The Case for Obama, Part 1: These "hard" economic times

There are two things I'm sick and tired of hearing about.  The first is that Obama and the Democrats are strong with voters on social issues, whilst Romney and the Republicans have the edge on economic and fiscal matters. In a word? BALONEY SAUSAGE. I've written plenty of posts in the past showing just how mush better things are under Democrats on purely economic terms, and [and this is the other thing I'm sick of hearing] "these hard economic times" are no different.  And don't expect the mainstream media to tell you any of this, but the fact is? Times ain't so bad. In fact, well... I'll let the data do the talking.

Exhibit A: The Dow Jones Industrial Average.  Generally considered one of the best indicators of overall economic health in this country.  Now, to put in context just what a wet, steaming pile of bullshit it is that people are talking about Obama like (1) he's done anything wrong, (2) that there IS actually anything wrong, and (3) that [even though it isn't wrong] it's all his fault, I want to start back a bit, to when George W. Bush took office, just to remind everyone what a shitty stock market REALLY looks like.  This is the DJIA from Inauguration day, 2001 to Election Day, 2004 (From Yahoo Finance):

Bottom line? DOWN 5.13%.  DOWN. Over FOUR YEARS! And that asshole got re-elected despite that!  Of course we all know how his second term fared.  Here's Election day, 2004 to Election day 2008:

Down 13.9%! And Conservatives wonder why Obama got elected? Conservatives are still trying to  argue that OBAMA destroyed the economy?! The DOW was down 13.9% in the four years since we reelected the guy under whom it had all ready fallen 5.13%!  Here's Bush's eight year term, Inauguration Day, 2001 to Inauguration Day, 2009:

Wow. DOWN 24.23%. Way to go, Georgie! Here's what's happened since Obama took office:

BOOM! UP! UP! UP! 66.4%! Wow! Now... I don't want anyone to get the idea that I think the President is directly, 100% responsible for the stock market, but... Let's not forget that the guys who are whining about "these hard economic times" are the guys who (1) got re-election after a 5% decline, and (2) were down over 24% by the time they were done.  And we're up 66% right now and I'm supposed to believe that it's THE OTHER GUYS who have the economic wherewithal?  Bullshit. According to the DJIA, Obama's done roughly three times the good in under four years than the amount of harm down by George W. Bush in EIGHT. 

Well, maybe the DJIA has a Liberal bias or something. I wonder what the S & P 500 looked like during Bush's first term:

Whoa. Down 13.16%. How the hell did that redneck get re-elected?! Is anyone goimng to seriously tell me that there's Liberal Bias in the media?!  Where was it in 2004?  Oh, and uh... How's things go the second time around?

Oh my God! DOWN 21.38%!  Almost as bad as the DOW. And people say Obama's presiding over a bad economy?!  Here was Shrub's eight year performance on the S & P:

Down 38.6%. Holy. Fucking. Shit. And since Obama took office?

And BOOM GOES THE DYNAMITE! UP SEVENTY FOUR POINT TWO-EIGHT PERCENT! Oh, yeah: Let's get rid of this guy!

The NASDAQ tells the same story:

Down 28.03%. That in just his first term folks! Can someone PLEASE tell me how John Kerry didn't beat this ass-clown in a LANDSLIDE?  Liberal Media, my hairy, unwashed ass!

Second time around:

Down another 19.2%. And they wonder why the lost. Must have been that Liberally biased STOCK MARKET. 

Overall, our roughly fifth worst President of all time managed to take a whopping 46.88% out of the NASDAQ during his tenure. Remember: This was the guy who mocked Al Gore's legislation that created the Internet.  OK, so how's the NASDAQ doing under Obama?

Up... One-Hundred... and... Thirteen... Percent.  Holy... Fucking... Shit... (I should have bought more!)  And really, to show how skull-fuckingly stupid (or just plain screwed) the Republicans are here, they keep trying to disappear George W. Bush's UTTER ECONOMIC FAILURES, every time Obama reminds people how bad things were under Bush. Thing is? The main reason that Obama's stock market has been as good as it was, is because it started in such a deep, dark hole! Saying that he came in essentially just at the right time, would be the easiest way for the Republicans to poo-poo his success. But, of course, they can't say THAT, because (1) they'd have to actually ACKNOWLEDGE his success, and admit that he also did the right things, and (2) they'd have to acknowledge Bush's FAILURE.

And... it's just easier for them to lie about it.  None of the Conservatively biased Mainstream Media is going to break from the narrative that the Right's strength is economics, (note: it isn't. they have no strengths) nor call out Fox News for going above and beyond in the field of outright deceit and propaganda.

OK, so admittedly the Stock Market MIGHT not be the best measure. (That sure was FUN for me to go through though, let me tell you!)  How about the GDP? Well, here's a chart:

It's from this article. My favorite part of which is the following line:

The average growth rate in private real quarterly GDP since 2000 has been 1.76%, so the private sector of the U.S. economy expanded in the first quarter of 2012 at twice the average rate over the last 12 years

I keep hearing about how slow, and sluggish and disappointing that 2.2% rate is, but "double the rate of the last twelve years?!" Seems like we're doing just fine in that regard as well.  BTW, you see those RED LINES?  Well, the Conservative Toadies in the Mainstream media won't tell you this, but... those are REDUCTIONS in Government Spending. And contrary to what the Macroeconomic Failures who drew up the Paul Ryan Budget will tell you: That's a drag on the economy.  So, if you think Obama should be doing more (meaning SPENDING more?) I'd agree with you 100%.  But that criticism sure as hell isn't a reason to vote Republican! And if you think he should cut more? Then you're either a Billionaire or an idiot who doesn't understand how economics works and will be out a job sooner than he thinks.

Speaking of which, unemployment is becoming so much NOT A PROBLEM, that Fox News has gone so far as to allege a conspiracy over the numbers!  Sarah Palin even questioned their accuracy!  Eric Bolling again accused the BLS of being partisan! Imagine the gall it takes, for a guy on FOX NEWS to accuse the BLS of partisan bias!  There should have been a quantum singularity forming in his crotch due to the gravity created by his massively HUGE BALLS.

