"I think the US is doing very well," Treasury Secretary Janet Yellen tells @SaraEisen #economy #inflation @SecYellen pic.twitter.com/n1KrguxMij
— CNBC's Closing Bell (@CNBCClosingBell) October 11, 2022
.@POTUS to @jaketapper on the economic outlook:
“I don’t think there will be a recession. If it is, it’ll be a very slight recession. That is, we’ll move down slightly.”
— Jordan Fabian (@Jordanfabian) October 12, 2022
First the Fed was late to inflation. Now, concerns are growing that the central bank is overcorrecting.
Greg Mankiw: “Steering the economy is like steering a large ship. It moves very slowly, and once you return the helm to normal, it keeps going."https://t.co/wHoAweyLr1
— Rachel Leah Siegel (@rachsieg) October 11, 2022
Good for workers, bad for business oligarchs and other tax cheats:
Explainer: How a U.S. rule on independent contracting will affect workers, businesses https://t.co/oDYVzEBA6O pic.twitter.com/2lYXY2XEaW
— Reuters (@Reuters) October 12, 2022
Here's the thing: the Fed can play with rates all they want but we lost a lot of workers during the Trump Administration, both from COVID & from stricter immigration enforcement. The demand for labor they left behind isn't going to just go away because rates went up.
— chatham harrison is tending his garden (@chathamharrison) October 7, 2022
The U.S. economy has added, on average, half a million jobs per month since Joe Biden took office—a pace of job growth that is unprecedented for the first half-term of a Presidency.https://t.co/G858R1kLaQ
— The New Yorker (@NewYorker) October 8, 2022
With the September jobs report in hand, there’s only one more employment update left before the midterms. The October report will be released on Friday, November 4th—just four days before the polls open. Yes, there is a possibility of a last-minute surprise, but, based on what we know today, the Democrats and Joe Biden can go to the voters and make a very strong case: since his January, 2021, Inauguration, the American economy has created ten million jobs…
Even though there are still deeply rooted racial and educational fissures in the labor market, the jobs gains over the past twenty months have been widely spread. When Donald Trump left office, the unemployment rate among Hispanics was 8.6 per cent: last month, it hit an all-time low of 3.8 per cent. During the same period, the Black jobless rate has fallen from 9.2 per cent to 5.8 per cent. (The white unemployment rate is now 3.1 per cent.)…
This success surely has something to do with the fact that, shortly after Biden took office, Democrats passed the American Rescue Plan Act, a 1.9-trillion-dollar stimulus package. The Rescue Act is controversial, of course. Republicans (and even some Democratic economists) have tied it to the upsurge in inflation during the past year and a half. In a sense, though, the critics of the Rescue Act are acknowledging that it succeeded in supporting the economy and boosting job growth: their argument is that the aid was too much of a good thing and led to economic “overheating” in the form of rapidly rising prices.
It should be noted that the September jobs report provided no evidence that the economy is suffering from a nineteen-seventies-style wage-price spiral, which is the inflation hawks’ nightmare scenario. In September, average hourly earnings rose by ten cents. That’s about 0.3 per cent, or 3.8 per cent on an annualized basis. And this wasn’t a one-month aberration. Since the end of last year, the rate of wage growth has fallen slightly. The corporate profit rate, on the other hand, has recently reached its highest level in seventy years, as businesses of all kinds pass along higher prices to consumers, and then add in a little extra for themselves.
For some reason, you don’t read about record corporate profits much, or hear about it very often from Federal Reserve officials, who remain determined to keep raising interest rates until something goes pop. Jerome Powell and his colleagues are hoping that this something will be the inflation rate, but it could just as easily be the entire U.S. economy, including the jobs market. That’s why the stock market fell sharply on Friday—the Dow closed down more than six hundred points. After digesting the jobs report, investors don’t think the economy is slowing down rapidly enough to dissuade the Fed: they are almost certainly right.
In this environment, the final weeks of the midterms campaign are likely to see further volatility on Wall Street. Next week, the Commerce Department is scheduled to release the Consumer Price Index for September, which will bring inflation back into the spotlight. According to a Monmouth University poll released earlier this week, more than four out of five Americans still rank inflation as an extremely important or very important issue, so Republicans will continue to hammer Democrats on it through November. But the President and his Party now have a new economic slogan for the campaign’s final month: ten million new jobs. “The fastest job growth in history,” Biden boasted on Twitter.
Baud
Obama also saved the economy, but he didn’t save it fast enough. There will always be something Imperfect to tar the Dems with.
rikyrah
Good Morning, Everyone😊😊😊
Baud
@rikyrah:
Good morning.
Geminid
@Baud: Republicans were determined to make Obama a one term President, and kept the stimulus package much smaller than was warranted. McConnell wanted to do the same thing to Biden, but the result of the Georgia Senate runoffs stymied that plan.
GregMulka
Got flu shot and moderna bivalent yesterday. Woke up at 0400 with a bad case of the chills and now I’m about to check if I’m running a fever. May be working from home today. Same thing happened last year. Took me about 18 hours to clear the head fuzzies.
rikyrah
@Baud:
Morning Baud.
You speak the truth.
Democrats clean up Republican messes😡😡
rikyrah
@GregMulka:
🙏🏽🙏🏽🙏🏽🙏🏽
Spanky
@GregMulka: I got the Moderna bivalent last week and opted to wait on the flu shot, based on reports similar to yours. Plus, I figured it was still a tad early for the flu vax to be effective through flu season. I need to start thinking about getting it in a couple of weeks.
Mild fatigue was my only reaction, btw.
rikyrah
@Geminid:
Everything that 46 has been able to do is because we won those Senate seats in Georgia.
The Oracle of Solace
It’s my hope that voters prefer Democratic successes (economic recovery, infrastructure & climate bills, and a decrease in the severity of the Plague) to Republican successes (consequence-free law-breaking, insurrection, and shredding women’s rights). We start to find out in four weeks!
p.a.
The Fed isn’t fighting the last war, it’s fighting a war from 2 generations ago. It’s always wage labor that gets the bleeding cure. Funny that.
“… and when we ask them how much should we give,
they only answer more more more…”- J. Fogerty
Geminid
@rikyrah: At the time, the January 6 Insurrection prevented a more thorugh examination of the Georgia Senate runoff results. One striking aspect was the relative dropoff in the vote from November to January 5th. Normally the Republican vote drops less but this time Jon Ossoff’s vote fell by ~90,000, while Senator Perdue’s fell ~240,000. Reverend Warnock ran in a “jungle” primary so there is not a clear comparison, but he ran 20,000 votes ahead of Ossoff in the runoff.
Georgia’s runoff provision made Ossoff’s win possible. Perdue beat him in November, but Libertarian Shane Hazel won enough votes to hold Perdue below 50%.
Goku (aka Amerikan Baka)
@GregMulka:
@Spanky:
I got the Moderna Bivalent Monday and I felt pretty bad until basically this morning. Only now starting to feel like myself again. Injection site still a bit sore. About a day in, it hurt so bad I could barely move my arm.
I hope these side effects are eliminated with future vaccines
MazeDancer
Excellent day to help “Hold the House!”.
Get addresses to write PostCards for some of the closest House races at PostCardPatriots.com. (Or click on my nym)
Shakti
My father watches The News With Shepard Smith nightly and they’ve been yapping about the price of gas and a looming recession for months now. To be honest, the inflation is real, so I’m job hunting since there’s little to no chance I’d get a raise to match the inflation. Also, there’s some other things going at my work.
To the extent that Trump et al could’ve prevented covid from being a crisis level pandemic, they have only themselves to blame for the massive job growth during this administration. It’s amazing to me that they cut funding for key disease and pandemic prevention programs, saw the economy drive off the cliff and into a ditch and then have the nerve to start screaming about prices and recession and act like they’re going to fix things. Sure, bruh.
Also, if they’re blaming the war in Ukraine for it? Didn’t we have this massive scandal in which the last guy tried to shake down the president for dirt on Biden in exchange for weapons? Wasn’t the last guy’s policy, “let Putin do what he wants?”
