Symbolic Blather: Washington's Congenital Disease

This Congress potentially could be the most productive in over forty years. It has passed the largest recovery plan in the nation's history. It extended health care to millions of children. It passed Obama's first budget with its significant down payment on education and energy. The House just passed the comprehensive energy bill. Health care reform and the most extensive financial reform since the New Deal are next up.

Yet this same Congress will take the time to debate legislation that might best be considered symbolic blather. Its only effect is symbolic and the symbolism is loony.

The best example of this is the bill championed by Blue Dogs in the House and Senate -- the conservative Democrats that the media labels "moderates" -- called PAYGO. Paygo is the Washington shorthand for a rule that requires the Congress to pay for any expansion of entitlements (guaranteed benefits like Social Security Medicare) or decrease in taxes. It's supposed to "discipline" the Congress on spending. Although discretionary spending -- the appropriations that Congress approves annually for the running of the government -- is not covered, the rule is designed to put significant pressure on Congress to limit spending.

Now House Blue Dogs are pushing to pass this self-imposed rule into legislation. At a time of unprecedented deficits, they want to parade their righteous commitment to cutting spending and balancing the budget. Since Democrats have already imposed paygo rules on their actions in the House and Senate, the legislation is purely symbolic. And the symbolism is utter blather.

For one thing, Blue Dogs are the first to line up to vote for massive spending on wars and adventure abroad, all of which is exempt from paygo rules. Thus Bush's three trillion dollar war in Iraq would not have violated paygo, nor does the special supplemental to fund the continuing war in Iraq and the escalating one in Afghanistan.

Beyond that, the message sent by the bill is wrong headed. In the short term, it puts an emphasis on cutting spending and balancing the budget. But we're in the midst of fighting the worst economic collapse since the Great Depression. In these conditions, with consumers and businesses cutting back, workers getting laid off, families losing their homes, the federal government must step in to boost the economy. Deficit spending is essential, not evil. In fact, as unemployment heads to double digits, states and localities face staggering cutbacks, banks aren't lending, businesses are cutting capacity not expanding it -- we will need to borrow more money to spend on a second stimulus plan. (as Paul Krugman among others argues) Paygo heads exactly in the wrong direction.

In the long term, paygo puts the focus on controlling "entitlement" costs. But virtually the entire long term structural deficit problem comes from projected soaring health care costs. We don't have an entitlement problem; we have to get health care costs under control. Ironically, the same Blue Dogs like Sen. Max Baucus that champion paygo are the ones doing the most to weaken the public option in health care reform, which will do the most to control costs by offering a choice to private insurance.

Paygo also is translated into the need to cut spending and limit tax cuts to balance the budget. In fact, as Clinton's experience showed, the way to balance the budget is to get the economy going. Without growth, budget deficits will increase and should do so.

Washington's dirty little secret is that we need more investment, not less. We're running a debilitating public investment deficit -- failing to invest adequately in areas vital to our future from modern infrastructure to research and development to new energy and education. In the new economy emerging out of the calamity, we need progressive tax reform with the wealthy paying far more in taxes than they do now, and increased public investment.

Finally, as economist Dean Baker argues, paygo is an atavistic throwback to the conservative economics that led us off the cliff. Growth, we were taught, comes from balancing the budget, sustaining a high dollar, deregulating banking, adhering to corporate trade policies, and ignoring the inequality and loss of good manufacturing jobs that resulted. That didn't work out so well. One would have thought that even the Blue Dogs understood that.

This week, progressive legislators will try to figure out where they stand on this lemon. At the very least, they should demand something sensible as a price for holding their noses as the symbolic blather passes. They could demand an investment bank or a capital account in the budget. Either would put the US in the same position as a family or state and local governments, financing investments in buildings or homes or education or research and development rather than budgeting their entire costs in the first year.

Speaker Pelosi supports paygo as a way of keeping the Blue Dogs as least partially on the leash. The question is why do the Blue Dogs so stridently demand it? It's like an ideological tic. They don't seem to understand how deep a hole we are in nor have a clue about how to get out. They simply want to croon the old ditties of a bygone and tawdry age.