Here's an unemployment chart that ought to get Obama re-elected:

Wow. Again what do we see? Things getting worse and worse and worse under Bush... And things getting better and better and batter, and the staying in the green under Obama.

Now, I'm going to look at energy and gas prices next, and I've never been shy about delving into social issues myself, but on a purely economic basis? Everything got worse under Bush, and everything has gotten better under Obama.  That not my opinion: That's what the data says. It's not a "liberal talking point" either: It's MATH.

If anyone needs a quick reference here you go:

As of 4/29/2012:

DJIA:
When Bush got re-elected: DOWN, -5.13%
Bush's Presidency: DOWN, -24.23%
Under Obama: UP, 66.4%

S&P 500:
When Bush got re-elected: DOWN, -13.16%
Bush's Presidency: DOWN, -38.6%
Under Obama: UP, 74.28%

NASDAQ:
When Bush got re-elected: DOWN, -28.03%
Bush's Presidency: DOWN, -46.88%
Under Obama: UP, 113.05%

I'm still stunned by this. Can you imagine what they'd be saying about Obama's economy if his markets had George Bush's returns?  Oh, yeah, but Bush gets re-elected after net first-term losses, and the so-called 'Liberal' media media keeps up the narrative that Republicans know their asses from their elbows when it comes to the economy.

One final note, regarding the millions of people still trying to find work.  In no way is my post here implying that your plight is not real. You're out of work. And no amount of economic data is going to put food on your table. (Of course... the Republicans want to kill anything that WILL do that as well.) The point here is WHY. WHY are there are so many unemployed people? And WHO, WHO is going to make things better and who will make them worst? History says the Republicans will make it worse. They're the ones who MADE IT BAD in the first place. And AUSTERITY won't fix anything. Obama has been embracing Austerity at an astounding rate, mainly to appease the Right, and it is the number one thing HAMPERING our economic recovery.  The Right will only give you more of he only thing Obama actually IS doing wrong economically. And that's not my opinion, or mere conjecture. I KNOW this because they've promised as much.  That's what massive SPENDING CUTS will do folks: Kill the economy. DO NOT give the Republicans this chance!

There was a cracked article yesterday that had the good sense to link to the following video by former Labor Secretary Robert Riech. The rest of the article had some feir criticisms of the OWS movement, but IMHO, is not really owrth cehcking out. This, OTOH is:



You tell 'em, Robert!

And the soloution to these 6 points?

1) Tax the rich
2) Tax the rich
3) Tax the rich
4) Tax the rich
5) Get a Progressive Candidate who isn't afraid to tax the rich, and lead from a progressive agenda.
6) Vote for said Progressive, and his progressive agenda. (And tax teh rich.)

Funny how that works out, huh?

Gladstone was right about one thing: the OWS people could learn to simplfy the message a bit.

Good Speech

Heard the President's speech tonight, while working out at the gym.

Leaving out any of the accumulated baggage, and forgetting for the moment about the last two and half years?  It was a good speech. A damned good speech.  A GREAT speech, even. Diplomatic, yet pointed. Practical but passionate.  Statesmanlike, but also partisan the best possible way: He called out Republicans mainly by reminding them of the truly great things that they once stood for.  He made the case for eliminating the Bush tax breaks for the richest Americans, pointing out that it's not partisan, nor is it class warfare, but rather a case of simple math.  He pointed out that the proposals in his Jobs Plan are (again) things that Republicans and Democrats alike believe in. And yet, this time his calls for bi-partisan action came off not as him being weak, but rather as him shaming Republicans, and managing to do so without sounding preachy! Tonight he had strength. Tonight, he had spirit! THIS was the man I voted for!  (I don't know where he's been for th past two and ahlf years, but... I'll get to that.)

It came as no surprise that there were several moments where the Left Side of the chamber was brought to their feet.   What DID surprise me were the numerous times that two or three on the Right side of the chamber had the courage to stand up as well.  And one time (not including when he was finished (LOL)), he had the entire chamber on its feet.

Save for one man...

And that might have been the best part of the whole speech: Watching that great, bronzed cocksucker Speaker John Boehner twisting uncomfortably in his seat the entire time, looking like he had a bad case of hemorrhoids throughout the whole address, and KNOWING that Obama was winning with his audience...

...And I don't mean his audience in the chamber.

Remember that whole, stupid pissing match they got into over whether the speech was going to be last night or tonight?  Well... Obama looked weak (again) and Bohener looked like a dick (again) over the whole stupid thing. But they way it worked out? Most anyone who would have thought it was to the Coppertone Man's credit that he was sitting on his ass all night, looking like a fool?  WERE THEMSELVES MOST LIKELY OFF WATCHING FOOTBALL!!!  The people most likely to have seen John Boehner looking like he was sitting in a chair that someone had peed in beforehand were the ones most likely to hate him for it!

So top marks...

...for the speech.

We'll see (and more likely, we won't) if this translates into action. 

And once again, we are reminded of what ClassicLiberal so aptly refers to as "the tragedy of Obama."

Because, Mister Presdient, the time to put your boot-heel to the necks of the Conservative movement was just over two and a half years ago. The opportunity to suffocate the life out of the Right, turn this country around and start moving FOREWORD again was handed to you 32 months ago on a polished silver platter and you squandered it.  And perhaps the greatest example of why he has failed, and why this too will also likely fail was offered by Orrin Hatch beforehand:

“If (the payroll tax cut) is standing alone, I think that might have some success,” said Sen. Orrin Hatch, R-Utah. “If it's lumped in with a whole bunch of big spending programs that builds Washington at the expense of the rest of the economy he’s not going to have much support from me or any other Republican.”

In other words:

"We'll take whatever you're going to give us for free, but don't expect anything in return."

And that's the rub isn't it? That has been the issue fro day number one - though I've never heard any Republican say it quite this plainly...

...Oh wait, YES I HAVE!

"The single most important thing we want to achieve is for President Obama to be a one-term president.”

