end...

Submitted by davidfarrar on Thu, 01/22/2009 - 12:43.

 ...until 1956 or so, when the stock market finally reached and surpassed it pre-depression levels.

I think the old adage applies here: "Figures don't lie, but liars figure."   I would strongly suspect WWII had a little something to do with the employment figures to which you have so generously supplied.

But, frankly, between the two of us, I think Mr. Morgenthau would be recognized as the qualified expert on this point; don't you?

ex animo

bike

davidfarrar

So many things wrong with such a short comment

Submitted by NextRightNando on Thu, 01/22/2009 - 12:52.

So many errors in what you just wrote. Taking them roughly in order:

1) The stock market is not the real economy.

2) GDP recovered to pre-crash levels in 1940.

Year       Nominal GDP ($B)

1929 $103.6
1930 $91.2
1931 $76.5
1932 $58.7
1933 $56.4
1934 $66.0
1935 $73.3
1936 $83.8
1937 $91.9
1938 $86.1
1939 $92.2
1940 $101.4
1941 $126.7
1942 $161.9
1943 $198.6
1944

$219.

3) You accuse me of being a liar becasue I use facts to refute your vague, unsourced opinons. The only polite things I can say about that is: you are wrong.

4) I never said or implied that WWII did not play a role in ending the Great Depression.

5) WWII does NOT account for the drop in unemployment and the rise in GDP from 1932 to 1939. That is down to FDR.

 

You are not using facts, sir...

Submitted by davidfarrar on Thu, 01/22/2009 - 14:07.

...you are using your interpretation of the facts. And while the stock market is not the real economy, it is a reflection of the real economy, one of the few we have here during this time period unaffected by WWII, its buildup, execution and aftermath.

 The GDP, did respond to defense spending and the production of massive amounts of defense related production. Again,  you are trying to manipulate the facts to support your view.

Rather than rely on your interpretation of the facts of this period, or even mine for that matter, I suggest we rely on Mr. Morgenthau's interpretation. He is the qualified expert witness here, not you, me or RaisingTide.

ex animo

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davidfarrar

 

rely on Krugman or Bernanke

Submitted by RisingTide on Thu, 01/22/2009 - 14:23.

they've got the perspective of fifty years of research. And they're both firm keynesians, who would say that wwII worked better than the new deal because it involved a level of gov't expenditure unmatched by anything before or since (save perhaps the civil war?).

GDP is a much better measure of the economy than the stock market. PARTICULARLY when the indices diverge, as your and my research together shows. When everything dovetails together, then yeah, it is a decent indicator of a recession -- at least the beginning of one. However, how much of a recession did we get after the dotcom boom? Are we still in a recession because the QQQ ain't up to where it was beforehand? Naturally not.

Your argument suggests that the Bush years were a perpetual recession. Will you stand on your argument, or bother to address some of the other points that I've made (in other posts here, say, my post on hedge funds)

You too are welcome to your own interpretations...

Submitted by davidfarrar on Thu, 01/22/2009 - 15:04.

...as well as your distasteful prose. But that doesn't mean I have to respond to them.

It always amazes me how quickly liberals are willing to ignore qualified testimony when it doesn't agree with their own unqualified interpretations.

I think I'll stick with Henry Morgenthau's interpretation of the facts and not yours.

I did fail to mention that not only will Obama's stimulus package delay the market's recovery, it will also lead to further devaluation of the dollar and to a greater degree than cutting government spending to stimulate the market.

ex animo

davidfarrar

I agree it will cause inflation.

Submitted by RisingTide on Thu, 01/22/2009 - 15:21.

inflation won't kill us. deflation destroys governments.

why do you not want to listen to America's greatest expert on the Great Depression?

That rhetoric only works when you can cut the caller off.

Submitted by NextRightNando on Thu, 01/22/2009 - 16:34.

That is some fine talk show host rhetoric you've got there - but unfortunately for you, it only works when you can cut the caller off.

You are not using facts, you are using your interpretation of the facts. 

To say that unemployment declined from 1932 to 1940 is not an "interpretation of the facts" - to say that 14.6  is lower 23.6 is to state an observable fact.

And while the stock market is not the real economy, it is a reflection of the real economy, one of the few we have here during this time period unaffected by WWII, its buildup, execution and aftermath.

