Krugman: GOP Austerity Causing Unemployment

[ScienceRocks]

The federal government is a criminal enterprise. Both party's should be forced to go to prison for stealing our wealth for the rest of there fucking life's.

 

[Quantum Windbag]

This chart shows yearly changes in government spending for goods and services.

As you can see, the numbers crossed over to the negative at the beginning of the year, and have been declining ever since. According to Krugman, the numbers correspond to slower job growth.

If government spending is necessary to sustain the recovery, is it crazy to pursuing cuts in spending now, while unemployment is still about 9%?

First, if I am reading that chart right, Krugman is arguing that the government is spending less now than it did in 2005. Can you explain that to me?

That is a graph of the change in total government spending adjusted for inflation.

I went to the FRED site, took the same data, as adjusted for inflation, and it indicated that total government expenditure is higher than in 2005.

 

[Toro]

First, let me state that I have not read this entire thread, and have no intention to, so if you answered this already I apologize for asking. Second, how do you know what the graph in the OP assumes?

I'm not assuming anything. I merely stated that Krugman is correct that government spending is falling because local and state governments are slashing more than the federal government is spending.

Somewhere I had read that total state and local government has fallen by 300,000 since the recession began, and that was about six months ago. Since federal employees have risen at a slower pace, total government employment is falling, which is consistent with declining government spending.

 

[Sundial]

<IDIOT ALERT>

The rich (top 1 to 10% of the population) CANNOT consume most of the countries resources and they ALREADY DO pay more of - nay most of- state and federal taxes.

They CANNOT?
Why not?

How many pounds of steak do you think the rich can eat?

How much land can they control? How many homes can they own? How much political influence can they buy?

 

[Toro]

First, if I am reading that chart right, Krugman is arguing that the government is spending less now than it did in 2005. Can you explain that to me?

That is a graph of the change in total government spending adjusted for inflation.

I went to the FRED site, took the same data, as adjusted for inflation, and it indicated that total government expenditure is higher than in 2005.

That's not inconsistent with the graph in the OP, nor is it inconsistent with the graph you posted. The OP is the year over year change in real government spending. So as long as the line is above zero, government spending is expanding, even if the line is falling.

 

[Trajan]

I was responding to Don'tBe's contention that Federal spending had decreased. I don't see that reflected in the numbers.

As for what happens if the GOP wins everything? Right now there is a TON of money sitting on the sidelines because the Private Sector doesn't trust this Administration. You've got to think THAT money will come back into play if investors feel like there's someone in the Oval Office working with them instead of against them.

You are correct about federal spending. It is not falling.

exactly.


and lets note- that is after a knock down drag out in April and May this year and the knock down drag out over the debt ceiling agreement.

As for the economy, it is true that the Administration has not been instilling confidence in the business community But I think those who believe this is the cause of our sluggishness will be in for rude shock when unemployment is still high (though trending lower) in 2013 and 2014. This is a balance sheet recession caused by a massive housing bubble and the implosion of the credit markets. Time, not policy, heals this. In the same way that conservatives are slamming liberals for the economy now, we will see liberals slamming conservatives after 2012 because the problems are beyond mere politics. And it is likely that the austerity will make things worse, not better. It will be better long term, but not near-term. Thus, don't be surprised if the Democrats win back Congress in 2014.

propping the housing market is not a rep virtue nor should it be, this is lasting longer and not shaking out, becasue we are carrying it ala F&F etc.

We are borrowing 3 billion a DAY, so until that is cut AND THEN we reduce outs we have not cut Net to revenue spending, we are just trying to apply a tourniquet. we are caught, if we stop borrowing we cannot fund everything we have OVER committed to, and the debt just keeps going up, if we cut we have to take the hit, and we both know Toro, we are going to have to take the hit NO MATTER what happens...its just now or later and I don't mean a lot later either, like 3-4 years IF that.

 

[Sundial]

No, that actually means in the long run that more people are employed in real jobs. Putting more parasites on the payroll does not help anyone who produces something of value make a living.

The people who defend the country, teach our children, build our roads, and administer the laws of our country are not parasites. People who consume without working are parasites. Parasites = the richest people in our country.

Government school teachers most definitely are parasites. They don't teach our children. They keep them ignorant and they indoctrinate them with leftist propaganda. People who provide a service you aren't willing to pay for are not productive. They are leaches.

The bureaucrats who rule us are also parasites. The department of Education does nothing I would pay for voluntarily.

It's "leech," not "leach". Leach is a verb.

 

[DontBeStupid]

We are borrowing 3 billion a DAY, so until that is cut AND THEN we reduce outs we have not cut Net to revenue spending, we are just trying to apply a tourniquet. we are caught, if we stop borrowing we cannot fund everything we have OVER committed to, and the debt just keeps going up, if we cut we have to take the hit, and we both know Toro, we are going to have to take the hit NO MATTER what happens...its just now or later and I don't mean a lot later either, like 3-4 years IF that.

Or we could raise revenue, right? I mean, that is an option. Even if you guys don't like it, we could "take the hit" by raising revenue.