Sen. Minority Leader Micth McConnell, October 25th, 2010

And AGAIN...

 “Well that is true, [making Obama a one-term President is] my single most important political goal along with every active Republican in the country."

Sen. Minority Leader Micth McConnell, July 10th, 2011 

Mister Obama, they will NOT stop playing politics, for the simple reason that they want you to fail  more than they want the COUNTRY TO SUCCEED.  You will never have their support.  You will never see anything from these traitorous scumbags other than their best efforts to sabotage your Presdiency, and progressive politics by extension (even though you haven't actually ever USED any). They will never be honest. They will never do right.   They will never stop trying to make you fail, and no sacrifice is too great for them! 

And I don't think it's all about race.  In fact, I don't think it's about race at all.

Their behavior over the past two years is because they recognized the threat to their party's future and to their entire philosophy that you and your popularity represented.

The tragedy here is that YOU never recognized the threat that THEY represented to you, to your presidency and to your country!

Still...

I won't have it be said that I don't give credit where I think it's due.

It was a good speech.

I Don't Believe in Miracles

Nobel Laureate and one of a very few people who “get it” (or tell the truth) anymore, Paul Krugman, wrote an excellent piece the other day in the NYT debunking the myth of the “Texas Miracle” that has supposedly happened under Governor Rick / General Robert E. Perry. It’s great piece and although it doesn’t go far enough (to use one of his own famous critiques) I recommend that everyone read it, just I as Recommend reading pretty much ANYTHNG this man writes. (Barry? Are you listening?)

And last night the Gym some ass-hat two machines down from me not only had Fox News On, but had it turned UP. (Usually the TV's are muted and just show subtitles.) So I got to listen to a marvelously fact-free response from the four members of the Fox Panel who HAVE NOT won Nobel Prizes in Economics. Devoid of rational response, or evidence to support their so called “miracle,” they report to calling [Krugman's analysis] the “Alien Invasion” theory suggesting either that Krugman credits illegal immigration ALONE for ALL of Texas’ growth, or that he was suggesting that little green men, perhaps from Mars, were somehow to thank. And of course, the average Fox viewer is more likely to hear that explanation and think, “Wow, that Krugman sure is a nut!” rather than, “Wow, these Fox peoples sure are stupid!” Because remember:

A LIBERAL WILL TELL YOU WHY YOUR ARGUMENT IS WRONG.


A CONSERVATIVE WILL TELL YOU WHY YOUR ARGUMENT IS LIBERAL.

(As an aside, between how pissed off I was getting listening to Fox and the Trainer playing the Greatest Hits of the Rocky movies with one his clients, I did have a really good workout!)

(Another aside - I couldn't find a transcript of the Fox segment, but while looking for one, I found almost the next best thing: This Idiot's Blog.  Check it out, although preferably not right after you've eaten! We got a future Hall of Shamer here, for sure. I'm curious to see if he has the balls to let my comments post(he did! good on him!), and the chops to respond to them. Or come here! If he does, who knows? It might get interesting.)

Well, anyway, I’m all for debunking “Miracles” as anyone who understands my Humanist and Skeptical Philosophy already knows. And I heard an EXCELLENT story on NPR this morning that started where Krugman left off and ran with it, showing even more reasons why the “Texas Miracle” is unlikely to apply to the broader economy. You can find a transcript and audio HERE, but here are some of the highlights:

1) Population Growth: Texas has had an influx of immigrants, both legal and illegal, yes, but also many people moving there from other States. And, as Mister Krugman pointed out, it’s not like EVERY STATE’S population can grow based on people moving there from OTHER STATES. So, either it IS (or will have to be) an actual “Alien Invasion,” as Fox sarcastically put it, or it won’t work. Nice work there, Fox.

2) Public Sector growth has been every bit as robust as Private Sector growth. Liberals would be neither surprised nor bothered by this, but remember: He’s promising small Government. Apparently what’s been good for Texas will NOT in fact be good for the rest of the Country – at least according to him and his Tea-Backers.

3) The overwhelming majority of the private sector jobs have paid minimum-wage or less. Governor Perry, please, despite what your Tea-Backer and Supply-Side buddies will tell you, we don’t just want jobs. We want GOOD PAYING JOBS. Filling the economy with part-time, minimum wage jobs (or worse) is NOT what we’re looking for!

4) Despite all that Public Sector Growth – that the Right isn’t even prescribing? Texas ranks 49th in per pupil public school spending, and 50th – tied with Mississ-fucking-ssippi (or as my father-in-law calls it: The states that keep West Virginia from being LAST in anything) in the percentage of adults that go without health insurance.

5) Texas residence still go without many of the services that residents of every other state enjoy. Remember folks, because this is his recipe for success: Sub-Minimum Wage Jobs, and no Public Services. THAT’s the Texas “Miracle.”

6) Perry's “Enterprise Fund,” which gives taxpayer money to companies to come to, or expand in, Texas. *ugh* OK, putting aside that this is little more than Rick Perry giving tax-payer money to the company’s that back his campaign (alone enough to warrant his removal from office) this might sound a bit familiar. In one of the rare instance in which I agree with the tea-baggers, another word for this is… duh-dah-daaaaaah: STIMULUS. (You know: That thing they want to GET RID OF so we can have MORE JOBS?) (Idiots.) And in one of those rare instances that I agree with Rick Perry, depending on how this is administered this can be a good thing. Of course, I’d prefer public works projects to strait corporate giveaways, but, in a rare instance where Paul Krugman and Rick Perry would agree, the economic effect is largely the same: IT CREATES JOBS. But, of course, this will likely be off the table when it comes to the rest of the country.  The Tea Party Republican Retards have no intention of spending any money to fix anything. (At least, not while Obama's in office.)