Comments

[Kilroy-wuz-here]

Truth of the matter is, both the Republican leaders in Washington, as well as the Democrats, are a bunch of greedy good-for-nothings who will only look out for their own best interest. What is desparately needed in 2010 is a third party revolt.

I challenge everyone who is fed up with the party they currently support to check out the Libertarian party. Help bring some sanity to Washington.

[Mike Barden]

Do ya gotta be Christian?

[DSimpson]

What does that mean?

[norgotoad]

Yeah, become a UBER Republican!! That's the ticket!

[Kilroy-wuz-here]

I am a little at odds here. On the one hand, I can agree that government spending, during SEVERE economic decline, is absolutely necessary to "stop the downward spiral" while on the other hand, I see real danger from the Fiat currency known as the US Dollar becoming too weak to turn the economy upward.

Since Nixon completed the process of decoupling the dollar from the gold standard, we have seen the money supply grow at an astounding rate. But what is it that "supports" the dollar? The "full faith and credit of the US government".

We see our friends in the Middle East and China (I use the term friends loosely) having second thought's about that "full faith and credit" thing. To be perfectly honest, at the rate Americans are buying gold, it's not just our "friends" who are seeing cracks in the armour.

I'm afraid that the determination that certian corporations are "too big to fail" has helped to ensure that we are on an unsustainable path. The more government spends to stop the downward slide of the economy, the more it reinforces the opinion that the dollar isn't safe as an investment vehicle.

What the Blue Dogs are trying to pull is a political hat trick to show conservative and moderate Democrats in their home districts that they are trying to help "reign in Washington" as they know that by 2010, they will be fighting for their political lives.

[elkabong]

The dollar is not in any immediate danger as evinced by a willingness to continue to buy our debt and the fact that gold has dropped $80 in the past month.

Tax the rich and we could be out of this mess sooner than you think.

[bighat]

Let us just go after the rich. They do not deserve money. They must have cheated someone or they would not be rich. How about Huey P Long tactics. No one needs to make more than a million/yr. No one needs to inheriti more than 5 million.

We could eliminate ownership of business and set wages so everyone is equal from the janitor and the president make the same money. we could all finally be equal.

[Mike Barden]

are they the ones that won that contest for ugliest dog?

[elkabong]

At end of WWII the maximum tax rate was 94% on incomes over $200k per year - about $6,000,000 today (It has steadily dropped since). When they speak of "The Greatest Generation," they rarely, if ever, mention this fact. Does anyone think that our current circumstances are any less dire?

Ronald Reagan convinced too many that once a billionaire filled his fifth onshore bank account and his sixth offshore, that a tax cut would make him wake up one day and declare, "Gee, I think I'll go out and create some jobs today!" The ONLY thing that creates jobs is DEMAND for goods and services. There can be no American demand when jobs are shipped overseas and wages are driven down to third world levels; when we lag the rest of the world in health-care and education.

Patriotism would be best demonstrated by a willingness to invest in our future - not wearing a lapel-pin made in
China.

[laxdan]

Elkabong -- I totally agree with your statement that "the only thing that creates jobs is demand". Maybe 30 years ago, if some wealthy person was given a tax reduction, then he would have to invest it here in this country. But today, more growth is in Asia and India, so most investment dollars go to those places and to their workers.

[DSimpson]

Demand for goods and services DOES NOT create jobs. It is fulfilling that demand by entreprenuers (risk-takers) when building businesses that create jobs. What you forget is the risk. In order to accept and take on the challenge of risk (some risk-takers lose their shirts), investors need to compensated for their risk. When taxes are too high, investors don't take risks in the United States. Why should they? They just move their businesses or capital to other countries where the returns will be greater. That's the great thing about this country. That's exactly why you as a taxpayer and our government own General Motors. Private investors weren't willing to accept the risks of a failing company.

[elkabong]

What you forget is that America needs to be compensated for the infrastructure which provides the conditions for wealth creation. What you forget (or never knew) is that most corporations pay an effective tax rate of 4% (if they pay anything) and use far more of our infrastructure than they pay for.

