Upping the Stimulus Dosage

[strigori]

The one thing that President-elect Obama is advocating that makes a lot of sense is to have the government invest in infrastructure projects. Those are projects that simply won't be done if the federal government doesn't undertake them, and for which there is a crying need. Examples are repair/replacemet of the Interstate system, upgrades to water systems and the electrical grid, etc.

 

Invest in those, and you immediately give an infusion to the economy at the most basic level - job creation and disposable income. It has the double effect of putting money into the economy that would generate production in all sectors while also reducing expenditures for federal programs for aid to those who lost jobs.

 

Great, another New Deal!!

 

Who says that infrastructure jobs couldn't be done if the federal government didn't undertake them? Of course they would!! We don't live in the 17th Century. There are plenty of companies that could undertake any job the government does, get it done faster and for less money. One of the biggest fallacies about using government to provide unemployment is that they create jobs from nothing and that somehow it stimulates the economy. The truth is government intervention is flat out unnecessary and always causes more harm then good.

 

The problem with politicians is that they only see the immediate effects of the policies and not the big picture or the long term effects. They only see the jobs created and not the jobs that weren't created. They only see those who were helped by the policies and not those who were hurt. The government doesn't pay the workers with nothing, they use taxpayer money to cover expenses. For every dollar spent creating jobs for infrastructure that's a dollar taken away from the taxpayers and whatever he or she would've spent the money on.

 

What about all the jobs that weren't created because the taxpayer wasn't able to choose how he spent the money? Because we spent the money on bridges and roads, we have fewer auto jobs, fewer TV technicians, fewer lanscapers, fewer computer technicians, fewer clothing workers, and fewer farmers. How is that helping the economy?

 

Many of these ideas were taken from Henry Hazlitt's book "Economics in One Lesson" if you haven't read it, give it a try!!

Calm down. You do not understand what AR said, or what infrastructure is at all. The infrastructure is something that companies not only do not own, but should never, under any circumstances own. Things like the electrical grid, the interstate systems. And at this day in age, infrastructure for internet. Most of these systems have not had real upgrades in more than 20 years.And the gov doesnt pay people directly for anything like this, they hire contractors.

 

You seem to think that businesses are the answer to everything, and deregulation is always a good thing. If your name does mean you are from CA, how did you like those rolling black outs, and high electrical costs? Direct effect of deregulation. The companies who own the systems like the high costs brought on by not having enough supply that the market demands, and will not build new power plants. In NE where the utilities are publicly owned, we dont have those problems. The idea that a total free market is the ideal, is exactly like the idea that communism works. They are the polar opposites, and both work on paper, and neither work in the real world, once you introduce greed and corruption into the mix. Look at the current economic mess. Yet another case of deregulation letting greed run amok. The trick is to find the balance.

 

First of all nobody said anything about owning infrastructure. I was merely making a point alluding to one aspect of our infrastructure, the interstate system. I'm well aware of the various systems that entail our countries infrastructure and understand the concerns about a private company owning any of it. The point was that government is the market's most inefficient actor, only looking at the short term effects of policies, that which will get them reelected, and never the long term. The more power bestowed upon them the less efficient society is. Just look at any socialist or fascist regime in history, they all have failed, history doesn't lie. As for the current mess, where do you get deregulation as the root of the problem? The problem is we spend too much money, consume too much, don't produce enough, don't save anything, prop up and fix prices, inflate our currency, reward bad business practices and regulate too much. All faults of the government, not deregulation. As for the balance we are looking for, that is a free market. When supply and demand are allowed to operate freely without controls or intervention, prosperity will be at its highest, and individual liberties will be restored; then we will find balance and truly be free.

 

You seem to be knowledgeable about the energy industry so explain to me this. Yes, California has many problems with energy costs and services (you're right I do have firsthand knowledge), so what leads you to believe it all has to do with the greed of private companies and not the government? In fact, many of the problems can be directly attributed to the government. From subsidizing certain companies and mandating taxes to legislation and regulations that make competition and new construction nearly impossible, the government's intrusion into California's so-called private energy industry is borderline criminal. Name me one energy provider the government is not in bed with? I believe we, as citizens, should each have a voice to decide who we give our money, service or support to. This alone should be the deciding factor in what fails and what succeeds, not the government. The system we have running in CA obviously isn't working and most of the blame lies squarely with the government. Also, you trying to compare the energy problems here in CA with those in Nebraska have much more to do with the population differences and sheer land mass than it does due to any pitfalls with industry greed.