And finally, the one that PISSES ME OFF THE MOST…

7) What kind of companies thrive in Texas? What are the biggest employers there, the ones driving most of that jobs growth? Well… Enron, ExxonMobil, Halliburton, Marathon Oil, Shell Oil, Texaco… You see the pattern yet? Mostly Oil Companies and other Energy Companies. And those guys have been doing great while the rest of the country’s economy remains in the shitter. Why? BOWEL-BASHINGLY HIGH GAS PRICES, THAT’S HOW!!!! These companies have made it their business model to siphon off as much of the rest of country's growth as possible! Well… OK… I’ll say potential growth, because with these greedy little fuckwads operating the way they do, they rest of the country will basically NEVER GROW AGAIN. Does that sound alarmist? Think about it. Since ~2005 or thereabouts (I've noticed it pretty clearly since the days after Hurricane Katrina) the pattern has gone in lockstep perfection:

1: Gas prices go up =>the economy slows.

2: Slow economy => no jobs => less demand => gas prices drop.

3: Low gas prices mean people have more money, as they are no longer being strangled by the oil companies. (Thank you, Mister Keyenes!)

4: More money => more demand => economy starts to improve.

5: Economy improves, demand goes up => GAS PRICES GO UP.

6: GOTO 1

And it doesn’t make a difference whether the oil is foreign or not. (Shell is a Dutch company. They still employ a lot of Texan-Americans.) The problem is that oil and gas (energy) prices will ALWAYS act as drag on the economy. They will ALWAYS be a negatively correlated indicator. Until we break their stranglehold we will not be able to escape this pattern. It’s like a tax on the rest of the economy, but one who’s rate actually goes up to the point that it kills growth as soon as there IS any. And nowhere has this kick-in-the-balls been more evident than in my home state of Michigan. High gas prices killed the SUV. That’s great for the environment, don’t get me wrong. It needed to happen, and it was inevitable that big-Auto would need to transition off of them. But the gas prices have gone back down since then! They slowed the economy and were really what kicked off the mortgage crisis. (Not the kindling, of course, just the spark.) And the two brought the Big Three automakers to the brink of bankruptcy. And we haven’t had a robust recovery – because the Republicans and big oil won’t LTE US!

Nice going.

Oh yeah… and as for the whole Low-Tax, low Regulation business environment?

8) Texas job growth has not kept pace with its population growth: They have higher unemployment that the high-tax, highly regulated, robust public service providing states of New York and Massachusetts. (You remember Massachusetts, right? The state with near-universal health care coverage, compared to Texas’ rank of dead last?)

So THAT’S his recipe folks:

• Shitty, Low paying jobs

• No public services

• Little to no health insurance

• Underfunded schools

• High gas prices

You know what? If THAT shit works? I just might start believing in “miracles!”

A Post-Scarcity Economy

(Note: I wrote this up a few days ago, before the O'Donnell and Miller stories broke.  So I'm putting this up NOW, but I'm going to come back tonight and address those two fascist clowns.)

Awhile back, I awarded Cracked.com (the website of Cracked Magazine) a Silver Star in my HoF. But articles like the one I’m about to refer you to seriously make me consider upgrading them to a Gold Star. Just to clarify: Silver Stars are for fun stuff, webcomics, pop culture sites, meme’s, games, and just random stuff I really like, Gold Stars are for serious political or philosophical resources that I find either profound in terms of shaping my personal philosophy, or (in the case of Election-Projection) have been repeatedly useful in terms of being a tool to provides some specific, useful information. Now… a decent portion what Cracked does is pop-culture based. and it’s hilarious. It’s A-List stuff. But its about movies, or Super Heroes, TV Shows… stuff like that. But they also do an decent amount of articles dealing with History, Science, Politics, Philosophy, Sociology and other more profound topics. Their articles are always very well researched, and cited, especially coming from a purely satirical site; and the end result is something that really makes you think twice about what you though you knew, and about the status quo, and does so with a sharp irreverence that can’t help but make you laugh. (Assuming of course that you’re not too heavily invested in believing in the status quo, of course!)

And… almost regardless of the actual conclusions they reach, there's something profoundly and inherently LIBERAL about researching a historical or sociological topic and reporting back with a result that challenges the status quo! (Am I right?) And while it is meant primarily for entertainment, some of you may already be saying, “Hey, the best comedy always has a grain of truth to it.” Actually, no, having a grain of truth? That’s Religion. With great comedy? The more truth, the better. In fact the greatest comedy of all has nothing but truth, and little to no exaggeration at all. Truth, of course, so often being much, much stranger than fiction. So with that in mind, I’d like to recommend that you read the following article, which just might be one of the most profound articles on economics that I’ve ever read – and I’ve got an MBA!

Five Reasons the Future Will Be Ruled by BS

First conclusion: That those who a good at "BS" will be all powerful in the future? In the future? You sure it will take that long?

But putting that said, the implications are incredible. The following could disappear overnight, right now: the Publishing Industry, the Newspaper Industry, the Manufacturing parts of the Music Industry, The Distribution parts of the Movie Industry, CD’s, DVD’s, the Post Office, 99% of the Paper producers, and others… Right now every single one of these things, beyond any doubt, has not only outlived its usefulness, but truly outlived all conceivable utility. Think of the number of jobs in those industries. Think of the amount of MONEY involved. Think about the vitally important role that some of these people play in our society and culture: Musicians, Authors, Journalists (just the good ones!). Now… Think objectively about how valuable that is… and then how you propose PAYING for it! (And how it might look, and how our culture might look, if it all went away, based on there being a single penny in it!)

500 years ago the Printing Press changed the world. The Conservatives (of the day) railed against it, seeing as how it would basically put the Monks out of business, being able to produce in a week what would take the Monks a hundred years. Literature flourished, literacy proliferated and the world changed. Just over a Century ago, Conservatives (of that time) were railing against industrial development, clinging to their agrarian lifestyles as Progressives laid railroad tracks and built skyscrapers. The industrial revolution kicked of a flurry of scientific research, engineering implementation that has never stopped accelerating, and continues to through to the present day. And, again, the entire world changed. Taking this article to its logical conclusion, and recognizing that these changes are being grappled with RIGHT NOW? I have no doubt that the full transformative power of the digital revolution is only know, even being GLIMPSED. This will change the world, in our lifetimes, and order of magnitude more that the industrial revolution. A decade or two from now? The transformative power of the Internet and of digital media will make the Space Shuttle look like the printing press.

