Mitt Romney: Shooting Himself in the Foot While It’s Still in His Mouth.

By: Jeff Spector
June 3, 2011

So it’s official now.  Mitt Romney is running for President. Surprised? I didn’t think so.  But, while he is considered the frontrunner today, that lead may soon vanish as some other notable names enter the race.  Namely, Hockey Mom, Sarah Palin. Yes, she will.

As an LDS member, I really want to like this guy.  He is all American to the core. Son of one of my most favorite Republicans of all time, George Romney; a good, strong member of the Church, so I think I have a good handle on his values; and a very successful businessman who had a real life before politics.

As the Governor of liberal Massachusetts, he was a pro-abortion rights moderate who enacted a statewide universal healthcare program strangely similar to the plan pushed and passed by new arch-enemy, President Barack Obama.

But, he has needed to reinvent himself. He is now far right wing, pro-life, universal healthcare-hating, and Tea Party-loving conservative in order to appeal to the base of the Republican party, many of which do not like him simply because he’s a Mormon.  But, his Mormonism, well defined as opposed to Jon Huntsman, is probably the least of his problems.

I wrote a post several weeks again entitled: “Why the Republicans Will Lose Next November.”  Unfortunately for Mitt, he is living proof why this continues to be so, maybe not for all the reasons I stated, but some of those and others.

For any candidate to win in November 2012, they need two major constituencies: folks whose political views fall in the middle and independents.  This includes President Obama.  Obama captured many of those folks last time as well as the lower middle class and poor, and the African American and most minority group votes.

At this point in the game, Romney is delivering his message to the base, right wing Republicans and Tea Party members.  In his speech announcing his candidacy, he said things like:

“When he took office, the economy was in recession. He made it worse. And he made it last longer,” Romney said, pointing at stubbornly high unemployment, record foreclosures and falling home values.  “Families are buried under higher prices for food and higher prices for gasoline…  It breaks my heart to see what’s happening in this country.”

“The president seems to take his inspiration not from the small towns and villages of New Hampshire, but from the capitals of Europe,” he said.  “With the economy in crisis, his answer was to borrow more money and to throw it at Washington bureaucrats and politicians, just like Europe.” (Yahoo News)

This is not a winning strategy. Whether those statements are true or not, it is important to offer solutions. He did not. And he has not.  He has had to defend his revolutionary healthcare bill because the base does not like it.  Just like they do not like the national healthcare bill.  He’s taken a beating on this from the every people he is courting.

It will be interesting to see what happens during the first Republican debate scheduled for June 13th in New Hampshire. These preliminary debates are where the candidates will not only tell you how bad a job Obama is doing, but how bad a job the other candidates would do.  Mitt Romney will be target number one.  And no one will even mention that he is a Mormon.

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110 Responses to Mitt Romney: Shooting Himself in the Foot While It’s Still in His Mouth.

  1. Paul on June 3, 2011 at 7:01 AM

    I am one of those folks who political views fall in the center. I’ve voted for as many democrats as republicans in presidential races over the years.

    Oddly, Mitt’s own party puts him in the difficult box he’s in — needing to appeal to an overzealous base to gain the nomination and then needing to convince the moderate electorate of the general election that he was just kidding.

    He’s certainly not there yet.

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  2. Will on June 3, 2011 at 7:08 AM

    ” And no one will even mention that he is a Mormon.”

    It was brought up and discussed in his interview with Hannity last night. Also, Maddow and former RNC chair Steele had a whole segment on Romney’s faith. So much for your theory,

    I do agree that the republicans will lose, however not for the reasons you suggest. The problem is entitlements. They are choking us. They are draining our budget. They are the primary cause of our massive debt. We will not solve our problems until we address entitlements. We will not address entitlements because we have too many people dependent on them. The only way to fix this problem is to break it — allow it to crumble under it’s own weight, which it will.

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  3. Jeff Spector on June 3, 2011 at 7:09 AM

    The other problem is that over the years he played to all sides at one time or another. So he’s becomes an “enemy” to many and a “friend” to no one.

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  4. Jeff Spector on June 3, 2011 at 7:16 AM

    Will,

    “The problem is entitlements. They are choking us. They are draining our budget. They are the primary cause of our massive debt. We will not solve our problems until we address entitlements.”

    I do agree with you there. But probably not in the same way as you think about it.

    the term “entitlement” means slightly different things to different people. to the Republicans, it means Medicare and SSI. To others, it means the whole range of handouts from Medicare/SSI to corporate subsidies and tax breaks. to others, it means all that and the tax breaks that we individuals get.

    I’d be happy to give up my deduction for home mortgage interest if the politicians in Washington had the courage to also shut off the corporate gravy train.

    Putting people back to work is the best remedy for what really ails us. And we cannot do that as corporations ships jobs out of the country. And the government helps them do it.

    And so far, Romney doesn’t adress that. (just to keep this someone on topic)

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  5. MoHoHawaii on June 3, 2011 at 10:34 AM

    It’s interesting that the educated, progressive electorate in Massachusetts had no problem with Romney’s religion while the religious conservatives of the Republican party would never vote for a Mormon. Andrew Sullivan once called Romney’s bid for the Republican nomination “a fool’s errand” for this reason.

    The irony is great. The Church has spent a lot of time demonizing intellectuals, the secular and progressives. On the other hand it has also spent a lot of time and effort aligning itself politically with the religious right. Yet, between these two groups, only progressives and moderates can see Romney the candidate and not Romney the Mormon. Whether or not Romney is electable I can’t say, but I know for sure that he’ll NEVER be able to get the Republican nomination.

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  6. Cowboy on June 3, 2011 at 10:37 AM

    Romney is a good businessman, but that leads to unauthentic politics. In business, a company like Bain Capital, helps other businesses become profitable. They do this by conducting market research, finding out what the consumer wants – and then they develop a plan to deliver to those wants efficiently. That makes a lot sene in business – but in politics, particularly when we start dealing with normative roles of government, people want ideology. We want someone who has positions and beliefs based on ideals, religious or otherwise – and we also want those ideals to resonate with us. We also want leadership, ie, someone who can actually do more than talk.

    Romney has proven his effectiveness as a leader in the private sector – I have no problem admitting that. The problem is, he has performed his research and found that his “consumers” weren’t to hip on his healthcare position, or his pro-choice stance (I know, personally pro-life while politically pro-choice, or so his defenders claim), so he changed his position the same way a bix box company would change their product. It would seem like this should be a good strategy, but what Romney has failed to learn is that American’s want more consistency on their politicians social ethics, than what they demand in product consistency from their paper suppliers.

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  7. Kullervo on June 3, 2011 at 11:15 AM

    “For any candidate to win in November 2012, they need two major constituencies: folks whose political views fall in the middle and independents.”

    Bingo. Going hard right is a strategy for failure. Pandering to the fringes of either party is lazy politics, and it means giving up the center, where the game is won and lost.

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  8. Mike S on June 3, 2011 at 11:36 AM

    Will/Jeff:

    When I was in Washington DC a couple of months ago talking to the Senators and Representatives from Utah, it became very clear that entitlements are ultimately the problem.

    You could raise the effective tax rate on the “rich” to 100%, eliminate 100% of the “corporate” tax breaks, and eliminate EVERYTHING else, and the system will still be broken in the next few decades.

    Unless something is done with entitlements, in the new few decades SSI, Medicare, Medicaid, interest on the debt, and defense (even cut in half from where it is now) will equal 100% of what the government takes in. It is absolutely non-sustainable.

    We can talk around the fringes all we want to make ourselves feel better – make the rich pay more, make the oil companies pay more, give up home mortgage deductions, etc. While helpful, none of these things ultimately matter until someone is willing to step up and say that it’s broken.