If the stock market is a reflection of the real economy, then could it possiblly be unaffected by the economic inpact of WWII?

But more importantly, why use the reflection when instead you can look at the real picture - like GDP? Why is your method - which is not used by practicing economists - the superior one? Other than the fact that it conveniently fits your crackpot theory.

The GDP, did respond to defense spending and the production of massive amounts of defense related production. Again,  you are trying to manipulate the facts to support your view.

How can you defend this "interpretation of the facts"? Are you saying the increase in GDP in '34 onward was do to WWII build-up? That is absurd on its face. But, just to demonstrate that is it is rubbish: Have a look at the the figures for US defense spending as a % of GDP (also using this link)  It is obvious that the WWII ramp up did not start untill, you know, WWII.

  • 1929: 1.4%
  • 1930: 1.7%
  • 1931: 1.7%
  • 1932: 1.7%
  • 1933: 1.4%
  • 1934: 1.1%
  • 1935: 1.9%
  • 1936: 2.7%
  • 1937: 2.2%
  • 1938: 1.7%
  • 1939: 1.9%
  • 1940: 1.7%
  • 1941: 5.6%
  • 1942: 17.8%
  • 1943: 37%
  • 1944: 38.8%

NB, there is a very good graphic of this on page 3 of this PDF.

Rather than rely on your interpretation of the facts of this period, or even mine for that matter, I suggest we rely on Mr. Morgenthau's interpretation. He is the qualified expert witness here, not you, me or RaisingTide.

Why is he a more qualified expert witness than, say, his boss, FDR? If he was so certain that FDR's policies were a disaster, why did he stay in the cabinet until 1945? Afterall, staying on meant his job was to finance these policies that you say he said were such a disaster.

Lets return to the beginning - you say he said that after 8 years the FDR administration had not made any progress. But the numbers so that unemployment rate had been reduced from 23.6% to 14.6%, and GDP had increased from $58.7B to $101.4B, with roughly the same defense budget.

So, what is more credible - this random "quote", from a man WHO REMAINED IN THE ADMINISTRATION, to the actual facts??

 

the fuck? standard and poors recovered within 10 years

Submitted by RisingTide on Thu, 01/22/2009 - 13:03.

of the crash. IT MEASURES THE LARGER MARKET.

The Dow Jones, which is what you are referring to, is a much, much smaller market segment, much more prone to market manipulation.

Further evidence Obama's stimulus package won't work comes...

Submitted by davidfarrar on Thu, 01/22/2009 - 18:17.

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 ...from the Congressional Budget Office. 

Congress wants to stimulate the economy by spending $30 billion on road repair and construction, but the CBO reports that . . .

* Less than $4 billion would enter the economy before 2010

* And less than $15 billion would be spent before 2013

If past recessions are any guide, an economic recovery could begin, naturally, by the end of this year. This means that most of the spending proposed in the so-called stimulus package will come too late to serve its supposed purpose.

* Only 7% will be spent by the end of the current budget year

* Only one out of every seven dollars intended for energy projects will be spent in the next year and a half.

* Only a quarter of the proposed clean water projects can be completed by October of next year

* Projects to provide broadband Internet to rural areas can't begin for years

Remember what President Obama's Chief of Staff, Rahm Emmanuel, said: "You never want a serious crisis to go to waste."

The only thing the stimulus package will do for the economy now is make it harder for the economy to undertake its natural recovery, further deflate the dollar, create enormous debit, but most importantly of all, give Democratic lawmakers a ready-made excuse to spend our children's future in order to stay in office past the 2010 Congressional elections.

ex animo

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davidfarar

 

 

 

<<a natural economy?>> Now

Submitted by In between on Thu, 01/22/2009 - 19:12.

<<a natural economy?>>

Now how does that work out when we have a financial crisis, besides a recession. How does that work out when we send our jobs overseas, the stores are full of Chinese goods, and our money is going to Iraq.

Whatever, Obama proposes is probably long tern. Whatever I proposed is long term. It takes 10, 20, or more years to get a return on science. We should have done a lot of things during the last 8 years and they were not done. We have to make up for those lost 8 years and we will only benefit many years later. You have talked about how long things will take to work, but Bush never had anything done.

You talk of the low dollar and Bush glorified the low dollar. And you talk about the children's future. Seemed like the republicans were not concerned when Bush was running up deficits and debt.

