Ideas, Opinions, Genealogy, and Book Reviews
Supply and demand is important economically. But since the Reagan revolution in politics, we have largely focused on growing the supply side.
Now with the current emphasis on austerity, we are actively cutting more and more into the demand side.
Is it any wonder that our economy is weak and not recovery very quickly?
Just 2 short notes today.
1. The Sequester is nearly upon us. The consequences have been much covered in the press. Long lines at airport security, cut-backs in air traffic control, military cuts, fewer food inspections, and many more. Additionally the cut-backs seem likely to hurt the economy which is only slowly recovering from the recession.
I see little movement toward a solution. In fact, both house of Congress took a week off last week, leaving only a few days to solve this.
2. Heath care reform (aka ObamaCare) is in place. Some find aspects they dislike or that they think will harm the economy. The only call I hear from these groups is “repeal” or “repeal and replace”. Since we have already passed health care reform and it has passed constitutional muster, why not work to fix those part that you disagree with?
I wrote about this a few months back but wanted to repeat that Jon Huntsman would be a good choice for Treasury Secretary . Treasury Secretary Timothy Geithner has announced his intention to leave. Now that we have settled the fiscal cliff issues in part (but also put off parts for a few months), President Obama must work with the Republicans in Congress to continue the recovery and improve upon the economy of the United States.
Both sides have very different ideas about what we should do and there is a lack of trust. Trust would certainly improve the chances of finding some middle ground that both sides can agree on. Perhaps one way to improve that trust is by naming a new Treasury Secretary that both sides can trust. Continue reading “Jon Huntsman would be a good choice for Treasury Secretary”
After the tragic child murders at Sandy Hook Elementary, the NRA proposed a plan to put armed guards in each school. There are about 99,000 public schools in the country according to National Center for Education Statistics.
NRA Executive Vice President Wayne LaPierre said:
I call on Congress today to act immediately to appropriate whatever is necessary to put armed police officers in every single school in this nation and to do it now to make sure that blanket safety is in place when our kids return to school in January.
A few days later (on December 23) he added on Meet the Press:
If it’s crazy to call for putting police and armed security in our school to protect our children, then call me crazy. I’ll tell you what the American people– I think the American people think it’s crazy not to do it. It’s the one thing that would keep people safe.
And the N.R.A. is going to try to do that. We’re going to support an immediate appropriation before Congress to put police officers in every school. And we’re going to work with Asa Hutchinson, who has agreed to work with us to put together a voluntary program, drawing on retired military, drawing on retired police, drawing on former Secret Service, and all these people that can actually go in and make our kids safe.
So he clearly calls for both volunteers and armed police. It is unclear how the numbers will work but with almost 100,000 schools we are clearly talking about a large numbers of jobs and a big federal expenditure.
There would be details to work out and these are by no means trivial. How do the volunteers work with the police? How volunteers will be recruited? How will they screened so we are not creating a worse situation by putting armed people into schools who may themselves cause a problem?
Could there be problems with students or others taking guns from the guards and shooting? This may sound crazy too but a weapon was taken from a police officer is the police station and 3 officers were wounded. (see Police station shooting story).
Just a few months ago, police shot 9 bystanders while killing a lone gunman. Since these were trained police officers, we cannot dismiss the possibility that students or teachers could be shot accidently by the guards.
Many schools will need multiple guards as one person can’t see everything and may not be sufficient to repel the attacker or attackers. Should we depend exclusively on volunteers or police here or have a mix?
Should we think about something similar for other places where the public gathers? Does the private sector need to add an armed presence in shopping malls, private schools, movies theaters, churches, etc.
Do governments need to post armed guards at other facilities open to the public? The Post Office and motor vehicle offices come to mind but there are many others.
This plan is clearly a dilemma for many politicians. Some will like the idea of armed guards in schools as proposed by the NRA but will not like the idea of a large federal program particularly one that uses federal money to create jobs and stimulate the economy. Others will like the idea of a federal stimulus but oppose armed guards in schools.
But it gives each side a bit of what they like. So maybe it is a potential route for compromise. Maybe throw a few more contentious issues into the mix and we’ll have something.
I think the plan will not work but rather than dismissing it as crazy, we should think it through.
Last year we had a big standoff on raising the national debt ceiling. It was very strange in that Congress has repeatedly passed budgets with deficits over the past several decades and suddenly decided that the national debt had grown too large. Then they decided the best course was just to stop borrowing money.
An apparently simple solution to a growing problem. But perhaps was too simple. People with bonds would like to be paid when the bonds come due. Soldiers and civilian employees both like to be paid. There are quite a few valid concerns raised by this approach.
So in recognition that the problem was a bit more complex then just not spending, Congress agreed to allow debt to rise but mean while would appoint a Super-committee to decide on both revenues and budget cuts which would once again bring fiscal sanity to our federal budget. And to make sure the job was done right, Congress proclaimed that there would be draconian budget cuts and tax increases if we did not have a plan in place by the beginning of next year (which is just a few weeks away now).