    And even more importantly, the American people need to step up and accept what this means. They need to accept a reduction in Social Security. They need to accept a reduction in medical care (or pay more). They need to accept that they can’t get as much as they do with someone else paying for it.

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  9. Ray on June 3, 2011 at 11:44 AM

    I don’t believe for one minute Romney is a conservative. He just saw which way the wind is blowing and changed all his positions accordingly. One has to wonder, though, if Republicans believe entitlements are the big problem, why they didn’t do anything during the Bush years when they held the White House, both houses of Congress and the Supreme Court. Between tax breaks for the wealthy, the prescription drug plan, two wars and no oversight of our financial institutions, they did more in eight years to wreck our economy than any public officials in modern memory.

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  10. ssj on June 3, 2011 at 11:58 AM

    “For any candidate to win in November 2012, they need two major constituencies: folks whose political views fall in the middle and independents.”

    I agree and disagree at the same time. Yes the candidate has to appeal to this group to win but first he has to win the republican nomination. The republication party will not support the Massachusetts Governor Romney. It seems as though in today’s political market you have to be so far on one side of the spectrum to get a nomination. So while the Governor Romney will appeal to the middle road people, Conservative Romney has to win the Republican vote. Obama got won over the independents because he was different and promised change but he is not in the middle of the political spectrum in the way Romney is. Obama is still very liberal and he won the democrats before he won the independents.

    As an independent voter (one which Obama appealed to) I really like Romney for all the reasons you mentioned – pro-choice, pro gay marriage, and his healthcare. It is unfortunate that in this day and age you have to be so far on one side of the spectrum to have a chance. I doubt Republicans will vote in a guy like him. He’s not conservative enough.

    What surprises me is how many LDS people support him. I saw so many people adamantly opposing Obamacare yet they support the man who Obama looked into when starting his program?

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  11. Jon on June 3, 2011 at 12:01 PM

    You all forget that in order to get elected you have to go through the primaries where the far right minority vote, so the person has to appeal to them (likewise, if you are democrat you have to appeal to the far left). Then in the general elections you have to move to center. This is the way it works every election cycle, nothing new here. Therefore, any person that wishes to be president has to be a liar (or stretch the truth, i.e., lying) from the very beginning.

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  12. Jon on June 3, 2011 at 12:05 PM

    Mike S, et al.,

    The core problem is morality. It won’t be until people have morals again will the problem be fixed. Even if the problem imploded on itself it would not fix the core problem, people believing that it is OK to steal from others to achieve their ends. The means are just as important as the ends.

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  13. Paul on June 3, 2011 at 12:15 PM

    #8 Mike S, I think you (and the Washingtonians you spoke to) are on to something (because I can do math). But as Jeff said, there needs to be some sense of shared sacrifice.

    In Michigan, we have a governor who is restructuring business taxation (very necessary) and funding it by taxing pensions, cutting spending for poor and education and revenue sharing. He’s smart to do it in his first five months in office. If it works (and it brings more business and jobs to MI) he’ll be a hero by the next election cycle. If it fails, he’ll be tossed out as the guy who robbed from the poor to pay business.

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  14. Will on June 3, 2011 at 12:38 PM

    Mike,

    We are in full agreement. I feel like I’m on the 100th floor of the world trade center just after the plane hit. It’s not going to end well. It’s gonna collapse. The best thing we can do is prepare personally. Get out of debt whatever it takes. For sure consumer debt, but also long term debt if possible. Has as many real assets as possible – inflation resistant assets.

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  15. Jeff Spector on June 3, 2011 at 2:07 PM

    I probably should have put a bit of emphasis on the primary where you have to win the hearts and minds of your party. It is going to be a blood bath for the giant field of republican wannabes. I am thinking some are holding back until later to come in as the knight(knightess) in shining armor to capture the nomination.

    I like the concept of shared sacrifice.

    ut the only way out of this poor economy is putting people back to work who pay taxes and spend money.

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  16. Mike S on June 3, 2011 at 2:41 PM

    I agree with both Will and Jeff. Maybe the end truly is near :-)

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  17. The Other Clark on June 3, 2011 at 2:48 PM

    This is becoming a political post where everyone agrees. Congratulations on doing the impossible, Jeff!

    Now, how does Romney–or any Republican–win the nomination, while still appealing to the center?

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  18. Mike S on June 3, 2011 at 2:54 PM

    I do know that raising taxes is NOT the way out of this mess. First, as I mentioned above, even if the top bracket was taxed at 100%, it’s not enough.

    And on a practical level, from my own line of work – medicine.

    - For every $1.00 that I bill, on average I collect around 65%, or $0.65.
    - My overhead is around 50%, so I net $0.33.

    So what would the potential tax rate be for that “top dollar”:
    - If Bush tax cuts repealed, top rate ~41%
    - “Millionaire” tax of 3%, so 44%
    - Potential 2.5% increase in payroll taxes and Medicare surtax on “high-income earners”, giving 46.5%
    - Removal of cap on Social Security income which can add around 10%, giving 56.5%

    So, if I tithe on gross at 10%, pay Utah’s 5% state tax, and have 56.5% federal tax, I am paying over 70%. This reduces my $0.33 to around a dime.

    At this point, it doesn’t make much sense to see those “extra” patients, or to squeeze in that “extra” surgery to make it more convenient. It doesn’t make sense to do extra, if from the $1.00 I bill I end up getting a dime.

    Multiply this by the entire economy, and it’s clear why we can’t “tax” our way out of this. We NEED to cut benefits.

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  19. mh on June 3, 2011 at 3:08 PM

    it is clear to me that the best way out of the mess we are in is to simultaneously cut spending AND raise taxes. I only hear independents supporting this position, not republicans or democrats. holding the economy hostage by talk about the debt ceiling is doing the entire country a disservice. our politicians are posturing instead of providing real solutions. I wish we had statesmen in charge that are willing to make correct decisions instead of constantly posturing.

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  20. Jeff Spector on June 3, 2011 at 3:24 PM

    Mike S.

    “It doesn’t make sense to do extra, if from the $1.00 I bill I end up getting a dime.”

    So how does that food storage taste? :)

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  21. Jeff Spector on June 3, 2011 at 3:25 PM

    “This is becoming a political post where everyone agrees. Congratulations on doing the impossible, Jeff!’

    Mitt Romney – our common enemy! oops

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  22. mh on June 3, 2011 at 3:35 PM

    jeff, I don’t understand your headline. where is mitt shooting himself in the mouth/foot?

    I understand he is in a tough position to cater to the extremes on the right in order to win the nomination before centering himself, but this seems to be a ‘necessary evil’ of our day if you want the power of a political party to get elected. are you saying he would be more successful if he went ross perot and choose to be an independent?

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  23. Jeff Spector on June 3, 2011 at 3:46 PM

    Well, first, it was an attention getter. But more than that it is his catering to the far right that will eventually come back to bite if he were to win the nomination.

    And saying that Obama is a failed President and not recognizing that some of the problems have been there for years and were set up by the Bushies. And that we have fundamental problems that need to be addressed and by running for President when it appeared he was all that interested.

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  24. mh on June 3, 2011 at 3:55 PM

    so would mitt be better served by abandoning the republican party in favor of an independent campaign?

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  25. JrL on June 3, 2011 at 4:21 PM

    MoHoHawaii: “The Church … has also spent a lot of time and effort aligning itself politically with the religious right.”

    Huh? What are you talking about? Many members of the Church, sure. But “the Church”? Other than Prop 8 and some anti-gambling work (where in my state at least we were allied with the Methodists — hardly “the religious right”), what examples do you have?

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  26. FireTag on June 3, 2011 at 4:43 PM

    Jeff:

    Two reminders. It doesn’t matter whether Bush broke it. We already fired HIM. Obama fixes it, or he gets fired, too.

