Can someone explain why democrats think

[PredFan]

bump

I thought this lefty economic plan was the greatest thing ever!! Don't tell me it's just another faily tale!! Another broken promise????

NOOOOOOO!!!! I'm devastated....

The only way you can stimulate the economy from the bottom up is to flood the bottom with cash. That is the most inefficient way to do it that I can think of. The extra cash makes for more spending which creates a demand for more product but the demand only exists as long as the cash does.

Now, some empty-headed lefty will try to claim that you can provide the bottom with jobs, but how do you create enough jobs for the bottom to work? You make them out of thin air with cash. It's the same thing. What will those jobs be? How will you force people who are used to getting paid for doing nothing to work those jobs?

In a sense, the lefties are right, you can stimulate the economy from the bottom, but only temporarily and at great waste of money.

 

[Shelzin]

bump

I thought this lefty economic plan was the greatest thing ever!! Don't tell me it's just another faily tale!! Another broken promise????

NOOOOOOO!!!! I'm devastated....

The only way you can stimulate the economy from the bottom up is to flood the bottom with cash. That is the most inefficient way to do it that I can think of. The extra cash makes for more spending which creates a demand for more product but the demand only exists as long as the cash does.

True, kind of. Which is why you don't create money out of thin air. You don't borrow it either.

Now, some empty-headed lefty will try to claim that you can provide the bottom with jobs, but how do you create enough jobs for the bottom to work? You make them out of thin air with cash. It's the same thing. What will those jobs be? How will you force people who are used to getting paid for doing nothing to work those jobs?

Make a strong dollar. You don't throw MORE money at the problem. You make the money that is already out there worth more than it currently is.

In a sense, the lefties are right, you can stimulate the economy from the bottom, but only temporarily and at great waste of money.

Yeah... But the bottom WILL spend the money. If you go from the top... They *might* spend it.

I mean hell... There are plenty of companies that made record profits last year. Why? Well... It's my guess the middle class competition died and they have to go to the major corporations. But they're not spending it. Why? Well... What would be the point? They are trying to make a profit, and they are... Obviously. If you give them more of a break, why would they do anything but make more profit?

 

[PredFan]

bump

I thought this lefty economic plan was the greatest thing ever!! Don't tell me it's just another faily tale!! Another broken promise????

NOOOOOOO!!!! I'm devastated....

The only way you can stimulate the economy from the bottom up is to flood the bottom with cash. That is the most inefficient way to do it that I can think of. The extra cash makes for more spending which creates a demand for more product but the demand only exists as long as the cash does.

True, kind of. Which is why you don't create money out of thin air. You don't borrow it either.

Now, some empty-headed lefty will try to claim that you can provide the bottom with jobs, but how do you create enough jobs for the bottom to work? You make them out of thin air with cash. It's the same thing. What will those jobs be? How will you force people who are used to getting paid for doing nothing to work those jobs?

Make a strong dollar. You don't throw MORE money at the problem. You make the money that is already out there worth more than it currently is.

In a sense, the lefties are right, you can stimulate the economy from the bottom, but only temporarily and at great waste of money.

Yeah... But the bottom WILL spend the money. If you go from the top... They *might* spend it.

I mean hell... There are plenty of companies that made record profits last year. Why? Well... It's my guess the middle class competition died and they have to go to the major corporations. But they're not spending it. Why? Well... What would be the point? They are trying to make a profit, and they are... Obviously. If you give them more of a break, why would they do anything but make more profit?

The answer is that you don't throw any money at the problem. Drop the taxes on businesses and get rid of at least some of the massive regulations.

The reason they aren't spending it is due to uncertainty in the business climate.

I agree that a good way to improve the economy would be to grow the dollar, but you don't do that from the middle class either.

 

[Shelzin]

The only way you can stimulate the economy from the bottom up is to flood the bottom with cash. That is the most inefficient way to do it that I can think of. The extra cash makes for more spending which creates a demand for more product but the demand only exists as long as the cash does.

True, kind of. Which is why you don't create money out of thin air. You don't borrow it either.