So one of the sticking points is income taxes. President Obama is pretty insistent on raising the tax rates on households making over a quarter million dollars per year. Republicans are insistent that this rate won’t be raised.
Everyone would like to see tax cuts continue on for households making less than a quarter million dollars per year (About 98% of us). But Republicans say they won’t agree unless the households making over a quarter million dollars per year are included (about the top 2%).
If there is not an agreement taxes rise on everyone which combined with the draconian budget cuts might be enough to throw this weakly recovering economy back into recession.
So a compromise is needed. Both sides like to repeat their position and do insist that it is the correct position. But there is some movement behind closed doors toward the compromise we need. Some days the reports are promising, other days not so much. Let us hope both side can show some flexibility.
In defending his tax plan which many analysts thought impossible Mitt Romney did come up with 2 good ideas, one of which may be a partial solution to the fiscal cliff we are facing.
President Obama is pretty insistent on raising the tax rates on households making over a quarter million dollars per year. Republicans are insistent that this rate won’t be raised. This standoff is over the temporary Bush tax cuts which should have expired but were temporarily extended 2 years ago and are now set to expire again at the end of this year.
The Democratic view is that these tax cuts should be kept in place for those households making over a quarter million dollars per year and allowed to expire for those earning more. The Republican view is that the tax cuts should be extended for everyone, regardless of income. Let us just call this the tax rate standoff.
Certainly there are many other tax issues – the estate tax, payroll taxes, dividend taxes, capital gains taxes, carried interest to name a few – but I think Mitt Romney may have suggested the solution to the tax rate standoff.
So here is Mitt’s good idea :
And so, in terms of bringing down deductions, one way of doing that would be say everybody gets — I’ll pick a number — $25,000 of deductions and credits, and you can decide which ones to use. Your home mortgage interest deduction, charity, child tax credit, and so forth, you can use those as part of filling that bucket, if you will, of deductions.
So if rates are kept the same on everyone (as the Republicans want), Congress can still limit deductions to a number which will not adversely effect those households making less than a quarter million dollars per year but would still raise taxes on those households making over a quarter million dollars per year (as the Democrats want).
Of course, it won’t be a sharp divide at a quarter million dollars per year but it meets the spirit of what both sides want to do. I’m not sure if the number picked is the right one and if there should be additional rules but this caps could be the start of a discussion.
It seems we are in the market for a new Treasury Secretary. It is a very important position in the cabinet. President Obama must work with the Republicans in Congress to continue the recovery and improve upon the economy of the United States.
The problem is that both sides have very different ideas about what we should do and there is a lack of trust. Trust would certainly improve the chances of finding some middle ground that both sides can agree on. Perhaps one way to improve that trust is by naming a new Treasury Secretary that both sides can trust.
Jon Huntsman ran in the Republican presidential primary and was a successful governor of a conservative state. He was also President Obama’s ambassador to China. Both sides have reason to trust him.
In addition, Jon Huntsman has made serious proposals about economic regulation and job growth and is a good choice as Treasury Secretary.
Now that the election is over, it may be a good time to do some actual governing. Seems the parties need to find enough common ground to reach a compromise and prevent us from falling off a fiscal cliff on this next January. Refusal to compromise could put us back in recession ( http://online.wsj.com/article/BT-CO-20121107-720595.html )
Mitt Romney has mentioned many times that his policies will add 12 million jobs.
I wrote about this before but thought an update is in order.
He says this will happen over his 4 year administration and it will be due to his five-point plan.
Or at least that is what he seems to be saying.
Turns out there is no strong tie to his 5 point plan, just a tie to average growth returning. Over 4 years this breaks down to a quarter million jobs added per month.
When Obama took over as President we were losing over 800,000 jobs per month. He turned that around and we have been gaining jobs since early 2010. The figures bounce around from month to month but have been over a quarter million some months and significantly less others but always positive. (See Is the Obama job recovery really so bad? And the stimulus worked ).
Is it better to trust the man who got us out of the job decline and is actually gaining jobs or the man who says he is going to do somewhat better but has no evidence to back-up his claim?
There has been much complaint about the Obama job recovery and many think we should trust our economy to Governor Romney because President Obama is doing such a bad job. His stimulus failed they say.
In my view President Obama is doing a good job considering where we came from 4 years ago and the lack of cooperation from Republicans in Congress who have blocked many of his attempts in the past 2 years to fix the jobs situation.
There is absolutely no credible evidence that Republican ideas would help the job market. Well, there are theories and “Atlas Shrugged” but no real evidence. After all, Republican ideas were put into effect in the years before the economic melt-down and we saw the result. Why are these ideas and this party going to fix things now?
So I thought it would be a good idea to revisit an old post from over a year ago and update it with new job figures.
The graph below shows the month to month change in private employment during the months from January 2008 to October 2012. The numbers on the right indicate thousands of jobs gained or lost each month. All numbers and the graph are from the Bureau of Labor Statistics (BLS) of the U.S. Department of Labor.