    The numbers say he can’t, as the chart here shows he’d have to have 66 months of job creation at a rate he’s only achieved for 2 months in his entire presidency just to get the unemployment rate back to what it was at the beginning of the recession BY THE END OF A SECOND FULL TERM.

    http://www.theblaze.com/stories/the-ominous-job-growth-chart-that-will-make-your-jaw-drop/

    Second point: 17 months before the election is still way too early to say who’s a front runner and who can’t win. Ask President Hillary Rodham Clinton.

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  27. Will on June 3, 2011 at 5:00 PM

    Mike/Jeff/ETC….

    The best way out of the financial mess that we are in is as follows:

    Take the percentage that each department received (defense, entitlements, etc..) last year and apply it to the current income. This would include creditors. For example, revenue last year (roughly speaking) was about 2.5 trillion. We spent 3.5 trillion. If you received 10 percent of the total expenses, or 350 billion, you would not get 250 billion. This is the most equitable way to resolve the budget problems. It is the definition of shared sacrifice. It is the ONLY way to balance the budget.

    If the revenue increases so does the payout to all departments.

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  28. mh on June 3, 2011 at 5:20 PM

    will et all,

    the easiest and fastest way to balance the budget is to reduce expenses and raise revenue. anybody that can balance a checkbook can figure that out without quoting millions of dollar figures and proclaiming it ‘fair’. puhleez.

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  29. LovelyLauren on June 3, 2011 at 7:23 PM

    I think the problem with any campaign is spanning the gap between actual voters and the ever-important media commentary on your campaign. The GOP has some pretty hard-line, intensely right-wing commentary that follows up any candidate. Even if one does register well with ordinary voters and takes a more moderate conservative stance, he or she will be slaughtered by right-wing media commentary.

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  30. Mark N. on June 3, 2011 at 7:42 PM

    The local talk radio morning guys here in Sacramento (and it’s a right-wing station) had a good time poking fun at Mitt this morning, on the grounds that to them, he just comes across as a big phoney; they called him “the Al Gore of the Republicans”.

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  31. Jeff Spector on June 3, 2011 at 7:50 PM

    Lauren,

    I’m afraid you are right and it is another reason why the republicans lose. By the time someone emerges from the pack, he or she will have been put through the ringer by those radio guys.

    And then everyone will be able to find something wrong with the candidate because the radio guys will have told them.

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  32. Jeff Spector on June 3, 2011 at 7:54 PM

    Firetag,

    “Two reminders. It doesn’t matter whether Bush broke it. We already fired HIM. Obama fixes it, or he gets fired, too.’

    while I agree in principle, the US Congress is also a factor and they are hated more than Obama. The current Republican revolution is in as much danger as Obama himself.

    Ultimately, they control the money.

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  33. Dan on June 3, 2011 at 8:38 PM

    hehe, Romney is the “frontrunner” at 17%. What a god-awful crop of candidates the Republicans have to deal with…

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  34. FireTag on June 3, 2011 at 9:47 PM

    Jeff:

    Except that controlling 1 house of Congress doesn’t get you nearly the blame that controlling the Presidency and 2 houses of Congress did in 2010. Presidential year elections are primarily a referendum on an incumbent President.

    You seriously underestimate how much right wing radio will prefer anybody-but-Obama, IMO.

    In the Rasmussen daily tracking poll, which I’ve followed for years, the ratio of strong approval for Obama to mild approval is <1:1. On the other side, the strong disapproval to mild disapproval ratio is 5:2. There isn't a bunch of upside potential for Obama at this point in either the economy or foreign policy. Any light at the end of the tunnel is more likely to be an oncoming train.

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  35. Stan Beale on June 3, 2011 at 9:55 PM

    Mike S

    I find your math quite interesting. One simple example. In order to pay a millionaires tax, you would have to earn at least a million dollars. Assuming your .33 per dollar billed is accurate, your business would have to gross at least $3,000,000 per year. Assuming you are a very busy doctor and bill 60 hours a week for 50 weeeks, you will end up with 3000 billable hours at a rate of $1000 an hour.

    Even if your .10 figure is correct (and it is not) that would be $100 an hour tax free and tithing clear for additional work. There are a lot of people that would find such an amount quite enticing.

    The reason I find your .10 wrong is hat the millionaires tax was proposed as an alternatic=ve to restoering the pre Bush tax rates, not an additional tax to it.

    In addition, with that type of income, I can’t believe that yoiu are not a personal services corporation that uses various means to shelter and invest income to reduce the effective tax rate even more. If you are not, you should be.

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  36. Will on June 3, 2011 at 11:09 PM

    Stan,

    Your assuming Mike’s income only stems from his practice, or physician’s salary. Most people that I know with 6 figure salaries (it is common for doctors to make 250 to 750k) have multiple income sources. Passive income in excess of their salaries — rental income, dividends, partnership distributions, etc. I personally know of docs with passive income in excess of 30k per month. It’s not hard to achieve that income, even with a cash on cash return of 10 percent. That’s only a cash investment of 3.6MM.

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  37. Will on June 3, 2011 at 11:17 PM

    He may also have docs, or PA’s working under him making him money.

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  38. Jon on June 4, 2011 at 1:20 AM

    mh,

    Sometimes the obvious must be stated. If you don’t want to overspend then spend less. Pretty simple, the politicians don’t get it though.

    The government doesn’t produce anything so raising taxes doesn’t fix the problem either, that only encourages spending more money.

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  39. Jon on June 4, 2011 at 1:25 AM

    The core problem is morality. It won’t be until people have morals again will the problem be fixed. Even if the problem imploded on itself it would not fix the core problem, people believing that it is OK to steal from others to achieve their ends. The means are just as important as the ends.

    Come on guys, this is core Mormon/Christian doctrine. Moral people = prosperous nation, immoral people = nation on its way to ruin. Don’t know why you have a problem with that.

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  40. Jon on June 4, 2011 at 1:31 AM

    Romney is a classic neo-warmonger and would be worse than Bush II (maybe even worse than Bush III, the current president).

    http://www.youtube.com/watch?v=1-5bbH1x2fE

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  41. Mike S on June 4, 2011 at 2:24 AM

    Stan:

    I don’t make a million $/year, but the results of the math are real. I work 1/2 day less per week now than I used to – basically because after I pay all of the taxes / tithing / etc. on that money, I’d rather just spend the time with my family (which is actually a really good thing). I coach my kids’ sporting teams, I do homework every night, and I have lunch dates with my wife.

    The results for my patients – longer waiting times to get in. Does it matter to them? Probably not. Some wait longer, some find another doctor. I’m under no delusions that I am the only doctor to give great care. I could die tomorrow and people would still get the care they need.

    But, my experience isn’t unique. When ALL the doctors start working less because it doesn’t make sense, then access becomes a problem. Because the balance between numbers of patients and numbers of doctors shifted in Massachusetts a few years ago, average wait times are now around a month depending on specialty.

    And this affects other areas of the economy as well. Higher taxes (above a certain point) cause people to just not do more work – thus decreasing efficiency of the system as a whole. Even the Rolling Stones moved out of England back in the day to get away from the absurdly high tax rates.

    And, at the end of the day, higher taxes WON’T FIX THE PROBLEM. Unless entitlements are addressed, the system is broken.

    Just as an aside, the really ironic thing in all of this is that these numbers are a best case scenario. For Medicaid patients (which politicians congratulated themselves for getting more “on the books”), I actually lose money. It doesn’t matter how much I bill, my expenses for treating them are higher than Medicaid pays. And for my uninsured patients, I don’t collect anything either. I give away tens of thousands of dollars in free care a year, and I can’t even “write it off” because it’s a service and not a product.

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  42. Mike S on June 4, 2011 at 2:28 AM

    Oh yea, and despite my “bitching”, it’s actually just fine at the end of the day.

