Chris and Eugene and Jack Welch oh my: Embarrassment is watching your own side do it.
Last night, a repurposed Chris Matthews and two scripted guests were complaining about the fact that a candidate said something accurate.
The offending person was Candidate Romney, who had appeared on a radio show (last week). Matthews played tape of Romney's exchange with his pal, Laura Ingraham:
INGRAHAM (videotape): How do you answer the president's argument that the economy is getting better in a general election campaign if you yourself are saying that it’s getting better?The economy is getting better, of course, compared to where it has been. It would be absurd to say different. (The economy grew by 2.8 percent in the last quarter.)
ROMNEY: Well of course it’s getting better. The economy always gets better after a recession. But the question is, has it recovered by virtue as something the president has done or has he delayed the recovery and made it more painful? The latter is, of course, the truth.
INGRAHAM: Isn’t that a hard argument to make? Is that a stark enough contrast?
ROMNEY: Well, have you got a better one, Laura? This happens to be the truth.
Quite correctly, we liberals have gotten upset when Republicans make absurd misstatements about such matters. (The stimulus didn’t create any jobs!) Last night, the children got mad when Romney made this accurate statement.
Chris is a clown, as he always has been. But today, he’s a clown on our side:
MATTHEWS (continuing directly): “Have you got a better one, Laura?” Is he asking Laura? I mean, I like Laura. You know, I disagree with her, but I think— Is he like counting on her to give him a better campaign strategy?What an embarrassment these silly hired hands are.
ROBINSON: He’s just fishing around, you know? What’s interesting about that, of course, it’s a would have, could have, should have, right? And it’s a hypothetical. Of course, that’s his very case against Obama, and that’s Obama’s argument. Obama has made the recession worse. Obama says, “You know, if I hadn’t done the things I did, it would have been much worse than it was.”
MATTHEWS: Too much nuance.
ROBINSON: So it’s very difficult for Romney to say that Obama’s argument is ridiculous when in fact, he’s making the same argument.
MATTHEWS: Chris, last question to you. Why would you give away the store on the way to buy something? Why would you give it all away and say, yes, it's getting better? Sure. And, by the way, do you have a better argument for me, lady? Can you help me out here because I don’t have a better one?
I mean, give me a break! He’s admitting he doesn't have an argument against Obama.
CILLIZZA: I think Laura Ingraham asked the exact right question, which is, "Isn’t that a tough argument to sell?" And the reality is, Chris, it is. We know for a fact in politics is that the president probably gets too much blame, I should say probably gets too much blame when the economy is bad, gets too much credit when the economy gets better.
Romney seems to try to thinly slice that onion to say, "Well, yes, things are getting better, but it wouldn’t have gotten better as slowly if it wasn’t for what President Obama did."
CILLIZZA: It’s a lot more complicated argument than just to say things aren’t getting better. And remember in politics, especially campaign politics, especially presidential politics, simple is what sells.
MATTHEWS: Yes. You won the football game, but I would have won it by more points. Give me a break!
Romney made an accurate statement; the economy is getting better, although it’s improving slowly. Everyone knows that’s true. But the hands all knew what the script demands. They pretended to get upset.
This is now the perpetual shape of the game on Our Own Liberal Channel. Almost every word is pretense. Ironically, we watched Piers Morgan a few hours later—and Jack Welch was Piers’ featured guest! Memories lit the corners of our minds as we remembered the way they were—the way Chris and his regular guests once pimped and recited for Jack, who was then Matthews' boss and patron:
WELCH (1/30/12): Well, I'm a big fan of Mitt Romney, not because of his combativeness, but because of his intellect and his ability to persuade all kinds of people to get together and get the right answers. So I'm—I think he's a solutions person. And this combative thing is necessary during these primaries, which is sort of crazy. But he's more of a conciliatory, pull teams-together and get- the-right-answer guy.There was more. But you get the idea.
MORGAN: He's also, Jack, and I would imagine you would have been delighted by this. He's also turned the whole debate from his wealth and his success from what looked like a negative, because he looked so defensive about it, into much more of a positive now where he finally stood up and did what I guess you would have done a long time ago and said, “Hey, I've been successful, so what? That's the American way, isn't it?”