Really amazing, how you will put down something, and we already know the last 8 years have been a disaster.

This is no ordinary recession. There are 8 years of neglect and also a financial crisis. It will take time to recover. Heck, just dealing with the Bush deficits and debt will take 20 years to fix.

I think your timing is off

Submitted by davidfarrar on Thu, 01/22/2009 - 20:42.

Obama's stimulus package is --or was designed to put people back to work, pronto!  But now that we see the real spending doesn't start until just before the 2010 Congressional elections -- so much for Obama's concern for the working class -- we have time to pause and carefully consider this stimulus proposal. The future of this country depends on getting it right.

In recognition of this fact,  I have a solution as to how we can all arrive at the right decision. It's a simple solution really. Since liberals believe individual labor should be taxed as profit, and since, obviously, government spending under a Democratic administration is set to spiral out of control; let's adopt the solution another Democratic administration adopted to pay down its deficit spending after WWII. Let's have Pres. Obama and Congress take their stimulus proposal to the American people through a massive "Buy Bonds for America" program to pay for his stimulus program.

You know, it would be great, Hollywood could sink its teeth into it.  The President can put his reputation behind the effort. All you liberals can get behind the effort, put your money where your mouth is (not somebody else's money) and roar out your souls to buy bonds. I am sure Congress would act responsively and never, ever think of using this hard-earned bond revenue for their own re-election purposes.  Okay? That's it.

Pres. Obama can use all the money he and his leadership can generate through the selling of "Buy Bonds for America" program and do whatever his liberal heart desires.

We both agree, we got the time. Obama's stimulus package isn't going to put millions to work anytime soon. We have two whole years to sell bonds while the economy goes through it natural readjustments, finds markets the Chinese, with they growing middle-class economy, will want to import from us, find our offshore oil and buy back our future for our kids through the buying of government bonds. 

Oh, I forgot...you want figures: Just to pay off our present debit, every man, woman and child in the United States will have to buy approximately $200,000 worth of bonds, that's before Obama's stimulus extravaganza hits the books.

ex animo

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davidfarrar 

 

Animations

Submitted by NextRightNando on Thu, 01/22/2009 - 20:51.

and all bold type are a poor substitute for facts and reasoning.

And this...

Submitted by Paleo-Skeptic on Thu, 01/22/2009 - 20:55.

... must really mean a lot coming from the expert of poor substitutes for facts and reasoning. 

Look, I'll explain this to you again

Submitted by davidfarrar on Fri, 01/23/2009 - 09:19.

Politicians can always inflate unemployment figures and the GDP by pumping (deficit) funds into a struggling economy and then go around patting themselves on their backs, saying, "Oh, what good boys are we."  But all they are really doing is delaying the market from making its necessary adjustments in order to sustain real economic growth.

If you want to ease the pain of market adjustments during a recession, and you have the money, fine. But if you don't have the money and you engage in deficit spending, you best remember, everything has a cost. The dollar will be devalued, food prices will go up.

What we need to do is cut government spending, big time, which will keep real money in the pockets of consumers. Only the consumer has the power to create real market growth and sustainability.

Now, where are my gifs:

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ex animo

click here

davidfarrar 

 

 

 

Well, I guess you can throw

Submitted by In between on Fri, 01/23/2009 - 09:36.

Well, I guess you can throw people out on the street. While I believe in cutting spending, it would be hard just to cut 100 billion dollars a year.

We can't cut the interest on the debt. Defense spending is 613 billion dollars a year. Maybe we can cut 50 billion out of that. Social Security, Medicare, and Medicaid was 1.3 trillion dollars. So all have to be looked at. Now our government is way behind in infrastructure and other spending that has not been done in years, so we will have to add a couple hundred billion for that. So you are back to where you are started. So I see no savings. But then you want to cut more, so I don't know.

Now the question is what are people going to buy? Chinese goods? Housing, as their jobs go overseas? Cars, as Japan has taken more of the market share? I mean we have some real problems. 

I didn't mean to imply...

Submitted by davidfarrar on Fri, 01/23/2009 - 10:29.

three heads

...we shouldn't use deficit spending to mitigate the affects of the recession. I was simply pointing out we can't "spend" our way out of a recession. If we actually wanted to recover from this recession in the shortest amount of time, significant government spending would have to be undertaken as well.