The graph clearly shows accelerating job loss in 2008 hitting over 800,0000 jobs lost in January 2009, staying in that area for several months, followed by a decreasing job loss, and emerging into positive job growth in early 2010. The job growth is too small bring down our stubbornly high unemployment rate but it is moving in the right direction. We need to create more jobs to keep up with the constantly growing labor force. Total job figures are a bit lower as we have the number of jobs in the public sector decreasing in many months.
There are quite a few things that could influence the economy in this time. The slow-down in job decline in early 2009 seems to suggest that stimulus plan seems to have worked but is now slowing down. The TARP program passed in late 2008 may have helped this recovery. And one could argue that things would be better or worse if we had followed a different plan.
So President Obama seems to be doing as well as could be expected and it seems the most sensible course would be to re-elect him and re-elect fewer Republicans to Congress.
So Mitt Romney is now the candidate of big change. Sounds very 2008 when President Obama was a candidate of hope and change.
I guess the difference is that I liked some of President Obama’s changes. I think it is good that health insurers can’t turn down people with pre-existing medical conditions. And it is good that insurers cannot cap your coverage if you have some really big claims. It seems good that insurers cannot find a reason to deny coverage if you are sick. There will be problems with health care reform and we need to elect people who will modify the reform to get it right.
I like that the economy is not falling apart and we are not losing hundreds of thousands of jobs each month as we did in the year before Obama took office. It seems the Presidents Bush and Obama (and Congress) took the right steps in late 2008 and 2009 to reverse the trend. Certainly things could be much better and I think they probably would be if Republicans in congress did not block many of President Obama’s efforts. But I see nothing to indicate Governor Romney would do any better.
I like that Obama seems to have a thoughtful foreign policy.
But Governor Romney is also known for his changes or flip-flops. I am surprised he wants to remind voters about that.
No doubt science is important. Very important. It help us understand our world and beyond. It guides us in many ways as we find our way to live in the world. It is the basis of industrial advances. It is an important part of a healthy economy. Scientific advances are also important to our health. The ways in which science impacts our lives are almost too numerous to count.
Yet science does not seem to play a large part in political debates. The presidential candidates barely mention science and certainly not in any way that approaches its importance to our society. I’m not aware of any elected political office where the candidates discuss science.
But the presidential candidates (President Barack Obama and Governor Mitt Romney) participated in an online science forum ( http://www.sciencedebate.org/ ) in which they answered a series of science questions.
The questions were submitted to and answered by the candidates. So it wasn’t really a debate but it is the start of a discussion and the hope is that candidates might be moved to address these important scientific questions in a debate.
So if you would like to know what the candidates are thinking about science, be sure to check out http://www.sciencedebate.org/.
Mitt Romney has mentioned many times that his policies will add 12 million jobs. In the recent debate ( transcript here ) he specified this would happen in 4 years and is a result of his five-point plan.
That’s why I put out a five-point plan that gets America 12 million new jobs in four years and rising take-home pay.
Or at least that is what he seems to be saying.
Dana Milbank of the Washington Post has written an article called Romney’s facts are curious things. A great article that examines this 12 million jobs claim. Turns out there is no strong tie to his 5 point plan and the 4 years thing is a bit fuzzy too. But read the article. You’ll be glad you did.
Mitt Romney has been a bit short on details when it comes to his plans. For example, he will cut taxes by 20% (that does sound specific) but he wants to keep revenue about the same and will do so by cutting deductions and loopholes (which are not specified). He has said on a few occasions that this cutting of the deductions will not cause the middle class to pay a larger portion of taxes than they pay now. At the October 3 debate he added that he will not increase the deficit or cut education.
He will lay-out a few broad principles such as the above and congress will find the answer. As I have said before trust him and trust congress. It is certainly a plan but not one in which I have much faith.
He has also said he will cut federal expenditures. He has not given many details. But a the debate, he did tell us that he would “stop the subsidy to PBS”. This despite loving Big Bird.
There is about a trillion dollar deficit. The PBS subsidy is 450 million dollars. For most of us (even Mr. Romney) this is a lot of money. But it is only a very small portion of the deficit .0005 or one twentieth of a percent).
Does Mr. Romney have any specifics on the other 99.95% of the deficit he needs to cut? One specific he has managed to come up with solves about one two-thousandth of the deficit but may result in killing Big Bird.
About 10 years ago, Vice President Cheney supposedly declared that “Reagan proved deficits don’t matter” as the administration moved us from the surplus at the end of the Clinton administration to the deficits of the Bush administration. Then a few days ago Mr. Cheney realized deficits do matter .
At first I was a bit confused. But then I realized, the difference. When a Republican run a big deficit, it doesn’t matter. But if a Democrat does it, it is terrible. This is true even if the Democrat inherited much of the deficit from his Republican predecessor.
We should all be grateful that this is cleared up at last and that we have a two party system to guide us through this difficult time.