I say if you want to do business in America, you need to pay for it. If you want to take your business to India, fine - sell your crap to the Indians.

[Trublulu]

No matter what tax incentives are available in this country, most of these patriotic private investors care about only one thing.....­..profit! And if they can pay children and old ladies $2/day with no health care coverage or Workman's Comp, they are going to outsource everything overseas and to Hell with this country. That's the big problem. Trouble is, when there are no longer any jobs for American's in this country, who is going to buy this cheap foreign crap?

[MJinCanada]

Fanned!

[bighat]

Are you under the impression that everyone who make more than 200k paid 94% income tax?

Have you considered the possibility that congresses of old used taxes to force the wealthy to invest in certain sectors (as devised by congress) in order to keep their money as opposed to the govt using tax money as investment in these sectors? Could it be that earlier congresses thought private business was more efficient than govt when it came to these certain sectors so they created a way for business to make america better and keep their money as opposed to the way we are doing things today?

[elkabong]

No. I'm saying that income over 200k was taxed at 94%. Don't believe me? Look it up.

[UberReaganite]

In the 50s if you didn't act straight, white, and religious the extremist right wing of American politics labled you as a dirty Commie. It was called McCarthyism.

These McCarthyists ruined many peoples lives for no reason at all and used these Communist scare tactics to push through very bad, self-serving decisions in Congress virtually unopposed.

I keep hearing the present day right wing social conservative troglodytes use the term "Socialist" when referring to any idea which differs from the current idiotic and incompetent mindest in Congress. After 28 years of irresponsible and incompetent American leadership the right wing Republican crazies have proven only that they believe in...
1. Screw the poor, give tax breaks to the wealthiest Americans only.
2. Allow the rich to circumvent American taxation, revenue and fnacial practice laws at will.
3. Spend Spend Spend and run your nation into debt with NOTHING to show for it
4. Do absolutely nothing to fix medicare, medicaid, Social Security, immigration, and fiscal responsibility.
5. Prop up failed and incompetent American business' over and over again at great expense to the nation and with no accountability of corporate leadership.

The results of these beliefs? Well worldwide recession and a nation in debt up to its ass for the next millenium. Did I miss anything? What else did they accomplish that is worth mentioning?

So, if I DONT believe in those things that makes me a.....SOCI­ALIST?

Well then better a Socialist than another worthless, incompetent Republican or Democrat.

[A4D2N]

Another "better Red than dead" scenario!

[57basque]

Thye are in the process of watering down health care nd the energy bill. Unless they find a way to cover everyone by expending mediacare and sytems like Masshealth here in Mass they are wasting our time. The same goes for their energy bill which will not bring the co2 down to 350 parts per million it has to be at. Its at about 385 now so it can get fixed, but under what they did it will go up to 450 parts per million.

If we do not switch at least 50% of our GUNS AND BOMBS Budget over to building the Electric Car we can plug into our Solar Powered Roofs we will be spinning our wheels go no where. All that would put Generations to work on something useful which will produce Peace.

And one more thing: why did not anyone in DC speak out against the Kidnapping of the Spirit of Humanity by Israel when all it was doing was bring toys for kids and much needed medicine to Gaza? America's support of Israel is the cause of terrorism! Clearly Israel and others are living a lie for Israel killed their last king 2000 years ago.

[Mike Barden]

but he's comin' back so's you bettr beware or there won't be anything under your tree.

[57basque]

He is coming back in the flesh as he came before. Everyone would call him nuts as they would call Michael of Daniel 12 who is the child of Revelation 12, Isaiah 9:6 and the leader who will be one of them in Jeremiah30:21-24 and Jer, 23 with a huge rebuke of the leaders of the Church Today. We could have that big party of Isaiah 25 if we could thrown all the kings in jail and use the profits for those who stand for peace as both Isaiah 21:17-18 and 24:21-21-24 talks about. None of that is the bs being spread around by the wingnuts on the right. they all exspect superman to come flying out of the sky while the TV is the clouds of heaven quoted by the Lamb by Daniel 7 .