Make a strong dollar. You don't throw MORE money at the problem. You make the money that is already out there worth more than it currently is.

In a sense, the lefties are right, you can stimulate the economy from the bottom, but only temporarily and at great waste of money.

Yeah... But the bottom WILL spend the money. If you go from the top... They *might* spend it.

I mean hell... There are plenty of companies that made record profits last year. Why? Well... It's my guess the middle class competition died and they have to go to the major corporations. But they're not spending it. Why? Well... What would be the point? They are trying to make a profit, and they are... Obviously. If you give them more of a break, why would they do anything but make more profit?

The answer is that you don't throw any money at the problem.

I agree with that.

Drop the taxes on businesses and get rid of at least some of the massive regulations.

I don't see how that helps anything given the response below.

The reason they aren't spending it is due to uncertainty in the business climate.

Record profits should mean that businesses should more inclined to spend to make more. They're not. Because of uncertainty... Not uncertainty of profit, uncertainty that it'll create more profit. And they are right... It won't. Keeping status quo means they still get great profit, and competition drops out of the picture. How is that good for the economy?

I agree that a good way to improve the economy would be to grow the dollar, but you don't do that from the middle class either.

No... But that's where the focus should be. Anything either party says that they are going to address the economy, needs to follow with and this is how it helps the middle class.

 

[PredFan]

Well, we'd have to lessen the uncertainty in the business climate. For on thing, Obama has to go. As long as he's there the business climate will be uncertain. Which goes along with the reduced regulations and reduced corporate tax rate. Which Obama would never do.

 

[PredFan]

"Record profits should mean that businesses should more inclined to spend to make more. They're not. Because of uncertainty... Not uncertainty of profit, uncertainty that it'll create more profit. And they are right... It won't. Keeping status quo means they still get great profit, and competition drops out of the picture. How is that good for the economy?

Record profits, if anyone is actually making that, won't necessarily lead to spending. Holding onto the profits is more lucretive right now than expanding and taking risk. Partly due to the formentioned regulations and taxes.

 

[Shelzin]

"Record profits should mean that businesses should more inclined to spend to make more. They're not. Because of uncertainty... Not uncertainty of profit, uncertainty that it'll create more profit. And they are right... It won't. Keeping status quo means they still get great profit, and competition drops out of the picture. How is that good for the economy?

Record profits, if anyone is actually making that, won't necessarily lead to spending. Holding onto the profits is more lucretive right now than expanding and taking risk. Partly due to the formentioned regulations and taxes.

I disagree. The regulations and taxes don't mean anything to it. They just don't believe that they'll make more profit from actually spending those profits.

As for if they are really making that... Please... By all means look into it.

 

[Bfgrn]

Here's another truth that the Democrats don't think about:

The GOP wants to cut the tax rate of ALL Americans who pay taxes. The DNC wants you to think it's just the rich.

A recent study by the nonpartisan Tax Policy Center

This paper examines the tradeoffs among three competing goals that are inherent in a revenue-neutral income tax reform—maintaining tax revenues, ensuring a progressive tax system, and lowering marginal tax rates—drawing on the example of the tax policies advanced in presidential candidate Mitt Romney’s tax plan. Our major conclusion is that any revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed would provide large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers.

http://www.taxpolicycenter.org/UploadedPDF/1001628-Base-Broadening-Tax-Reform.pdf

 

[Obamanation]

OK, it looks now that we all agree you can't build from the bottom up, as the only way to do that is massive inflation. You want to stimulate economy you need to convince those with money to spend it. It's really that simple.

The gov't needs to convince those with money to spend it, right? Policies should obviously be created in an effort to get the rich to spend. RIGHT?

 

[regent]

Wrong. Much of American industry was heavily leveraged and when the stock market crash wiped out much of America's investment capital, lenders began to call in other debts to cover their losses. When business owners couldn't cover their loans, they were forced to close their doors and liquidate what assets they could, of course, laying off their workers in the process.