The world is absolutely changing every bit as profoundly, more so actually, as it was then.

And this progressive? Can admit to having the slightest bit of trepidation abotu it. Not because of the technology itself, I’m an engineer, I love new technology, but because of how the rules are changing. For better or worse, the laws of supply and demand, based on economies of scarcity have existed, and driven human behavior (and really, even the behavior of everything else) since life first crawled out of the ooze. Now, I hate to act like those Monks, cursing the printing press, or those [once slave-owning] farmers, cursing the cities that grew up around them, but THINK ABOUT IT… What will replace this? What does a post-scarcity economic model even LOOK like? Socialism? Not really, not as I see it. Because socialism is still subject to market force. Forces that can be understood, quantified, manipulated… Market forces, driven by scarcity, are every bit as integral to a Socialist model as to a Capitalist one. But what will the rules be when supply is infinite at a cost of zero, and demand goes to zero very quickly as the cost go above zero?

And even though at the moment, it's limited to only certain intellectual property and the distribution of it, consider this: Development of Wind and Solar Power generation will do the same for Energy!  After all: How much does a gallon of sunshine cost? Or a pound of wind?

Already we have huge industries right now, and more coming, that are basically rearranging the deck chairs on their own Titanic and, at best, sending an Ensign down to the engine room with a few pound of paraffin… just in case there’s a leak or two.

We know the world is changing, but I believe Liberals and Conservatives alike are only beginning to get the slightest understanding of the real implications; good, bad and chaotic.  Assuming I live to my life's expectancy, I will die in a radically different world than the one I was born into.  Far more so that in my Father's case, or even in my Grandfather or Great-Grandfather's case. The progressive in me can't wait to see it... But I'm beginning to understand why the Glenn Beck / Tea Party crowd is so freak out.  That rate at which the world is leaving them behind is accelerating like never before.

I wonder what GOLD will be good for, in a post-scarcity economy.

Losing heart...

*sigh*

I’ve really been losing heart lately.

The Phelps piece was totally draining for me to write, because it really is a lose-lose scenario. I still feel like crap for having to come down on the side of shitstain like Phelps, and feel even worse that my feelings haven’t really changed much since writing it. Sometimes I find that when writing something and laying out my argument that my feelings on the matter change during that process. That the arguments that sounded fine and dandy in my head, sound absurd once I put them down on paper, (so to speak.) And the Phelps piece could easily fall into that category, bar the fact that I still feel the same way. (And still feel completely and utterly awful about it.)

But beyond any one issue, there’s been a growing sense of helplessness in my mind lately. Some of it comes from the continuing erosion of public support for the Democrats, and how they will now likely lose control of at least the House if not the Senate. Part of it comes from the fact that they DESERVE TO, having abandoned their voting base, accomplished very little, and failed to really sell what they did, after having made concession after concession to the Right, all in a vein effort to win their support – which they never would. And perhaps the worst part of it all is that the general perception (according to narrative being played out in the media) is that they’re losing because they tried to be too Liberal. This narrative has been carried by the Beltway Press since the Carter days, and while there has NEVER been much actual evidence to support it, there is far less now than there has ever been.

The REALITY is that the Republicans have actively tried to sabotage everything Obama and the Democrats have tried to do, even as this has caused people to lose their homes, lose their unemployment benefits, and forestalled the country’s economic recovery until such time as it would be politically advantageous for them. And for all their treasonous, anti-America scumbagery, PEOPLE ARE REWARDING THEM.

What a joke. Obama’s too liberal – even though no part of the liberal agenda has come to pass – and it’s his fault the country’s in this mess – even though it started under Bush, and has been on a steady path to recovery, despite every effort made by the Republicans to prevent this.

The public is being actively misinformed. And they have no fucking clue. None at all.

And it’s not like I haven’t been aware of this for years. It’s not like my frustration with utter stupidity possessed by the average American is anything new. But while I’ve been both a skeptic and cynic my whole life, I guess for one brief moment, between the time the Democrats took back the House in '06 and Obama won the Presidency in '08, I thought things might change. For one brief period of time, I let myself BELIEVE. I had FAITH. But I guess I also seriously underestimated just how stupid this country is, and how easy it would be for the uber-rich and the RW Media (which is ALL of the media!) to simply GIVE power back to the Right. I really didn’t think people would forget how badly the Republicans fucked everything up quite this quickly, especially as the Democrtas have made some progress FIXING almost everything.  IOW - the COURSE is basically right, we just not going fats enough, thanks to the Repulicans, so people want the Republican's to set the course. 

It's makes no damned sense at all.

And not only are the Republicans are running against a recovery that they fought against, and incumbantcy that has been slowly but surely cleaning up their messes for the past four years, reversing the downward death spiral that we were in when the Dem’s came to power in 2006 and that we in the absolute depths of when Obama was elected in 2008… And yet not only are they winning, but the candidates they are winning with candidates who are like everything that was wrong with the ones that lost in 2006, SQUARED! I swear… the next time I hear one of these god-damned tea-baggers saying that we need to cut spending to create jobs, or cut taxes to fix the deficit, I am going to punch them square in the face! (And while they’re on the ground, as I continue kick the shit out of them, maybe I’ll take the time to educate them about how progressive taxation systems or macroeconomics work.) Reagan & Bush’41 CREATED the fiscal problem, Clinton fixed it, Bush’43 brought it right back, and these people want to go BACK to those morons, even as the economy recovers under Obama!

It's utterly insane.

I’d say they deserve what they get, but the problem is that the rest of us DON’T.

Anyway, thanks. Thanks for listening to me piss and moan. I really needed that. I want to leave you with something I came across the other night from a webcomic I’ve started reading recently called “Venus Envy.” (Which is really, really GOOD, BTW! Strong, complex characters, good plot with clever twists, funny as hell at times, dark and tragic at others. Definitely a future Silver Star recipient, although probably not this month.) This is a rather old piece, and it's not a piece from the actual storyline, but rather an expression of the author's frustration with the results of the 2004 election that perfectly echoes not only how I too felt at the time, but how I have increasingly come to feel in over the past two years, and particular in the past few months. I couldn’t say it any better, and don’t really want to try (again) so here it is:

You’re beautiful, Erin. 