[WTFitzgerald]

Yes to progressive taxation called for here but it needs a big rethink. Just because someone has wealth and income does not mean that they did not earn it and deserve to keep it. It is now time to reintroduce the concept of earned versus unearned income and demand shift of taxes from earned incomes to unearned incomes. This would be real progressive taxation because the source of unearned incomes is disproportionately in the hands of wealthy individuals and corporations.

Incomes from labor and use and investment in real capital, i.e. the tools of production, are earned. Most taxation falls on these productive factors. Incomes from ownership of land and natural resources are wholly unearned because the value of land and natural resources is created by and only by society as a whole through the need of every individual in society for access to land for every purpose. Very little taxation falls directly on land value or unearned incomes from land.

Failure to tax unearned incomes forces taxation of earned incomes to the absolute detriment of any society that does so. Taxing land value and incomes from mere ownership of land does not penalize anything anyone does. Is that not obvious? For example, because land is not capital we could completely eliminate the capital gains tax by increasing tax on land and land values thereby taxing corporations and the wealthy without injustice of disincentive (except for land speculation) thus satisfying demands of both left and right.

[eichler1]

Just because someone has wealth and income, that does not mean the person "deserves" it or is entitled to keep it. A person attains wealth through the efforts of him- or herself, but also of others. In fact, all of us taxpayers contribute to a system by which the wealthy person attains and keeps wealth. Thus, the greater public should benefit from a portion of the wealth created, even if created "privately­." The idea that some individual who happened to get rich "deserves" to "keep" all that money is a right-wing shibboleth and should be deep-sixed immediately.

[bobwalters]

Some good ideas here, but a disproportionate share of the wealth and income of the wealthy comes from "investments" and is passive rather than productive. A more equitable and progressive tax policy would treat all income the same, regardless of source, with a top tax rate of 75 - 80%. Capital gains taxes should be retained, and boosted to 35 - 45%; inheritance tax should be raised to 85 - 90% for estates over $5 million. Exemptions­/deduction­s should be phased out beginning at incomes of $250K individual/$500K couple filing jointly, with exception of exemptions­/deduction­s for investments in productive infrastructure (which creates jobs) and limited exceptions for investments in education. A transaction tax of 0.01 - 0.05% on stocks, bonds, other financial instruments, and commodities should be added. Domestic assets of any corporation that moves its production or services overseas should be expropriated to the Treasury for compensation to workers who lose their jobs, and those corporations' products/services re-imported to the US should carry a tariff of at least 50% - 95%, depending upon the impact of their move on employment. It's time to eliminate the privileges of the rentier class altogether. Rethuglicans are always braying about the US being a "classless" society, so they shouldn't object if tax, trade and industrial policy moves the nation toward that goal. Let the privileged and their spawn pay their way, instead of riding on the backs of working people, whom they exploit at every opportunity.

[Mike Barden]

let's see, 99% of 1,000,000 equals how much?

[bighat]

Why would anyone invest in anything with the possibility of losing everything but only be able to retain 60% of any positive return. Might as well just stick the money in a coffee can and bury in the back yard. Buy gold and bury in the back yard.

[lvtfan]

wtfitzgerald has it right. We ought to be placing far more of our tax burden onto that which NONE of us created, or could create individually: land value and income which flows from the ownership of natural resources.

That sort of income ought to be socialized, and doing so would permit us to privatize wages and other things which are inherently and rightly the property of those whose labor creates them.

This is not a difficult concept, but those who have high hopes of being "top 1%" at some point in their lives don't seem to be able to recognize the logic, the efficiency, the justice, the wisdom of it.

Why should we permit SOME of us to privatize something they didn't create?? Why should they reap what all of us together have sown?

Google lvtfan or wealthandwant to learn more about these very old, very wise -- and very just -- ideas.

[PaiaGirl]

Put the wars on PAYGO....a­nd make it retroactive. Oh, too bad, no more money for war.