Growing the economy from the middle out is political bullshit. You can have all the demand in the world for your product, but if you can't find investors to give you the money to open a factory and cover your operating expenses, nothing will happen. You can have the best idea for a business in the world, but if you can't find investors who will give you start up capital, nothing will happen.

The difference between Obama and Romney, or more broadly between left and right, is that Obama believes the government should tax away some investment capital and direct to politically and ideologically sound investments, such as windmills or solar panels or electric cars and Romney and others on the right believe that private investors risking their own money are more likely to make investments that will produce economic growth than are politicians and bureaucrats, and most of the world agrees with Romney, which is why so many previously central planned economies such as China and Russia are now allowing private investors to determine where investment capital should go.

Hoover provided investment capital with the RFC and the companies sat on the money, what businessman would continue producing products that no one is buying? Of course the investers could insist the factory keep producing but what investers would do that? Why did farmers dump their milk in ditches when people wanted the milk? The farmers had the product, no investers needed, but it went into ditches. Why would companies spend billions on advertising to create a demand if demand wasn't a major factor?

The problems began with the stock market crash that wiped out investment capital and forced businesses to close their doors and liquidate assets to try to pay off their debts. This is what produced the unemployment you are talking about.

Once the economy had reached this point, there was no way I know of to quickly return it to its former prosperity, however, if Hoover had been able to immediately flood the country with emergency rescue loans to businesses that had had their debts called in, many businesses would not have had to close their doors and lay off their employees and it is likely that the nation would not have suffered nearly so terrible a depression, but the federal government lacked the financial tools necessary to do this on a large scale in those days.

If Obama had made government loans available to all credit worthy businesses and individuals that had been turned down by the banks when the troubled banks started cutting back on lending in 2009, we might well have avoided the recent recession and by now, be enjoying a more robust economy. Instead, Obama tried and failed to revitalize the economy by increasing demand through his stimulus bill.

Not too long ago, both Sweden and Japan suffered financial crises brought on bursting real estate bubbles just as we have, and the two countries responded to their crises in strikingly different ways and had strikingly different outcomes. Japan tried to revitalize its economy by increasing demand through large scale deficit spending on infrastructure projects just as Obama did later, and as long as the deficit spending continued, unemployment fell and the gdp rose, but when the debt reached unsustainable levels and Japan was forced to reduce its deficit spending the economy fell right back into recession and stayed there until Japan finally restructured its troubled banks, making capital more easily available to private investors and the private sector economy finally began to grow again.

In Sweden, the government immediately took over the troubled banks, removing their troubled assets and resupplying them with cash so there there was never a time when credit worthy borrowers did not have the access to loans they needed and the recession that would surely have otherwise followed their financial crisis was prevented. In both cases the key to recovery was ensuring the private sector economy had adequate access to capital,and in no case was the private sector economy ever revitalized by deficit spending to increase demand alone.

Ah so that's it, if a no one is buying what a company produces but investers keep feeding the company investment capital the company can be considered a success. Not too bad where do I find these investers?

 

[Obamanation]

Hoover provided investment capital with the RFC and the companies sat on the money, what businessman would continue producing products that no one is buying? Of course the investers could insist the factory keep producing but what investers would do that? Why did farmers dump their milk in ditches when people wanted the milk? The farmers had the product, no investers needed, but it went into ditches. Why would companies spend billions on advertising to create a demand if demand wasn't a major factor?

The problems began with the stock market crash that wiped out investment capital and forced businesses to close their doors and liquidate assets to try to pay off their debts. This is what produced the unemployment you are talking about.

Once the economy had reached this point, there was no way I know of to quickly return it to its former prosperity, however, if Hoover had been able to immediately flood the country with emergency rescue loans to businesses that had had their debts called in, many businesses would not have had to close their doors and lay off their employees and it is likely that the nation would not have suffered nearly so terrible a depression, but the federal government lacked the financial tools necessary to do this on a large scale in those days.