And BTW, I love her follow-up reply, to the emails basically telling her to STFU and ‘get on with the story.’ All I can say is, "Wow. Damned strait! You go, girl!"

Remedial Economics - For those who either don't believe or don't understand

Hoo-boy. Glenn Beck’s got a plan to “save” America. You can read a little about it HERE. It’s the typical Right Wing garbage and for all his praying and crying about it, it won’t in fact save the country. All it will do is DESTROY the economy, while being deficit neutral at best. Perhaps the biggest irony in all of this is that it’s really just another cynical attempt by the Right to let the Rich grab (and keep) a whole lot more money. The IRONY is that, were this implemented, it would be as DISASTROUS for the Rich as it would for the poor. It would, in fact, BRING ABOUT the very economic calamity that Beck is trying to avoid. Although… given that Beck has repeatedly revealed himself as an anarchistic, nihilist LOON, maybe he’s TRYING to being this calamity about! I mean, if the world DOES end, suddenly that guy on the corner wearing the sign doesn’t seem so crazy! But I digress. The reason that all these conservatives keep saying “CUT Taxes, CUT Spending” as a recipe for both fiscal and economic success is that they (1) don’t understand Keynesian Economics and (2) they’re blinded by their ideals (and their greed) and can’t stand the idea that someone (other than them) gets any money that these guys don’t think the recipient “earned.”

Now… last year I promised a primer on Keynesian economics that I never quite got around to. Well... with Glenn Beck in full-on crazy mode, maybe a little education for everyone is in order. And I think I’ve got an example that will make this clear. It’s oversimplified, so it’s NOT intended to convince those who don’t believe it. but rather to explain it to those who don’t understand. So if you think stuff is really complex: THIS BLOG POST IS FOR YOU! I’ll show you how it’s not as hard as you think.

We’ll start off by putting out a couple of “givens.” These are FACTS, not talking points, and there’s no legitimate economist anywhere who will disagree with them. There are FOUR THINGS a government can do, relative to its ECONOMY and its DEFICT:

1. Raise Taxes
2. Cut Spending
3. Cut Taxes
4. Raise Spending

And while economist may quibble of the DEGREE, directionally raising taxes and cutting spending do the same thing and cutting taxes and raising spending do the same things:

• If you (1) Raise Taxes or (2) Cut Spending, you will harm (shrink) the economy and you will help (shrink) the deficit.
• If you (3) Cut Taxes or (4) Raise Spending, you will help (grow) the economy and you will harm (grow) the deficit.

None of these are up for debate! If you don’t believe either of the two preceding statements, you are either too conservative or too liberal for your own good. These are FACTS. Take an economics course if you don’t believe me. And besides, taken together, they are neither liberal nor conservative. They are BALANCED. Where the libs and cons disagree is over which one does MORE, which one helps or harms MORE – taxes or spending. I’m not going to settle THAT debate here, (hint: it's SPENDING) but I will explain what the Keynes model states, and show you how it works.

The important part of the Keynesian model is what happens when you do both in unison. Now, obviously if you did (1) and (2) you could erase the deficit, but you’d destroy the economy doing so. I’m sure lib’s and con’s alike would agree with that. Likewise, if you did (3) and (4) together, you’d have a BOOMING economy… but before long you’d have some pretty crippling debt. I’m sure we can all see why that won’t work either, but I’ll include in my example anyway. Where Keynes get’s controversial (though he’s absolutely right, and I’m going to show you why) is the following:

• If you (1) RAISE taxes by, for example, $1 Billion and you (4) RAISE spending by $1 Billion, you will, in fact, RAISE the collective income of everyone in the economy by $1 Billion, while not changing (or creating) a deficit AT ALL.
• If you (3) CUT taxes by $1 Billion and (2) CUT spending by $1 Billion, you will LOWER the collective income of everyone in the economy by $1 Billion, while not changing (or creating) a deficit AT ALL.

This is known as the “balanced budget multiplier” and it EQUALS 1. This means that if taxes and spending move in the SAME DIRECTION by some amount, INCOME will also move in the same direction by “one times” that amount. Also – as this is the very definition of a ‘balanced budget’ it should be obvious that the deficit is not affected.  (It's the actual defintion of deficit-neutral.)

How does this work? I’ll demonstrate:

Let’s say we have a country with just two people living in it: Connie and Libby. Connie is a retailer and real estate developer. She owns all the stores and all the land. Libby is broke and unemployed. She doesn’t have a pot to squat in or a window to dump it out of.

Now, in Fiscal Year One (FY1) Connie makes an income of $100 and Libby made $0. Our starting deficit is $0 and the collective income earned was $100. (100 + 0)

Seeing as how Libby is on the verge of starving to death, naked, sleeping under the stars, the government of this fine country is going to implement a relief program if Fiscal Year Two (FY2.) We are going to RAISE TAXES on anyone making over $50 (Connie) by $10 and give Libby a check for $10 to live on. Now… you may be tempted to say, “Connie now has $90, Libby now has $10, and all you did was rob from the rich and give to the poor and society is no better off.” But you’re wrong. Libby was living in poverty. Now that she has some money to spend, she’s going to buy some food clothing and shelter. IOW – she’s going to SPEND he $10. And since Connie owns the only store and the only apartment complex, she’s going to spend that $10 at Connie’s businesses. So Connie’s income will actually be: $110 (pre-tax), $100 (after-tax.) Despite the tax, her after-tax income didn’t change. Meanwhile Libby enjoyed an income of $10. So our society income is now $110: Connie income ($110 minus $10 in taxes) plus Libby’s income ($10). I managed to raise one person out of poverty without incurring any deficit or debt and without really lowering anyone else’s income! Pretty cool, huh?