[bighat]

Do you really believe if the wars were on paygo they would vanish? My bet. Everything elsesupported by tax money would go first. We would do without schools before we gave up the ability to wage war be it offensive or defensive

[coloneblog]

The US currently sports an $11+trillion national debt and $52+ trillion in unfunded liabilities. What's interesting, at this point in time, Obama is not responsible for even 1 penny of it. Then why, all of a sudden, is there such a concern for limiting debt? Is it that Obama's programs go to benefit the people? Oh, God forbid.

[martinfrosa]

Sir,

Maybe you need to read the Constitution. Only Congress can spend money - all that "wasteful spending" that he attributes to Bush, he signed off on as a senator. Furthermore, while he assails the deficits he inherited from Bush, the answer is not to double or triple the debt. Any family that takes this road is headed for bankruptcy. The same goes for our nation. Too much spending, too little revenue to back it - this is a recipe for disaster.

[Mike Barden]

but didn't Bush write the recipe?

[dananotech]

People borrow money all the time in the hopes of getting ahead. Mortgage for a house. Money to pay for schooling. The notion that you should not go further in debt if you are already in debt is BS and depends on the circumstances.

As far as our nation goes, if we don't spend money on infrastructure so that we have good roads and rails and a good electric grid, then when it inevitably fails, that WILL be a disaster.

Investing in alternate energy sources is also a great investment. If we don't have to send 700 Billion dollars a year out of the US just for oil, then we can use that to do good things for our citizens & pay down the debt.

The problem isn't that the US is spending money, it is that not enough is being spent on infrastructure and alternate energy. Too much is going to prop up zombie banks.

[lastams]

How is it even possible for stimulus spending to work when at the same time we continue to support the leveraged casino that has become our banking system? At some point, when Goldman Sachs and the other players have sucked the last penny out of the middle class, when their so-called "jobless recovery" ends and there is no more real value to leverage into inflated economic balloons and manufactured wealth, then the whole giant house of cards will collapse. We simply cannot spend money on stimulus while at the same time pumping up a system that is basically anti-stimulus, a system based on inflated financial engineering instead of infrastructure, and expect it to work.

[Mike Barden]

don't know nutin 'bout this one 'cause i ain't no econonimus.

[fdrrules]

Its suprising to see all the conservatives trying to lead the conversation on Huffington Post.We handed the world to the businessman under Reagan,Clinton and Bush and as a result they screwed up the economy.Bu­siness taxes are so low they are negligable­.Most large corporations are not paying any taxes and yet conservatives say this is the reason for not hiring.No,­the reason for not hiring is all the greedy businessmen that could moved their corporations overseas and the others to save money laid off people so nobody can afford to buy their products.T­he Republicans and greedy businessmen have flat out destroyed America.No­w they are complaining that we have to spend money to help the poor people they drove into poverty through their greed..Tfh­e idea of the republican party is to make the people pay everything and exempt the rich from all taxes.Yes we need another round of spending but hopefully the republican in sheeps clothing better known as Obama will create some job programs until we can rebuild the manufacturing sector the greed soaked Republicans destroyed with their global economy,extreme tax breaks for the rich and stupid wars which have bankrupt this country

[gtalkspolitics]

When Republicans say big goverment it means deregulate the banks, do not have the goverment monitor FDA. EPA, etc.., only help for the wealthy, pour $1 trillion in the Iraq so that the wealthy can steal and pack their pockets . When President Obama starts to help the middle class.
Repbulicans scream BIG GOVERMENT

[Poorsarah]

How true, how true...the sad fact is, the GOP is more to blame for "BIG GOVERNMENT­."

[groland]

Why is it that all the free market advocates claim that consumer spending is good but government spending is bad. Actually, consumers send most of their money overseas, since the majority of our consumables are no longer made in the US. At the very least, government spending on infrastructure will keep money within the country. You cannot outsource road and bridge building nor education or basic science research. In the end it is all consumer spending, except taxes use the money for our country rather than for ourselves. Which is more patriotic?

The objections to government spending are ideological and not based on any real data or analyses.