 

[freedombecki]

Looks like ol' ferret face is solidifying his ranking as my #1 favorite science fiction/fantasy writer.

Who knew a $3.5 trillion (non)budget was "austerity"?

I was gonna say something, but now I don't have to. You said it so much better!

 

[Sundial]

How many pounds of steak do you think the rich can eat?

You know it's funny. You're using now the exact same argument and reasoning I use for spreading tax cuts and not focusing them on the wealthy. Because honestly, how many steaks can one man eat?

Funny.

The honest truth is there IS no reason for a federal government of this size. It is completely opposite of the purpose of this nation as a nation of states and freedoms. Power back to the states and cut the hell out of the federal government. I'd support bringing the troops home.

Government is always too big until somebody tries to cut something. Then it's EXCEPT for Social Security, EXCEPT for Medicare, EXCEPT for defense...

I am for cutting defense, though.

 

[DontBeStupid]

With a weak economy and a weak job market, there is simply no logical reason to cut government spending at this time. And no one seems to want to provide one.

Wait 5 years. Get the economy growing. Get the job market booming again. THEN we can cut spending and lay off workers and they'll actually have some place to go.

 

[freedombecki]

I was responding to Don'tBe's contention that Federal spending had decreased. I don't see that reflected in the numbers.

As for what happens if the GOP wins everything? Right now there is a TON of money sitting on the sidelines because the Private Sector doesn't trust this Administration. You've got to think THAT money will come back into play if investors feel like there's someone in the Oval Office working with them instead of against them.

You are correct about federal spending. It is not falling.

exactly.


and lets note- that is after a knock down drag out in April and May this year and the knock down drag out over the debt ceiling agreement.

As for the economy, it is true that the Administration has not been instilling confidence in the business community But I think those who believe this is the cause of our sluggishness will be in for rude shock when unemployment is still high (though trending lower) in 2013 and 2014. This is a balance sheet recession caused by a massive housing bubble and the implosion of the credit markets. Time, not policy, heals this. In the same way that conservatives are slamming liberals for the economy now, we will see liberals slamming conservatives after 2012 because the problems are beyond mere politics. And it is likely that the austerity will make things worse, not better. It will be better long term, but not near-term. Thus, don't be surprised if the Democrats win back Congress in 2014.

propping the housing market is not a rep virtue nor should it be, this is lasting longer and not shaking out, becasue we are carrying it ala F&F etc.

We are borrowing 3 billion a DAY, so until that is cut AND THEN we reduce outs we have not cut Net to revenue spending, we are just trying to apply a tourniquet. we are caught, if we stop borrowing we cannot fund everything we have OVER committed to, and the debt just keeps going up, if we cut we have to take the hit, and we both know Toro, we are going to have to take the hit NO MATTER what happens...its just now or later and I don't mean a lot later either, like 3-4 years IF that.

We are borrowing 3 billion a Day on top of what we already owe to creditors? I'm gonna faint. 3 billion divided by 3.25 million Americans. That's grave. I can't even do the math. What is that per capita, per diem?

 

[Quantum Windbag]

First, let me state that I have not read this entire thread, and have no intention to, so if you answered this already I apologize for asking. Second, how do you know what the graph in the OP assumes?

I'm not assuming anything. I merely stated that Krugman is correct that government spending is falling because local and state governments are slashing more than the federal government is spending.

Somewhere I had read that total state and local government has fallen by 300,000 since the recession began, and that was about six months ago. Since federal employees have risen at a slower pace, total government employment is falling, which is consistent with declining government spending.

The GCEC1 data contradicts him. Local and state governments are spending less, but, even adjusted for inflation, RGCEGI is higher now, that is specifically the point I am questioning.

I do believe that some government spending has a net positive effect on the economy, but much of it does not. Even the CBO points out that all government spending is not equal, and they are about as Keynesian as it is possible to be. Krugman trying to argue now that cutting government spending is always bad is actually contradicting his argument that the government should spend more money on infrastructure.

I will also point out that the main reason the government spends less on infrastructure now is not because of spending cuts, it is because government regulations now require environmental impact statements, permits, and various other regulatory hurdles be cleared before a single clod of dirt is moved, a process that often takes years. If the man is actually as supportive of infrastructure jobs as he claims to be he should be joining the Republicans in their fight to reduce regulatory hurdles before money can be spent.

 

[Sundial]

Government school teachers most definitely are parasites.

Well great. Now it's official.

You're an ass hole.

Why, because I state a simple fact? I know imbeciles like you want to cast any criticism of teachers as beyond the pale. Sorry, but only hacks and toadies accept that characterization. Unionized government teachers are essentially thugs who hold our children for ransom to extort cash from us.

Government school teachers know with absolute certainty that if parents had the option of spending their money elsewhere, they would be out of a job.
That's why they lobby so hard to defeat any voucher initiative. That makes them parasites. Their services are not wanted. We pay for them at gunpoint.

The fact is that people vote overwhelming to support public education because it does work. People like you are the minority - a tiny, itsy bitsy insignificant minority. You pay taxes at gunpoint because otherwise freeloaders like you wouldn't pay at all.