Baud
I am sadly crossing “Debbie is just on vacation” off of my list of possibilities.
Goku (aka Amerikan Baka)
@Baud:
She still hasn’t shown up, yet? That’s worrying
Jeffro
per that Chatham tweet…the U.S. needs much more immigration, like, yesterday. It’ll actually help bring inflation down.
(Also, I’d like a pony while I’m at it.)
Anyway, it looks to be another beautiful day here in central VA…gonna try and get out and enjoy it before all the rain & thunderstorms tomorrow!
lowtechcyclist
@Baud:
Unemployment was around 10% in the summer of 2010.
prostratedragon
Anyone who has ACA insurance through BRIGHT should definitely check out David Andersen’s post immediately after this one. You have just been gifted a brand new 2022-model pain-in-the-ass. My condolences, but at least you can get ahead of it.
Baud
@lowtechcyclist:
A situation we inherited.
Biden focused on jobs and he’s getting hammered on inflation.
There is no way to win, especially in a two-year time period between elections.
Geminid
@lowtechcyclist: That’s because Obama could not get the stimulus package the country needed. Conditions warranted one two or three times larger, but Republicans wanted to throttle the Obama presidency with austerity. It almost worked.
Baud
@Jeffro:
I’m pro-immigration, but isn’t that another means of holding down wages?
I’m struck by the lack of any explanation of how to increase wages without creating inflation.
Eyeroller
@Baud: The two-year term for the House is yet another of the crappy “design” features of our crap system of government. The sainted Founders somehow imagined this would make the House more “responsive,” I suppose, but even then it should have been obvious that the short timeframe would cause short-term thinking.
lowtechcyclist
@Geminid:
This was also when the phrase “negotiating with himself” originated. The proposal that Obama sent to Congress in the first place was already too small, then the Republicans knocked it down from there. Biden learned, and made it huge in the first place.
Something I genuinely don’t understand about 2009: Warnock’s and Ossoff’s wins on 1/5/21 gave the Dems seats #49 and #50 in the Senate, putting our excellent VP in the tiebreaker position.
But in 2009, the Dems started off with ~57 seats in the Senate. Why did they need 60, when Biden didn’t? They couldn’t have used up the opportunity to use reconciliation to pass it, the Congress had only just begun.
Betty Cracker
Rachel Maddow has a new podcast series called “Ultra” about a fascist plot to overthrow the U.S. government in the 1940s. I listened to the first two episodes while running errands yesterday, and it’s fascinating and all-too-relevant to our current moment. Maddow did a podcast a couple of years ago about Spiro Agnew (“Bagman”), and it was also great.
I know Maddow’s MSNBC show wasn’t everyone’s cup of tea — she does have a long wind-up and endless digressions, and that drives people like my hubby nuts. But her podcasts aren’t like that at all. They’re tightly produced. Just throwing this out there in case anyone is looking for new content.
Goku (aka Amerikan Baka)
@lowtechcyclist:
If I had to guess, perhaps more conservative blue dogs? Also in 2009, more people probably still believed in “bipartisanship” and didn’t see all of the GOP as fascist bomb throwers. Trump and 1/6 clarified things for a lot of people
Geminid
@Eyeroller: I didn’t think the two year House term was that crappy in 2018. Those midterms did a lot to limit the damage trump and the Republicans were doing.
The UK has no midterms, and citizens there are stuck with a crappy government until at least the summer of 2024.
Baud
@Betty Cracker:
People are talking about it. I don’t do podcasts as a general matter. But I might give this a try.
Baud
@lowtechcyclist:
I don’t know the answer, but they did use reconciliation paired with the Senate bill to get the ACA over the hump.
lowtechcyclist
@Geminid:
True, but I was responding to Baud’s comment that ‘there will always be something imperfect to tar the Dems with.’ My point was that this was well beyond ‘something imperfect.’
jonas
@GregMulka:
That’s exactly what happened with my initial Moderna shot and booster, too. For the bivalent booster last month, though, I got Pfizer and didn’t have the chills, aches and other symptoms. Other family members got Moderna and had absolutely no reaction, though, so it must be a highly individualized thing.
Baud
@lowtechcyclist:
There was no way to have low unemployment by summer 2010. The economy doesn’t move that fast. Whatever it was would still have been bad even if we had our dream legislation.
Matt McIrvin
@Baud: Republicans believe that the economy was a disaster all the way up to the moment Trump entered office, and then miraculously started booming. The way they justify this is by simply believing that all the economic statistics were fake up to that moment, and then they became real. There was a rally in which Trump literally said that– “we used to think those numbers were fake but now we think they’re real, right?” and the crowd roars.
There was a lot of active self-mystification going on. Remember that “ShadowStats” website that claimed that “true unemployment” was just getting worse and worse even after 2010? They claimed it was worse in 2014 than in 2010, which was just contrary to direct experience.
Geminid
@lowtechcyclist: If you want to blame Democrats for the insufficient stimulus in 2009 that is your right. I’ll still lay the blame at the doorstep of Republicans who knew that more was needed and would have voted for more had a Republican been President.
Baud
@Matt McIrvin:
Honestly, our side talked down the economy throughout the Obama years. I think we’re doing a lot better this time.
Eyeroller
@Geminid: That was something of an exception for us (2006 also). Our voters are much less reliable than the Republican voters, and need strong motivation to turn out for non-Presidential year elections. Overall I think it has been a negative for the country.
BTW I live about 12 miles south of you, and it annoys me to no end that we have an election in this state every damn year. I don’t know why NJ does it but I’ve always assumed that for VA it had something to do with voter suppression (for the reason I just stated above).
lowtechcyclist
@Baud:
In a smoothly functioning global economy, wages can increase in one nation without causing inflation* because global competition holds prices down. Over the past couple of years, though, the global economy hasn’t exactly been functioning smoothly, thanks to Covid.
It also hasn’t helped that antitrust enforcement in the U.S. has all but become a thing of the past. Too many industries are dominated by a very small number of businesses. Domestic competition, if it were more robust, would also hold down prices to the extent feasible.
*Obviously if wages increase so drastically that employers can’t make a profit, then things are gonna go haywire regardless. But at least here in the U.S., most businesses aren’t anywhere near that situation.
Matt McIrvin
@Baud: Part of that was that “our side” included people like Taibbi who in hindsight were probably already trying to shiv the Democrats.
I remember liberals taking ShadowStats and Zero Hedge seriously. Zero Hedge later went overtly alt-right/conspiracist, but it wasn’t obvious to everyone back then.
SFAW
@lowtechcyclist:
I admit that my memory is worse than it used to be, but I don’t recall the unemployment rate being a big issue in the 2010 midterms. The ACA was, and a number of Dems lost their seats (I think), plus the general Rethug-trashing of the US and its collateral damage. [That second part is gratuitous, and not necessarily based in reality; it’s just because I hate Rethugs.]
Subcommandante Yakbreath
A question for the economics-literate: I thought I heard (a long time ago ) that unemployment below a certain figure (3%?) is considered to be effectively full employment for the nation. Can anybody set me straight here?
Baud
@Matt McIrvin:
Agreed. It’s not just the MAGAs that are the targets of propaganda and influence operations.
mrmoshpotato
@GregMulka: Apparently the booster shot is working. (I had chills from my booster too.)
Hope you feel better soon.
jonas
@Baud:
Right now, there are certain jobs in our economy — farm labor, meat processing, restaurant dishwashing, e.g. — that non-immigrants won’t do at any price. People scoff at that, but it happens to be true. So immigrant workers aren’t competing directly with domestic workers. If there aren’t immigrants, the jobs just go unfilled and the crops rot in the field.
Matt McIrvin
@SFAW: Unemployment was so bad in 2010 that it couldn’t help but be an issue–even if it wasn’t the big subject of contention, it was making people feel bad. But it was a matter of assigning blame.