If Obama had made government loans available to all credit worthy businesses and individuals that had been turned down by the banks when the troubled banks started cutting back on lending in 2009, we might well have avoided the recent recession and by now, be enjoying a more robust economy. Instead, Obama tried and failed to revitalize the economy by increasing demand through his stimulus bill.

Not too long ago, both Sweden and Japan suffered financial crises brought on bursting real estate bubbles just as we have, and the two countries responded to their crises in strikingly different ways and had strikingly different outcomes. Japan tried to revitalize its economy by increasing demand through large scale deficit spending on infrastructure projects just as Obama did later, and as long as the deficit spending continued, unemployment fell and the gdp rose, but when the debt reached unsustainable levels and Japan was forced to reduce its deficit spending the economy fell right back into recession and stayed there until Japan finally restructured its troubled banks, making capital more easily available to private investors and the private sector economy finally began to grow again.

In Sweden, the government immediately took over the troubled banks, removing their troubled assets and resupplying them with cash so there there was never a time when credit worthy borrowers did not have the access to loans they needed and the recession that would surely have otherwise followed their financial crisis was prevented. In both cases the key to recovery was ensuring the private sector economy had adequate access to capital,and in no case was the private sector economy ever revitalized by deficit spending to increase demand alone.

Ah so that's it, if a no one is buying what a company produces but investers keep feeding the company investment capital the company can be considered a success. Not too bad where do I find these investers?

Try using the taxpayers. It works for Obama's buddies at Solyndra for a few extra years...

 

[Shelzin]

OK, it looks now that we all agree you can't build from the bottom up, as the only way to do that is massive inflation. You want to stimulate economy you need to convince those with money to spend it. It's really that simple.

The gov't needs to convince those with money to spend it, right? Policies should obviously be created in an effort to get the rich to spend. RIGHT?

Depends on how they do it. But essentially that is what needs to happen yes.

 

[mamooth]

OK, it looks now that we all agree you can't build from the bottom up,

Obviously incorrect. That's why supply side has always failed so badly when it was tried. That's why Democratic presidents preside over economies that are so much better than Republican presidents.

as the only way to do that is massive inflation.

Don't be absurd. You simply do it by not taxing the middle class, and taxing the rich instead. If the middle class has more to spend, the economy expands.

You want to stimulate economy you need to convince those with money to spend it. It's really that simple.

The gov't needs to convince those with money to spend it, right? Policies should obviously be created in an effort to get the rich to spend. RIGHT?

Such policies in the past have always failed. Thus, conservatives want very badly to repeat that failure. Liberals are more practical, and put good results over cult ideology.

All supply side achieves is a paper transfer wealth to the rich, who then refuse to spend that wealth. Why would they spend it on expanding production, when there's no demand? Rich people aren't stupid, and won't throw away their money like that.

Capital? There's no shortage of capital. That's not what limits the economy, and that's another fundamental failure of the supply-side myth. If the demand is there, the capital will be spent, but not before the demand (or at least projected demand) is there.

This is basic economics, but most Republicans will not be capable of understanding it, since they're so emotionally invested in not understanding it. They weren't reasoned into their beliefs, so they can't be reasoned out of them. And they won't change their beliefs until one of their authority figures orders them to change their beliefs.

 

[manifold]

Can someone explain why democrats think

Somebody has to.

 

[regent]

The problems began with the stock market crash that wiped out investment capital and forced businesses to close their doors and liquidate assets to try to pay off their debts. This is what produced the unemployment you are talking about.

Once the economy had reached this point, there was no way I know of to quickly return it to its former prosperity, however, if Hoover had been able to immediately flood the country with emergency rescue loans to businesses that had had their debts called in, many businesses would not have had to close their doors and lay off their employees and it is likely that the nation would not have suffered nearly so terrible a depression, but the federal government lacked the financial tools necessary to do this on a large scale in those days.

If Obama had made government loans available to all credit worthy businesses and individuals that had been turned down by the banks when the troubled banks started cutting back on lending in 2009, we might well have avoided the recent recession and by now, be enjoying a more robust economy. Instead, Obama tried and failed to revitalize the economy by increasing demand through his stimulus bill.