WELCH: Finally, he did it. It took him a long time. He's not a braggadocio guy. Candor like that doesn't come easy. Patting himself on the back doesn't come easy but he did it. And he did it in a first-class way. And he is a first-class person. And in doing that, he absolutely put the thing on the table. People might not like it. But John Kennedy was a wealthy man. Franklin Roosevelt was a wealthy man. Teddy Roosevelt was wealthy. We've had wealthy presidents.
We’re so old that we can remember when Matthews was pimping the viewpoint of Welch every night of the week. As he performed this nightly service, his salary went from $1 million to $5 million per year.
The “liberal” world just let it go. That includes people like Robinson.
You see, career liberals need good jobs at good pay! As editor of Style, Robinson savaged Candidate Gore in real time too.
Darlings! The hired hands were all doing it then! Today, though, things are much better. Today, they get to invent stupid claims which send thrills up our legs.
Romney made an accurate statement, saying it happens to be the truth. Treating his viewers like low-IQ fools, Chris Matthews got very upset.
The way the hired hands play you: Obama says this: “The economy is getting better. Except for me, it would have been worse.”
Romney says this: “The economy is getting slightly better. Except for him, it would have been better.”
Robinson knows what he's hired to do. “In fact, he’s making the same argument” as Obama, the hired hand brightly said.
Last night, the children got mad when Romney made this accurate statement.ReplyDelete
I'm not sure just which statement you're saying is true here, Bob. You bolded Romney's observation that the economy always gets better after a recession, but that's not the statement Romney insists is true:
But the question is, has it recovered by virtue as something the president has done or has he delayed the recovery and made it more painful? The latter is, of course, the truth.
Have the president's policies slowed economic recovery?
The economy grew a bit less than 0.7 percent last quarter-- at a 2.8 percent annualized rate.
Even from the liberal perspective.
Everyone (including Krugman) said the stimulus was way too small.
Tax cuts are not stimulus.
*And I would say some economists are still arguing that the economy will not truly "get better" until the housing situation finally plays itself out - either the banks take their haircut, or they get saved again, still lots of bad "paper" out there!*
Tax cuts can help stimulate spending, but not as much as other government options. The bedrock of Keynesian stimulus is the Multiplier Function, which is the amount the money supply increases over and above the amount released by the government.Delete
“In congressional testimony given in July 2008, Mark Zandi, chief economist for Moody's Economy.com, provided estimates of the one year multiplier effect for several fiscal policy options. The multipliers showed that increased government spending would have more of a multiplier effect than tax cuts. The most effective policy, a temporary increase in food stamps, had an estimated multiplier of 1.73. Making the Bush tax cuts permanent, had the second lowest multiplier, 0.23. A payroll tax holiday had the largest multiplier for tax cuts, 1.29. Refundable lump-sum tax rebates, the policy used in the Economic Stimulus Act of 2008, had the second largest multiplier for a tax cut, 1.26.”
Food stamps can only be used for consumption. Tax cuts could be used to pay off debt, and if banks don't re-lend the money, there is little stimulus.
Tax cuts for those already consuming as much as they want could be used for long term investments, or be hoarded in offshore bank accounts, offering no short term stimulus.
That's why reducing taxes on the wealthy has the lowest multiplier function.
It stands to reason that increasing taxes on the wealthy will have the least recessionary impact.
According to Bob's excerpt, the MSNBCer's chastised Romney for admitting that the economy has improved. They actually suggested that telling this truth was a blunder and they implied that Romney should have instead lied and said that the economy had not improved at all.
Nice article, but one quibble. Bob offers "The stimulus didn’t create any jobs!" as an example of a false statement. However, cause-and-effect cannot be proved in economics. While most economists believe that the stimulus created jobs, that's still a matter of opinion, not fact.ReplyDelete
BTW economists who believe that the stimulus created jobs should also believe that paying back the money borrowed for the stimulus will reduce jobs in the future. There's no free lunch.
And they do. Google modern monetary theory (MMT).Delete
"BTW economists who believe that the stimulus created jobs should also believe that paying back the money borrowed for the stimulus will reduce jobs in the future."ReplyDelete
You might think so, but you'd be wrong, as usual.
The impact of Fed money creation depends on the prevailing state of the economy, of course.