[DSimpson]

Under your theory then, why don't we all just go to work for the government? We could all be one big happy family of governemt bureaucrats. China can continue to manufacture everything for us to meet our heart's desire. After all, they can do it so cheaply. We'll even have our own government crews to rebuild and maintain our infrastructure and keep at least a portion of money in the country, other than, of course, the money we send to China for our consumer spending. And we can all car pool from our neighborhoods (in our Chinese built cars) to our governmnent offices, saving on our fuel costs and need for energy. Sounds like a real utopia. Under this format, I certainly see no reason for objection to government spending, do you?

[bighat]

I think that is what the left wants. We all work for the govt and we all receive equal pay based on title. All promotions on seniority.

[Sean 6399]

"Why is it that all the free market advocates claim that consumer spending is good but government spending is bad."

In the case of consumer spending, an individual decides for his self, how to spend his wealth. That is economic freedom.

In the case of government spending, a third party decides how he will spend YOUR money. That is economic slavery.

Supporters of free market principles want more individual economic freedom, and the supporters of ever increasing government want economic slavery. Presumably they hope that the government will build them a very nice gilded cage for their slavery, but it's a cage nonetheless.

[mac03m]

Do you really believe the majority of our tax money is spent on building bridges, roads, and education? What about the 1 trillion dollars spent overseas maintaining this American empire? What about the fact that regardless how much money they put into the department of education, or national educational performance keeps getting worse? What about the billions of dollars just spent to bailout these "to big to fail" firms?

My father doesnt make much money, but he has about $650 taken from every paycheck so that AIG can stay in buisness and we can have a military base in Germany. Maybe if the government would let him and millions of others keep their hard earned money we wouldnt need to buy cheap Walmart products.

[123andy]

This is so much BS it is embarassing. If you can hold back on labeling all those who don't fit the "progresive" vision of the world and think a bit if you don't pay for the goodies you want to deliver the country will go bankrupt. If you pay for it you have to raise taxes more than just the miserable few who make more than 25K$. Now you can nationalize more and more businesses and use whatever profits the businesses generate to raise funds....w­hen this was tried last it did not work too well, but hey you never know. God save us from those with your ideas

[LottaLiberal]

This is such a narrow view! Why does every resolution seem to point to higher taxes? If money is flowing, raising taxes is unnecessary. What seems to me as flawed is that all of the stimulus money is stuck inbanks and financial institutions. The stimulus wiuld work immediately if money were given directly to American citizens to do with as they will. Circulation of cash is circulation of cash. At present, there is no circulation, just one huge life-threatening clot!
Rooseveldt's programs put prople to work immediately on infrastructure projects which still exist today. We need roads and bridges, not high speed trains.
They best way to move forward is to look back and see what worked. WPA and CCC worked! Big time!

[DSimpson]

It was really World War II that got us out of the depression rather than any government program. Lord forbid, is it going to take World War III to salvage our economy?

[lastams]

Nicely put.
But no one is suggesting a return to the laws that protected the integrity of our banking system for a generation. Instead we are supporting the same mindset that rewards financial engineering over infrastructure and the results are as can be expected.

We have what Wall Street is calling a "jobless recovery"
Translated that means big big bonuses as at Goldman Sachs and a lot of people sleeping under bridges.
You can pump all the dollars you want into "stimulus".
At the end of the day, without a solid foundation to the economy, it'll be like
trying to scoop up water with a fork.

[mac03m]

First of all, if they really wanted to put money directly into the hands of the people... why not eliminate the income tax. My father doesn't make much money, and he pays about $650 every check in income tax. I’m sure he would be thrilled to see that extra money every single payday. But that’s just crazy! Letting people keep their hard earned is money would be disastrous for the economy! We need the government to take our money and spend it for us...

The clot you speak of is savings which is what we need. The whole problem with our economy today is that we have borrowed and spent ourselves to death. We need to increase our savings, we need to let these bad firms fail not bail them out, and we need the government to stop spending money they don’t have on useless "stimulus" programs we don’t need. Then they should stop spending so much money on this insane foreign policy so that we can cut some serious taxed and allow people to keep there hard earned money instead of using it to build some bridge in Iraq.

