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Why the Economic Stimulus (and Recession) is all About

Here are three things you need to read.

Martin Fackler on the lessons that the Japanese recession (and its own economic stimulus package)  should teach the US.  An amazing piece of journalism.

Second, Robert Reich provides his daily commentary about the effectiveness of various stimulating proposals. Look at this chart:


(The main flaw of this data is not stating the effects of cancelling the tax cuts; that seems to be what Obama in suggesting for upper income populations (at least in a few years).

Finally, take a look at one of this Phillip Longman piece on how improving the national train system would pay handsome dividends. (I linked to this a while back).

Here’s an email I sent to Sen Cornyn and Sen Hutchinson:

Howdy, I’m calling to let you know my opinion about two very important issues:

1)I oppose the $15,000 tax break for new homeowners. I’ve read several papers online about how it would simply increase the price of houses without delivering any real benefit. it also raises issues of fairness. I rent and have been renting all my life–I never get to use these tax breaks. (The mortgage deduction is another deduction I’ve never been able to use either).

2) I oppose the Nelson-Collins attempt to cut public spending on arts funding, climate change research, homeland security, Amtrak, NSF. These are all worthy causes which would probably only be funded by public organizations. It is unfortunate that your Senate has chosen to spend a king’s share of money on banks in TARP when it appears to have  done little good.

As a general observation, you need to forget about financial capitol and start focusing on human capitol.

Thank you.


Comment from Shanikka,  about a NYT article on the recession rate:

I wish the lies out the Labor Department each month would just STOP. Honestly. Hopefully President Obama will see clear to have this agency go back to the truth instead of the spin we’ve been fed for the past 25 years where the unemployment rate is concerned.
7.6% unemployment? We WISH. The real unemployment rate — the one that counts all those people who are unemployed and underemployed under the government’s narrow definitions of both (thank Reagan for first decreeing this funny math to be the rule for labor department statistics, much like he declared ketchup a vegetable), and puts back all those folks who were screened out simply by Reagan’s folks re-defining what "unemployment" is. Puts back all those who are disgusted and simply have given up looking after futile searches for work that they undertook in good faith not just once, but perennially.
When you use Real Math instead of Funny Math, the government’s own data this month (contained in Labor Department Table A-12 – innocuously labeled as "Alternate Measures of Unemployment") puts the current TRUE unemployment rate at 13.9%. Almost DOUBLE the 7.6% Funny Math rate.
A rate which, while increasingly alarming, nonetheless which continues to lull the general population into a sense that all is still OK. Because, after all, it’s only those that don’t want to work anyway who are suffering: the "lazy", the "unqualified", the haughty who think certain work is too good for them — and the outliers, especially Black men (who have been suffering double to triple the announced unemployment rate for decades) (yes, that’s brutally angry sarcasm from this Black woman) that don’t have a job.
And yet our still telling ourselves that if we just "retrain" everyone or get them into "green jobs" it will all be fine. We will again be able to "compete" with the folks overseas who are benefitting from our own corporate greed and making bank as fewer and fewer folks, even with college educations, can make ends make.
13.9% unemployment, folks. In America. Why are we not outraged at those whose greed and malfeasance, within and outside of government, continue to bring our economy and our people’s ability to care for themselves to its knees?

Notable number from the original article:

In addition, the government revised the estimates for previous months to include another 400,000 job losses. For December, the government revised the job loss to 577,000 compared with an initial reading of 524,000. Over all, it said, the nation has lost 3.6 million jobs since it slipped into a recession in December 2007.

This backward revision is important because initial surveys almost always get the numbers wrong. First, it shows how deep the recession has been so far. When you are unemployed, the last thing you want to hear is that more people are competing for the same jobs that you are. When I was “profoundly unemployed” in 2002, I discovered that I just couldn’t compete even for lowly jobs as a result of unemployment. My enhanced job skills seemed practically worthless. Also, I noticed that you can no longer talk your way into jobs into jobs you were on the borderline of being qualified for. It meant fewer full time jobs and more contract jobs; in my field of technical writing, it meant emphasizing expertise on tools rather than ability to organize and write. Finally, I noticed that job networking rarely helped you because everyone was in the same boat. My solution was to move in with parents, accept a job with limited opportunity for growth and stay longer than I needed to. (It also meant going into more debt).  On the other hand, I see a new area for job growth: education.

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