Quote Of The Day

Aug 8th, 2011

"Goodness is the only investment that never fails." 
-- Henry David Thoreau

I Keep Saying This...

June 1st, 2011

The crisis of American economy is one of willful design. Lawrence Mishel of The Economic Policy Institute published a paper a few weeks ago titled We're Not Broke Nor Will We Be that supports this view.


His conclusion is both clear and actually somewhat entertaining:

"There is an old joke about the Lone Ranger, who turned to Tonto and said, "We’re surrounded by Indians," and Tonto responds, "What do you mean by 'we,' kimosabe?'" That same logic applies to policymakers who claim that "we're broke." It matters who is included in "we." We, collectively, have been gaining income and wealth and will continue to do so. "We," the broad middle class, have not been gaining wealth and have not received much of the income gains of the past 30 years. Whether the broad middle class prospers in the next 30 years does not hinge on whether there will be substantial income growth; there most definitely will be. The future prosperity of the broad middle class hinges on the economic policies and structures that determine how that income is generated and shared. Are our federal and state governments "broke"? They certainly face deficits. Whether those governments provide the services we need will totally depend upon the political decisions made regarding taxing and spending. Taxation and revenues have diminished, both due to policy choices and the impact of the Great Recession.

So, are we broke? Only if we choose to be."

Why Pulling The Omnibus Bill Was A Disaster

Dec 17th, 2010

By F. Grey Parker

In my final post yesterday, I stated bluntly that Sen. Harry Reid's (D-NV) sudden surrender on the omnibus spending bill was a "disaster." To me, this statement was as simple as saying the world is round, the Sun rises in the East and the only sure things are death and taxes. I took it to be a truism. There was more than a little disagreement over this. I was surprised at the number of contrarian e-mails that awaited me this morning. Some of the commentary so strongly opposed my position, including that of arguably my most devoted reader, that it is necessary to plead my case in some detail.

Deficits As Investment

Nov 18th, 2010

by James Hayford

I cringe every time the I hear that the government should learn to live within it's means, "like households all over the country". So I was very happy to see Robert Reich take on this pervasive idea; that deficit spending is always bad. It has become an article of faith that even Obama seems to repeat in order to seem serious about the deficit. 

 Reich uses the example of households taking out loans to send their kids to college, to point out that sometimes going into debt in the short term, is the best way to get ahead in the long term. 


 I like that example, but I think that governments are more like businesses than like families. Many businesses use short term debt. And as we all know from the effects of the credit crisis, businesses that can't get credit must shrink or even go under. 
Reich goes on to say that the way out of debt is through growth. 

He worries that "budget-deficit mania will slow future growth if it forces government to cut the things that fuel growth – education, basic R&D, child health, improved infrastructure."


 Well put.