CONSERVATIVE COLUMNIST: Spending Cuts Are Pushing Us Towards A Recession

http://www.businessinsider.com/gdp-4q-report-shrink-obama-jennifer-rubin-2013-1 ^ | 1-30-2013 | Brett LoGiurato

[blam]

CONSERVATIVE COLUMNIST: Spending Cuts Are Pushing Us Towards A Recession

Brett LoGiurato
January 30, 2013

Washington Post conservative columnist Jennifer Rubin has joined the voice of many conservatives lamenting the surprising drop in GDP last quarter.

In her post, Rubin argues that spending cuts and Obama's regulations are pushing us toward a recession.

The big reason for the surprise drop in fourth-quarter GDP was because of a drop in government spending, particularly a stunning fall in defense and military spending.

Rubin writes:

"I don’t know why they say the drop is unexpected. We are preparing to decimate national security, at a cost of perhaps 1.2 million jobs. The country was and still is poised to accept more tax hikes. The regulatory burden on employers and the prospect of Obamacare hang over our heads. No wonder we are in an economic slump. One more quarter of this, and, according to the technical definition, we will be in a recession. [...]

"This is why Republicans must talk growth, jobs and economic opportunity. The president isn’t because his policies stifle all three."

Conservatives and Republicans want to cut government spending, which they often say is out of control. The Republican argument on the GDP report, as noted by RNC communications director Tim Miller in an email, is that the economy is not in a good spot when government spending cuts combined with already-large deficits creates GDP shrinkage.

The U.S. is scheduled to endure more across-the-board spending cuts as a result of sequestration, which both parties agreed to as part of the Budget Control Act. As of now, both parties seem resigned to letting that happen. Earlier this month, House Speaker John Boehner said he was willing to let it happen and had Republican support in his pocket.

[blam]

(LIBERAL)MICHELLE MEYER: GDP Was 'Grossly Distorted', And You Should Fade The Headline

[TBP]

No, spending increases are pushing us bak to a Depression.

[theBuckwheat]

ONLY IN THE UPSIDE DOWN INSIDE OUT WORLD OF KEYNES do reductions in government money-printing and perpetual-debt borrowing damage the economy.

People who insist that it does are telling us that the government IS the economy. That should be a double danger alarm that government has grown too large. This is for the simple reason that government can only create money, it cannot create wealth. Only the private sector can do that.

[Jim Robinson]

Shoot, all those unemployment checks going out should have the economy booming. The Dems said so.

[bolobaby]

You gotta break a few eggs to make an omelet.

Everyone with half a brain understands that there is NO WAY to stop the current government gravy train without severely impacting the economy in the short term. The economy will recover in time and come back stronger than ever, but we have to take our lumps based on the strong dependency we’ve created in the economy for government spending.

[cicero2k]

This is why Beohner had to cave. We have to spend to keep going.

What is wrong is that small businesses continue to lack incentives to form because of regulation and legal risk.

That’s what Boehner et. al. need to fix. Otherwise some lawyer in a wheelchair can come by and shut your business down; not to mention EPA, OSHA, Commerce, Education etc.

[Jim Robinson]

If the government can tax, borrow and spend its way to prosperity, we’d all be rich.

By the way, just how big is $9 trillion dollars (or whatever the size of the debt Obama has run up)? How much per household would that be if he would have just written us all a check? (actually, I think he did for about half of us).

[griswold3]

Krugman was on CSpan this morning with demand for more government spending. He was preaching Monetary Sovereignty and saying anyone worried about the debt is crazy.
45 commercial-free minutes of Central Planning talking points. The trend is catching on as the true believers claim it has worked to save us so far.
We’re so screwed!

[wmap]

Fourth quarter spending was up from the prior two quarters. The President blames Sandy for the retraction. The government state and federal spent money during that time. It was Nancy Pelosi whose reasoning said giving unemployment for every dollar spent $1.75 is shown up in the economy. I do not get it.

[pgkdan]

This is all so silly. If government spending and the Fed’s printing pressed are the way to prosperity then why not just send every Amerian a check for $1,000,000.00 or hell, make it 10 million! That way we can all spend our way to prosperity!

[pgkdan]

This is all so silly. If government spending and the Fed’s printing pressed are the way to prosperity then why not just send every American a check for $1,000,000.00 or hell, make it 10 million! That way we can all spend our way to prosperity!

[pgkdan]

This is all so silly. If government spending and the Fed’s printing pressed are the way to prosperity then why not just send every American a check for $1,000,000.00 or hell, make it 10 million! That way we can all spend our way to prosperity!

[cripplecreek]

There are about a million things that can be cut with little domestic public anger. $100 million for an Aquarium in Brazil may be a “Drop in the bucket” but there are enough of those drops to fill a supertanker.

If Brazil doesn’t like it, maybe they should think long and hard what it means for us to pay for their “companionship”.

[SkyPilot]

You gotta break a few eggs to make an omelet.

I am not saying you are bolobaby, but a lot (a lot) of Freepers here are absolute hypocrites regarding government spending.

Where they stand is where they sit. And where a lot of them sit is they are all for cutting something, as long as it isn't their own entitlements.

There are two kinds of entitlements: earned and unearned.

Earned entitlements are Social Security, military pensions, and Medicare.

Unearned entitlements are Medicaid, Food Stamps, Earned Income Tax Credit (a giveaway program), Section 8 housing, and TANF.

I consider unemployment checks paid beyond 6 months to be in unearned welfare category.

Many Freepers are either on Social Security or want to get it. If you argue that our national defense is being eviscerated at the expense of our entitlement society, expect a war of words and a fight on your hands.

That is because they know something has to give, and they don't want it to be "theirs." I almost considers these Freepers to Conservatives in ideology, with an Obama entitlement mentality. Call them "Co-Bamas."

