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Well when Blogger27 tells Gbaji something is right, Gbaji believes it. He doesn't understand the cause/effect of half the **** he claims to. Then again he is 200 times more knowledgeable then me, so obviously I should reload this page a few more times so I can be told what kind of slippery slope I am on.


(buzz words are fun.)

Bah, all those economists are liberal elites! They're in the Democrats back pocket, they only publish that stuff to get funding. It's like global warming, it's all a conspiracy!

Guess you haven't quite accepted that you can rarely get people to change their minds about something after all.

Ok. That's simple I guess.



While I'm not claiming it's a factor in this case, you shouldn't limit your analysis in such ways. Those bars could also represent changes in population. It is a "per-capita" measurement of GDP, right?

But yes. I agree that GDP shrank in 2008, then shrank a lot more in 2009, then began growing in 2010. I do happen to think that's one of the poorer measurements to use though. If you'd like I'll explain to you why.

Regardless of that though, I'm not sure how this negates my argument. The biggest economic negatives occurred in 2009 *after* the stimulus bill was passed, and certainly after Obama won the White House, and the Dems won overwhelming control of both houses of Congress, and it was clear that they were going to pass some kind of really big spending bill.

My claim rests on the assumption that the greatest economic harm occurred because of the effect that overspending on "recovery" had on the choices that players in our economy made. This both deepened and lengthened the downturn. So far, the numbers you're showing me don't disprove that claim at all. I would expect to see exactly what we're seeing: Big negative in 2009 after the Dems won control of the government and embarked on that spending, then sluggish recovery after that point.



Yeah. A peak which occurred *after* Obama started passing massive stimulus bills. Again, you're not disproving my claim at all. If anything, you're providing wonderful supporting evidence.



You're assuming causation though. The economy, absent any action other than TARP, would have experienced a greater and faster recovery. It's normal for economic forces to "bounce" after a downward trend. You need do nothing but fix whatever caused that downturn in the first place (and sometimes you don't need to do that). The idea that you attribute that bounce to Obama's stimulus bills is where you go off the rails. Go look at other recessions. Look at the early 00s (after the dot-com collapse). Look at the early/mid 90s (S&L crisis). Look at the early 80s. In each case you'll see about 100% of the losses in the first year and a half recover in the next year and a half. By the end of year four a typical recession cycle will not only have recovered to pre-recession levels, but be back on the trend that existed prior to that recession (so as though the recession didn't happen).

It's *normal* for that to happen. It's what has happened in the previous 3 recessions, none of which involved stimulus spending anywhere near the size of that passed in early 2009. Yet this time, we did spend massively and have experienced less relative recovery. The positive numbers you attribute to Obama's policies are less than we should have gotten if he'd not done a damn thing at all.


You can't just look at numbers in a vacuum. You need to compare them to other similar situations and see if what we're seeing is normal, below normal, or above normal. Again, let me point out that the Dems hyped 2010 as the summer of recovery because if our recovery had occurred like previous ones, that should have been the year we recovered. Instead, we're still just now starting to get some recovery nearly 2 years later. Obama doesn't get "credit" for this. He gets "blame".



Um... Don't you recall Obama saying that if we didn't pass his recovery act, that unemployment would rise above 8%? That means that it was less than 8% when he was calling on people to pass it, right? And unemployment is *still* above 8% today.

How do you call that anything other than a failure?



Yeah. Just did. Even by Obama's own measurements, his recovery act failed. It failed to keep unemployment under 8%. It failed to produce the expected recovery in 2010. I suppose you could try to fall back on the "it would have been worse otherwise" argument, but you'd first need to abandon the ridiculous claim you're making that our recovery has been wonderful and just as promised/expected. It hasn't.

And if you do go to the "could have been worse" or "it was worse than we thought" argument, then you need to show why we should trust the very people who were so wrong about the economy back then to both know the right thing to do to fix it *and* to be able to accurately measure after the fact how much their actions actually blunted some newly imagined disaster which would have occurred otherwise.


At the end of the day, conservatives opposed passing Obama's stimulus plan for the exact reasons that ended out happening. It would scare away job growth make the recession deeper, and would slow down recovery. And even when we do finally recover, we'll then be burdened with massive debt that will have to be paid down somehow. They were right.