You will notice here, nobody is talking about cutting government spending here to any significant degree.

Nevertheless, I think the only way to eventually free ourselves from the growing tyranny of government is to limit its income. We should reduce personal income taxes on labor as a means to limit government growth gradually until we are finally free of it altogether.

ex animo

lemmings

davidfarrar

 

 Well, personal income taxes

Submitted by In between on Fri, 01/23/2009 - 10:57.

 Well, personal income taxes have been reduced for the past 8 years.

The old rate was 15, 28,31,36, and 39.6%

The New rate has been 10, 15, 25, and 33%

So during this time the debt has gone from 5.6 trillion dollars to over 10 trillion dollars and this years deficit is close to 500 billion dollars in which we had a surplus in the year 2000. 

So we have done what you have said. Now what?

 

And to recover from not only a recession, but a financial crisis, all the experts on CNBC have said the government has to flood the economy with some sort of stimulus. And they site Japan, because they only did it half heartedly. At present we have an "uncontrollable downward spiral." And no one (the experts) has an answer.

I have an answer. Are you with me, brother?

Submitted by davidfarrar on Fri, 01/23/2009 - 22:55.

April 15, 2009, is just around the corner. Pres. Obama could wave his magic executive pen and sign an executive order stopping the IRS from taxing individual labor as profit. This act alone would directly keep 1.1-trillion dollars in the economy, directly into the pockets of the consumers.

Let's go for it, bro!

And not just that, let's extend that tax free holiday on personal labor for the next five years. Just think of it, while the economy picked up speed, government spending was reduced to it bear essentials. God help us, but I think I am on to something here.

ex animo

acedance

davidfarrar

 

So far, I do not see this as

Submitted by In between on Fri, 01/23/2009 - 22:58.

So far, I do not see this as an acceptable answer. We have been through the tax cut, deficit and debt game for 8 years. Our jobs are going overseas, so no one has addressed globalization, which is one of the biggest challenges we face. The republicans have left the middle class, and they still have no answers.  

The American marketplace, dear boy, can and will address...

Submitted by davidfarrar on Fri, 01/23/2009 - 23:20.

...your anxiety over globalization. The American marketplace cannot expect to exist in a vacuum. If it can't compete in the global marketplace, it can't compete anywhere. But I am not ready to write off one of the most powerful forces present in today's marketplace. It will adjust and survive. But our present task is to get it going again, quickly. Massive tax cuts for the working class, deep cuts in government spending will revive the economy. Heck, it's going to recover anyway by year's end if we don't do anything stupid like blow a trillion dollars we don't have on the wrong thing.

 exanimo

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davidfarrar

Same o, same o. Bush talks of

Submitted by In between on Fri, 01/23/2009 - 23:30.

Same o, same o. Bush talks of free trade and the factories close up. We have done nothing on globalization. And I am not talking of protectionism. I am talking of infrastructural spending, energy independence and creating jobs, mandatory vocational training as we lose the factories, embryonic stem cell research as Bush had vetoed the funding and Singapore is supporting it, science, innovation, and all the research and development you can have. Also there is a backlog of 700,000 patents. I suspect some sort of alliances with government and industry to create a battery that will run on a 100+ miles on a charge. China already has a car that will go 63 miles to a charge. We are way behind in science, time, and money. The last 8 years have been a disaster and a waste of time.

We cannot compete with third world wages. The factories are closing, people losing jobs, wages, healthcare coverage, and pensions. Cities and states are going broke. And this is the reason why the republicans lost the election. They turn a blind eye to the issues and problems. To the republicans it has been tax cuts and laissez-faire. Now, can we get back to work instead of playing political and ideological games?

And you think Obama is going to address your issues?

Submitted by davidfarrar on Fri, 01/23/2009 - 23:51.

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Come on, get serious. If anyone is going to save this economy it will be fiscal conservatism, not socialism, for God sake.

I mean, you cannot be serious.

ex animo

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davidfarrar

 

Well, we know Bush didn't do

Submitted by In between on Fri, 01/23/2009 - 23:57.

Well, we know Bush didn't do anything. I have no idea what Obama is going to do, but we have seen the republican failure. 

Yes, we do know that.

Submitted by davidfarrar on Sat, 01/24/2009 - 09:14.