R-Jud
@Betty Cracker:
I listened to the first two episodes of that this morning while doing errands, even though I’m not super into Maddow’s style of delivery on her show. The podcast is really well done, although some of the backing music is a little mismatched to the content, IMO.
It reminded me a bit of the BBC’s The Bomb, which has two seasons. Different subject matter, obvs, but a similar style of production.
mrmoshpotato
@Betty Cracker: Thank you.
jonas
@SFAW:
The ACA was a big deal in that election, but remember, too, we were still coming out of the Great Recession and Obama had “failed” to completely upright the economy yet. That depressed Democratic turnout in a lot of districts. Combined with Republican fauxrage at the ACA, the stimulus package and the Big Bank and GM bailouts, you got a historic trouncing.
Brit in Chicago
@Baud: Increasing productivity—more output for workers.
Ken
@Subcommandante Yakbreath: I believe the theory is that there will always be some small percentage of people in transition between jobs, due to moving, businesses closing, etc.
Soprano2
@Baud: They need to go up a few points every year. I think we’ve had the past 10 year’s wage and price increases in the past two years, which makes it hard for people to adjust. The Fed held rates too low for too long, so people got used to it being almost zero. Now normal feels way too high because of that.
Matt McIrvin
@jonas: Yes, the TARP bailouts were a huge focus of outrage, and it was bipartisan to some degree–the left, with some moral justification, didn’t like the “banksters” getting bailouts when the little guy didn’t. Remember Jon Stewart asking “where’s OUR bailout?”
Of course, all this started in the waning days of the Bush administration under Hank Paulson and it was a bipartisan effort, with a lot of cooperation between the outgoing and incoming administrations, but it all got successfully pinned on Obama. It’s kind of like the way that by a couple of years into the Clinton administration nobody could remember that the Ruby Ridge incident happened under George H. W. Bush.
Geminid
@Eyeroller: I think Virginia does do the off year election in order to suppress votes; more particularly, to decouple Virginia elections from national ones. This was instituted by conservative Democrats, but after the party realignment of the 1970s it benefitted Republicans. Democrats have been doing a much better job of turning out since 2017, so the Republican advantage is reduced now.
The one term limit for governors was also a conservative measure, I think. They feared a two term populist governor might break the hold of conservative elites on state government. Instead, governors would come and go, while powerful senior General Assembly members called the shots.
If you live 10 miles south of me you are probably a fairly close neighbor of Honus, who comments here. He and I worked for the same home contractor in the 1980s. He then ran his own company for a while before hanging up his toolbelt and going into law. A very nice man.
Starfish
@lowtechcyclist: I think they need 60 to overcome Republican obstruction if something is not related to budget. Budget can be passed through reconciliation with 51. That is why we ended up with so many executive orders. If the budget does not pass, the economy would tank, AND there are some Republicans who would do that because they are stupid, so we have rules that work around that.
mali muso
@Jeffro: Here in my corner of VA, we live close to several apple-picking farms and are used to rolling in and hanging out there on a random weekend. I kind of forgot that it is peak fall season, so when we dropped by on Saturday, it was totally mobbed with daytrippers from DC and NoVA. Happy for the bottom line of our local businesses even if it did mean waiting for parking and apple cider donuts.
SFAW
Because I’m not an economist, the whole “we gotta destroy the economy in order to save it” mentality of Powell and the Fed baffles me. My belief — which, with a couple of bucks, can get you a ride on the subway — is that the primary underlying cause of the current level of inflation is more-or-less directly related to supply chain issues. Yes, I understand wage increases are a component of inflation, but I was under the impression that a lot of the price increases have been from lack of supply, factories being under-utilized, and so forth. In other words, cost of materials. [Yes, I realize labor costs factor in to cost of materials, but not as much when production quantities are in the millions or billions.] We were hearing about massive chip shortages for a year or two, I sometimes read that it’s still an issue, but it’s wages causing the problems? Another example: eggs: are factory farms suddenly paying the egg harvesters a shit-tonne (waves at “English” speakers Tony Jay and Amir Khalid) more than they were, leading to a 50-or-so percent increase in prices?I guess (to me, at least) the “people’s wages need to come down” thing is the fig leaf, but I’m still not sure how it will end up helping anyone other than our corporate overlords.
What am I missing?
Steeplejack
@Baud:
Eliizabelle put up a link to a transcript last night.
lowtechcyclist
@Starfish: OK, but I’m still not clear why Obama and Biden weren’t working within the same sets of constraints.
H.E.Wolf
@lowtechcyclist:
Baud has your answer at comment #1: “There will always be something Imperfect to tar the Dems with.”
Matt McIrvin
@Subcommandante Yakbreath: There’s this idea called NAIRU, the non-accelerating-inflation rate of unemployment, which is that if the unemployment rate gets below some level you’ll get increasing levels of inflation, from the upward pressure on wages caused by a tight labor market.
The economists who talk about NAIRU tend to set it around 5 or 6 percent, and would doubtless regard the present situation as evidence that unemployment has gotten too low and needs to be higher–though obviously wage pressure is far from the only thing driving prices up right now.
Geminid
@SFAW: I think Powell and the Fed screwed up by not tightening rates earlier. Their estimate for 2021 inflation turned out to be way too low, but they did not respond until this year. Now I think they are overcorrecting.
This is frustrating to me because so many people who went backwards during the recession were finally starting to catch up, and I fear they will be set back again, unneccessary.
jonas
@Matt McIrvin:
That’s right. TARP was passed by the outgoing Bush administration, but most of the headline bailout-ing was done in the early months of the new Obama administration. I’m still of the opinion that one of the greatest mistakes Obama made was listening to Larry Summers and other banksters who urged him not to force banks to renegotiate mortgages for average people whose property values had tanked and keep them in their homes. So shareholders got bailed out and the financial system survived, but millions lost their homes. That that left a *very* bad taste in people’s mouths was no surprise.
MisterDancer
YES!
We really have flushed the Blue Dogs down the memory hole, haven’t we?
We forget that, at that point, there were at least 5, maybe 10, Machins(sp) in the Senate. We had 60 Dems in total, but so many were conservative (small-c) and unwilling to spend money or support social justice that they formed a real roadblock to getting work out the door.
More specifically to the question, trying to pass bills over their heads wold have resulted in a massive backlash that the GOP would have exploited. The big fear then was that we’d have Democrat->GOP defections, and cutting them out of these bills would have encouraged them to run to the GOP.
It was a precarious situation, and one that got “resolved” by the GOP nuking them all out of their seats. Which leads us to the present moment.
Matt McIrvin
@SFAW: You’re not missing anything. Employers always claim their employees are too lazy and greedy, and they’ll certainly use cover from economists to push that line if they can.
We’re coming out of a 40-year period in which organized labor was close to moribund and it’s freaking them all out.
Immanentize
@lowtechcyclist: I think the answer is in part that the Democratic Senators during Obama’s time were much worse than they are today. Instead of one Manchin and one looney Sinema, Obama had at least five or six Manchins (but luckily no one quite like Sinema.) And a lone Manchin can cause trouble, a gang of right leaners caused momentum, largely against needed stimulus. And of course diluted the ACA as much as possible.
SFAW
@Matt McIrvin:
I understand that part, and a big raison d’etre of the Party of Traitors is to destroy unions (and similar). But I’m trying to understand if the whole interest-rates-through-the-roof thing makes economic sense, given what I believe are the underlying conditions (which I think, perhaps incorrectly) are significantly different from previous pre-rate-increase conditions.
Matt McIrvin
@jonas: Then on the other hand, the Tea Party movement literally had its origin in a CNBC commenter ranting about how the irresponsible victims of predatory lenders had ruined it for the rest of us hardworking investors, with a lot of talk about how it was all the fault of “Fannie and Freddie” and the government programs to make mortgages available to minorities.
So I can only imagine the howling from the right if there really HAD been a big bailout of individual borrowers. They thought that was happening as it was, with special secret bailouts for non-whites I’m sure.
New Deal democrat
@Baud: This post is in my wheelhouse, and the quote tweets in the post are just about worthless in terms of what is really going on.
