Monday, February 2, 2009

Blogging myself or Obamafuscation

Jim Pethokouskis from US News and World Report picked up my last blog entry and that brought in some mail and stimulated (ah yes Stimulus at last!) some behind the scenes dialog that has prompted some more thinking on the subject of stimulus and Obama.

As I have tried to explain the conclusions I came to, I have made some new discoveries about what I think is going on.

This plan is purposeful obfuscation, call it Obamafuscation.

Obama-Rama
Obama-rama (as I like to call it) features two goals: speed and punch. Obama is pushing for speed faster than George W. Bush trying to jam his Iraq War bill though Congress. Even more important (perhaps?) he is pushing for punch. Spending has more of it than tax-cutting since the multiplier is larger. So spending it is...or is it?

A Hallmark moment: belated stimulus...
The spending multiplier is bigger. Every introductory economics student knows this about the spend Vs tax cut multiplier, just as preschoolers know the alphabet song: A, B, C, D, E, F, G... Spending money packs more punch than untaxing me... Ah, but the CBO has scored the House plan as leaving about one third of the stimulus from this plan to after 2010. That's two years in the future!! What do we want! Stimulus? When do we want it? Now! So what is this? Does the administration go to Hallmark and buy us taxpayers a belated stimulus card? Dear taxpayers: Happy but belated stimulus!!! Signed Barack and Michele!

I WANT IT ALL!!!
What do you do when speed and punch conflict? This is no Muhammad Ali plan (float like a butterfly, sting like a bee). It's more like float like a lead balloon, bite like a flea. It seems when these goals conflict, the Obama guys spring in favor of spending. Why? I think it is because the secret plan is to control the outcome. If you give tax cuts as your main stimulus, you lose control of how monies are spent. If you do the spending, you control where and how money is spent. You get $X of stimulus and you get it where you want it right there in your favorite agenda projects.

Who's on First?
Now that suggests another hierarchy in choice. You can choose to whom to give money or how to spend it. While the Obama-rama plan has some tax cuts that do target certain people, the larger spending portion will target 'what' instead of 'whom'.

President as Sacred Cow
There are clandestine choices that underlie the spending plans that no one has been able to rationalize. We do not have a good enough map of the spending to truly know what it is. And anyone who disagrees with the new president is branded as nearly a triator. Hey hold on about closing down Gitmo after all.

Nothing up my sleeve...
Barack has begun his first foray into policy with a plan that is either a hopeless muddle or a brilliant piece of politics that no one can understand or oppose. He has dedicated his stimulus plan to conflicting goals allowing him and his staffers to switch back and forth like the guy doing three card Monte on Broadway- oh 'scuse me that was an investment banker!

The truth lies somewhere. Unfortunately in this administration it appears to be buried about as deeply as it was in the last administration.

Call it Obamafuscation.

6 comments:

Anonymous said...

More opinion than fact, methinks.

Mike S. said...

About 50% of the nation knew it when we didn't vote for him: Obama lacks good judgement. He is a nice, Hollywood fella some would call witty or clever, but his judgement is dangerous. And it is our punishment for the next four horrible years (hopefully no more than that) of him and his idiot co-horts in Congress.

T-Bone said...

Are you saying the first 2/3 of the spending isn't sufficient stimulus?

Because it seems natural that some of the spending items would take a while to complete, but it doesn't mean it's a bad idea to start now. Should we throw out good long term projects just because the spending is spread out over a 10 year period rather than started and completed in the first 2 years?

And I suppose the thousands of police, firefighters, FBI, and homeland security agents hired in the stimulus won't be fired in 2 years.

As I understand it, this budget projects to 10 years time. And the amounts in those last 8 years are substantially lower than the first 2 years (or as you say, 1/3 of the spending occurs over the last 8 years, and 2/3 occurs in the first 2 years). If I recall correctly, the numbers in the last 8 years are pretty stable from one year to the next.

So aren't those later year items just continuances of items that have started in the first 2 years? We don't leave bridges and buildings half built, right? I mean, it's not like stuff in the bill is scheduled to START in the latter 8 years. If that were the case, then I'd see reason to object. But otherwise, you're arguing that no long term projects should be undertaken now. I'd argue just the opposite... that now is the perfect time to start.

Anonymous said...

Red, white or black? What kind of nonsense is that? Wake up! It's way too late to stop spending. We should have thought about that a decade ago. We will inflate our currency until the rest of the world has the balls to say enough is enough. When China and Japan say hey, it's not the American taxpayer who is getting screwed, it's us, then the game ends. Everyone takes a hit and we have a new global currency under one international bank to which all central banks will answer. It is that simple. That's when the lunacy will end. Our standard of living will decline and the Japanese, Arabs and Chinese and will once again buy up America. Better to spend it than to lose it.
Arthur Narverud

adrian said...

I can't believe that crap like this has ended up being picked up for google news story attachment... pure conservative garbage... who let you out of your cage and on to the web?

QUALITY STOCKS UNDER 5 DOLLARS said...

Obama has had his chance.