Hoyer: Food Stamps, Unemployment Insurance 2 'Most Stimulative' Things for Economy

[GuyPinestra]

So the government taking out of the economy, taking a cut, then returning some of that money back to the economy is stimulus? Really? These people are idiots. The only way to get wealth is to work for it. The only way the economy will recover is when people are working, it is simple, but too simple for simpletons like Hoyer. Sad thing is they really believe their crap.

Money flowing through the economy creates more money, pretty elementary stuff.

No it doesn't! It is only the FLOW of money, it creates nothing.

 

[Freewill]

This discussion has absolutely nothing to do with helping the poor and the food stamp program. It has to do with whether or not it is a benefit to the economy.

 

[occupied]

No matter what your feelings on foodstamps and unemployment it is correct that they have the most immediate stimulative effect on the economy, not to mention that the country's food industry would crash without them.

OMG you people really do believe that crap. Three years we have had this thought rising up from Congress and Obama, THREE YEARS. The economy has not be stimulated as evidenced by the 8 percent unemployment, high gasoline prices, inflation and the devaluation of the dollar. Not the mention the 4 trillion dollars in debt that the Democrats and Obama have added to our grandchildren. 3 years of this policy and it is obviously a failure yet you want to continue doing so. Incredible.

I was listening to CBS news, for a short period, and one of the commentators was crowing about the economy and said we had low gasoline prices. Low by where Obama wants them maybe but they have doubled in his 3 years. That is exactly what I have been saying for 3 years. The report on the economy will grow better and better as we near the election. Now when I turn on CBS I C....BS.

The data says I am correct, point to something (nonpartisan) that says my statement was in error.

 

[occupied]

So the government taking out of the economy, taking a cut, then returning some of that money back to the economy is stimulus? Really? These people are idiots. The only way to get wealth is to work for it. The only way the economy will recover is when people are working, it is simple, but too simple for simpletons like Hoyer. Sad thing is they really believe their crap.

Money flowing through the economy creates more money, pretty elementary stuff.

No it doesn't! It is only the FLOW of money, it creates nothing.

Yes it does, lern sum economics.

 

[ladyliberal]

I honestly do NOT understand how giving free stuff to people=stimulative for economic growth. Money doesn't grow on tree's...It is made through growing the economic pie. Growing the size of the economy through building businesses and growing wealth of all the classes does.

I wish to learn your reasoning to why you believe this my friends on the left. Is this really sound economics?

The short answer is that giving money to poor people is more stimulative than giving money to rich people because poor people are more likely to spend the money immediately. This of course immediately increases the economy as compared to the size of the economy if the recipient of the money had saved it. And if the person who receives the money the poor person spends it again the economy spends even more. Of course the most stimulative policy isn't necessarily the best policy-- we may wish to increase the savings rate or we may wish to direct the money to or away from particular sectors of the economy.

For a list of multiplication factors (about which there is, of course, considerable disagreement among macroeconomists) see, eg, http://www.economy.com/mark-zandi/d...e-Committee-Unemployment Insurance-041410.pdf

Who said anything about giving money to rich people?
It's not a give to the poor or give to the rich situation.
Your frame of reference is incorrect.

Well, I said it was "the short answer". But as to who said anything about giving money to rich rather than poor people (besides me), I would say that Hoyer and the economist with whom he spoke, as quoted in the original post mentioned giving money to rich people (emphasis and notes added):

“Because those folks who receive those resources [food stamps and unemployment insurance] must spend them. And they’ll spend them almost upon receipt. Most economists with whom I talk believe that those with significant discretionary income, that that’s not the case.”

"Those with significant discretionary income" seems to be a reference to relatively rich people, probably the people with annual incomes in excess of $250,000 as referenced in the article. In addition to this, the original poster refers to "growing wealth" which might be a reference to giving money to or otherwise aiding wealthy entities.

 

[Peach]

I agree, because most recipients need to spend it quickly to survive.

Of course, welfare spent ACCORDING to law goes straight into the US economy, as does unemployment comp. The Cayman Islands benefit greatly from the "anywhere but the US" investors but few in their tax havens return the favor, like Bush's war much of the trillions stay outside this country.

 

[alan1]

The Broken Window Fallacy

Taking money from me to give to the poor merely shifts how and where the money is spent, it doesn't stimulate the economy.

 

[alan1]

The short answer is that giving money to poor people is more stimulative than giving money to rich people because poor people are more likely to spend the money immediately. This of course immediately increases the economy as compared to the size of the economy if the recipient of the money had saved it. And if the person who receives the money the poor person spends it again the economy spends even more. Of course the most stimulative policy isn't necessarily the best policy-- we may wish to increase the savings rate or we may wish to direct the money to or away from particular sectors of the economy.