Now… if I did that WITHOUT raising taxes? Sure, things would have even better: Connie would have had $110 and Libby $10 and or society would now have an income of $120… but would also now have $10 worth of debt as well. I’ll now demonstrate why that doesn’t work, in the long run.

Let’s say that in FY3, word of our great society begins to spread and another unemployed dead beat, Demi, moves in. Now… I COULD raise Connie’s taxes by $10 again, pay Libby and Demi $10 each and we’d be (collectively) up to $120 in the same manner:

• Connie would make $120 and pay $20 in taxes, for $100.
• Libby would have $10 in income (that she’d spend with Connie)
• Demi would have $10 in income (that she’d also spend with Connie)

But Connie’s a Republican and feels she’s being taxed enough. And since Libby and Demi didn’t make it to the polls, let’s assume we can’t raise taxes. So in FY3:

Demi and Libby will get their $10 checks, and spend them with Connie. Connie will thus get $120 in income, and pay only $10 in taxes. So $10 + $10 + $110 = $130 in collective income, and $10 in debt. ($10 in taxes, $20 in spending = $10 of debt.)

So now we're in FY4. Connie still makes $120 and pays $10 in takes. Libby and Demi still get their $10 checks. (Collective income of $130) BUT I have to pay interest on that $10 I owe. Let’s assume the interest is 10%, and that the bonds aren’t held by Connie, Libby or Demi. So I take in $10 in taxes, but I have to pay $1 in INTEREST. That leaves me $9, to pay out $20 in benefits with. So my deficit (now $11) gets added to my debt ($10) and I now OWE $21.

FY5: Connie makes $120 and pays $10 in Taxes. Libby and Demi get their $10 checks. Out of the $10 in taxes I collect, I now need to pay $2.10 in interest (10% times the $21 I now owe.) That leaves me just $7.90 to pay $20 in benefits with! So my defict is now $12.10, which gets added to my debt of $21. I now owe $33.12.

I’m sure by now, you can see the trouble we’re in. Despite maintaining my country’s income at $130 (instead of the $120 there would be if I had just raised Connie’s taxes) our debt is quickly spiraling out of control. Without cutting spending, or raising taxes, in just a few years, all of my tax revenue will be going to pay the interest on my debt!  So either I have to raise taxes or cut spending, and both will harm my economy.
  
So let’s do the CONSERVTAIVE thing, and get rid of those benefits. We still owe $33.12, but in FY6 we won’t pay out any benefits. So Libby and Demi will go back to making $0, and since they won’t be spending anything, Connie’s income will also drop to $100. Now… she’ll still have to pay her $10 in taxes, so her income is now $90. And my country’s income went from $130 down to just $90. A FORTY dollar drop, due to a $20 reduction in gov’t spending. Even if we cushioned it with a $6.69 tax break for Connie (so I can still pay the $3.31 in interest I owe) her income only goes up to $96.69. So my contry loses $33.31 in income, when I cut taxes by $6.69 and cut spending by $20.

So let’s go back to FY4 and pretend we raised Connie’s taxes to $20, and maintained our balanced budget. Connie will have [$120-$20] $100 in income, and Libby and Demi each get $10. So my country has an income of $120, and NO DEBT. And we get a new president who want to CUT taxes and CUT spending by $10 Each. So, in FY5 Libby and Demi only get $5 each, and Connie goes back to paying $10 in taxes. Because of thier reduced incomes, Libby and Demi can only spend $5 each. So Connie pre-tax income dropped to $110. She pay $10 in taxes, so she’s back $100. Combine that with Libby’s $5 and Demi’s $5 and my country’s income is now $110.

Did you see that?

It went DOWN by $10 after I cut taxes by $10 and cut spending by $10!

And, if you recall from way back in FY2 (and what I first proposed for FY3,) it went UP by $10 when I RASIED taxes and RAISED spending by $10!

And that’s how (and why) the Keynesian model works! It recognizes that an economy is more than just production. Production is necessary, of course, but without CONSUMPTION all the production in the world won’t make you a penny. You need to MAKE STUFF and you need to SELL IT. If people can’t buy it, it doesn’t matter how much you produce. It also recognizes that people don’t KEEP all, or even most, of their income. They SPEND it, and it then becomes someone else’s income! (And so on, and so on…)

Now… there are two legitimate criticisms of the Keynesian model - one from Professor Arthur Pigou and one from Nobel Laureate Milton Freedman, both of whom are conservatives, economically and fiscally speaking. As I said, they’re legitimate… but IMHO they’re also misguided and thus not applicable outside of academic discussions. If anyone is interested, I can explain them, and explain with they’re wrong. Otherwise, I’d like to hear what y’all think of this, and answer any questions (or criticisms) you have first.

In any case, given the TRUTH and FACT of the Keynesian model, it should be pretty clear that Beck's "plan" would destroy the economy and not really help the deficit.  Nice plan, huh?  I'm serious when I say that he's not really even TRYING to save anything.  He a nihlist.  And his every word demonstrates this.

Who does better with the economy?

The economy is something the right likes to harp about all the time but, just like everything else, really has no credibility on. I guess the thinking goes that since all the successful CEO’s are Republican (not true, but whatever), and they all know how to run COMPANIES (like, you know… Enron, General Motors and Citibank?) then the Republicans MUST be better at “running the economy.” Couple problems with that… First off all, the vast majority of Republican politicians, like most politicians in general, are LAWYERS, not businessmen. Second, a company is to the economy what today’s weather is to the climate – the two are related, but a thorough understanding of one or the other requires a completely different skill set. (Go figure that they aren’t on the right side of the global warming debate either!)

Now… it should be clear why these "successful" CEO’s "all" vote Republican: Republican generally don’t put as many regulations on industries and prefer the lesse-faire approach. That this approach has ALWAYS ended in disaster is apparently lost on them, but the CEO’s seem to think they’ll make more money under Republicans.

But will the economy do better?  (Will we keep our jobs? Will our investments grow?)