    I have a job and am lucky enough to make a comfortable living doing something I wanted to do since I was a little boy. I get to help people directly. And I still treat everyone that walks in my door with excellent care, truly regardless of their ability to pay. So I can’t really complain. (But I will from time to time :-) )

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  43. Stan Beale on June 4, 2011 at 5:05 AM

    Mike

    Just a few random comments:

    1. My snarkiness has to do with your math. I spent a number of years as a financial analyst for a teachers union. I had to deal with constant underestimation of income and overestimation of costs followed by “that is why we can’t give teachers a raise.” It would take hours, if not days, to sort out the real situation. Mathematical hperbole really touches a sore spot.

    I simply found your inclusion of the millionaires tax with the end of the Bush tax cuts just a bit over the top. I am sure, since you earned less than $1,000,000, you would prefer the the millioaires tax rather than the restoration of the tax rate previous to Bush. The net effect would be no increase in taxes for you.

    2. So much of the current debate over entitlements is composed of bad math, bad statistics and bad policy. Frankly, the only hope is a bipartisan committee composed of pragmatists being given the time and authority to deal for the whole. This waS done for the base closures in the 1990′s and it was quite successful. I just am not sure that a Congress dominated by Tea Partiers, conservative troglodytes, legislators rented (if not owned) by special interests and uber progressives is capable of that type of effort.

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  44. el oso on June 4, 2011 at 8:37 AM

    For those who (rightly) point out that this current economic slowdown was started during Bush’s presidency and think that Obama can then blame Bush, I think you are way wrong. Obama campaigned on correcting the Bush mistakes, but with total control of Congress he only gave us Obamacare and some short term stimulus. Most voters do not agree that Obamacare addressed the real problems and the mid-term elections showed this. Next year, the stimulus is all gone and only Obamacare remains. Obama will not have any more accomplishments, unless he gets some more foreign policy victories.
    Mitt Romney is on message on economic growth and occasionally on fiscal responsibility. Many voters think that these are the top issues now. This may be the change that resonates with voters, perhaps even with enough evangelical conservatives to win the nomination.

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  45. MH on June 4, 2011 at 9:21 AM

    Jon, I don’t need to remind you that you’re an anarchist, so “obviously” you’ve got a very strange point of view, and I question anything that comes out of you or Will’s mouth (or keyboard.) Start making sense, and I’ll start to agree with you. Until then, things that you find “obvious” probably aren’t, or we’d all espouse anarchy. I know it goes without saying, but your opinions on government are HIGHLY suspect by 99% of our readers. “Obviously” you should understand this, before you start condescending about the “obvious.”

    Jeff, I’m not sure if you’re ignoring my question purposely, but I’d really like to know if you think Mitt should run as an independent and abandon the republican party. Would that help Mitt avoid shooting himself in the foot/mouth?

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  46. MH on June 4, 2011 at 9:27 AM

    Jon, let me state further that your comment 38 and my comment 19 agree, so why is that not “obvious” to you?

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  47. Jack on June 4, 2011 at 10:33 AM

    Jeff,

    I think you underestimate the public’s concern over the economy. If Romney can get folks to believe he’s the one who can fix it then he’ll have a good run.

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  48. Jon on June 4, 2011 at 10:47 AM

    mh,

    Why so confrontational? And why are we talking about anarchy. Can we not have any blogversation without talking about anarchy?

    The reason I stated what I did is because of your comment:

    the easiest and fastest way to balance the budget is to reduce expenses and raise revenue. anybody that can balance a checkbook can figure that out without quoting millions of dollar figures and proclaiming it ‘fair’. puhleez.

    Which appears to be very sarcastic. Will stated the obvious and you didn’t like that. So I stated that the obvious correct, except for you stating that taxes need to be raised, which is obviously not true. That’s not what the core problem is. Raising taxes just encourages more spending not less. If the government actually produced something then raising more revenue wouldn’t be a problem but it doesn’t and so shouldn’t burden us with more of its pie in the sky dreams that never manage to come to fruition.

    People’s opinions on politics that contradict the gospel of Christ are highly suspect yet I will still try and attempt to understand them. The devil said let me use violence to get people to be good, God said that was a dumb idea and sent him and his minions away. I don’t know why anyone would espouse such an obviously satanic position.

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  49. mh on June 4, 2011 at 11:40 AM

    jon, if you think the fastest way to solve the budget problem is simply through spending cuts, you are obviously blind to half of the solution. yes I agree with you that there need to be spending cuts. but when the poor start rioting because they are exploited by the rich as is happening in the middle east, then we will have your violent anarchy along with the violence you seemingly oppose.

    jon you are as blind as you are naive about your anarchic utopia. your solution to cut taxes on everyone helps the rich at the poor’s expense. you will see a violent reaction that you seemingly oppose. frankly jon, your position is causing a lack of faith in the economy and leading to an economic meltdown. holding the debt ceiling hostage for spending cuts that benefit the wealthy is a recipe for disaster, violence, and anarchy. it is clear to me that you are in favor of the satanic plan, but are blind to your idealism.

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  50. mh on June 4, 2011 at 11:45 AM

    let me remind everyone that hugh b brown said that members of the republican and democratic party are men of integrity, and unquestioned patriotism. if your ideas don’t fit within the framework of these 2 parties, you are an extremist. while brown was talking about segregationists and dixiecrats, I think his talk applies to anarchists and tea party members as well. don’t be an extremist jon. that’s what brown was really saying. and don’t look at 1 solution as the only solution, or you are myopic.

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  51. Dan on June 4, 2011 at 11:46 AM

    tax the rich, guys. 50%. It worked just fine under Ronald Reagan. Get it back to that level and we just might find that our economy will boom again. And then, amazingly, the government’s revenue will equal or surpass its expenses and we won’t have this to bitch about. We’ll have something else, for sure. But tax the rich. 50%.

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  52. Jon on June 4, 2011 at 12:05 PM

    mh,

    Hate to break it to you but the poor are being exploited in this nation by the elites already. They just have bread and circuses to keep them distracted.

    Yes, I agree that chaos will ensue if you do the changes over night, they must be incremental in the correct direction.

    Accordingly the revolutionaries were extremist that broke from Britain. I don’t mind being an extremist if it places me in the camp of those who desire freedom and liberty. I would much rather be an extremist the worship the false of god of the state. Should I follow those of Sodom and Gomorrah because everyone else is doing it or should I follow God? I choose the God of Israel. You can have your idols.

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  53. mh on June 4, 2011 at 12:35 PM

    jon, I agree that the rich already exploit the poor. and your solution makes it easier for them to exploit. this is really bone-headed.

    the apostle paul told us to be temperate and patient. we have been counseled to be moderate in all things. extremism is not a virtue, it is a vice. and the devil is the father of vices. jon, I fear for your soul if you think extremism is a virtue, and try to blame this on the god of israel. you may find he tells you to depart of your iniquity.

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  54. Dan on June 4, 2011 at 12:48 PM

    Jon,

    Accordingly the revolutionaries were extremist that broke from Britain.

    Clearly you don’t know your history. The revolutionaries, while strongly against the British, were not extremist. They didn’t radically alter the structure of their society like Robespierre did in France. THAT’S extremism. More like your kinda fellar. You do not side with those who desire freedom and liberty. You side with those who wish to be commanded by a king. The revolutionaries of America believed in the civil structures they received from England. They kept common law. They kept a court system. They kept representation in government. The only thing they didn’t keep was to be ruled by a king. Otherwise the young American nation was not very different at all from its parent.

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  55. Jon on June 4, 2011 at 1:07 PM

    mh,

    Statism makes it easier for the elites to exploit the poor.

    I already expressed that I would be moderate while recognizing true principles, it’s called libertarianism, that’s the centrist position, anything beyond that is extreme. Accordingly Republicans and Democrats are extreme.