We also know Bush was never a fiscal conservative, and neither is Obama. But, hey! If that's what you believe, go for it. I just wouldn't hold my breath on it though.

ex animo

davidfarrar

Well, we are in this

Submitted by In between on Sat, 01/24/2009 - 11:09.

Well, we are in this situation where Bush borrowed for tax cuts for 8 years and we are back into a recession. Bush has borrowed for his war and never cut spending. So we have deficits and debt. The tax cuts were for the here and now and nothing done for the future. The war is draining the economy of at least 10 billion dollars a month. We have a housing mess, falsely targeted when we have globalization problems. The factories are closing, people are losing jobs, wages, healthcare coverage, and pensions. Cities and states are going broke. The infrastructure in neglect. And then you have a financial crisis. 

So we are where we are. More tax cuts after 8 years of tax cuts plus a stimulus does not solve the problem when people lose jobs to globalization. The fed has lowered interest rates to their lowest levels. So you cannot stimulate any more. It is overdone and ineffective. So the government (as many economists agree) is the last resort. We are seeing mismanagement by Paulson, and that is one problem among many. But no one can agree exactly which way to go with the financial crisis. 

In any case, this is the worst mess in our lifetimes.

 

Government spending has been

Submitted by In between on Thu, 01/22/2009 - 20:58.

Government spending has been out of control for some time. But at least Clinton and Gingrich was on the right track. They had a surplus and were just beginning to pay down on the debt. You will have to put your money where your mouth is, because the biggest republican spender just left the White House. Buying Bonds? Bush should have had that to pay for the war.

Okay, I have tried to stay away from this cliché...

Submitted by davidfarrar on Thu, 01/22/2009 - 22:18.

 ...but I am only human so here goes: Two wrongs don't make a right.

It's true, the eight years of the Bush administration was an economic disaster. While I say the Iraq war was necessary under any pretense, and history will vindicate Bush for its cost, his bailout of Wall Street was inexcusable.

As I am sure you are aware, the grassroots of the party, a large percentage of independents and a good proportion of Democrats all told our leadership not to bailout Wall Street with our money. They didn't listen. Obama didn't listen. But somebody at some point will have to listen to the people. We have got to cut government spending while keeping more money in the pockets of the taxpayer. I think somebody suggested a three-month tax free holiday. Hell, April 15, 2009, is just around the corner, let's go with one full year tax free, 2008. What about it?

Use the stimulus money to deal with the shortfalls, but when that money runs out, start eliminating government programs where possible, reducing others by the needed percentage points in order to rid ourselves of the deficit and grow the economy at the same time.

Look, this is important stuff.  The future of our country depends on our leaders making the right decision here. It is far too important to simply throw it all into the hands of a few politicians who have their own agendas, agendas that may not be in the best interest of this country or its people. Let's take some time here to get it right, our future is at stake.

If Obama was true to his word, he should be the first to hold things up here and build a consensus around the right thing to do. Instead, he is pushing his agenda ahead before people can seriously question it. You know, that is exactly how they handled the Wall Street bailout debacle. Is that really change? Obama isn't change. He is the same old, same old, politics as usual. 

 ex animo

 

 

 

 

davidfarrar

Well, it is serious. And

Submitted by In between on Thu, 01/22/2009 - 22:45.

Well, it is serious. And Obama is painted in a corner. There are so many things going wrong, it will take a miracle to get out of. I agree government spending needs to be cut, but just the same as you can't raise taxes when the economy is down, it will be most difficult to cut spending when the economy is down. Obama has said he will look into the programs and either cut or readjust them, as I believe he understands the issues.

A tax holiday would mean more in deficits unless you cut spending somewhere. And I don't know what a tax holiday is supposed to do. I guess to put more money into the hands of people. But we run into the same problem as the last 8 years. And that is tax cuts does not solve problems. All issues have to be worked on. And that is to cut spending, putting the proper works programs in place, more in science and education to compete with globalization. The other side of the equation is you are losing a tax base. Unemployment is going up, cities and states are going broke as factories close. I don't know of anything that will replace those jobs. And that is why you need more science, etc. But that takes time, we are short on time and money.

You say keeping more money in the pockets of the taxpayer. And we have done that for 8 years. So now what? What good is a tax cut if you lose your job? And if not that, then it is the wage pressure, loss of healthcare coverage, and loss of pensions. And who is going to produce 2-4 million jobs? What product can be made?