1. We will almost certainly have a recession next year. With OPEC cutting production, it will be sooner rather than later. About 90% of all of the things that happen in advance of a recession, have already happened earlier this year.
2. The more the Fed raises rates, the deeper the recession will be.
3. The Fed is chasing a phantom menace, because the metric it uses to measure house prices, “owners’ equivalent rent,” which is 1/3rd of the entire index, lags actual house prices by about a year or more (something I’ve been saying since last autumn, and Larry Summers and Paul Krugman just confirmed). As a result, it will almost certainly overshoot.
4. Job growth has been excellent, but it is already slowing down, and with consumer spending having stalled for the past half year or so, it will continue to slow down, and it is increasingly likely that it will stop or reverse next year.
5. The Fed did let inflation get too out of the bag last year (again, because it wasn’t paying attention to actual house price increases), but that horse has left the barn (and is over in the next county). But current inflation is because of supply shortages, e.g., chips for cars, and gas prices. The Fed can’t fix either by raising rates. Biden also isn’t really responsible for either shortage, although one can certainly question whether he should have taken more action (perhaps invoking the Defense Supply Act) to get more production of the missing chips.
6. The only silver lining is that the downturn won’t hit until after the elections, and may be over in sufficient time before the 2024 elections.
lowtechcyclist
@jonas:
I’ll scoff. I remember when McCain was saying people wouldn’t do farm labor for $50/hour. When he said that, it hadn’t been that long since I’d been teaching at a small, underfunded Christian college, and my salary in my last year there was $26,800. For the year.
If farms were offering $50/hour, that’s the equivalent of $100K/year. I’d have been there in a heartbeat. Restaurant dishwashing? Absolutely – I actually did a bit of that in another lifetime. I might have drawn the line at meat processing, given that it’s both hazardous and gross, but for a 4x pay multiplier, I’d have been sorely tempted anyway.
Subcommandante Yakbreath
@Ken: Thanks. It would seem to me that, in normal times (ha), the current unemployment rate would be seen in a positive light. Silly me.
germy shoemangler
More money (for Tulsi):
Splitting Image
@lowtechcyclist:
Several of those seats were in states that had been voting Republican for years outside of the Senate, and were held by people who feared that passing any legislation that was too progressive would wipe out a big chunk of the Democratic caucus.
They weren’t wrong.
Look at the record: in 2009, the Democrats held both Senate seats in Montana, West Virginia, Arkansas, and North Dakota. They also held seats in Indiana, Alaska, Iowa, North Carolina, South Dakota, Missouri, Nebraska, Louisiana and Florida. Most of those seats were long-time Democratic strongholds (although a couple, like Alaska, were surprise wins in 2008). Today the Republicans hold almost all of those seats, although the Democrats have made a few gains elsewhere.
Basically, in 2009 the Democrats had a 60-seat caucus, of which only about 40 or so were willing to sign on to much progressive legislation. Now they have a 50-seat caucus with 48 members who are willing to get things done. Two dogs-in-the-manger are easier to handle than 20.
lowtechcyclist
@H.E.Wolf: Huh??
zhena gogolia
OT, but economics depresses me.
Baud
@zhena gogolia:
But that would make fascists lose face!
Subcommandante Yakbreath
@Matt McIrvin: Thanks. All this makes me glad I’m just a schmoe what works with his hands…
New Deal democrat
@Geminid: “I think Powell and the Fed screwed up by not tightening rates earlier. Their estimate for 2021 inflation turned out to be way too low, but they did not respond until this year. Now I think they are overcorrecting.”
Yes, this.
One problematic issue is that they let house prices get completely out of hand. But, if there has been a shortage of new building as contended by many, then cutting back on housing construction only creates a bigger shortfall.
One item I should add to my previous comment is that, while wage growth did add to inflation in the past 18 months, it is slowing down of its own accord as job openings, which were in the stratosphere (and meant workers could trade up to better paying jobs easily) are coming back down to more normal levels. There is no ‘70s style wage price spiral in the works.
The Moar You Know
@SFAW: that this current wave of “inflation” is not in fact inflation, it’s price gouging. At all levels, from the producers/manufacturers to the retail outlet. Not that anyone is willing to say it in public.
The Moar You Know
@New Deal democrat: I was thinking that when I read it. I’ve been reading you since 2008. Have you ever considered front paging here?
Another Scott
@lowtechcyclist: A big problem with the Great Recession was that the data lags – a lot. The people drawing up the plans thought it needed to be (say) $250B then the next numbers came in a week later and OMG it needs to be $500B. They were always trying to finesse the numbers, were always trying to keep it below $1T because that too big and scary a number (it doesn’t matter if that’s what it takes, that’s too big!!), and as Krugman pointed out, they only got one chance to pass the rescue – no revisiting it later.
Couple all that with Moscow Mitch knowing the path to greater power was strangling the recovery, and it was destined to be too small.
But it served as a clear lesson for Biden’s team – You put everything in the plan design at the start, and you pass as much as you can incrementally. You won’t get everything, but you’ll get a lot and have opportunities to make adjustments.
They both fought for as much as they could given the constraints at the time.
Cheers,
Scott.
Mike S (Now with a Democratic Congressperson!)
John Fetterman on the Twitters machine where he rules! Asked about his recovery from a stroke:
Shalimar
One of these years, all the older Republican voters are going to get what they don’t realize they’re voting for and have their social security and medicare taken away by the assholes they elect.
lowtechcyclist
@MisterDancer:
Wrong, at least on this one. We had all their votes (actually only 57 or 58 Dem Senators at the time the Obama stimulus was passed), but we still needed at least two out of three of Snowe and Collins and Specter.
Matt McIrvin
@jonas: …anyway, TARP got pinned on Obama in much the same way that Hillary Clinton is now the mastermind of the 2003 Iraq war. It’s enough to make one think that the main danger of bipartisan action is that if there’s any kind of failure or even a suboptimal result, you’re going to be the one left holding the bag–the other side was against it all along.
Matt McIrvin
@The Moar You Know: But inflation always includes some price gouging. That’s part of the deal when there’s inflation. People will try to charge what the market will bear.
SFAW
@Mike S (Now with a Democratic Congressperson!):
Alan Grayson gave good Twitter (figuratively speaking), too. As long as Fetterman wins, he can do whatever he wants on Twitter. I’m just hoping his team is not over-focusing on being hip (or whatever), because I sure-as-shit don’t want to hear in mid-November that “he lost, but boy, was his Twitter/online game great.”
Another Scott
@Geminid: The FED has been pushing on a string for decades. They have almost always missed their 2% inflation target on the low side (unless there’s an oil shock or something). The problem is and has been that there’s too much money out there that is not circulating and doing anything productive. Taxes on that money are too low. Inflation has been too low (Tiffany, we have to invest the money in something that grows in value or inflation will take it all!!). The FED’s major tool to reduce inflation is to throw people out of work, but Powell hopes he can scare MotUs to take smaller profits instead without causing a recession. Let’s hope that he’s right.
Congress needs to raise taxes on higher brackets a lot, needs to tax big estates and trusts, and needs to find a way to tax wealth and not just income.
Lots to do!!
Cheers,
Scott.
Captain C
@Immanentize:
You could probably make an argument that Lieberman was the closest; he was just a quirky outfit and some overtly inappropriate public behavior away at times.
NotMax
@Matt McIrvin
And all those free Obamaphones were 3G so now are paperweights. What a rip-off!
//
zhena gogolia
Am I the only one who keeps watching the video of Ariel Elias chugging the beer that some MAGAt threw at her in a comedy club?
germy shoemangler
MisterDancer
I’m speaking about more than just the ACA, which is why I said “unwilling to spend money or support social justice”.
The Blue Dog impact wasn’t/isn’t just in the final vote; it’s felt all along the legislative process. A lot of bills, and Presidential support for same, died in that period because the Blue Dogs stood against them — openly or in private. I’m pretty sure that’s what happened to the Freedom of Choice Act, to take one highly relevant example.