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  56. Jon on June 4, 2011 at 1:10 PM

    Dan,

    I thought you were the one saying overthrowing your government is extreme, is that not what the revolutionaries did? Did they not set up a form of government never before tried? Is not that extreme?

    Remember that you were the one saying that you would like to throw me out of this country at gun point while all I have preached is peace you preach violence. That is extreme, violence that is.

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  57. mh on June 4, 2011 at 1:20 PM

    ok, after that tangent, can we get back to mitt shooting himself in the foot or mouth?

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  58. FireTag on June 4, 2011 at 2:35 PM

    MH:

    We have “experimental confirmation” that the Keynesian remedy to the economic problems of the recent past have NOT worked.

    Maybe Keynes was ALWAYS wrong; it did take WW2 to end the Great Depression, not anything the government did before WW2.

    Maybe Keynes is only right if you are as vigorous in running government surpluses in good times as in stimulating the economy with deficits in bad, so that the “buyer of last resort” doesn’t get tapped out before the bad times come — which the rise of a political class able to buy short term votes by passing costs to the future will thwart.

    Maybe Keynes is wrong once you couple your economy to a global economy where for most people times are ALWAYW bad, so that you can’t stimulate your way out before your government is tapped out.

    Maybe Keynes only works if you devote your stimulus at wealth producing activities, not simply protecting politically favored constituents from pain and don’t simultaneously try to ADD wealth consuming benefits people have never had at the same time.

    Who knows.

    But we seem to be EXPERIMENTALLY in a regime of the math where Keynesian economics is not working. More spending is largely going into depreciating currencies, which is producing inflation in food and fuel which is DIRECTLY tied to Mideast instability and violence.

    The choice is no longer between pain and no pain. Anything we do, cut spending and/or raise taxes, is going to get people hurt here and/or abroad.

    Obama has to put a serious plan on the table and stop trying to demonize the other side to be taken seriously as a leader. He already used a “bipartisan commission” to try to get his House majority beyond the 2010 election, and then refused to use any of it in his own budget proposal.

    Infantile behavior!

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  59. Jon on June 4, 2011 at 2:58 PM

    FireTag,

    The great depression was ended when all the regulations (and whatever else) went away after FDR died. The economy was freed up quite a bit after the war from price controls, etc.

    According to Hazlitt war is the ultimate in the “Broken Window” fallacy.

    Either way, I do agree that Keynesianism doesn’t work, if you start passing out money, of course people (i.e., special interest groups) are going to grab at it and it won’t end up where it was supposed to go, human nature.

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  60. FireTag on June 4, 2011 at 3:47 PM

    There is nothing false about the broken window fallacy in terms of stimulating spending. The fallacy in both the broken window and the war solutions to depression is contending that the spending thereby created to recreate that wealth destroyed makes us better off than if the wealth hadn’t been destroyed in the first place.

    War makes us spend resources we were afraid to spend because we’d need it more tomorrow. When war comes, we prefer to worry about starving in our old age rather than get shot now, and so spend. And if you’re in a lot of countries in the Mideast right now, you’re desperate enough, with both loss of dignity and financial desperation involved to be willing to take your chances with the guns and the tanks. We keep spending like we are, and a lot more countries may come into the same ***** choice.

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  61. FireTag on June 4, 2011 at 3:59 PM

    I should also note that the same fallacy also applies to not counting the costs of environmental degradation in the process of raising GDP, for all my environmental friends out there. :D

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  62. Dan on June 4, 2011 at 5:15 PM

    Firetag,

    Maybe Keynes was ALWAYS wrong; it did take WW2 to end the Great Depression, not anything the government did before WW2.

    Because the government didn’t spend ANY money during WWII… com’on Firetag, I expected you to be smarter than this. This is elementary. Who spent most of the money during World War II? Who made orders for millions of weapons? Who paid for them? Who got paid for them? When it comes to Keynesian economics there is nothing that proves it works better than the United States involvement in World War II. That massive spending jumpstarted our economy like nothing else, and it led to one of the greatest economic growths in world history.

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  63. Dan on June 4, 2011 at 5:19 PM

    Jon,

    I thought you were the one saying overthrowing your government is extreme, is that not what the revolutionaries did?

    They didn’t overthrow the government. They kicked out the British but kept essentially the same functions the same. In fact, most of the leaders were the same as they were under British rule. Robespierre overthrew the French government. Do you know anything about him? Look him up. Maximilien Robespierre. He’s your kinda guy.

    The great depression was ended when all the regulations (and whatever else) went away after FDR died. The economy was freed up quite a bit after the war from price controls, etc.

    huh…so Congress (not controlled by FDR) set up regulations to expire with the death of FDR…fascinating. And of course utterly stupid.

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  64. Jon on June 4, 2011 at 5:23 PM

    Once again war doesn’t get us out of depressions/recessions. It was the ending of government intruding in the free market. Stimulus may temporary create “false recoveries” but they cannot create wealth so in the long run all they do is bankrupt a nation and impoverish the people. Just like the housing bust, dot com bust, etc. Each one gets worse than the previous one. Will the next one be municipalities bust? Or state busts? Or federal government bust? Or one progressively stacking on top of the other?

    America’s Great Depression – Rothbard
    http://mises.org/rothbard/agd.pdf

    http://mises.org/media/6076/World-War-II-Did-Not-End-the-Great-Depression

    There is a reason the Lord told us to denounce war, not glorify it.

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  65. Dan on June 4, 2011 at 6:31 PM

    oh great, more Mises crap.

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  66. FireTag on June 4, 2011 at 9:30 PM

    Dan:

    Government spent both before and during the war. To what do you attribute the fact that the second spending triggered increased private spending after the war but the first didn’t? Similarly, the Great Depression only turned into the depression AFTER government began interfering.

    Government spending is NOT the explanatory variable.

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  67. Dan on June 4, 2011 at 11:08 PM

    Firetag,

    Similarly, the Great Depression only turned into the depression AFTER government began interfering.

    What?!?!?! Are you freaking kidding me? When do you think the Depression began? In January 1933 when Roosevelt came to office? Or did it not start in October 1929 with the stock market crash? You think Hoover attempted to interfere with the market? Stop drinking the tea party kool aid, Firetag. It’s not good for you. It destroys your brain cells.

    Government spent both before and during the war.

    indeed. But when you compare the amount of spending before the war and during the war, there is no comparison. During the war, the government spent exceedingly more than before the war. And certainly Obama’s stimulus package of $800 billion was not enough (to really jumpstart our economy today, we needed more along the lines of about $2 trillion or so). Still, Obama’s stimulus staved the decline and at least kept the economy on some level fairly well.

    Government spending is NOT the explanatory variable.

    Yes, it is. But I am curious to see what you think is the explanatory variable.

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  68. Dan on June 4, 2011 at 11:13 PM

    I’m sure you’re going to say the Encyclopedia Britannica is left leaning socialist crap, but…

    http://www.britannica.com/EBchecked/topic/243118/Great-Depression

    Great Depression, Longest and most severe economic depression ever experienced by the Western world.
    It began in the U.S. soon after the New York Stock Market Crash of 1929 and lasted until about 1939. By late 1932 stock values had dropped to about 20% of their previous value, and by 1933 11,000 of the U.S.’s 25,000 banks had failed for a combination of reasons, including declining property values, bank runs by panicked customers, and defaults on loans. These and other conditions—worsened by monetary policy mistakes, adherence to the gold standard (until 1933), and the introduction of voluntary wage-and-price controls through the National Recovery Administration—led to much-reduced levels of demand and hence of production, resulting in high unemployment (by 1932, 25–30%).