Edited, Feb 24th 2012 6:17pm by gbaji

When did economics fact become decided by vote? And did we take a poll at some point? You say this, but it doesn't make my assessment wrong. There are plenty of economists who agree with me on this. Even if you don't agree with my argument that it hurt our economic recovery rather than helping it, you can't deny that the negative effect of the massive increase in debt that has resulted from that spending is causing problems and will continue to cause them for some time.



Or you could expand your choices to include all the economists who agree with me. Of course, you'll dismiss them because they work at biased places like the cato institute or the heritage foundation. Circular argument, but you like going in circles.

Me. I look at who accurately predicted things. Everything that conservatives warned would happen if we passed the recovery act happened. Very few of the things that Obama promised would happen if we passed the recovery act happened (and we can make a case that those few things would have happened anyway). So where does that leave us?




Everyone? Who is everyone? I know that the liberal line on this is to insist that there was some unicorn like magical specialness to this recession so as to excuse the lack of recovery, but there really wasn't. It was larger than most, but that's it. What I find really amusing is the blatant rewriting of relatively recent history going on here. How can it be that "everyone knew it wasn't a typical recession", when it sure looks like no one on the Obama staff seemed to actually think that. Well, except when trying to scare people into supporting the recovery act, that is.

If they'd actually thought that the base condition was that bad, they'd have used a much higher unemployment figure than 8%. Their own excuse for being so wrong was that the economy was actually in much worse shape than they thought. But today "everyone knew" this? How can that be? It makes no sense.


You know what does make sense? That they didn't think the economy was in that bad a shape after TARP, that they did believe it would recover normally, and that they didn't think that unemployment would go much above 8% (if it even reached that point). I think they figured they could take advantage of the publics fear of the economic downturn to pass a laundry list of liberal social spending that they'd wanted for decades but had never been able to pass. I think they were so sure that the economy would recovery "normally", that they could get away with spending massive amounts of money in ways that had little or nothing to do with stimulus or recovery, and since the economy would recover anyway, they could claim that they were the ones who fixed it.


They were wrong, of course. But then, us conservatives knew that back then. We knew that spending so much money would hurt the economy and drag out the recovery. And we were right. No amount of changing the words after the fact changes the fact the the GOP predictions were correct and the Dem predictions were wrong. But despite this, you still want to go to the same source that was wrong last time and repeat their new spin?


Have fun with that. I'll stick with looking at the actual world around me and basing my opinions on that.

The day it was declared a soft science rather than a hard one.


I could. But if I'm expanding my choices to include them, why not go for the majority of the economists which puts me back where I was?


How's that 2.5% unemployment rate and $89 billion construction boom going?


Did you sleep through October and November 2008?


So long as it's understood that "The economy, absent any action other than TARP, would have experienced a greater and faster recovery" was just your uninformed and minority opinion, that's fine

He has some guys from right-wing think tanks!

To dismiss their opinion is equivalent to dismissing economists working in the private financial sector because those guys are all "the same people who said 8%!". All of them. Even people who didn't work with the president. Even people who were economic advisors to McCain's campaign against Obama. They're all leftist shills with Big Government liberal agendas who are wrong, wrong, wrong.

And I did just that.



You apparently don't know what the term "net" means here. Net means "after accounting for other factors". So net revenue is revenue left over after you've subtracted your expenses. Similarly, in order to declare that the stimulus bills had a "net positive effect", you'd need to know what the outcome would have been if we hadn't passed those bills. And that's somewhat subjective, isn't it? I say that the economy would not have gotten as bad as it did (looking mostly at employment here), and would have recovered much more quickly absent the stimulus bills and all the debt they heaped onto our economy. I believe that those bills had a net negative. My entire argument is about how the effect was negative on net.

You need to counter with something more than just insisting that they were a net positive. I get that you disagree with me, but simply repeating the disagreement doesn't actually help support your position. Why do you think that spending was a net positive?



You're being selective though. Economic fortunes go up and down. The always have. You're choosing to focus on one short time period in which private investments failed badly, and resulted in lots of lost revenue and jobs. But we're talking about "net economic effect", right? So shouldn't we also look at all of the years in which private investments produced massive and consistent economic gains?

If, as a result of our profit driven financial banking system, we experience an average of 4.5% GDP growth, and sub-5% unemployment for 10 years, but then we have two years where GDP drops slightly negative and employment pops up a few percent, are we better or worse off "on net" over that period of time? Would it be better to accept a lower average GDP growth, and higher average unemployment on the promise that by curbing said investment, we'll limit the likelihood and degree of the bad times?