As I recall: The ACA’s final form has a LOT to do with how the Blue Dogs were unwilling to support ideas they thought were too extreme — and Obama took the heat for accepting their compromise to get to 60.
Paul in KY
@Goku (aka Amerikan Baka): Gonna get the Moderna Bivalent today. The previous ones have not affected me very much.
Baud
@zhena gogolia:
Probably. It was cool though.
Ohio Mom
@Baud: debbie has been MIA since the beginning of the summer. I don’t like that but not sure what I could possibly do about it.
germy shoemangler
@MisterDancer:
And the blue dogs were motivated by the wishes of their donors, rather than any philosophy (unless the philosophy was knowing which side their bread was buttered on).
Baud
@Ohio Mom:
Nothing to be done. WaterGirl has tried emailing her several times.
Geminid
@Another Scott: I understand that the Fed cannot make up for Congressional action or lack thereof.
My point was that the Fed was remiss in not raising rates last year. This year they raised them by ,25%, .5%, and three times by .75%. They did not even tap on the brakes last year, and now they’ve slammed them. The chance of overcorrecting would have been lessened had they not been so tardy in reacting to inflation.
germy shoemangler
Geminid
@germy shoemangler: These Democratic Senators were also probably influenced by their states’ relatively conservative electorates. The donor explaination must be given some weight, but it is not a good universal explainer, I think.
lowtechcyclist
@Another Scott:
Data lags, schmata lags. They knew at the time that they really needed something on the order of 1.5T. But the Administration let itself be cowed by the ‘a trillion is too big!‘ talk, so they started around $900B, and the Repubs demanded cuts from there in return for their votes. There was also talk within the Administration about how they wanted something that would pass with >80 votes, all but by acclamation, so they were apparently keeping it smallish partly on that account.
Without being able to traverse alternate timelines, there’s absolutely no way to know whether that’s true.
Omnes Omnibus
@Geminid: No, everyone who doesn’t agree with me is a sellout. It’s the only possible explanation.
The Moar You Know
@Matt McIrvin: I’m calling this as a first cause, not a follow-on as has been the case in the past. Quoth me: The root cause of the current round of inflation is price gouging (not caused by supply shortages) by the oil companies, which has spilled over into every other industry.
Feel free to tell me to get bent, I’m just some guy.
Omnes Omnibus
Doesn’t that statement rather render pointless the rest of your comment?
Matt McIrvin
@The Moar You Know: I think the effect of Putin’s invasion of Ukraine this time around is very similar to that of the Yom Kippur War and the Iranian revolution in the 1970s oil shocks. It was a real supply shock to the global market, but it also created a massive opportunity for price gouging in the industry.
germy shoemangler
@Omnes Omnibus:
You’re such an asshole.
lowtechcyclist
@MisterDancer:
I wasn’t even talking about the ACA. We were talking about the ARRA, the stimulus bill that passed Congress in its final form on February 13, 2009.
Omnes Omnibus
@germy shoemangler:
I am not the person who denied that there could be honest differences of opinion.
topclimber
@Baud: It has probably already been said, but increased productivity (output per labor hour) is the general answer.
The problem has been that for at least a generation the surplus from increased productivity has gone overwhelmingly to the top 1-10%.
Josie
@New Deal democrat: I’m interested in your ideas and would like to subscribe to your newsletter.
Seriously, what is the name of your blog? You explain economics in a way that even I can understand.
germy shoemangler
@Omnes Omnibus:
Your sarcasm comes from a place of great privilege
Good to know the public option was killed by an “honest difference of opinion”
Another Scott
@Geminid: It’s easy to blame the Fed, but objectively a 3.0 – 3.25% Fed Funds rate is still historically low. If a business cannot survive with current interest rates at 6.25% (current “prime” rate – which doesn’t mean much these days in times of 20+% CC rates when the Fed Funds rate was 0%), then they’re doing something wrong.
In 1965 the CPI was 1.9%. The Fed Funds rate was 4.08% (annual yield). It looks like 30 year mortgages are a recent (1970s) thing. In 1964 a mortgage interest rate was around 5.45%.
The FED rate increases shouldn’t be enough to cause a recession, but we are living in a time of expensive housing so small changes in mortgage interest can have big effects on payments. But since there’s so much cash out there, and so many houses are being bought with cash by “investors” (speculators) it’s hard to know the real impact (beyond making the 20+%/yr price increase bubble smaller).
tl;dr – The FED is raising rates rapidly to get the GQPers in Congress off it’s back about “fighting inflation”. It’s trying to change the thinking of speculators who make their money by borrowing cheap money and making a quick profit. But it has no direct control of inflation (and hasn’t for decades) and certainly can’t fix supply chains or end wars or throw insane tyrants out of office. It can only change perceptions, so that’s what it’s trying to do.
(Insert “everything is under control, stay calm” gif here.)
We’ll see!
Cheers,
Scott.
lowtechcyclist
@Omnes Omnibus:
No.
Another Scott
@lowtechcyclist: Nominated.
Hehe.
Cheers,
Scott.
Baud
@Another Scott:
You nominated “No.”?
Omnes Omnibus
@germy shoemangler: Oh, ffs.
Omnes Omnibus
@Baud: That is actually a really good nomination. I second it.
Bokonon
There’s a real cost to all of this recession talk – in terms of making it a self-fulfilling prophecy.
I work at a tech company that has been getting battered by Wall Street to show toughness and austerity – and I just had my job cut, along with hundreds of other employees, as a sort of blood sacrifice to satisfy those market demands and the need to produce visuals.
Layoffs are corporate America’s automatic and go-to move for ANY economic stress. In this case, companies are doing pre-emptive layoffs before things have even gotten difficult.
lowtechcyclist
@Splitting Image:
That makes no sense.
Look, this bill passed the Senate by 61-37, with 58 (just checked) Dems and Collins, Snowe, and Specter. Regardless of the number of Blue Dogs, every vote they don’t have to get is one more Senator whose expectations and demands they don’t have to meet. Only needing 50 votes would have meant they’d been able to pass it not only without any GOP votes (Collins’ price was a $100B haircut, IIRC), but also without whichever eight Dem Senators chose to be the biggest pain in the neck. How does that not result in a bigger bill than the $787B they actually got?
So we’re back to my original question, which is: why did they need 60 instead of 50?
Ksmiami
@p.a.: I’m really really pissed at Powell. He should have gradually raised rates starting last summer instead of crashing the car as in the global economy. I don’t even think the rate increases will affect food or gas prices as those are being driven by drought, war and under-production.
Geminid
@Another Scott: Yes, it is easy to blame the Fed. But I did not say the current rate is too high; that is not proveable one way or the other, and my belief that they’ve overcorrected is only a belief (although a commenter with a better knowledge base seems to agree, @#77).
I said that had they started raising rates last year they might not have raised rates as high as they have.
Omnes Omnibus
@lowtechcyclist: Because it didn’t fit the specific requirements of a reconciliation bill. Remember, the ACA was passed partly by reconciliation and part by standard procedures (they needed to beat the filibuster on those sections).
Betty Cracker
@Bokonon: I think you’re right about the self-fulfilling prophecy aspect, and I’m sorry you got caught up in the blowback. Here’s hoping you find something better soon.
Steeplejack
@zhena gogolia:
As a fan of Hot Fuzz, you will appreciate this:
Ksmiami
@Shalimar: I’m to the point that I don’t care
lowtechcyclist
@Another Scott:
Now this is something I can totally agree with you about.
The vast majority of people spend most of their income because they have to. And they spend it on goods that someone has to make, and services that someone has to perform. IOW, their spending creates jobs.
Rich people not only don’t have to spend most of their income, but beyond a certain point, there’s only so much in the way of job-creating goods and services that they can spend it on. You only need but so many mansions and mega-yachts, and there’s only so much you can spend on food and clothing, even if you buy the best there is of each. The rest just drives up stock prices, and generates the never-ending search for some odd investment with a higher rate of return.