There is no question that Defense spending is on the "good spending" side of the equation. You cannot be a major player on the world political and economic stage with a 2nd rate military. And we are heading towards a 2nd rate military - fast.

Billions of dollars are generated by Foreign Military Sales of our products, one of the last, real things we manufacture that nation's of the world want to buy. Defense spending drives jobs in research, engineering, contracting, medicine, and manufacturing.

Now everyone is shocked (SHOCKED) that we cut spending under Obama I by $500 Billion (over ten years, but still by $50 Billion last year) and it adversely affected the economy!

Well, Sequestration kicks in 1 March 13 - and it is even worse.

Enjoy it America!

[andy58-in-nh]

There does seem to be a lot of "noise" in this GDP report -a big drop in defense spending, a large increase in personal consumption (due to sales of assets intended to get in under the 2013 tax increase?), increased equipment and software purchases (to beat the change in accelerated depreciation rules, perhaps?), and a downturn in private inventory investment.

But here's the real story, the "big" picture:

[Iron Munro]

Belief that government spending is the path to a stronger economy and stronger GDP is akin to believing in perpetual motion machines.

[Uncle Miltie]

If government spending solves economic woes, then increase government spending tenfold so that it consumes 100% of the economy.

Why not?

If you don’t like this logic, then your argument is flawed.

[SkyPilot]

If government spending and the Fed’s printing pressed are the way to prosperity then why not just send every American a check for $1,000,000.00 or hell, make it 10 million!

67% of all Federal spending is giveaway checks in the form of entitlements.

It is fast approaching 70%.

Ask someone if government spending is bad, they all emphatically say yes.

Ask someone if they should cut their unemployment, disability, Social Security, Medicare, etc check - and you get a different story.

[Domandred]

Personally I’m going to be spending about $300 a month less thanks to getting my taxes raised by Obamacare combined with the increase in payroll taxes. Multiply me by a few 10 millions and that’s real money.

Of course the liberals and fake conservatives can’t figure out why that will cause a slip in GDP.

[blam]

"Belief that government spending is the path to a stronger economy and stronger GDP is akin to believing in perpetual motion machines."

Yup. People who invested in perpetual motion machines are losers.

I have my money in cold fusion.

[Pietro]

"The big reason for the surprise drop in fourth-quarter GDP"...

Is the anti-business agenda of this administration.

and its about as surprising as snow in January.

[Pietro]

"The big reason for the surprise drop in fourth-quarter GDP"...

Is the anti-business agenda of this administration.

and its about as surprising as snow in January.

[alloysteel]

Artificially pumping up the highly visible enterprises in an effort to provide the illusion that the economy is growing is self-defeating in the end. The inevitable contraction is only postponed for a little while. Meanwhile, even more resources committed to continue the facade of prosperity are simply lost, as the house of cards continues to collapse.

If the idea is simply to squander our inheritance, Bronco Bama is doing very well at that task. He is like the winner of the lottery, who, after years of living in poverty, winds up blowing not only the entire amount of the winnings, but a considerable amount of incurred debt as well, and instead of being merely poor, he is hopelessly mired in to what, to him, would have been a unimaginable burden.

[LZ_Bayonet]

IF ALL THOSE GUNS AND AMMO HAD NOT BEEN PURCHASED IT WOULD HAVE BEEN WORSE !

[Erik Latranyi]

We are watching the deliberate collapse of the western nations by socialists.

[DesScorp]

Jennifer Rubin is not, and has never been, conservative.

[cotton1706]

There have been no spending cuts. We’re spending more this year than last year, and last year we spent more than the year before that.

If I reduce my spending and stay within my means, that leads to prosperity for me, not recession or poverty.

[blam]

"IF ALL THOSE GUNS AND AMMO HAD NOT BEEN PURCHASED IT WOULD HAVE BEEN WORSE ! "

Here too:

Rush To Safety: Americans Buy Nearly Half a Billion Dollars Of Gold and Silver In January

[stylin19a]

I thought sequestration reduces\cuts the future growth ?

RATspeak regarding cuts:

I have 50 billion.
I asked for 60 billion.
I only got 52 billion.
I got cut 8 billion.

[IMR 4350]

Combination of both.

Defense spending falls into the “trickle down” economics category. The govt. actually gets something in return for what it spends, same as you buying a car, and both create jobs and the wealth flows down to the people making what the military needs.

Entitlement spending on the other hand is “trickle up” economics.

If the govt is willing to pay $500 to rent an apt. for a welfare bum when the apt is only worth $400, people that work and pay for their own apt will then have to pay $500 for a $400 apt. That’s $100 bucks that could be spent on something else that would create jobs.

Raise the taxes on the RICH guy that owns the apt building to pay for more govt handouts, and the price of rent goes up.

The higher you raise taxes on the rich to provide goods and services for the poor the rich will get richer and the poor will get poorer.

[familyop]

Many who call themselves conservative are dependent on local regulatory bureaucracy, government education (useless, detrimental), pensions from the same, government-supported services, etc. So yeah, both political parties are quite soiled.

But spending cuts must happen sooner or later. Much rougher, if they happen later. Because if not done now, the numbers of layoffs of government regulators, teachers who should be privately employed in their work, haircuts of pensions (’cause bond investors will take their “haircuts”) and many others in the near future will be enormous under the bond collapse and forced repudiations to come.

[GOPJ]

I’m waiting for the headline that says ‘ LIBERAL COLUMNIST: Spending Excess Pushing Us Toward Depression..’

I’m waiting for godot too...

[bolobaby]

I’m 41. If they cut off all social security benefits for me right now, I wouldn’t care...

...so long as I knew the tax burden for SS would decrease over my remaining 25 working years.