You complain, but the truth is you enjoy the advantages and privileges of being an American. You just don't want to have to pay your share.

 

[Quantum Windbag]

That is a graph of the change in total government spending adjusted for inflation.

I went to the FRED site, took the same data, as adjusted for inflation, and it indicated that total government expenditure is higher than in 2005.

That's not inconsistent with the graph in the OP, nor is it inconsistent with the graph you posted. The OP is the year over year change in real government spending. So as long as the line is above zero, government spending is expanding, even if the line is falling.

Thanks for making that point.

Putting it into a chart that shows the change in spending from the previous year makes it look ominous, which is why I prefer real numbers.

 

[NYcarbineer]

Defense is the best target for massive cuts because defense doesn't produce anything. Half of the defense spending in the is country is nothing more than a make-work project to line the pockets of those represented by the defense lobby.

Defense spending at the current levels is like having twice as much car insurance on your vehicle than it needs, in short,

money thrown down the toilet.

And that's the part of the budget that conservatives really don't want to cut. Some will even INCREASE defense spending if they can.

It's the same old song and dance from the GOP. They cut taxes, start wars, increase defense spending, run up horrific deficits,

and then they suddenly flip flop and say woe is me the debt is too high, let's cut everything except defense.

 

[ScienceRocks]

We are borrowing 3 billion a DAY, so until that is cut AND THEN we reduce outs we have not cut Net to revenue spending, we are just trying to apply a tourniquet. we are caught, if we stop borrowing we cannot fund everything we have OVER committed to, and the debt just keeps going up, if we cut we have to take the hit, and we both know Toro, we are going to have to take the hit NO MATTER what happens...its just now or later and I don't mean a lot later either, like 3-4 years IF that.

Or we could raise revenue, right? I mean, that is an option. Even if you guys don't like it, we could "take the hit" by raising revenue.

Why keep growing the federal government? Why centralize power.
-Make education a local issue, construction, ect.
-tax Chinese and other third world "goods" enough to make our market productive against theres. Hopefully, allowing for our market to be able to compete.


There is NO reason to keep growing the federal government. Why do we have to increase revenue? Lets just get out of Afghanistan and iraq, south Korea, europe, japan, ect.

Seeing what occurred with the nation building and how it has utterly failed. I see no reason for it. The only thing we should be concern with is our borders. No more worthless decade long wars that this government doesn't have the balls to win. Waste of blood and treasure. Idiocy.

I'm sure if we pulled our military to behind our borders and raised a high tax on all outside goods into our nation, we wouldn't need to raise any revenue. I'd hope we could cut taxes as we would have crap loads of it if we didn't have to wipe the worlds ass. Lets not be the global police anymore.

 

[Sundial]

no not actually, unless of course 7 trillion in 2.5 years isn't enough spending to you, so what do you suggest? we just continue to write checks on borrowed money to state public employee unions forever? or buy 600 dollar hammers?

Myth of the $600 hammer.

Interesting link. I've always wondered about that hammer. There have been other cases where a contract was cancelled as a cost reduction and all the research and development cost was allocated to the prototype. Then the media gets the information and uses it portray how wasteful government procurement is when in reality the government action saved the tax payer a lot of money.

Some things are just bigger than truth. When people know something is true, the fact that it isn't doesn't matter. Facts have a liberal bias.

 

[ScienceRocks]

You know it's funny. You're using now the exact same argument and reasoning I use for spreading tax cuts and not focusing them on the wealthy. Because honestly, how many steaks can one man eat?

Funny.

The honest truth is there IS no reason for a federal government of this size. It is completely opposite of the purpose of this nation as a nation of states and freedoms. Power back to the states and cut the hell out of the federal government. I'd support bringing the troops home.

Government is always too big until somebody tries to cut something. Then it's EXCEPT for Social Security, EXCEPT for Medicare, EXCEPT for defense...

I am for cutting defense, though.

I'm for getting the hell out of Afghanistan, south Korea, Japan and Europe and cutting a good 30 bases throughout the world. What that saves from the defense budget after figuring out what 30,000 troops on our borders will cost will go into a cut on it. Sounds fair?

 

[Quantum Windbag]

We are borrowing 3 billion a DAY, so until that is cut AND THEN we reduce outs we have not cut Net to revenue spending, we are just trying to apply a tourniquet. we are caught, if we stop borrowing we cannot fund everything we have OVER committed to, and the debt just keeps going up, if we cut we have to take the hit, and we both know Toro, we are going to have to take the hit NO MATTER what happens...its just now or later and I don't mean a lot later either, like 3-4 years IF that.

Or we could raise revenue, right? I mean, that is an option. Even if you guys don't like it, we could "take the hit" by raising revenue.

How do you propose raising revenue? Do you think it is better to raise revenue by increasing the gross receipts the government takes in, or by charging more for government services while reducing the overall amount of money the government actually receives?

Your problem is you assume a tax increase automatically means the government gets more money. That makes you as simplistic as the people who argue that a tax cut does the same thing.

Tax increases have a negative impact on the economy, which is why Obama wanted to extend the Bush tax cuts. Even Krugman understands that, which is why he advocates deficit spending in a recession.