Not too long ago, both Sweden and Japan suffered financial crises brought on bursting real estate bubbles just as we have, and the two countries responded to their crises in strikingly different ways and had strikingly different outcomes. Japan tried to revitalize its economy by increasing demand through large scale deficit spending on infrastructure projects just as Obama did later, and as long as the deficit spending continued, unemployment fell and the gdp rose, but when the debt reached unsustainable levels and Japan was forced to reduce its deficit spending the economy fell right back into recession and stayed there until Japan finally restructured its troubled banks, making capital more easily available to private investors and the private sector economy finally began to grow again.

In Sweden, the government immediately took over the troubled banks, removing their troubled assets and resupplying them with cash so there there was never a time when credit worthy borrowers did not have the access to loans they needed and the recession that would surely have otherwise followed their financial crisis was prevented. In both cases the key to recovery was ensuring the private sector economy had adequate access to capital,and in no case was the private sector economy ever revitalized by deficit spending to increase demand alone.

Ah so that's it, if a no one is buying what a company produces but investers keep feeding the company investment capital the company can be considered a success. Not too bad where do I find these investers?

Try using the taxpayers. It works for Obama's buddies at Solyndra for a few extra years...

Well it didn't work too well for Hoover. Maybe that's why FDR changed the whole idea. FDR reasoned that if you want to sell products, get the money into the hands of the consumers. the consumers that are the likely buyers of the products. Of course, FDR had the Hoover-RFC example in front of him so it didn't take a genius to come to that conclusion.
Seems some have forgotten that hard earned lesson and we might have to repeat it. Is it our failure to learn or just thay new generations come along and so we go through the whole process again.

 

[Bfgrn]

OK, it looks now that we all agree you can't build from the bottom up,

Obviously incorrect. That's why supply side has always failed so badly when it was tried. That's why Democratic presidents preside over economies that are so much better than Republican presidents.

as the only way to do that is massive inflation.

Don't be absurd. You simply do it by not taxing the middle class, and taxing the rich instead. If the middle class has more to spend, the economy expands.

You want to stimulate economy you need to convince those with money to spend it. It's really that simple.

The gov't needs to convince those with money to spend it, right? Policies should obviously be created in an effort to get the rich to spend. RIGHT?

Such policies in the past have always failed. Thus, conservatives want very badly to repeat that failure. Liberals are more practical, and put good results over cult ideology.

All supply side achieves is a paper transfer wealth to the rich, who then refuse to spend that wealth. Why would they spend it on expanding production, when there's no demand? Rich people aren't stupid, and won't throw away their money like that.

Capital? There's no shortage of capital. That's not what limits the economy, and that's another fundamental failure of the supply-side myth. If the demand is there, the capital will be spent, but not before the demand (or at least projected demand) is there.

This is basic economics, but most Republicans will not be capable of understanding it, since they're so emotionally invested in not understanding it. They weren't reasoned into their beliefs, so they can't be reasoned out of them. And they won't change their beliefs until one of their authority figures orders them to change their beliefs.

Good post mamooth.

Ironic, the one Democrat the right wants to call one of there own is President John F. Kennedy because he proposed tax cuts. BUT, what the right doesn't know, or willfully ignores is taught in econ 101...DEMAND side tax cuts.

JFK did not believe in trickle down economics.

JFK, the demand-side tax cutter

"The Revenue Act of 1964 was aimed at the demand, rather than the supply, side of the economy," said Arthur Okun, one of Kennedy's economic advisers.

This distinction, taught in Economics 101, seldom makes it into the Washington sound-bite wars. A demand-side cut rests on the Keynesian theory that public consumption spurs economic activity. Government puts money in people's hands, as a temporary measure, so that they'll spend it. A supply-side cut sees business investment as the key to growth. Government gives money to businesses and wealthy individuals to invest, ultimately benefiting all Americans. Back in the early 1960s, tax cutting was as contentious as it is today, but it was liberal demand-siders who were calling for the cuts and generating the controversy.