Oh and your comments on the great depression couldn't be any more incorrect. FDR and Hoover were menaces who caused what started as a minor recession (that’s right the onset of the great depression was actually less severe than other recessions before it) to turn into the longest depression in history.

[Sean 6399]

That's all nonsense. The depression was going stronger than ever after all the manipulations, alphabet agencies, and gold confiscations of FDR.

[research]

The IMF, we just gave 8B$ to, will soon impose "austerity rules".

Spending on war is good,

Spending on people is wastefull socialism.

GOP spending is good,

Democratic spending is bad.

That's the Conservative strategy, always has been.

[bighat]

Do some more research and you may discover the conservatives do not even have enough power to call a press conference. The dems are in charge.

The blue dogs are not conservative. They are just doing a little early marketing for their 2010 campaign

[research]

The DLC democrats are conservatives, completely owned by the bankers.

[DSimpson]

This Congress could be the most destructive in 40 years. There seems to be confusion between "investment" and spending. Individuals and corporations invest. The government spends. As a former sales representative who handled government accounts, I wish I had a dollar for every bureaucrat in charge of a budget who said, "I've got to spend this money in my budget. If I don't spend it this year, my budget will be reduced next year." That didn't then, nor does it now, sound like "investing­." It sounds like spending to me.

What is a business? A business is an on-going entity that creates jobs on a year-after-year permanent basis. Government stimulus funds create jobs via projects (short-term, not long-term) that will disappear as soon as the stimulus funds end. Witness Oakland, California who hired 20 new police officers. As soon as the government money dried up, they layed the 20 officers off. That is the result, unless stimulus funds are renewed over and over again. The key is getting the money into the private sector so they really can invest in long-term job creation and growth. Otherwise, the prescribed mediciation will prove to be an overdose, kill the patient, and leave our children deeply in debt, and only hearing war stories about how great the United States was at one time.

[bobwalters]

This is so much Rethuglican talking-po­int-hockey­-puck!! What were you selling to the government? $650 toilet seats? $200 hammers? $50 boxes of paper clips? As another comment pointed out, money circulating in the economy is money circulating in the economy. Your love affair with "business" is misguided.

A "business" is an on-going entity that creates jobs ONLY SO LONG as the business owner(s) are making a profit; if the economy crashes, wherein noone can buy what the business is selling, the business ceases to be an on-going entity. If the infrastructure jobs created by government spending create lasting value, as WPA and CCC in fact did in the 1930s, (as opposed to the production of made-for-d­estruction of war materiel) a) the wages paid to those workers circulates back into the economy (keeping your businesses afloat); and b) contributes to the viability of the overall economy going forward, which viability leads to formation of more businesses and more jobs. Get it? The follow-on to that scenario is that as the economy becomes more viable, the operating deficit -- and hence, the national debt -- is reduced proportionately, as tax-income goes up. Corporate welfare rarely gets circulated back into the real economy, despite the arguments of right-wing economists and politicians. What the Blue Dogs are proposing is exactly the same "correction" imposed in 1933, which deepened and broadened the depression, and didn't result in any less national debt...it just made things worse.

[DSimpson]

You're partially right. But it wasn't the WPA or CCC that dug us out of the depression. It was World War II. Maybe World War III can get us out of this one, huh?

In order for any economy to sustain itself, it has to produce something of value. Manufacturing based economies have always been the most solid. The way things are going in this country, we will soon be ordering our missiles out of a Chinese catalog. Government doesn't produce much in the way of redeeming value, but lots of paper work. About the only things government should do is national defense, roads and highways, and police and fire protection. That's for the common good. Other services should be left to the private sectors who are much more efficient. Although government circulated dollars spend the same, in reality they don't serve the same function of building a strong and diversified economy as dollars circulated from the private sector.

As to the downfall of our present economy, the reason is self-evident. The culprits are poor government policy, Fannie Mae and Freddie Mac, banks being forced by the government to make imprudent real estate loans to those who couldn't afford to repay, the Federal Government guaranteeing those loans, foreclosures, with the end result being home values that have fallen below the mortgage amounts on individual properties. Ultimately, even many of the "rich" are broke. Investment stops. And jobs are not created.