    That entry is written by Professor Richard H. Pells of Texas:

    Professor of History, University of Texas, Austin. Author of Radical Visions and American Dreams: Culture and Social Thought in the Depression Years.

    and by Professor Christina D. Romer of Berkeley:

    Class of 1957 – Garff B. Wilson Professor of Economics, University of California, Berkeley. Former head of the Council of Economic Advisors. Author of numerous articles on business cycles, the Federal Reserve, and the Great Depression

    I’m sure they’re both eeeeevil because they’re college professors and looking only to slant history toward liberalism, in spite of one of them being from Texas, but based on their pedigree, they clearly know what they are talking about.

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  69. Jeff Spector on June 4, 2011 at 11:35 PM

    Wow, again going for the entire day with working in the yard, a son going to the hospital and hosting 5 YM from a Utah singing group, I miss the Will/Dan chronicles.

    I’ll respond to the posts but i do have an SS lesson to prepare as well.

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  70. Jon on June 5, 2011 at 12:50 AM

    Dan,

    Hoover implemented a lot of the policies that FDR would later run with. Hoover was very interventionist and wasn’t a free marketeer as the socialists in public schools would like us to believe. Similarly Bush was a huger interventionist also and Obama has just continued the policies started by Bush. We’re just repeating history right now.

    It is interesting to note that FDR originally ran for office with the idea of not continuing the Hoover policies but then continued them anyways and expanded on them.

    Statism at its worst (well, not really, when FDR got purposely got us into WWII would be statism at its worst).

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  71. Dan on June 5, 2011 at 5:18 AM

    Jon,

    Really, just stop. You’re comments are so ridiculous and stupid. You have such little awareness of how dumb you sound. Just stop. I picture in my head that you are some 14 year old, just starting to learn of the world. I cannot imagine you inside my head as anyone over the age of 20. That’s how utterly stupid your comments have been.

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  72. Dan on June 5, 2011 at 5:20 AM

    Jeff,

    I’ll respond to the posts but i do have an SS lesson to prepare as well.

    I’ve prepared mine, but I didn’t have as busy of a Saturday as you apparently. :)

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  73. FireTag on June 5, 2011 at 8:43 AM

    Dan:

    “voluntary wage-and-price controls through the National Recovery Administration”. Now there’s an oxymoron that gets at the heart of the problem. You try to “control” prices and are then utterly shocked, shocked that you end up with supply and demand imbalances, which you then try to fix by still more “controls”. Sounds like Obamacare or Romneycare doesn’t it?

    In physics, when we know our theories aren’t giving the correct answers, we generally do some new experiments until we have a better explanation.

    Let’s try testing the hypothesis that economic confidence about the future explains both why spending sometimes works and sometimes doesn’t, and attack confidence more directly. If the current right direction – wrong direction numbers are about 1/3rd to 2/3rd, maybe the administration ought to try changing direction instead of following Paul Krugman over the cliff of doubling down. Especially when I gave you several reasons why Keynesian prescriptions might NOT apply to the current situation.

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  74. Jeff Spector on June 5, 2011 at 9:15 AM

    MH,

    “Jeff, I’m not sure if you’re ignoring my question purposely, but I’d really like to know if you think Mitt should run as an independent and abandon the republican party. Would that help Mitt avoid shooting himself in the foot/mouth?”

    Well, as a point of integrity, he could do that so he was able to state is true views on issues rather than the pandering to the far right that is going on. But, realistically, 3rd party candidates are really not viable at this point. So he is stuck between a rock and a hard place.

    I guess that’s what happens when you let the fringes of the party take over. It happened in the late 60s/early 70′s in the Democratic Party and it is happening now with the Republican Party.

    Kind of a cyclical thing, I guess.

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  75. Dan on June 5, 2011 at 11:42 AM

    Firetag,

    Now there’s an oxymoron that gets at the heart of the problem. You try to “control” prices and are then utterly shocked, shocked that you end up with supply and demand imbalances, which you then try to fix by still more “controls”. Sounds like Obamacare or Romneycare doesn’t it?

    um, hate to break this to you but that was Hoover and the “get your damn hands off the market” Republicans

    Especially when I gave you several reasons why Keynesian prescriptions might NOT apply to the current situation.

    Are you referring to comment #58? You write there:

    Maybe Keynes was ALWAYS wrong; it did take WW2 to end the Great Depression, not anything the government did before WW2.

    WW2 of course was all government spending…thus proving Keynes right. FDR’s problem previous was that he didn’t think grand enough. Same with Obama. Follow Krugman’s lead. The guy knows what he is talking about. As for your other examples, I actually agree that, for instance, not letting the Bush tax cuts expire on those making over $250,000 was a mistake and really more about politics than doing the right thing; oiling the pockets of those who fund your next campaign. I think one of the best ways our government can stimulate the economy right now is to invest in infrastructure maintenance. Our bridges and roads need a lot of work. There are workers aplenty out there. Put them to work. :)

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  76. Dan on June 5, 2011 at 12:29 PM

    Firetag,

    I must apologize. I mistakenly deduced that the National Recovery Administration was a Hoover thing. It was a Roosevelt thing.

    As for trying different things when some things don’t work, you gotta give both Hoover and FDR credit for trying different things. Hoover’s policies failed while the economy improved under Roosevelt.

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  77. FireTag on June 5, 2011 at 3:32 PM

    Economic policies under FDR did not improve until the war. They did improve under Calvin Coolidge, which is how we got the “Roaring 20′s” in the first place.

    Too little regulation, you crash one way because of the greed of the private sector; too much regulation and you crash another way because of the greed of politicians. You still crash, and long term growth in GDP in this country is still 2%, with relatively little fluctuation once the business cycle data gets smoothed out. That’s with both Dem and Repub policies.

    http://www.nationalreview.com/exchequer/268603/hope-not-policy

    And 2% growth isn’t going to enable us to pay off the promises we’ve already made to ourselves before they come due. You progressives better learn to play defense, because the next decades are going to be an era of givebacks and damage control for big institutions.

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  78. Will on June 5, 2011 at 3:53 PM

    Dan,

    Just keep living in your fantasy land.

    Stan,

    Working together. This is what got us into the mess. They have collectively worked us into insolvency.

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  79. Dan on June 5, 2011 at 3:56 PM

    Firetag,

    Actually the economy DID improve under FDR. As you can see

    http://www.signaltrend.com/Stock-Market-Great-Depression.html

    the stock market increased 372% under FDR until 1936 (when FDR foolishly followed the advice of those who said we should get the deficit under control). Then of course, the economy double dipped.

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  80. MH on June 5, 2011 at 8:01 PM

    Jeff, I agree completely with you in 74. Cutting oneself off from either party and going independent is a herculean task. As such, the headline seemed a bit unfair, IMO. (For the record, I’m more in favor of Huntsman than Romney.)

    Since the primaries are controlled by the extremists of each party, I don’t know how any candidate can’t pretend to be an extremist in order to get elected. I wish the extremists didn’t dominate the primaries, so I don’t think Mitt is shooting himself in the foot. He’s doing what is necessary to get elected, and then will “center” himself to get the independent vote. I think most independents understand this, and we aren’t taking too much concern for the over-the-top rhetoric that is happening now.

    I really wish there was a viable, centrist third-party. It would mute the extremists of each party, IMO.

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  81. [...] The Olympics are off to an interesting start (not to mention other sports controversies), and the US presidential circus is warming up as well! [...]

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  82. FireTag on June 5, 2011 at 10:52 PM

    Dan:

    I find it ironic that, you, of all people here, would choose to measure economic recovery by its effect on the big business stockholders (little guys didn’t get back into stocks after the 29 crash.) Main street isn’t Wall Street.

    To get a more extensive view, I quote from

    http://en.wikipedia.org/wiki/Economic_history_of_the_United_States#Great_Depression:_1929.E2.80.931941

    “The extent to which the spending for relief and public works provided a sufficient stimulus to revive the U.S. economy, or whether it harmed the economy, is also debated. If one defines economic health entirely by the gross domestic product, the U.S. had gotten back on track by 1934, and made a full recovery by 1936, but as Roosevelt said, one third of the nation was ill fed, ill-housed and ill-clothed. …GNP was 34% higher in 1936 than 1932, and 58% higher in 1940 on the eve of war. The economy grew 58% from 1932 to 1940 in 8 years of peacetime, and then grew 56% from 1940 to 1945 in 5 years of wartime. However, the unemployment rate never went below 9% before the draft.”