When Kennedy ran for president in 1960 amid a sluggish economy, he vowed to "get the country moving again." After his election, his advisers, led by chief economist Walter Heller, urged a classically Keynesian solution: running a deficit to stimulate growth. (The $10 billion deficit Heller recommended, bold at the time, seems laughably small by today's standards.) In Keynesian theory, a tax cut aimed at consumers would have a "multiplier" effect, since each dollar that a taxpayer spent would go to another taxpayer, who would in effect spend it again—meaning the deficit would be short-lived.

At first Kennedy balked at Heller's Keynesianism. He even proposed a balanced budget in his first State of the Union address. But Heller and his team won over the president. By mid-1962 Kennedy had seen the Keynesian light, and in January 1963 he declared that "the enactment this year of tax reduction and tax reform overshadows all other domestic issues in this Congress."

The plan Kennedy's team drafted had many elements, including the closing of loopholes (the "tax reform" Kennedy spoke of).Ultimately, in the form that Lyndon Johnson signed into law, it reduced tax withholding rates, initiated a new standard deduction, and boosted the top deduction for child care expenses, among other provisions. It did lower the top tax bracket significantly, although from a vastly higher starting point than anything we've seen in recent years: 91 percent on marginal income greater than $400,000. And he cut it only to 70 percent, hardly the mark of a future Club for Growth member.

 

[OODA_Loop]

The right calls JFK one of their own ?

 

[Obamanation]

Ah so that's it, if a no one is buying what a company produces but investers keep feeding the company investment capital the company can be considered a success. Not too bad where do I find these investers?

Try using the taxpayers. It works for Obama's buddies at Solyndra for a few extra years...

Well it didn't work too well for Hoover. Maybe that's why FDR changed the whole idea. FDR reasoned that if you want to sell products, get the money into the hands of the consumers. the consumers that are the likely buyers of the products. Of course, FDR had the Hoover-RFC example in front of him so it didn't take a genius to come to that conclusion.
Seems some have forgotten that hard earned lesson and we might have to repeat it. Is it our failure to learn or just thay new generations come along and so we go through the whole process again.

We went through this earlier in the thread. You can't build an economy from the bottom up. It's impossible. There is no money at the bottom.

How do you get the money at that bottom?

 

[Obamanation]

OK, it looks now that we all agree you can't build from the bottom up,

Obviously incorrect. That's why supply side has always failed so badly when it was tried. That's why Democratic presidents preside over economies that are so much better than Republican presidents.

as the only way to do that is massive inflation.

Don't be absurd. You simply do it by not taxing the middle class, and taxing the rich instead. If the middle class has more to spend, the economy expands.

You want to stimulate economy you need to convince those with money to spend it. It's really that simple.

The gov't needs to convince those with money to spend it, right? Policies should obviously be created in an effort to get the rich to spend. RIGHT?

Such policies in the past have always failed. Thus, conservatives want very badly to repeat that failure. Liberals are more practical, and put good results over cult ideology.

All supply side achieves is a paper transfer wealth to the rich, who then refuse to spend that wealth. Why would they spend it on expanding production, when there's no demand? Rich people aren't stupid, and won't throw away their money like that.

Capital? There's no shortage of capital. That's not what limits the economy, and that's another fundamental failure of the supply-side myth. If the demand is there, the capital will be spent, but not before the demand (or at least projected demand) is there.

This is basic economics, but most Republicans will not be capable of understanding it, since they're so emotionally invested in not understanding it. They weren't reasoned into their beliefs, so they can't be reasoned out of them. And they won't change their beliefs until one of their authority figures orders them to change their beliefs.

This is a joke right? I would love to understand it. That is why I kept posting the question...

How do you intend to put the capital in the hands of the poor? to begin your magic salve designed to save the world...

 

[regent]

One of the most intersting plans to get money into the hands of the consumer during the Great Depression was the Townsend Plan. Every one over 60 years of age was to receive $200 bucks a month, but only on the condition they spent the entire $200 bucks during the month. The plan never passed but it put a lot of heat on FDR to do something.