That's basically the argument you are supporting. But the problem is that no government system has ever shown an ability to actually prevent the downturns by curbing private investment and shifting that money into government spending programs. Countries that do that still experience periods of negative growth and recession. So there's no real gain (over time) to doing that. However, there is a real and measurable cost. Economies which do that tend to have higher unemployment on average, and they tend to have less upward mobility within their economies on average, and they tend to be less able to bounce back when those downturns occur.


So yeah. On net, it's better to leave that money in the hands of private investors.



Said like someone too young to remember the 70s. That was the decade of big government management of our economy. It was a failed experiment. We lurched from one recession to the next, each caused by the "fix" to the last, and each having progressively worse negative economic effects. By the end of the 70s, we had double digit inflation, double digit interest rates, and incredibly anemic GDP growth. Our economy was basically stuck in the mud, spinning its tires. It wasn't until Reagan came along, told us that "government is the problem" and started implementing policies designed to get the government out of the economic micromanagement business that things recovered (and quickly too). There were a few years of pain, but it turned out he was right, and we proceeded to have 15 years of record prosperity as a result.


Most of the posters on this forum are too young to have known a US economy which wasn't influenced by Reagan's policies back in the early 80s. You've lived your whole lives thinking that 5% GDP growth, 5% unemployment, 4-5% interest rates, and 3% inflation rates were "normal". So you accept when people tell you that there's something wrong with conservative economic policies. You willingly focus on the minor negatives of the free market, while not realizing the enormous positives that occur as well. You think that there's no cost to restricting that market for some direct government plan or program, because you think that our economy works as well as it does regardless of that free market component. You think that Clinton had anything at all to do with the economic boom in the 90s. And you think that the free market somehow failed us during the 00s.


You're wrong though. Obama's economic policies are a throwback to the same sorts of things we tried back in the 60s and 70s. They were a disaster then, and they'll be equally disastrous this time around. The difference is that most voters have forgotten (or never knew) just how bad things can be when those policies are in operation. The sluggish recovery we've seen over the last few years is just the tip of the iceberg. Things will get worse, much much worse, if we continue down the road that Obama is taking us.

Over what time period though? Can we agree that given sufficient time the GDP and unemployment figures would have improved? Remember, GDP was negative around the time period when the stimulus bills were being passed. It was going to get better, stimulus bill or not. You're trying to give credit to the stimulus, without any rational for it. As I've said repeatedly, I can just as easily argue that the economy would have recovered as well (or better!) had we not passed the stimulus bill(s) at all. And we'd have a lot less debt.

You're also simply factually wrong about unemployment. Unemployment in February 2009 (when the recovery act was signed into law), was 8.3%. It has only just this month gone back down to that level. It has been higher than that the entire time between that passing and this month. So arguing that the stimulus bill made the unemployment rate go down is pretty far fetched. I would argue (and do) that it made the unemployment number go up, and that we're only just now recovering from the harm done to our economy by the Recovery Act.



Something it would have done anyway. What you have failed to even remotely come close to arguing is that the stimulus bills actually had any positive effect on that recovery at all. We can say that they increased our deficit. That is not in doubt. And that increased deficit *is* causing us economic problems. That is also not in doubt. So in order to counter the known negatives of that spending, you'd need to show some irrefutable proof of positive economic effects from the stimulus spending. But you haven't done that.

All you can do (all anyone can do) is plaintively insist that "it would have been worse". But the problem is that is you can't possibly actually measure the supposed positive effect of stimulus because you can't accurately say what the economy would have done absent the spending. Let's not forget that the Obama economic team completely failed to assess what the economy would do on it's own. They have to have. As I argued earlier, if they'd been able to accurately predict both the natural course of the economy *and* the effect the stimulus spending would have, then they would not have made such a horribly wrong prediction regarding the effect on unemployment.


After having gotten it so completely and demonstrably wrong back then, we're now supposed to trust them when they claim that things really were worse than they thought, and that instead of their recovery act making things better, as they predicted, it only managed to prevent some much much worse outcome? Why should we believe that? How can they possibly be trusted to make that claim, much less their assessments about jobs "created or saved" during that time period?


Isn't it possible that the initial estimates of the economic effects of the downturn were accurate? And instead of it actually being worse than they thought, what happened is that just as us conservatives predicted, the stimulus spending actually made things worse? Can't you even consider the possibility? Again, let's not forget that when the Dems were arguing for their stimulus bill(s), they were arguing "spend this and things will get better", while the GOP argued "if we spend this, things will get worse".