Basically, a huge chunk of their wealth basically disappears from the economy that the rest of us live in.
Decedents’ estates should be taxed on a graduated scale that tops out at, say, 90% on every dollar above $1 billion in valuation.
The children of deceased billionaires will manage somehow.
lowtechcyclist
@Omnes Omnibus:
And Biden’s stimulus bill did? That just shifts the question to: how come Obama’s didn’t if Biden’s could?
What does the ACA have to do with it? They only needed reconciliation because Scott Brown.
Chief Oshkosh
@Baud:
Increase supply.
Decrease demand.
Price controls.
Those are three that come to mind. You didn’t ask for effective/possible solutions… ;)
Immanentize
@Chief Oshkosh:
— decrease and/or limit corporate profit taking in times of inflation.
MomSense
@Baud:
What happened?
Immanentize
@lowtechcyclist: the “only” in that last sentence is doing really heavy lifting.
Immanentize
@MomSense: no one knows, that’s what is worrisome. I miss her too.
mrmoshpotato
@lowtechcyclist:
Well, someone isn’t the child of deceased billionaires obviously!
New Deal democrat
@Josie: Here is where I normally blog:
https://bonddad.blogspot.com
it was started by Hale Stewart, who has since retired from blogging. But I soldier on.
Geminid
@Chief Oshkosh: There’s also judicious investment in physical infrastructure and human capital. So far the Biden administration has had substantial success in the former, with the Infrastructure and CHIPS+ bill. And the clean energy initiatives in the IRA could produce efficiencies that will reduce inflation over time.
Success with the latter has been less substantial. If voters return Democratic majorities in Congress, we may make productive investments in our human capital with Universal Pre-K and free community college and other work force training.
These investments will only impact worker productivity in the medium and long term, though, and cannot affect inflation immediately.
The Moar You Know
@New Deal democrat: OG Bonddad is out? I missed that…although I couldn’t help but notice you’ve been the only person posting there for years.
You’re one of my three daily reads: Here and Bill McBride are the others.
Scout211
I just saw this on the front page of CNN.com. These MAGA people are just the best people, are they not?
Josie
@New Deal democrat:
Thanks. I’m glad you do.
Baud
@Chief Oshkosh: The meteor will solve inflation — permanently.
@MomSense: Missing since late July.
lowtechcyclist
@Immanentize:
I don’t see how. Were they saving reconciliation for the ACA in case Coakley lost her Senate race, rather than use it for the stimulus? Teddy was still alive and casting votes in the Senate at that point.
Also, even with the ACA, reconciliation itself didn’t do the heavy lifting: the bill proper passed the House in the form that the Senate had passed it with 60 votes in December 2009; reconciliation was used for the minor fixes in a separate bill – pulling the ‘cornhusker kickback’ and the like.
Sure Lurkalot
@jonas:
Yes and Timothy Geithner at Treasury was an awful, no good, bad choice.
Another Scott
@Geminid: Although it may seem like I’m nitpicking your posts, I’m generally trying to use them as a branch point to bring up other related aspects that I thing help fill-out the picture. You present your arguments well.
Lots of changes are happening now and change is scary and disruptive and businesses don’t like change so they complain. They almost always complain about the price of labor, also too, so when that changes to “lack of demand” or whatever, that can be significant. Otherwise, it’s often the usual griping.
Sorry if it seems like I’m your personal on-line B-J stalker. :-)
Cheers,
Scott.
MisterDancer
First, I’ll apologize for confusing the ACA/ARRA discussions. I got the acronyms and discussion paths on here, confused.
I’ll be honest — I don’t see any reporting on if the ARRA was even thought of for Reconciliation in 2009. It is a complex process; just reading summaries like this one is a lot to take in if you’re trying to compare it to, say, Wikipedia’s summary of the scope of the 2009 ARRA.
At the end of the day, I suspect they didn’t use Reconciliation because they didn’t see a need to put themselves at Risk, from a political capital perspective. As I was trying to say earlier, it’s a bad look to leap over members of your own Party in that way, and the fear of losing Blue Dogs was real.
There’s technical situations, as well. My utterly layperson understanding is that you do need to have a tight scope for Reconciliation to work, and the ’09 ARRA, with it’s provisions like “$1 billion for explosive detection systems for airports” would have been a poor fit for that process. At a minimum, the Byrd Rule, which narrows a lot of the scope for these efforts, would have likely derailed a number of portions. Then there’s the fact that the Senate Parliamentarian can make calls on if provisions can be included for these efforts; if not, you either have to pull the provision, or make a rules change (or get rid of the Parliamentarian for a lackey, I suppose).
So — again, as a layperson — I’d opine that it was a combination of wanting to try to keep to norms, maintain unity in the caucus to vote as one, and avoiding having to tweak and narrow the package to meet those rules, that led to voting it in this way, in 2009. Biden had different constraints, and thus a different approach.
This is just a summary. Honestly, it’s not a bad question, it’s just one with no simple answer, or even someone who was asking it at the time. I suspect “everyone knew” why it wasn’t, and it was just not something the reporting felt was worth noting.
You could likely piece it together, but it would take some real work I fear, and I apologize that I don’t have the time to do that work justice.
New Deal democrat
@The Moar You Know: In re Bonddad: Hale was writing at Seeking Alpha on stock and bond markets exclusively for the last few years. Then he got a new job about 6 months ago and said one of the conditions was he had to give up his outside gigs, so he rode off into the sunset (at least for now(….
ian
@Omnes Omnibus: I wish we had upvotes. You get two thumbs up!
lowtechcyclist
@New Deal democrat:
Just read your fascinating post on mass migrations, and added a couple of books to my reading list as a result.
Kay
Political media are all embarrassing themselves again – this time with Fetterman coverage. CNN has their (ridiculous) employees pondering a plastic model of a brain.
We all know how this goes- poor job performance means they get the (more) defensive they get and the more they circle the wagons. It will get worse.
They could have covered Fetterman’s stroke without making complete asses of themselves- it’s not “breaking news”- they had plenty of time to plan for it, get some input from some not-ridiculous people , etc.
Instead it’s just cheap, rushed out junk.
New Deal democrat
@The Moar You Know: In re: “front paging here,” first and most importantly, I’ve never been asked.
Also, my typical nerdy Econ posts don’t fit very well with a political blog, although obviously, like this thread, there is important overlap.
But thanks for the compliment.
lowtechcyclist
@Omnes Omnibus:
I tried disagreeing with you for that reason, but I couldn’t find anyone to sell out to! Sadly, I’ll have to do it for free.
Kelly
@New Deal democrat: I’m not an economist and ready to be corrected by someone of your expertise. I thought the wild house price inflation was a result of a very large reduction in new house starts following the bankruptcy of many house building business in the 2008 recession. Capacity dropped then stagnated at many levels including sawmills and young people learning the building trades. I’m from sawmill country near the Willamette Valley so that part of the story is a local topic of conversation.
Is my understanding of the housing problem correct and what could have the Fed done about it?
Geminid
@lowtechcyclist: This place could use some form of jackal bucks.
And also a pi filter, to screen out circular arguments.
New Deal democrat
@Geminid: “My point was that the Fed was remiss in not raising rates last year. This year they raised them by ,25%, .5%, and three times by .75%. They did not even tap on the brakes last year, and now they’ve slammed them. The chance of overcorrecting would have been lessened had they not been so tardy in reacting to inflation.”
Again, exactly correct.
Had the Fed started gradually last year, they may never have had to raise rates as high as they are now, to cool things down a bit.
So hopefully more people understand, you may have heard it said that monetary policy works with long and variable lags.
Here’s an important example: one of the main conduits of interest rate policy is the housing market (via mortgage rates). The *actual economic activity* of the housing market is total $$$ spent on construction.
Well, let’s look at the last year. The bond market started to anticipate Fed tightening last December. Mortgage rates started up from under 3%. Without getting into the exact math, if a 3% mortgage rate increases to 6%, a $1000 monthly payment increases to (not exactly but more or less) $2000. That’s a big jump!