For a list of multiplication factors (about which there is, of course, considerable disagreement among macroeconomists) see, eg, http://www.economy.com/mark-zandi/d...e-Committee-Unemployment Insurance-041410.pdf

Who said anything about giving money to rich people?
It's not a give to the poor or give to the rich situation.
Your frame of reference is incorrect.

Well, I said it was "the short answer". But as to who said anything about giving money to rich rather than poor people (besides me), I would say that Hoyer and the economist with whom he spoke, as quoted in the original post mentioned giving money to rich people (emphasis and notes added):

“Because those folks who receive those resources [food stamps and unemployment insurance] must spend them. And they’ll spend them almost upon receipt. Most economists with whom I talk believe that those with significant discretionary income, that that’s not the case.”

"Those with significant discretionary income" seems to be a reference to relatively rich people, probably the people with annual incomes in excess of $250,000 as referenced in the article. In addition to this, the original poster refers to "growing wealth" which might be a reference to giving money to or otherwise aiding wealthy entities.

Again, nobody is talking about giving money to rich people. You are operating on a flawed premise when you say "The short answer is that giving money to poor people is more stimulative than giving money to rich people".

 

[ladyliberal]

The Broken Window Fallacy

Taking money from me to give to the poor merely shifts how and where the money is spent, it doesn't stimulate the economy.

It is entirely possible, depending on your personal spending habits, that you are more likely to stimulate the economy than the average poor person (for all I know you are also poorer than the average poor person). In general, however I do not believe that any such trend holds.

I have already discussed in this forum at unfortunate length the fallacies that I believe are present in the "parable of the broken window" (Parable of the broken window - Wikipedia, the free encyclopedia). In any event, I don't believe that it applies here insofar as that we are proposing to give food stamps to people to people to stimulate their food spending, not to destroy their existing food stores to do the same.

 

[Oddball]

The Broken Window Fallacy

Taking money from me to give to the poor merely shifts how and where the money is spent, it doesn't stimulate the economy.

Liberoidals: Breaking your leg, then handing you a crutch and telling you how lucky you are to have their "help".

 

[ladyliberal]

Again, nobody is talking about giving money to rich people. You are operating on a flawed premise when you say "The short answer is that giving money to poor people is more stimulative than giving money to rich people".

Why do you say that? I've told you why I believe that Hoyer and the economists were talking about exactly that, with textual support for my interpretation. And I hope that (barring a narrow definition of "talking") it is clear that I at least am indeed discussing a range of policy options that includes giving money to rich people.

 

[Big Fitz]

Hoyer: Food Stamps, Unemployment Insurance 2 'Most Stimulative' Things for Economy
CNSNews ^
Hoyer: Food Stamps, Unemployment Insurance 2 'Most Stimulative' Things for Economy | CNSNews.com


Hoyer: Food Stamps, Unemployment Insurance 2 'Most Stimulative' Things for Economy By Elizabeth Harrington July 17, 2012

(CNSNews.com) – House Minority Whip Steny Hoyer (D-Md.) said Tuesday that food stamps and unemployment insurance are the two "most stimulative" t things you can do for the economy.

During a pen and pad briefing with reporters on Capitol Hill, Hoyer was asked if any Democrats are “reconsidering the wisdom” of letting the Bush tax cuts expire at year’s end for the top income earners given the still struggling U.S. economy.

"I haven’t talked to any who are of that mind," said Hoyer. "If you talk to economists, they will tell you there are two things that are the most stimulative that you can do -- one’s unemployment insurance, the other’s food stamps, okay?”

“Why is that?” he said. “Because those folks who receive those resources must spend them. And they’ll spend them almost upon receipt. Most economists with whom I talk believe that those with significant discretionary income, that that’s not the case.”

Unless action is taken by Congress, the Bush tax cuts will expire on Jan. 1, 2013. Originally enacted in 2001 and 2003, President Barack Obama and Congress renewed the cuts for all income-brackets for two years in 2010.

Obama and the Democrats are now proposing that the rates be extended for one more year, until the end of 2013, for people earning less than $250,000 a year, while Republicans want the rates extended for people in all income brackets.

----

I honestly do NOT understand how giving free stuff to people=stimulative for economic growth. Money doesn't grow on tree's...It is made through growing the economic pie. Growing the size of the economy through building businesses and growing wealth of all the classes does.

I wish to learn your reasoning to why you believe this my friends on the left. Is this really sound economics?