Let's take a look at how the economy has performed under Democrats and Republicans using two of the most common economic indicators: The Dow Jones Industrial Average and the Standard and Poores 500 Index. Here’s how the experiment will work. We’ll hypotyhetically put $1000.00 on the market when one party takes the White House, sell it when they’re voted out, and put it all back in when the regain power. We’ll then calculate what you’d have today if you’d done this over the years. The two strategies will be called “Betting on the Dem’s” and “Betting on the Pub’s.”

I was able to find DIJA data going back to 1900. We’ll do the Pub’s first. The idea is that you’ll BUY udner McKinnley, SELL with Wilson, BUY with Harding, SELL with Roosevelt, BUY with Eisenhower, SELL with Kennedy, etc… through to the present day, when you would SELL when Obama took office. And I’m going to show 6 different scenarios, depending on which President you want to start with. Also, it should be noted that I’m using the Jan-1 closing data, rather than the day they actually took office. This is because that’s the only data I have. If I can find some more precise data, date-wise, I’ll re-calculate it. Here is the data I’m using:

Date:_____DJIA: _____Incoming (Incumbant) Presdient:
2/12/2010_10,099____(Obama-D)
1/1/2009__8,000_____Obama-D
1/1/2001__10,887____Bush-R
1/1/1993__3,310_____Clinton-D
1/1/1981__947_______Reagan-R
1/1/1977__954_______Carter-D
1/1/1969__945_______Nixon-R
1/1/1961__648_______Kennedy-D
1/1/1953__290_______Eisenhower-R
1/1/1933__51________Roosevelt-D
1/1/1921__72________Harding-R
1/1/1913__88________Wilson-D
1/1/1900__68________(McKinley-R)

Using this data, and calculating the number of shares and values you’d have at each stage, if you used the “Bet on the Pub’s” strategy, starting with McKinley, your $1000 would be worth $5311. today. If you started under Harding, your $1000 would be worth $4104 today. If you started under Eisenhower, your $1000 would be worth $5794 today. If you started under Nixon, your $1000 would be worth $2593 today. If you started under Regan, your $1000 would be worth $2568 today. And for the poor saps who thought they’d bet on George W. Bush, their $1000 would be now worth only $735. Now… these returns account ONLY for the growth under Republicans. If you figure out the number of year involved (starting date through 1/1/2009) and calculate the annual rate of return [ (Final value / Initial Value) ^ (1 / number of years) -1 ] you get the following, based on which President you start with:

McKinnley: 1.5%
Harding: 1.6%
Eisenhower: 3.2%
Nixon: 2.4%
Reagan: 3.4 %
Bush: -3.8%

Here’s how “Betting on the Dem’s” performed: Starting with Wilson, your $1000 would be worth $28,089 today. Starting with Roosevelt, your $1000 would be worth $34,341 today. Starting with Kennedy, your $1000 would be worth $6038 today. Starting with Carter, your $1000 would be worth $4140 today. Starting with Clinton, your $1000 would be worth $4171 today, and starting with Obama, your $1000 would be worth $1268 today.

Figuring the yields the same way, (only going through to the TODAY, rather than ending on 1/1/09) you get this for the Dem’s:

Wilson: 3.5%
Roosevelt: 4.7%
Kennedy: 3.7%
Carter: 4.4%
Clinton: 8.7%
Obama: 23.7%

That’s right – the WORST CASE scenario under the “Betting on the Dem’s,” (Wilson, 3.5%) still gives a better return than the BEST CASE scenario under “Betting on the Pub’s,” (Reagan, 3.4%) So according to the DJIA, the economy not only does better under Democrats, it does much, MUCH better!

But who knows… MAYBE the DJIA has a liberal bias or something. So how about the S&P 500? Now, the S&P only goes back to the 1950’s. So we’ll start with Eisenhower. Here’s the raw market-close data:

Date:_____S&P:___Incoming (Incumbant) President:
2/12/2010_1078___(Obama-D)
1/1/2008__826____Obama-D
1/1/2001__1366___Bush-R
1/1/1993__439____Clinton-D
1/1/1981__130____Reagan-R
1/1/1977__102____Cater-D
1/1/1969__103____Nixon-R
1/1/1961__62_____Kennedy-D
1/1/1953__26_____Eisenhower-R

And here we go again. If you started with Eisenhower, your $1000 would be worth $4822 today. If you’d started with Nixon, your $1000 would be worth $2022 today. IF you’d started with Reagan, your $1000 would be worth $2042 today. And the poor sap who bet on George W. Bush would only have $605 left of his initial $1000 investment. Using the same formula, here are the returns, starting with:

Eisenhower: 2.8%
Nixon: 1.8%
Reagan: 2.6%
Bush: -6.1%

Back to the Dems… If you’d started with Kennedy, your $1000 would be worth $8598 today. If you’d started with Carter, your $1000 would be worth $5176 today. If you’d started with Clinton, your $1000 would be worth $4061 today, And betting only on Obama, your $1000 would be worth $1305 today. So, again, using the same formula, here are the returns, starting with:

Kennedy: 4.5%
Carter: 5.1%
Clinton: 8.5%
Obama: 27.0%

AGAIN, the worst case scenario under the “Dem’s” strategy (Kennedy, 4.5%) is STILL better than the best case scenario under the “Pub’s” strategy (Eisenhower 2.8%).

Now... Obama's market is obviously still in play, and so the final Democratic returns can vary.  But as it stands right now… if you want to be better off financially, you’d better do what you can to help the Democrats WIN!


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BTW… there are some flaws with this whole exercise. I’m not going to point them out yet, since I’m not particularly motivated to go help the Right bolster their case here. (Plus I'm just curious to see what any of them come up with.) However, I have been challenged with several pretty clever arguments given to me by Conservatives, pointing some of these out in an attempt to undermine this, and the conclusion still stands. Maybe some conservative who knows what’s what will eventually shoot something my way that will stump me. But I’m not holding my breath!

Also, I’d be happy to explain how I calculated any of the above returns, if anyone does their own number-crunching and comes up with a different number. I’ve tried several different methodologies and they all give the same final answer: Dem’s rock, Pub’s are the suck. This is just the one that I felt was most defensible.