zuvuyeay said:
well i can't claim to know the what the democrats have been doing or what the real difference is between dem and rep but i prefer less state in govts do you think there will be a double dip for sure then do people tend to drift to the right as they get older in the usa |
There's always a double dip. If you look at the GDP growth most recently it was much higher then expected... however this was due to shops taking in a lot more invetory now then they usually do.
Suggests that they won't buy nearly as much leading up to Christmas, and will have lots of leftover stock going into future months... which means they WON'T be buying in the next few quarters... leading to a negative drag on GDP.
Unless consumer spending booms way more then expected in any case... which there is no reason it should.
That's the issue with Kensyian policies... massive government spending to prop up until consumer conifdence returns doesn't really help... when consumer confidence doesn't return. Which it never does until after the double dip when funding is pulled away.
I mean... it's logical when you think about it.
1) Huge economic Crisis - People are worried.
2) This giant stimulus bill will prop up our economy - People are still worried. Even when pro stimulus... I mean afterall... the economy NEEDS to be propped up. As long as government spending is going on... it's proof the economy is fucked up.
3) government spending goes away... and because consumer spending has never come back... and the spending increases that were caused by stimulus "deals" were also inveory "foward "shopping... the economy dips. Because all that money is now gone from the system. (By foward shopping, like the stimulus money that was done to make cars cheap for anybody who wanted to buy a new car. Everyone who was going to buy a new car now has.)
4) Economic recession again... this time the government can't intervene because it just pulled away money and there was a huge amount spent.
5) Economic recovery eventually comes as people get adjusted to the new "low" and have learned how they're going to spend/budget etc in the new economic landscape.
6) Everything recovers and starts growing more stabley.
2 and 3 seem... pretty much just a hinderance... that makes things suck less in the short term, but suck for longer... and hurts us in the long term. Like instead of getting punched in the gut you get pricked in the arm a few times then punched in the gut later.
People like to bring up the great depression... not noting that under the Hoover administration... government spending actually grew greatly.
Hoover didn't "do nothing". He actually did a lot... and it wasn't good.
Heck,Hoover in 1929 sounds a lot like what Obama may be saying in 2012.
"We might have done nothing. That would have been utter ruin. Instead we met the situation with proposals to private business and to Congress of the most gigantic program of economic defense and counterattack ever evolved in the history of the Republic. We put it into action…. No government in Washington has hitherto considered that it held so broad a responsibility for leadership in such times…. For the first time in the history of depression, dividends, profits, and the cost of living, have been reduced before wages have suffered…. They were maintained until the cost of living had decreased and the profits had practically vanished. They are now the highest real wages in the world.
Creating new jobs and giving to the whole system a new breath of life; nothing has ever been devised in our history which has done more for … "the common run of men and women." Some of the reactionary economists urged that we should allow the liquidation to take its course until we had found bottom…. We determined that we would not follow the advice of the bitter-end liquidationists and see the whole body of debtors of the United States brought to bankruptcy and the savings of our people brought to destruction."
Does Hoover the man who's supposed to be the proof of coincquences of not passing stimuluses really sound like it?