 

You also brought up a point, I think I have touched on before in another thread, when you mentioned free markets and socialism only work on paper. Once again I say look at history and see for yourself. Yes, Communism has been proven not to work but the free market never has. Show me a situation where the free market has failed and I will show you a situation that highlights government intervention in the free market as the root of the problem. You mention corruption and greed as downfalls, but in a free market the liberties and freedom granted to each individual enables them a choice to abstain from and voice that which a person is not pleased with or doesn't approve of. And like I said before, this alone makes each individual responsible for who or what succeeds and who or what fails.

 

As sad as it is to say, it doesn't appear as if we, as a country, are willing to take on the responsibility that come with personal liberty and the free market. We have become so dependent on the government that we forget that our country was founded to escape the tyranny and oppression of government. I just hope that people realize this before it is too late and we are pledging allegiance to King Whoever!!

You think businesses think long term? HA! They think by period or quarter, which ever one is the way the bonus structure works for that company. Make as much money as fast as possible, then the execs jump out with the golden parachutes. The current mess is a direct result of the loosening of rules for lending and next to no government oversight of the industry. Without anyone occasionally looking over the lenders' shoulders greed ran rampant and things imploded.

 

As far as free market goes, are you familiar with the Robber Barons? They are the perfect example of what happens when you have no government oversight or rules. Monopolies rule, and innovation comes to an end, as a very few use money and power to crush any competition by any means. Or lets take a look at the minimum wage. When it went more than a decade without an increase, did the free market keep wages up with the cost of living? Nope. Wages were stagnate, unless you were an exec, then you say your wages go up by staggering amounts.

 

CA power companies. What would make them want to build new power plants? By having more supply, and more overhead with having more property and equipment to maintain, their profits go down. They couldn't care less what the consequences of their greed is. Brown outs? Rolling Blackouts? Just raises the prices of electricity and puts more money in execs and stockholders pockets.

 

The central problem with the personal liberty and free market is it does not account for greed or the human element in general. Sure, in a perfect world the free market would work perfectly without any government involvement. But this is not a perfect world. How about Enron? Tyco? AIG? Make as much money as fast as possible, often pillaging the company in the process. What happens to anyone else is not important to them. An individual making something rise or fall? I again refer you to the Robber Barons. Without any government, those with the money make the rules. In any company does a worker have any say in how the operation runs? Not a chance, the execs do. In a world where there is no government to oversee things, you eventually get to more of a world of corperate slavery. Before the government instituted the 40 hour work week, you could expect to work 6 or 7 days a week for more than 10 hours a day. Sure the theory would say "then go find a different job", but if ALL jobs worked like that, what option would you have? Or if the company would penalize you financially for quitting, or blackball you in in an industry so you could never work for a competing business. Such was the reality under Robber Barons. Yeah, a total free market world is real appealing.

 

Who gave you that info, Paulson himself? Any business that plans on being successful had better think long term!! I'd like you to show me a successful company that is only looking at the short term and I guarantee you they won't be around for much longer? (That or they'll grow so quickly the taxpayers will be forced to bail them out.) Sure, you'll have a few businesses that will only be out for the quick buck but many times those types of practices and schemes involve criminal acts. When this happens, those that commit the crimes need to be held accountable.

 

You seem to think that the free market is without rules and regulations. The rules are the Rule of Law, in which one cannot commit murder, fraud, rape or trample another human's right to life, liberty or property. You mention the Robber Barons and yes, I won't argue that they displayed unethical business practices (much with the help of the government), but I also don't think Vanderbilt, Rockefeller or Gould ever killed anybody. How many people has the government killed to protect and influence its business interests? If you study the so-called entrepreneurs of the 19th Century, instead of letting the markets dictate their success the Robber Barons used the government to subsidize and influence regulation. Attached is an excellent article about the Robber Barons you may find interesting. It discusses the Robber Barons and the difference between market entrepreneurs and political entrepreneurs. Taken from the Mises Institution, an economics school based on the principles of Austrian Economics. The Truth About the "Robber Barons"

 

As far as the regulation in the market goes, that is left up to each individual. We each have a choice of: who we work for, who we buy from, who we boycott, and who we vouch for. That's the beauty of the free market; individuals have the personal liberty to decide for themselves what they like and dislike. So yes, when you mention that if someone is not happy with his or her job, why not find a new one? Hell, start your own business for that matter!! You think that by adding more regulation, you are going to stop criminals bent on greed that are already willing to break the law from breaking it again? What planet are you from? Maybe you feel the same about gun control and look at how that's worked out. Instead of punishing those you actually commit criminal acts with guns, they remove guns from the hands of honest citizens and before you know it the criminals are the only ones armed. Smart thinking!! How about we hold those who commit criminal acts accountable for their actions instead of punishing those who follow the already established Rule of Law.

