Obama gets "Poor" and "Fair" marks from economists

We're looking at it from different ends, but I think we're coming to the same conclusion.

 

Congress' approval rating is meaningless. People dislike Congress as a whole but they keep re-electing the same members of Congress (or, if said members retire, a replacement from the same party) 80-90% of the time. Also, why should Jim DeMint care what voters in New York think of him? All that matters is what South Carolina voters think of him. Same for Chuck Schumer in New York.

Voters can focus their anger on Obama because he is one person elected by the whole nation, as opposed to one of 535 in Congress elected only by their own specific House District or State. And most voters don't understand that the President can do very little without Congress' consent. They think Obama can just snap his fingers and fix everything. He can't.

Yes, Obama should have been more assertive in pushing forward a specific vision and working to make it happen. But you can't push too far in the other direction either. Bill Clinton tried doing that his first couple of years in office (especially with HillaryCare), and he got a tremendous backlash for that.

 

My point to it all is it isn't just a matter of "demand's lacking, so let's prop up demand and things will be better."

It's a bit more nuanced than that because 1. You don't want to return to pre-recession demand levels because those were artificial, and 2. You don't necessarily want to over "stimulate" the part of the market that crumbled, leading to slumps in other sectors because that was a sector where demand was WAY too high.

The key is to make sectors that are insecure feel secure again. There are signs that that is starting to happen already, given the spending during the Christmas season. It means people started spending the money they had been sitting on. They feel a little bit better about their situation.

Obviously, unemployment remains high and jobs aren't coming back in construction because, as an effect of the housing bubble, there were more construction jobs than there was a natural demand for. So how do you make up for that? And what do you do about the lost government jobs from the last two-three years?

 

Why, you cut cut cut government way way more, because the teabaggers don't want to pay any taxes for anything, and nothing the government does is ever of any benefit to anybody.

Simple.

 

I will say this for the "cutting" crowd: If the economy was artificial, as it was, then that means tax receipts should have been artificially high. And if we are going to adjust to a more "realistic" economy, we have to adjust to fewer tax receipts. Meaning you have to cut at some level of government or build debt at a more drastic rate.

I could be wrong about that. Correct me if I am. Just thinking out loud. Or thinking on paper. Or whatever.

 

You have a dilemma. If you raise taxes at this point, you run into the real possibility of reducing spending, thus offsetting the raised taxes. It's the old Republican line, but it's true. In a bad economy, people are quick to cut back, especially if they are living paycheck-to-paycheck.

You shouldn't really raise taxes until the economy gets going and the increase in tax receipts from the raised taxes can make up for any cutback in spending from higher taxes.

Does that make sense?

 

I'm buying lots and lots of stock in Ralston Purina. That's because we'll all be eating dog food by the time we retire.

 

Save us, puppy chow creators!

 

This is the point I keep reaching: We do not really want the economy humming mid-'90s style again because that run was fueled largely by loans that should never have been allowed to take place in the first place.

Emerging from this mess, I'd much rather see a slower but sustainable growth pattern that reflects people spending within their means coupled with better oversight of credit industry practices.