I suggest he be forced to live on them, under the guidelines you can legally have them for 2 years, and see what he thinks about it's stimulating effect then. How fucking stimulated are you about them now?

 

[hortysir]

No matter what your feelings on foodstamps and unemployment it is correct that they have the most immediate stimulative effect on the economy, not to mention that the country's food industry would crash without them.

Hi, Cloward.
Have you seen Piven lately?

 

[salem.hills]

I know Hoyers is a hack leftist but how can anyone not insane say that? Wouldn't jobs be better? So we all should get on food stamps and Obama and Hoyer will handle things? An absurd thing to say is good for us

 

[GuyPinestra]

Money flowing through the economy creates more money, pretty elementary stuff.

No it doesn't! It is only the FLOW of money, it creates nothing.

Yes it does, lern sum economics.

Learn some common sense, moron. Did it suddenly clone itself in the till of the shopkeeper? No matter how many times a dollar gets spent, it's still just a dollar. Rube.

 

[alan1]

Again, nobody is talking about giving money to rich people. You are operating on a flawed premise when you say "The short answer is that giving money to poor people is more stimulative than giving money to rich people".

Why do you say that? I've told you why I believe that Hoyer and the economists were talking about exactly that, with textual support for my interpretation. And I hope that (barring a narrow definition of "talking") it is clear that I at least am indeed discussing a range of policy options that includes giving money to rich people.

Nobody is advocating giving money to rich people.
You are framing your point of reference incorrectly with the statement you made.

Last year, I went on 3 vacations. Each one of those vacations involved me supporting the airline industry, the hotel industry, the cab, limo or car rental industry, the restaurant industry, and some other sort of entertainment industry. Now suppose the government decides I need to pay more in taxes so that poor people can have EBT. With that EBT, they will support the grocery (and indirectly, the farming) industry. When I eat out (while on vacation), I'm also supporting those same industries. Take that money from me though, and all the other industries I mentioned above are no longer getting economic benefit. The economy isn't actually being stimulated, it was just depressed by taking money from me.

 

[Big Fitz]

No matter what your feelings on foodstamps and unemployment it is correct that they have the most immediate stimulative effect on the economy, not to mention that the country's food industry would crash without them.

Hi, Cloward.
Have you seen Piven lately?

Found him. He seems to be in a little trouble.

[ame=http://www.youtube.com/watch?v=s5-4yA7CDZw]Judgement Night Rant - YouTube[/ame]

 

[ladyliberal]

I know Hoyers is a hack leftist but how can anyone not insane say that? Wouldn't jobs br better? So we all should get on food stamps and Obama and Boyer will handle things? An absurd thing to say is good for us

It would certainly be somewhat absurd to suggest that food stamps are better than a job or that everyone should be on food stamps. It is also absurd to suggest that Hoyers/Boyer/Hoyer said any of those things.

 

[ladyliberal]

Nobody is advocating giving money to rich people.
You are framing your point of reference incorrectly with the statement you made.

Last year, I went on 3 vacations. Each one of those vacations involved me supporting the airline industry, the hotel industry, the cab, limo or car rental industry, the restaurant industry, and some other sort of entertainment industry. Now suppose the government decides I need to pay more in taxes so that poor people can have EBT. With that EBT, they will support the grocery (and indirectly, the farming) industry. When I eat out (while on vacation), I'm also supporting those same industries. Take that money from me though, and all the other industries I mentioned above are no longer getting economic benefit. The economy isn't actually being stimulated, it was just depressed by taking money from me.

The key distinction (in evaluating economic multipliers) between the average person who takes frequent vacations and the average recipient of food stamps is not (I believe) what they spend their money on, but how much money they spend. Food stamps are nearly always spent. Middle class after-tax income is often saved. This necessarily reduces its stimulative effect. Again, that doesn't mean that you shouldn't save, only that choosing to save money for later will tend to shift economic activity away from the current economy and to future economies.

You've shifted your claims about talking to claims about advocacy. The first post asked for analysis, not advocacy. I've tried to give my explanation of Hoyer's thinking (with which, in this respect, I agree) rather than to advocate for any policy. As I noted in my first post, the most stimulative policy is not necessarily the best one.

 

[occupied]

No it doesn't! It is only the FLOW of money, it creates nothing.

Yes it does, lern sum economics.

Learn some common sense, moron. Did it suddenly clone itself in the till of the shopkeeper? No matter how many times a dollar gets spent, it's still just a dollar. Rube.

Will someone explain to this person how the private sector creates large amounts of money out of thin air? It sounds crazy, I know, but it actually happens, all it takes is for someone to put money in the bank.