 

By the government stepping in and creating more regulation they only harm those who follow the rules to begin with. You bring up Tyco, Enron, and AIG as examples of companies that did or attempted to defraud the public and look at the mess the government created. In these cases, you would know that instead of merely punishing those responsible for the criminal acts they created the Sarbanes-Oxley Act, and in the case of AIG bailed them out and are continuing to do so!! Awesome, instead of punishing the criminals that break the rules we force every publicly traded company to submit to government oversight and regulation and reward the crooks. Do you not see the problems that arise from that? First of all, companies are forced to spend money on something they normally wouldn't, which in turn forces them to A.) Raise the prices of their products B.) Ask the taxpayers for assistance C.) Cut other programs and jobs that may have been created, or D.) Go out of Business. So now, instead of fixing the problem of fraud in corporations, we subsidize the businesses that are able to afford the regulations, crush all the businesses that can't afford it, and make competition and the creation of new business nearly impossible. Please show me how this type of regulation is good for anyone except for those who directly receive and benefit from the government's help?

 

You keep saying that the current mess is a result of deregulation but that isn't the case at all. Our economic crisis has much more to do with the reckless spending and over consumption of our country than it has to do with any type of deregulation. Until we see that, we are never going to be prosperous. We can't continue to spend without saving and consume without producing, that's not the way prosperity works. Yes, greed has played a role in our current crisis but it has been the greed of the government and not those who wish to create a successful business. Take a look at who's at the center of the bailouts; you have Fannie Mae, Freddie Mac, and AIG. All businesses tied directly to the federal government. Coincidence, I think not. Our government is so bent on propping up a failed system that they are blind from the truth and can't see through their own mess.

 

The government would like you to believe, which in you they obviously have a fan, that our problems are result of the free market, corporate greed, and deregulation but in reality it is the regulation of the free markets and the government's own greed that has caused the mess. You can speak all you want on the robber barons of the past, the greed of corporations, and the so-called failures of the free market but the truth is, in each and every one of those situations it has been the involvement of government and the regulation of the free market that created the ensuing problems. Maybe we need to start holding those who break the current laws accountable before we start creating new regulations that only hinder progress and prosperity and prove no hindrance to those who don't abide by any laws to begin with.

A great deal of these regulations you lay the blame at, were passes by politicians at the very request and urging of the money backers from these companies. Laws and mounts of red tape to build a power plant? Who benefits the most from that regulation? Is there terrible regulations is some areas? Yeah, the Telecom industry is probably the worst. But the solution isnt no regulation, thats over correcting.

 

I have worked for a company that payed very little regard long term on anything. And they happened to be the largest in that field. Each subdivision and each department head would work for their own bonuses, and often the requirements would run counter to another manager's bonus. I have seen a Manager make a bonus for losing half a million dollars, and the same year another not get his for making $1.1 million as his mark was $1.125.

 

Who crushes the smaller businesses? It isnt the government. It is the mega corps who buy out or use questionable practices to put them out of business. Lets take Wal-Mart as an example. The free market theory states that businesses will pay more for better workers, and more competition raises the wages. When Wal-mart enters a market, the opposite happens. Wages stagnate or drop as management looks to 'compete with Wal-Mart.' Wal-Mart will use strong arm tactics(basicly threats to pull all that manufacturer's products unless they are given the price they want) to manufacturers to give them product at prices that smaller businesses cant compete against. Those businesses then go under, and jobs are lost. And most industries have operations like this.

 

You say go find another job, or start a business yourself. How would that work under the system I just outlined? If there are no jobs that are different from what you had(in some fields this is the case), you have to look at a set back of years and years to restart a new field. If you wanted to go start, say, an electronics store, how on earth could you compete with Wal-Mart or Best Buy? They already have prices you couldnt match, and if you somehow managed to pull off a sale that was better, then they ad-match.

 

One of the biggest issues with all these bail outs, is these companies were allowed to get too big. We ended up in a situation where so much was held by so few, the failure of a badly run operation then begins to pull the nails out of the foundation of the whole economy. Lack of regulations gets so much power into the hands of so few, if the execs of that company fall to the temptation of corruption that those jobs so easily open themselves to, if that company then fails, we are then missing that industry.