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  83. Jeff Spector on June 6, 2011 at 7:13 AM

    MH,

    “I really wish there was a viable, centrist third-party. It would mute the extremists of each party, IMO.’

    Completely agree! If we can beleive that Ross Perot was the last really visable 3rd party candidate! WOW

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  84. Dan on June 6, 2011 at 9:01 AM

    Firetag,

    We’re talking past each other methinks. I was merely pointing out that the economy DID improve from FDR in 1933. That’s all I said. My example was that the stock market rallied for a 372% increase from 1933 to 1936. Did that translate to everyone? Of course not. But you cannot show that I was wrong in saying that the economy did improve under FDR with what you share. Because obviously only after the massive spending of the war effort did the stimulus affect everyone.

    The point is that if you give poor people money, they will spend it. If you give rich people money, they will save it. If you want to stimulate a downed economy, create work for poor people! FDR didn’t think grand enough in 1933, but he had the right idea. Only the massive mobilization for the war caused the government to give jobs to everyone. Once that happened, the economy rolled to one of the greatest periods of growth in the history of the world.

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  85. Jon on June 6, 2011 at 9:21 AM

    If Keynesism is about stimulus that puts young men into a war setting to be killed and slaughtered to make the economy better you got problems. War doesn’t create wealth, it destroys wealth and diverts energies to useless endeavors. How many vehicles could have been made instead of tanks. Sure there was more money beings spent but what about the quality of life? People were rationed what they could eat for goodness sake, you call that good? Stimulate my foot! Dan, you always talk about full of crap, this is a truckload of it, this didn’t improve people’s lives this destroyed peoples lives and made people’s lives worse, just like all government stimulus, then you have to pay it back eventually like the housing boom and bust, we are paying back for the Keynesian stimulus now by more suffering not less. True wealth does not come from government stimulus, true wealth comes from saving and investment through the private sector where goods are created that the people truly want and desire not some central planner that thinks he knows what is good for us. I know what I want and what is good for my children, if a person wants to use gentle persuasion to convince me otherwise, fine, but don’t point a gun at me.

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  86. Dan on June 6, 2011 at 9:27 AM

    Jon,

    You don’t realize how much history is against you

    http://en.wikipedia.org/wiki/Post-war_economic_boom

    The post–World War II economic expansion, also known as the postwar economic boom, the long boom, and the Golden Age of Capitalism, was a period of economic prosperity in the mid 20th century, occurred mainly in western countries, and which followed the end of World War II in 1945, and lasted until the early 1970s, ending with the collapse of the Bretton Woods system in 1971, the 1973 oil crisis, and the 1973–1974 stock market crash, which led to the 1970s recession. Narrowly defined, the period spanned 1950/1951 to 1973, though there are some debates on dating the period, and booms in individual countries differed, some starting as early as 1945, and overlapping the rise of the East Asian economies into the 1980s or 1990s.
    During this time there was high worldwide economic growth; Western European and East Asian countries in particular experienced unusually high and sustained growth, together with full employment. Contrary to early predictions, this high growth also included many countries that had been devastated by the war, such as West Germany (Wirtschaftswunder), France (Trente Glorieuses), Japan (Japanese post-war economic miracle) and Italy (Italian economic miracle).

    or in other words, the greatest economic growth in the history of the world.

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  87. Jon on June 6, 2011 at 9:31 AM

    The roaring 20s was caused by easy money created by the federal reserve/government. Look at the first graph in this book review post, it would be worth while to read the post also.

    http://elusivewapiti.blogspot.com/2008/11/book-review-americas-great-depression.html

    Things the interventionist Hoover did:

    And that natural response was fought tooth-and-nail by Hoover, with all the quasi-fascist big-government market interventions he could muster. In keeping with the worldwide socialist bien pensant of economic centralization in vogue at the time, President Hoover attempted inflationary bail outs of key industries, fixing, even increasing real wage rates, implementing child labor laws, mandating partial employment (which destroyed productivity), shortened workweeks, expanding the size of government, mostly through massive public works projects (which are nothing but pure consumption–the opposite of the saving and investment that would be needed), government-run labor boards, price supports for agriculture, implementing collectivist ideas in business, tax increases, attacking and expropriating private property (which FDR was to repeat later) and even the Hoover New Deal–all failed to solve the crisis and actually made it worse. Indeed, Hoover’s concentration on the “new economics”, specifically, boosting wage rates and export prices so as to ensure prosperity–rather than emphasizing savings and prosperity which then leads to high wages and higher standards of living–led to all sorts of counter-productive government interventionist mischief and resulted in 11 years of persistent unemployment and generalized misery.

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  88. Jon on June 6, 2011 at 9:34 AM

    “or in other words, the greatest economic growth in the history of the world.”

    Or in other words was not created by war. War destroys wealth. How much richer would these countries have been without the destruction of war and just a freer market as outlined by you?

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  89. Jon on June 6, 2011 at 9:35 AM

    You can join your death machine and see how that stimulates you. As for me and my family we will have no part in it (except for the taxes that I am forced to pay for it).

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  90. FireTag on June 6, 2011 at 12:23 PM

    Dan:

    I think you need to try to generalize your theory of spending and saving on a more fundamental basis.

    People spend because they need something now more than they expect to need something later. The things they “need” may or may not be wise; they may regret the spending tomorrow, or they may be in the position of not being able to worry about tomorrow. They may be confident enough about tomorrow that they expect to be able to get anything they want tomorrow even if they spend today, so it’s not a problem.

    On the other hand, people save when they expect to need or want something tomorrow which they can’t have if they spend today. Usually, even saving involves giving it to some other economic activity in the expectation that the “saver” — i.e., capitalist — will get the savings back plus more besides. Even Scrooge McDuck doesn’t really get richer by keeping his resources in a vault in his basement.

    So what has to be explained about today’s economy is why even savers aren’t investing in producing or consuming. It isn’t the greed of capitalists, because, presumably, the capitalists are no more greedy than they always were.

    The conservative critique of Obama’s policies is that they raise fears that people are going to need their resources tomorrow more than they need them today, and even investing them is risky because the government may just “redistribute” any gains away.

    Government can’t just declare wealth now exists by fiat beyond the point where people lose faith in the government to deliver. Political classes have been learning that to the detriment of their lifespans since the days of the Roman Empire or before. The “multiplier” that applies to government spending in the current environment is MUCH less than the Keynesian assumptions say it should be, as more and more people in the Western world wake up to the fact that government has overpromised what it can deliver.

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  91. Dan on June 6, 2011 at 12:35 PM

    Firetag,

    People spend because they need something now more than they expect to need something later.

    Right on. And when an economy is in shambles, this is where you strike with government-based stimulus. It is proven that the best use of stimulus is providing food stamps to the poor and unemployment benefits to those out of work. It should be clear why these two things work the best, because that money immediately goes back into the system.

    You’re talking about a larger budget battle on a long term scale. Keynesian economics stipulate that when an economy goes sour, the best way to get the economy stimulated again is through government borrowing and lower taxes. Keynesian economics also stipulates that when the economy goes well, the government cuts back on spending, increases taxes which raises revenue to account for the money spent during the “rainy days” and to ensure long term viability. We’ve seen this work now for 70 years, Firetag. No other system has worked as well as Keynesian economics has over a similar time. It is only when we flirt around with other economic models that we start having major problems. Such as Reaganomics (which says that if most of the money is in the hands of the top 1%, the money will somehow “trickle-down” to everyone else, which is just plain bullcrap) or the Austrian school. Keynesian economics is also a politically popular model because you don’t take away from the people when they’re down (you give them support when they are down), and you take from them when they are doing well (when they won’t mind as much). For instance “Vouchercare”—Paul Ryan’s plan—is politically radioactive because it pushes for cuts in support to people, who otherwise will have a tough time getting the same support on their own, when they are already down from the economic downturn. It is why so many people have turned against Vouchercare.