So in the first few months of this year, mortgage applications started going down. Housing permits started going down. Then, a month or two later, housing starts started going down. All the while, house *prices* kept increasing – which added more burden to new homeowners. Then prices peaked during the summer.
And total housing under construction, including $$$ spent, is just peaking now. Almost one year after rates started rising.
But the Fed has only been slamming on the brakes for the past 4 or so months. Those increases haven’t even fed through into actual economic activity yet.
Had the Fed started gradually hiking by 0.25% every 1.5 or 3 months in summer 2021, the effects would have taken effect more gradually, and we might have seen housing construction peak and gently decline long before now. Instead we have the real economic activity turning down right now, even as lots of Fed hiking hasn’t even hit yet.
patrick II
@Baud:
In the short run, I don’t know either. There are longer term solutions that we don’t have the patience for and the rich don’t want.
New Deal democrat
@Kelly: It’s …. Complicated.
One aspect is demographics. The nadir of the Gen X birth cohort hit median house buying age about 10 or so years ago. Which means there was (everything else being equal) a low point for housing demand. That’s been replaced by the more numerous young Millennial birth cohort, so more new housing is needed.
Meanwhile, in the places people are moving to, not enough new housing has been built, in at least some substantial part because of zoning restrictions. With bigger populations, the options are (1) more density, or (2) bigger sprawl. In the US, we’ve opted almost entirely for (2), because of the restrictions on building.
Denser housing (e.g., midrises) are less expensive per capita than single family houses in the far burbs. Bottom line: there’s been a persistent shortage of affordable housing in growing metro areas.
Raising mortgage rates, with even fewer houses built, only exacerbates that problem. Not too much Congress or the President can do about it, because zoning is a State and local issue.
Hope that is responsive to your question.
schrodingers_cat
@Omnes Omnibus: Well at least he didn’t call you a fascist and racist based on who some members of your family support or some random person who shares your heritage.
lowtechcyclist
@Geminid:
:-D
JPL
@Kay: Since I live in GA, I think republicans should be ashamed of themselves to run a mentally ill person. It’s sick
Here is Herschel talking about the National Anthem. link
zhena gogolia
@Steeplejack: Loved it!
Omnes Omnibus
@lowtechcyclist: If it helps, I have rethought a bit and insanity would also be a reason to disagree with me. So, pick your poison
Ruckus
@Baud:
A big problem is that the people that make the big money want to run the country so that they make the big money. But that isn’t all that great for the people that just want a paycheck every week or so, which allows them to go shopping for food and pay for a roof. The big money people get a louder say than the millions of weekly paycheck folks. The country runs better and is healthier when more people are working and the ultra wealthy are not getting quite as wealthy, quite as rapidly. But the ultra wealthy think of the entire world revolves around the stick they have stuck somewhere, which is either their investment bankers ass – or theirs – or both. And it’s a problem because sometimes their investments actually do help the country and not just their portfolio. And if you rate everything based upon the ultra wealthy then Jeff Bezos and Elon Musk are geniuses.
I see a three flaws in the concept of that last line.
Matt McIrvin
@MisterDancer: I think lowtechcyclist is not entirely wrong here: generationally, Obama was almost a GenXer, and like me he grew up hearing about how the ballooning deficit was this looming bipartisan problem that nobody had the courage to really fix. There were good-government Dems like Paul Tsongas who had made that their whole brand. (And of course, it DID get fixed temporarily during the Clinton boom, and then Bush blew that surplus away. So the idea that Democratic administrations, perhaps working with a Republican Congress, might have the necessary virtue was there too.)
So I think he really was reluctant to go full New Deal and attack the recession with massive deficit spending. Advisers like Summers and Geithner didn’t help. You could see that too in the way that, the first time the Republicans took the debt ceiling hostage and demanded austerity, he saw it as an opportunity to fix the deficit.
It was the times too. I think there’s much more political space now to contemplate more generous solutions, or at least there was in the immediate environment of COVID shutdown.
Kay
@JPL:
How much does an NBC or CNN reporter make? A lot, probably, right? Not the 40k or so a Toledo Blade reporter makes, that’s for sure.
Do a better job. When someone suggests pulling out the plastic brain model ask “is this good work we’re doing here or just junk?”
They interview JD Vance on Ukraine and Vance whines about “diplomacy” and how that’s what should happen but none of them ask him specifics. What does he want Ukraine to give up?
Ruckus
@Paul in KY:
I’ve had all 5 shots. 3 Pfizer and 2 Moderna boosters.
The first shot was the worst and it wasn’t all that bad, except for the brain fog for 2 days. Woke up the day after and stayed in bed for 2 days as I sure as hell couldn’t do anything else. All boosters have been pretty much just over zero reaction. IOW, my arm hurt a bit.
Kelly
@New Deal democrat: Thanks! It’s complicated is the way the economy works when I get beyond the simple examples of my long ago Econ 101 class :-)
Steeplejack
@zhena gogolia:
“I only know ’im as the Elephant Man.”
Steve in the ATL
@ian:
JFC you can’t encourage him this way—it’s like feeding gremlins after midnight!
lowtechcyclist
@Omnes Omnibus: Jeez, you talk about insanity as if it were a bad thing. Let’s not have any insanity-shaming around here! I promise I won’t shame you over your (comparative) sanity.
Besides, you’re a lawyer. You should know there ain’t no sanity clause.
Ruckus
@Matt McIrvin:
I think there was another problem that many will not say. And that is President Obama’s skin color. And that is a lot of people in this country would rather sky dive off the Empire State building without a chute than have a president with that skin color. Or would rather sink the country than do anything that might make him look actually presidential. Their entire human viewpoint is that someone with dark skin is incapable of, well pretty much anything, especially anything good and or smart. Even if only given this one example, President Obama, it is obvious that it’s bullshit. But that is a major part of the history of this country. I have no idea how to get rid of this bullshit, I’m not sure it can be gotten rid of, but we would be dramatically better off to be rid of it.
My point is that much of our citizenship is racist and some of our political leaders are as well. And anything that might neutralize that racism is poison to those racists. For a lot of them their racism is what their lives revolve around, even if they deny it. Or maybe especially IF they deny it.
Ghost of Joe Liebling’s Dog
@Soprano2:
I think you’ve raised that point before in other comments. If I remember correctly, you’re an employer, and maybe you’ve raised wages 10 years worth in the past two years (I suppose some employers must have done; I don’t mean to doubt your word).
But I’m currently in
a losing battlediscussions with my employer of 15 years, trying to get my comp back to where it was five years ago, in constant dollars. Increasing responsibilities, increasing workloads (God knows), and in the last two years, record profits followed by even larger record profits.Nothing has trickled down to me (or AFAICS to other people at my level).
I read fairly widely, and it doesn’t look as though I’m the only one falling farther and farther behind year over year.
I mean, go on thinking that if it makes you feel good. I wish I could think it too.
Omnes Omnibus
@lowtechcyclist: We’re all mad here.
Matt McIrvin
@Ruckus: There are definitely things a white male President can get away with that Obama could not.
Baud
@Omnes Omnibus:
Now that’s a good rotating tag.
Geminid
@New Deal democrat: I will be interested to see the impact of California’s recent legislation regarding zoning. I believe the legislature is overiding local government’s ability to prevent rezoning of commercial property to residential use. I think the intent is to expand the stock of residential housing units.
Omnes Omnibus
@Baud: The Cheshire Cat is seldom wrong.
MisterDancer
@Matt McIrvin: And I’ll be honest — I tried my best to answer, in good faith, a fairly specific question about why Reconciliation now, and not in 2009.
And you note, in your response, the broader set of questions that are also being asked (or implied?) around why the ’09 approach was done in that way, that also are engaged here. On the flip side: even for my more narrow issue, the answer I fear is “we don’t know, and any real answer has to involve a ton of complex Congressional rules, along with speculate on motives no one’s written down to our mutual awareness.”