 

The current mess does have quite a bit to do with deregulation. Most of the current mess has to do with the lending industry in the housing sector. As regulations were dropped banks were allowed to do more lateral control. Where before banks were forbidden from owning real estate companies, title insurance companies and the like, the various companies worked as a system of checks and balances to keep unqualified people from getting into loans they could not afford. Now you have one big company who owns all the parts of an industry. Real estate agents worked to drive housing prices to artificial levels to get bigger pay days, worked(and in a great many cases falsified records, there are several hundred FBI agents currently investigating cases) to get people to the very limit of what they could afford. The banks then pushed more of these adjustable rate mortgages, often sub-prime as well, onto people who were not getting any information from someone who was not part of the one company who was looking to make a fast buck. The banks then took these questionable loans, bundled them up into huge pots, and then cut little slices of god only knows how many loans and sold them to investors. Warren Buffet referred to this as 'Russian Roulette with the economy'. Then when the interest rates started spiking, people who had these loans could no longer afford the payments. They started to default. Only there was one teensy little issue. No one knew who owned the person's debt, as it had been sold in little parts to lots of investors. Thus started the implosion of banks and remaining banks fear of lending. Had regulations been on the books preventing the actions these banks took, we wouldnt be in the current mess we are in.

 

The sad fact is that the current economy is set up based on credit. Almost no one can afford a car or a house without a loan. Businesses need loans and credit to buy inventory to sell. To change back the (world really) economy and go back in time decades to where people bought most everything with cash, the economic disaster people are not willing to face.

 

I would love, love love, these execs to be off to prison for the rest of their lives, and every thing they own be sold off at auction to repay the tax payers. Too many legal protections for many of them sadly.

 

And for the record, I am fairly pro-gun. I'm all for CC laws, but I really dont think military grade assault rifles are something people really need.

[AR Husker Fan]

***SNIP***

 

So before you go wrongfully criticizing the free market and raising government, government officials and bureaucrats to noble and messianic stature, while enthusiastically awaiting your government welfare/bribe check (stimulus check) you must first climb yourself out of your state of ignorance or you can just remain silent.

And I would make two suggestions to you:

 

1. Read the threads before replying. At no point did any poster "[raise] government, government officials and bureaucrats to noble and messianic stature". Making that claim - absent any evidence - automatically brings into question any opinions you set out.

 

2. Take a moment and read the Board's rules against personal attacks on members. Coming in and on your first post alleging that posters are "ignorant" is a good way to earn a ban. If you want to claim that your allegation of "ignorance" was general in nature, then my response is that the burden of clarity rests with the person posting the statement - make certain that your posts are not, as was the case above, filled with ambiguities that permit the reader to make a reasonable inference that your insult was directed to other posters and not "in general".

 

Looks like a nerve was struck…

 

Had I meant to insult or make allegations against you or anyone else on the thread they would have been clear and concise. Hence why I started the post with the phrase “general comments.” So the covert threats are not needed.

 

The only other part of your response that merits a reply is your assertion of guilt until proven innocent with your statement, “the burden of clarity rests with the person posting the statement.” I say otherwise, one is innocent until proven guilty, therefore the accuser must present the burden of proof to the allegations made.

 

Regardless, I would rather discuss politics and economics and not he said she said diatribe.

My "threat" was not "covert" - it was quite plain. Continue the insults, and you're banned. Hardly covert - and had a "nerve been struck", I would have simply banned you. I've instead attempted to inform you that your conduct violated a board rule, which could result in you being banned, and that if that was not your intent, you need to ensure that you communicate that intent more clearly.

 

To that end, I made no assertion of "guilt until proven innocent". I informed you of the fact that if your intent was misunderstood - please note the "if" - the fault rests with you as the person trying to communicate your intent without such specificity as to invite reasonable inference.

[BIGREDFAN_in_OMAHA]

The infrastructure in the United States is sorely lacking with the roads, bridges, levees, power grid and even the schools falling behind the standards being set by the rest of the world. It is nice to think that big business could step up and handle the job (while likely using under paid immigrant workers...hmmm...railroad circa 1800's) but that hasn't happened and there don't appear any signs of it happening in the near future. If it takes a "New Deal" of sorts then so be it.

[strigori]

The infrastructure in the United States is sorely lacking with the roads, bridges, levees, power grid and even the schools falling behind the standards being set by the rest of the world. It is nice to think that big business could step up and handle the job (while likely using under paid immigrant workers...hmmm...railroad circa 1800's) but that hasn't happened and there don't appear any signs of it happening in the near future. If it takes a "New Deal" of sorts then so be it.

It would never happen unless said businesses were to own those parts of the infrastructure. I dont know about everyone else, but the idea of tons of toll roads or bridges is not very appealing. And I think the effects of all the privately owned(and very corruptly passes regulations by pet politicians) of the telecom industry is a perfect example. If there is one thing I trust less than the government, it is big business. At least with the gov. we have some control over which crook is there.