    If you want money spent (which is the essence of capitalism) then give money to the poor. If you give money to the rich, they’re just going to save it. If you give money to the poor, they are going to spend it. One is based on capitalism, the other is not. You can probably guess which is and which isn’t.

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  92. Jon on June 6, 2011 at 12:43 PM

    Here we go with more fallacies. There is no wealth created when you just give people money, there might be a temporary “stimulus” but nothing of value is created. When you let people be creative and do something productive for society then wealth is created and people are better off all around. Just giving money away creates a class of people that would rather not work and produce, as we are currently seeing, which lowers the self respect of people on the dole.

    The Austrian school is not an advocate of trickle down economics. The Austrian school is about rule of law where everyone is given an equal chance for their own prosperity.

    Keynesianism naturally leads to favoritism by the political class. A natural human tendency and, therefore, could never work.

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  93. FireTag on June 6, 2011 at 12:48 PM

    Dan:

    What I said went right over your head. Increases or decreases in spending by the poor CAN NOT drive the economy. That’s because THEY’RE POOR!

    The argument you just made scares the bejibbers out of everybody else, from Wall Street to the Heartland to Berlin to Beijing, causing them to pull money out of the economy, and their behavior dwarfs the money you think you’re stimulating. More taxes to pay for more debt, and the government bureaucrats to make THEMSELVES rich for their good works in redistributing the wealth.

    Multiplier effect shrinks every time the left opens its mouth. :D

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  94. Will on June 6, 2011 at 1:20 PM

    Dan,

    #91 has to be the biggest eye-watering, four-flushing pant load I have ever read in my life. Liberalism is truly a mental disorder. It really is. It is so far from realty it is pathetic. It is thinking like that, that has us in the mess we are in.

    Firetag,

    Good analysis.

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  95. Will on June 6, 2011 at 1:23 PM

    I’m not done. Your proposal is like pumping water from one end of the pool to the other and expecting the water level to rise. It is stagnation….. Never mind, there is no sense presenting my argument when the other side has no sense.

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  96. Dan on June 6, 2011 at 1:55 PM

    Firetag,

    Increases or decreases in spending by the poor CAN NOT drive the economy. That’s because THEY’RE POOR!

    Then what do you care if they get money or not? They’re poor and they can’t apparently affect the economy. Might as well give them money then. They’ll certainly spend it.

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  97. Dan on June 6, 2011 at 1:58 PM

    Furthermore,

    The argument you just made scares the bejibbers out of everybody else, from Wall Street to the Heartland to Berlin to Beijing, causing them to pull money out of the economy, and their behavior dwarfs the money you think you’re stimulating. More taxes to pay for more debt, and the government bureaucrats to make THEMSELVES rich for their good works in redistributing the wealth.

    You think the reason people are pulling money out of the economy is because we give aid to the poor? What the f***!?!?! I realize you’ve got your backups (Will and Jon) to support you in this lunacy, but this is bullcrap of the utmost order, Firetag. I guess you’re not as smart as I thought you were.

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  98. Dan on June 6, 2011 at 2:08 PM

    so I’m gonna pull a Jon and link to someone else to better explain the Keynesian model to which I ascribe.

    http://www.econlib.org/library/Enc/KeynesianEconomics.html

    He says it better than I can.

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  99. FireTag on June 6, 2011 at 2:21 PM

    Oh, Dan, you never thought I was smart.

    “You think the reason people are pulling money out of the economy is because we give aid to the poor?”

    No, I think people are pulling money out of the economy because they’re realizing that our political leadership actually thinks that taking money from producers and investors and giving aid to the poor is the best way to stimulate the economy AND ARE TOO BLIND TO WHAT IS HAPPENING TO CHANGE COURSE.

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  100. Jon on June 6, 2011 at 2:26 PM

    Will,

    I like your pool analogy, just think of all the water spilled as you take water from one side to the other.

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  101. FireTag on June 6, 2011 at 2:34 PM

    Dan:

    I pushed the post button before I finished.

    I think you are well intentioned, Dan, but you do the poor no good by advocating well-intentioned policies that end up, in fact, making more of the poor in the name of helping them.

    Economics and morality do not have to be at odds, IMO, but we have a lot more to learn about both topics before we learn how to reconcile them.

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  102. Will on June 6, 2011 at 3:06 PM

    Jon,

    And evaporating.

    Wealth is created.

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  103. Dan on June 6, 2011 at 5:06 PM

    Firetag,

    dude, what policies toward the poor do you think I am advocating for that have not been implemented already to great successful effect in this country? Unemployment benefits are a success (success here defined as protecting laid off workers from losing everything and helping them find a job as quick as possible). Food stamps are a success. Medicare is a success (to the extent that it is available. It would be an even greater success if we would implement it completely in our country as opposed to just the elderly). Social Security is a grand success.

    We’re in a massive deficit right now, Firetag, for two major reasons. 1) the economic downturn and 2) Bush’s tax cuts. Get the economy going again, and remove the tax cuts and voila, amazingly we’re no longer in a deficit.

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  104. Will on June 6, 2011 at 5:13 PM

    Dan,

    My Dad use to always say to me ‘It is better to be thought of as a fool, than to open your mouth an remove any doubt’. You have just removed any doubt. Food stamps a success? Medicare a success? Are you serious?

    Ok, I take that back. They have been a success – a success at bankrupting this country.

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  105. Dan on June 6, 2011 at 5:27 PM

    Will,

    Maybe you don’t know the definition of bankrupt. http://tinyurl.com/3s9h768

    That should help.

    Or in other words, this country is NOT bankrupt at this moment in time, nor for the foreseeable future. If we keep cutting taxes, then yeah, we’re going to face shortfalls in revenue, but it’s not bankrupt.

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  106. Will on June 6, 2011 at 5:47 PM

    Dan,

    You either don’t understand, or don’t want to understand the extent of the problem. 14 trillion in general obligation debt and an estimated 40 trillion in unfunded benefits. That’s over 50 trillion in debt, on a 2.5 trillion dollar income. With 50 trillion you could pay cash for 500 million homes at 100k a piece. That is tantamount to having an income of 25k per year with obligations in excess of 500 k. As mentioned by the Doc, in the near future
    entitlements, defense and debt service will equal our income. We are broke. Either you are not looking at the problem, or you are not looking at it honestly. Either way your wrong

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  107. Dan on June 6, 2011 at 5:55 PM

    sorry Will, but you are wrong. We are not bankrupt. I do agree that we need to rein in the projected spending in the future. But to claim we are bankrupt over spending that will occur in 30 or 50 years is just plain stupid. And that’s all I’ll say on this topic. The fools can have the last word if they so desire. If not, then mine will be the last word.

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  108. Jon on June 6, 2011 at 7:33 PM

    Cool Dan, you’re going to let someone else have the last word.

    I’ll just quote Ernest Hancock:

    “There are some that just want to be left alone. There are others who just won’t leave them alone. Which one are you?”

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  109. Mark N. on June 6, 2011 at 9:31 PM

    “There are some that just want to be left alone. There are others who just won’t leave them alone. Which one are you?”

    Into which group would you put Mormon missionaries?

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  110. Jon on June 6, 2011 at 10:27 PM

    Ha!

    If they don’t stop bothering you even after you tell them to go away from your property then I think they would belong in the latter, but hopefully most of them would fall in the former, at least that what I practiced on my mission.

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