Weren't the GOP right? We spend that money, and things got worse. Maybe we should give a bit of credence to the guys who were right, and a heavy dose of skepticism to the guys who were wrong? Just a thought!



Try what again? Your argument makes no sense. There was no unemployment gain from the stimulus spending (and arguable a lot of loss). And GDP was at a low point. There was nearly no way to prevent it from coming back up. Taking credit for that is pretty ridiculous.



I'm kinda speechless here. This paragraph alone displays such a clear lack of understanding about the economics of the US in the 70s that it's hard to know where to start. Some serious revisionism there though, with the whole "economy proposed up on a war" bit. Really? You honestly think that the US economy was tied to Viet Nam? That's... insane.



I've already done so. The stimulus policies of the Obama administration caused more economic harm than the banking crisis which was used to justify it. Long after the banks have recovered, and long after the GDP rates go back up, and long after unemployment numbers return to normal, we will still be suffering negative economic effects from that spending. You're looking at the short term costs of a single economic downturn. But they happen, pretty much no matter what we do. And we tend to recover from them, also pretty much no matter what we do. But if we overreact to such things, and create a huge amount of new areas where we spend money, that cost will stay with us long after the initial need used to justify them has disappeared.

We nearly *never* eliminate social spending programs. The best way to limit their cost is therefore to not create them in the first place. The whole purpose of the Obama stimulus spending wasn't to fix the economic problems of the day, but to put that spending into place, knowing that it would become long term spending. There's a reason why that spending was focused on social stuff which the Dems have wanted for decades and not so much on actual stimulus.


You honestly can't see how some program that spends money over 10 years, or which doesn't start spending money for a couple years, or some combination of those two, can't possibly ever actually cause a stimulus effect for the economy? The only thing it'll do is weigh the economy down with debt. And that's *exactly* what that spending did. It's why our recovery has been so sluggish compared with other recessions.

Yes. But you're leaving out cause. As I already stated, those "errors" were directly caused by our government meddling in the housing market in order to make it look like poor people were able to afford to own homes, and then passed the cost of that meddling into the financial investment market via investment instruments they created and laundered through the GSEs.



That depends on what you mean by "improved"? Also, you're lumping two different things here. TARP and ARRA were completely different types of spending bills. Let's look at just ARRA (and other similar spending bills passed by the Dems and Obama). No one's debating TARP, so lets set that aside for the moment.

I don't think the economy has improved. Our GDP is better, yes. Unemployment is still high (and went higher after ARRA was passed). There's certainly no indication that ARRA had any positive effect on either of those. But the negative is the massive debt. That can be directly attributed to ARRA (and other stimulus spending during that time period). That is today having a huge negative effect on our economy.

Let me ask you a question: Do you think that lack of investment capital in the financial markets is today responsible for our high unemployment and sluggish economy? Or do you think that the biggest economic problem in the US right now is our massive deficit? Do you think that maybe the looming fear of higher taxes might just have a lot more to do with todays sluggish economy?


I think the answer is obvious, but I'd love to hear your answer.



Yes. I'm well aware of the "after/because" fallacy. Neither of those words mean "because". You are not arguing causation, but merely the order two things happened relative to each other. Just because something happened "after" something else, does not mean that it happened "because" of that other thing. It's common to use the "after" language though, because it allows one to imply causation, without actually making a statement which is factually incorrect.

In other words, it's a formation people use when they want to be deceptive.



No. I'm claiming that the stimulus spending passed in 2009 caused *different* events (effects would be the word I'd use), than the 2008 subprime investment collapse did.

The subprime collapse caused investments in the financial industry to suddenly lose value. Which left banks with insufficient capital to operate properly, which in turn affected all parts of the economy they interacted with. Without going into detail, this was "bad", but ultimately could be fixed by simply loaning money to the affected parts of the financial industry.

The stimulus spending spent massive amounts of money (and committed to future spending of yet more massive amounts). The spending itself is harmful because it lumped a ton of debt onto an economy that was struggling to recover. It also included mostly social spending rather than economically focused spending. That combined with constant rhetoric about raising taxes on the rich and big businesses, affected spending/investment choices by the very groups we most needed to jump back into the ring with their money once the banks recovered.