While rates are near-zero and business borrowing stagnant, the Fed rapidly increasing the money supply does not crowd out other spending and helps to create (or prevents the destruction of) many jobs.
When the economy picks up, business will take on debt (and thereby stimulate the economy themselves) and the Fed can stop creating money without ill effect.
But you go on pretending to educate us with your facile homilies -- it's entertaining to watch you feign sober judgment as you delude yourself.
Swan, you have presented one theory. Coincidentally, a new research paper by a professor at UC San Diego and the National Bureau of Economic Research concludes that on balance government spending does not appear to stimulate private activity. See http://weber.ucsd.edu/~vramey/research/NBER_Fiscal.pdfReplyDelete
To me, that result seems intutively reasonable, because the US and the European countries with high government spending have not been successful at increasing private activity. E.g., when Clinton was President, federal spending was half what it is now and the economy was a heck of a lot better. So, Bush's and Obama's spending increases would appear to be counter-productive, if anything.
No one ever said goverment spending increases private job activity. The paper you cite states that government spending increases overall employment because it increases government employment, which can pick up slack in the economy during times of lower private sector employment until private sector employment rebounds. Which exactly proves Swan's point.Delete
And, beyond merely increasing government employment, borrowing and spending by government increases demand for private sector goods.Delete
David-in-Cal is quite simply wrong. Wrong about his conclusions, wrong about what the papers he cites indicate. Just wrong.
Probably on purpose, perhaps through self-delusion -- but, anyway, wrong.
I don't whether the last two posts come from the same "anonymous', but the second contradicts the first. According to the first one, "No one ever said goverment spending increases private job activity."Delete
OTOH the second one says "borrowing and spending by government increases demand for private sector goods." That implies that the government spending does increase private job activity, since more workers will be needed to satisfy the increased demand.
BTW I agree with the 2nd anonymous as far as s/he goes. However, there's another factor. Payment of taxes to pay for the increased government reduces private job activity. And, even if borrowed money is spent, the anticipation of higher taxes affects private job activity, although this impact must be quite difficult to measure.
If you agreed with me, you would've shut up while you were ahead (that is, while, though it was evident to everyone you hadn't a clue what you were talking about, you were still *ahead* as you hadn't yet insisted on being completely obtuse) -- but now you've gone and blown it.Delete
Yes we're different Anons. And no, as anyone with sense could see we don't contradict each other: It's perfectly possible for government spending to create government jobs AND ALSO to create private sector jobs.
Also, you've been deaf to the response by Swan on the separate issue of Money Creation by the Fed -- your original hobbyhorse (about which you were completely, mind-boggling ill-informed, presenting as a refutation a paper which in no way bore on the issue -- typical, really).
And by "your original hobbyhorse," I mean of course the one to which you reflexively turn at every moment -- the one which is best summarized: "There hasn't been inflation yet as a result of all this debt and money supply, but, but, but, sputter..."Delete
Regarding inflation: In late January I bought some 10-year TIPS (inflation-proof Tresuary bonds) paying only 1/8 of 1%. Furthermore, I had to pay a premium of about 1.77%. If there's no inflation, for an investment of $101.77, after ten years, I will have gotten back $100 plus total interest of $1.25. That's a negative rate of return, unless inflation comes into play.ReplyDelete
Here's the punch line: In two weeks, my bonds have appreciated by 2.5%. Other investors are so worried about inflation, that they're willing to pay 2.5% more than I did for this negative return. Conclusion: I've got a lot of company who are worried about looming inflation.
BTW the threat of inflation and of a weakening US dollar is another problmeatic side effect of the stimulus. Because of this threat, I'm moving some of my retirement savings away from US stocks. If lots of other investors are doing the same, that means less capital invested here than would have been the case with a smaller deficit. IMHO this change in investment strategy costs American jobs, although it's impossible to say how many.
In short, as I see it, stimulus adds jobs in more-or-less measurable ways, but reduces jobs in ways that are hard or impossible to measure. Under these circumstances, I don't think anyone can honestly say he knows what the net effect is. Still, to me, borrowing money for a stimulus resembles cutting a strip off one end of a blanket and sewing it onto the other end to make the blanket longer.
Yeah, that's the hobbyhorse I mean.Delete
Ride on into your sunset.