In other words: Trying to nail down the overall set of issues around the 2009 legislation is a mug’s game, y’all. I get why you’d ask the question, but a good-faith answer is a Master’s thesis of research. And I think it’s OK for me, at least, to acknowledge that, and to move on with my day. :)
Jim, Foolish Literalist
Here’s Dan Pfeiffer, who was actually in the rooms when the ARRA was discussed
As I recall, it’s also in Grunwald’s book , which should have been required reading, that Pelosi told Obama she couldn’t sell anything over $800B in the House. Current MSNBC firebrand Claire McCaskill bragged about eliminating “silly stuff” from the bill, like plans for a massive purchase of hybrid vehicles for federal agencies. As to reconciliation: I don’t remember all the ins and outs of the negotiations, and I don’t pretend to know all the rules, but one of the key players was old Bobby Byrd, the man who wrote some of the rules governing/restricting use of reconciliation, the Byrd Rule. And I sometimes think I’m the only person in the country who remembers Byron Dorgan and Kent Conrad
Jim, Foolish Literalist
it started before Obama was inaugurated
My recollection is Bayh claimed to have a dozen members lined up. Note Third Way is a “progressive” outfit in this story.
Baud
@Jim, Foolish Literalist:
I get why people compare the bank bailout to the stimulus package. But IIRC the bank bailout was mostly a short term liquidity measure consisting of loans that were paid back, while the stimulus was pure Keynesian spending, even if not enough. Really two different animals.
Baud
@Jim, Foolish Literalist:
Haha.
The Moar You Know
@Matt McIrvin: I’m a GenXer – two years younger than Obama, I think. I knew it was utter and absolute bullshit when I was a teenager. I wasn’t political and I wasn’t raised political and still I knew that the people pimping this were lying through their fucking teeth, it was that obvious.
How did so many people take this seriously? Let me rephrase that: how did so many DEMS take it seriously? The Republicans never did and still don’t, and have shown us that over and over again. The deficit is a problem only for programs and expenditures Republicans don’t like. For the stuff they love, the checkbook is open.
Jim, Foolish Literalist
@Baud: sure, but how many people got that distinction, including in Congress? I remember Ezra Klein saying he tried to explain it to Dem MoCs, and they still didn’t get it. People were convinced the crash of ’08 was somehow caused by government spending and “the deficit”, something I would bet 60% of the country can’t properly define.
Baud
@Jim, Foolish Literalist:
Just the other day, I hear Morning Joe complain that inflation is a result of the debt.
John Revolta
@Omnes Omnibus: I have rethought a bit
Bad habit to get into. When did we go all kumbaya around here all of a sudden?
Kelly
@Geminid: Similarly Oregon has overridden local single family zoning rules. All towns over 10,000 population must allow duplexes in formerly single family zones. There are also some mandates for apartment zones but I don’t know the details.
JPL
There is a good chance that the supreme 6 will decide that we have no right to privacy. I’m don’t have the TV on a lot, but I haven’t heard a peep from democrats about that.
Has anyone?
Baud
@JPL:
What are you referring to? There’s always that long term danger, but I’m not aware of anything immediate.
ETA: I’ve heard the issue being discussed. But our voters don’t really pay attention to long term threats.
Jim, Foolish Literalist
@JPL: yeah, I’m a political junkie and I’m not sure what you’re referring to. Griswold?
evodevo
@New Deal democrat: Oh my goodness…I followed that blog since 2007. Got there by way of Naked Capitalism and then was led to Calculated Risk. Those websites gave me a college level education in economics, and a foresight of the ’08 Crash and understanding of its causes. I am grateful to this day…
Steve in the ATL
@Baud: I’ll never understand why you people watch that show
Steve in the ATL
@Jim, Foolish Literalist:
Dossier updated!
Omnes Omnibus
@Steve in the ATL: Don’t kink shame.
EmbraceYourInnerCrone
@Jim, Foolish Literalist: Jeez, I have a high school education and do NOT invest anything (except for what my work 401K invests in and I’m pretty conservative about my choices there). I know that the 2007/2008 crash was cause by homes being over valued and banks bundling and selling mortgages as new ” investment instruments” then when the housing market finally corrected itself Banks and hedge funds were left holding a whole bunch of nearly worthless paper. The big banks then needed a bail out from the government, to cover their losses because if all the big banks crash they drag the rest of us with them.
How is it that people who have far more education than I do and command far more respect, do not understand this? I am a lot more skeptical of “the smartest people in the room these days…) more like some people are born on 3rd base and think they hit a triple.
Baud
@EmbraceYourInnerCrone:
Most members in Congress, even on our side, are not the smartest people in the room. (A few are great.)
Paul in KY
@Paul in KY: Got the shot. They gave my Pfizer. No taste for human flesh…..yet.
David 🌈 ☘The Establishment☘🌈 Koch
@Steve in the ATL:
I watch it for their porn recommendations.
lowtechcyclist
@Omnes Omnibus: Stay sane inside insanity.
Paul in KY
@Kay: I would think a TV reporter is making North of $600,000 per year.
JPL
@Jim, Foolish Literalist: Even Kemp said that he would look at bills before him that mentioned birth control. My concern is marriage equality
Roe was found on the right to privacy, so it is also a way to talk about abortion indirectly.
Paul in KY
@Ghost of Joe Liebling’s Dog: Good luck! Generally, they seem to only increase the comp if they think you are leaving & they want to keep you.
Matt McIrvin
@The Moar You Know: To some degree it was BECAUSE the Republicans didn’t take it seriously, so Democrats figured they had to. That is, in the 1980s complaining about the national debt or the deficit was mostly a Democratic attack on Republicans, because, after claiming he was going to balance the budget, Reagan had blown it way the hell out with his tax cuts and defense buildup. Similarly during the Afghanistan/Iraq War era, when Bush had taken a government that was actually running a surplus and drove it way into the red.
And then we had to go and be consistent about it. Being “fiscally conservative” was actually part of the Democratic Party brand by that point.
StringOnAStick
@New Deal democrat: Hey, could you post a link here when you put up a new post at bonddad?
Omnes Omnibus
Infowars jury is in. Not good for Jones.
Steve in the ATL
@Omnes Omnibus: but the plaintiff’s attorney will be getting a new boat and airplane! If the judgement is collectable, that is.
StringOnAStick
@EmbraceYourInnerCrone: You can add one thing to you very accurate understanding: the banks bundled those mortgages, sold off “strips” of the bundles to city, state and private pension funds. Goldman Sachs made a huge profit setting these things up and dumping them on the less savvy in their industry; anyone running a state pension system was seen as easy pickings by the MOTU running the huge hedge funds and Goldman Sachs. They knew this would crash eventually, and Goldman Sachs set up internal trading vehicles to profit on that crash, which they did. It’s a little like how when the electricity market was deregulated in CA, Enron did such a great job working over the electricity buyer groups in CA who had never dealt with real sharks before.
Another Scott
@Jim, Foolish Literalist: This reminds me – Krugman often makes the hindsight point that the Recovery Act number was too small. I like Krugman a lot (though honestly I haven’t read him since FTFNYT made it very difficult to do so without a subscription). But I reread his columns from back then and he didn’t clearly state that “the number needs to be twice as big!!”. No, he said things like (roughly) “we’re in a deep hole and we need a big push to get out; and we won’t get a second shot. I hope this is big enough”.
I think he was afraid to say how big he thought the number should be. Lots of people were very afraid to go close to or above $1T because of fear of the political cost of $BIG-SCARY-NUMBER.
Corrections welcome.
Cheers,
Scott.
Steve in the ATL
@StringOnAStick: if we had a real justice system, GS execs would be in prison for this
Jim, Foolish Literalist
@StringOnAStick: Krugman was practically trolling back in 09. One of the reasons I bailed on Eschaton was all the preciously sanctimonious references to “Dr Krugman” and how Obama should listen to him. I think it was Jonathan Chait who laid out the politics in a sort of open letter to Krugman, who responded with a faux-naive “I’m just a bearded economist! I don’t do politics” I lost a lot of respect for him