The Human Equation

New York Times ^ | July 10, 2009 | Bob Herbert

[reaganaut1]

Vice President Joe Biden told us this week that the Obama administration “misread how bad the economy was” in the immediate aftermath of the inauguration.

Puh-leeze. Mr. Biden and President Obama won the election because the economy was cratering so badly there were fears we might be entering another depression. No one understood that better than the two of them. Mr. Obama tried to clean up the vice president’s remarks by saying his team hadn’t misread what was happening, but rather “we had incomplete information.”

That doesn’t hold water, either. The president has got the second coming of the best and the brightest working for him down there in Washington (think of Larry Summers as the latter-day Robert McNamara), and they’re crunching numbers every which way they can. They’ve got more than enough data. They understand the theories and the formulas as well as anyone. But they’re not coming up with the right answers because they’re missing the same thing that McNamara and his fellow technocrats were missing back in the 1960s: the human equation.

The crisis staring America in its face and threatening to bring it to its knees is unemployment. Joblessness. Why it is taking so long — seemingly forever — for our government officials to recognize the scope of this crisis and confront it directly is beyond me.

There are now five unemployed workers for every job opening in the U.S. The official unemployment rate is 9.5 percent, but that doesn’t begin to tell the true story of the economic suffering. The roof is caving in on struggling American families that have already seen the value of their homes and retirement accounts put to the torch.

[reaganaut1]

I'll never agree with any of leftist Bob Herbert's proposals, but at least he recognizes that Obama's policies are failing.

If the government
(1) delayed the coming increase in the minimum wage
(2) ditched cap-and-trade
(3) delayed health care "reform" and in particular promised employers that an insurance mandate was off the table
(4) encouraged domestic production of oil and gas

the economy would gradually recover.

[gusopol3]

Raising the personal exemption would have been a way to stimulate the economy without the rebates being “wasted “on savings ? Just guessing.

[DB]

The simple fact is you can’t fix a debt problem with more debt.

People are in debt to a far greater extent then ever in our history, but the bozos in Washington think they can “stimulate” them to borrow and spend again. It isn’t going to happen. So instead all they are doing is debasing our currency with no upside. Incredibly stupid. When inflation starts kicking from all that devalued money they printed interest rates are going to rise which is going to lead to a whole new round of defaults and bank bankruptcies all because they couldn’t resist “doing something” in Washington...

And then add on top of that all the new taxes and regulation pouring out of Washington. Employers are scared to death of what’s coming. So that too is causing employers to hunker down and not hire anyone.

It is the perfect storm of stupidity in Washington and it is relentlessly beating down our country and will likely to continue to until the source is removed.

[muawiyah]

All irrelevant. Just like they did in 1930, and again in 1932, the American public voted for the Democrats in 2008 in hope that the economy could be fixed.

How stupid of them. The Democrats have proven time and time again they are no better than the Republicans at fixing economies. PLUS, the Democrats are sure to attempt to impose fascism on the broad masses while stealing them down to their underwear.

Things will not be different until the Democrat party is banned.

[DB]

Paying off debt is the only way to turn things around.

You can’t fix a debt problem with more debt.

[Boardwalk]

You don’t throw good money after bad. Economics 101. Too bad no one on Obama’s team can grasp these concepts. Maybe Obama should have gone to Harvard Business School instead of Harvard Law School.

[gusopol3]

Yes, I believe the whole situation is the end of "buy now, pay later" mentality, but I'm assuming it's true that Reagan's tax cut and the Bush tax cut of '01 were helpful in preventing a deeper recession in the way that Obama's "top-down" approach hasn't been. The most coherent Republican proposal I had heard as a competitor to the stimulus package back in January, had been to halve the payroll tax for a defined period of time, which would have cost about the same, but put the money directly in people's hands. I know that personal exemption was $600 in the sixties ; I don't know how that squares up with $2700 today, adjusted for inflation. But I do know people with kids have got to spend the money now; adults can wear the same stuff for another year and bank any rebate for a year or so; it doesn't work that way with children. That was my ill-reasoned rationale to rebut the argument that "too much of tax rebates go into savings."

[Paradox]

Instead of spending all that money as a "stimulus", why not enact a tax cut of the same size for this year? Seems to me if business knew it was going to be able to keep a substantial amount of its profits this year, they would have been more inclinced to expand and hire.

Dunno, but back when they were discussing the stimulus, I was thinking, wouldn't that be something if the Government announced that for the first 6 months of 2009, no one would pay any taxes, or something like that, just something totally off the wall.

[roj]

My guess is, the reason they don’t understand the unemployment problem is they’ve never employed anyone.

[NicknamedBob]

"Anyone who believes that the Obama stimulus package will turn this jobs crisis around is deluded. It was too small, too weakened by tax cuts and not nearly focused enough on creating jobs."

Analysis fail in all three categories.

• Not too small
  
• Not weakened by tax cuts
  
• Not creating jobs, which government cannot do
  

If nothing had been done, we'd be recovering by now.

The only thing the "stimulus package" stimulated was government growth, and even that only in areas that had supported 0bama. It's the Chicago way; you pay to play.