I don't know how to more clearly explain this to you. I really don't. The recovery act was exactly the wrong sort of spending at exactly the wrong time. If you accept that the economic downturn was caused by big banks and investors losing money, why assume that threatening those same people with higher taxes wont hurt the recovery? You need investors to put their money back into those very areas where we lost money before. But the recovery act hurt that.

And the debt alone is bad too.



Are you stupid? You already did this. Unemployment was worse *after* the recovery act was passed then it was during the height of the economic downturn. GDP growth was anemic at best during that time period as well. I keep explaining this to you, but instead of responding to my explanation, you keep re-asking the same question.

Let me be absolutely clear: Our economy tanked the most *after* Obama took office than it did before. And I believe that much of that was because of his economic policies, specifically the massive spending his party embarked on. If we had just passed TARP and nothing more, I don't think unemployment would have even hit 8%. I think that GDP recovery would have occurred a full quarter earlier. I think that the markets would have recovered much faster and continued recovering.


The real evidence is not in the quick up/down numbers immediately during/after the actual official recessionary period. It's in the sluggish recovery after that point. That's where the overspending has had its effect. And when you measure that compared to what the economy should have done, it ends out being much much much worse than the original economic collapse. At the time TARP was passed, almost no one outside the financial and housing markets had been directly affected by the collapse. With the passage of TARP, this should have stayed contained within those markets with a small amount of trickle into other industries.

It was because of the spending that other areas of the economy, which should not have been affected by the economic downturn at all, began under performing. Most directly, they began hiring freezes, not because business was bad, but because the spending would need to be paid for, and they would be the ones to pay.



Lol. How about just plain logic? We've already talked about the GDP and employment numbers. We presumably agree on the numbers themselves. Why do you need someone else to tell you what they mean?




Um... Because they have? Because those banks directly affected by the downturn in 2008 which didn't go bankrupt had more or less completely recovered (and paid back the TARP money) by early 2010? Every part of the economy *except* employment has recovered. GDP is still anemic, but that's largely because of the bad employment figures.

Do I need to link to some source showing this? I thought this was understood as a given. It's not like anyone's been calling for bailouts for our struggling banking industry for the last few years. This is why I keep saying that TARP fixed the actual problem. ARRA (and others) created a new problem. And that problem has been far more harmful to most people than the original financial collapse was.

Hell, most people's 401k's have completely recovered their lost value as well. Seriously. Have you actually looked at the financial stats lately? Everything is doing well except the actual employment and production. And that isn't because of the financial collapse back in 2008. It can't be. There's no logical reason for the banks and markets to recover, but for unemployment to still be so high and production so low.


There is, however, a very logical explanation for why companies might be producing less in the US *and* hiring less in the US. Could have to do with massive debt. It could have to do with a health care bill that's going to increase cost of employment. It could also have to do with eternally extended unemployment benefits which make it hard to hire people in certain salary ranges. And it could have to do with payroll tax cuts which have the effect of foisting *more* of the cost of employment onto the employer.


All of those things are direct results of Obama spending polices. That's why the economy is doing so poorly today. Has nothing to do with the collapse in 2008. That is over. It has been for at least two full years now. We should be fully recovered right now. Instead, we're no where near it. And that's the fault of the spending spree the Dems went on when they found themselves in control of both houses of congress, the white house, and a convenient economic crisis they could take advantage of in order to scare people into letting them do it.


Are you arguing that we're still suffering some direct economic effects from 2008? Where? What? How? That makes no sense at all.

Edited, Feb 27th 2012 6:46pm by gbaji

No, it didn't. I assume you're speaking of the economic recession caused by the S&L crisis in the early 90s? Funny that this was just a few years before the big economic boom of the late 90s. Clearly, it did not take a decade for our economy to recover from that. But then, we didn't embark on massive social spending to fix the symptoms of the problem.


Or were you referring to the Great Depression and pretending there have been no financial sector caused recessions since then? Want to know what our current economic condition has in common with the Great Depression? They tried to fix the economic problems with massive social spending programs back then too. And we conservatives today argue that it was because of that spending that it took a decade for the economy to recover (and it never really did until the post-WW2 period).


So imagine us making the same argument today when Obama proposes that we embark on massive social spending right after a financial collapse caused recession? Surely you can see why some of us might raise our hands and point out that this didn't work out so well back in 1929, so maybe we should avoid it this time around. You honestly don't see the pattern here? This "Great Recession" (as some are calling it) is so not because of the financial problems, but because of the similarly stupid social spending response causing horrible economic effects far out of scale with the original problem.




It's the same one you're pointing to. The problem is that you keep attributing the ongoing costs and deficits and anemic GDP growth to the initial financial problems back in 2008. I'm attributing those losses to the spending by the Dems in the name of "recovery" in 2009. When you add up the debt incurred because of that spending, it's massively more than the losses from the economic downturn itself.

Hell. If you want, I'll show you CBO numbers proving that 60% of our deficit increase over time period the between 2007 and 2010 has come in the form of increased spending and *not* decreased revenue. And if you want, I'll show how about half of the decreased revenue during 2009 and 2010 was actually spending from ARRA (in the form of tax credits).

I don't have the time to quote the relevant numbers and do the math right now, but I've posted this information in past threads. The numbers don't lie. The direct economic effect (at least in terms of government revenue and debt) from the economic downturn wasn't that large. The effect from spending increases and other stimulus related things has been massive.


Most of the negatives you attribute to the 2008 financial collapse are actually the result of the spending polices of the Dems in 2009. You just choose to pretend that the spending didn't have any harmful effects. But it clearly did. If we're going to count GDP, shouldn't we also count spending which consumes that GDP as well? You want to talk about $700B in lost GDP because of a downturn, but don't want to look at $3-$4 trillion dollars in increased spending during that same time period.


Guess what? One of those massively outweighs the other. And the financial downturn didn't have anything to do with the increased federal spending. That was a decision made by the Democrats when they took power in 2009.

Edited, Feb 27th 2012 7:21pm by gbaji

Recent history? Maybe. World economic history? No.

So you're talking about something you didn't reference? You said something about the last time the banking industry went tits up. And that was (in the US at least) in the early 90s with the S&L crisis). Heck. Technically, we might even look at the dot.com bubble collapse and financial hit from 9/11 as well, but that was more of a general market collapse rather than banking specific.

You're trying to wiggle the definitions to make your starting assumptions true. The reality though is that we've had a number of banking crises and semi-collapses since the Great Depression. Most of them have required nothing more than some quick loans to the banking industry to prevent collapse and ensure recovery. See. Cause banks tend to make money over time absent a current collapse condition. Fix the condition, the banks recover, and you get your money back.


What causes an economic crisis to turn into a "Great <whatever>", is when liberal governments attempt to spend their way out of the crisis. That usually creates a new problem which is much worse than the initial crisis. That's what happened in the Great Depression, and that's what's happening now.



You need a link to the ARRA wiki page? What would that accomplish? Do you think there exists some authoritarian source that you and I would both accept which would definitively state that "The recovery act caused more economic harm than the sub-prime mortgage collapse it was passed to help correct"? Of course there isn't. There isn't one that'll say the opposite either btw. So jumping up and down and demanding a source for an opinion of the relative effect of the recovery act is pointless.


I could just as easily demand that you provide a source proving that the mortgage collapse itself was more harmful than the stimulus bills passed by the Dems in 2009. Can you do that? With a source that I would accept? Of course not. So how about instead of demanding something that is useless, you actually engage your own brain and defend your own position?

That would be novel!



Ok. fine. There. I've provided you with a link to a government spending program which resulted in greater economic harm than the sub-prime mortgage collapse. See how that's useless? I believe it's more harmful. You disagree with me. How the hell does me just linking to it accomplish anything?

Sigh...



Now subtract the debt. Do you see the point yet? You're like someone who realizes that his monthly bills exceed his income by $100/month, so he just puts the extra on a credit card instead of reducing his expenses. Then he declares that he's fixed his budget problem!

Dumb. Dumb. Dumb. The long term effect of that spending will make that short term loss of economic activity during the actual recession resulting from the subprime mortgage crisis seem like a tiny little speed bump to our economy. You honesty don't realize this? Economic fortunes go up and down all the time. They tend to wash out over time and should only require the smallest amount of action to deal with them when they occur. Long term spending trends will massively dwarf those effects over time.


Increasing our federal spending from around 20% of GDP to around 25% is a significant increase. If we don't cut that spending, the long term effects will be incredibly huge. I just don't know how many different ways I can say this so that you might just understand one of them. If I increase spending by $700B/year every year from now until the end of time, the total negative effect on the economy will be much much larger than a one time loss of $700B over the course of a couple years. Surely, you can see this.