It’s Finally Happened: Obama Has Driven the Pundits Insane!

samuelson

Sure, these two guys were a little nutty to begin with, but now they’ve gone around the bend.

First up: Have you seen the latest drivel from Robert J. Samuelson? Seriously, even the Washington Post should be ashamed to publish this guy. Get this — Samuelson says that sequestration is John F. Kennedy’s fault!

How so?

Fifty years ago, President Kennedy made a decision that, with hindsight, ranks as the biggest mistake of domestic policy since World War II. In many ways, it led directly to today’s “sequester” debacle.

Good Grief! What’s he talking about? The Bay of Pigs? The Cuban missile crisis?

No silly, President Kennedy decided to stimulate the economy.

In early 1963, he proposed a $13.6 billion tax cut (today: about $320 billion) even though the economy was not in recession and the tax cut would enlarge the budget deficit. Kennedy adopted the theory that government could, by manipulating its budgets, increase economic growth, reach “full employment” (then a 4 percent unemployment rate) and reduce — or eliminate — recessions.

It was a disaster.

High inflation was the first shock. An initial boom (by 1969, unemployment was 3.5 percent) spawned a wage-price spiral. With government seeming to guarantee 4 percent unemployment, workers and businesses had little reason to restrain wages and prices. In 1960, inflation was 1 percent; by 1980, it was 13 percent. The economy became less stable. From 1969 to 1982, there were four recessions, as the Federal Reserve alternated between trying to push unemployment down and prevent inflation from going up. Only in the early 1980s did the Fed, under Paul Volcker and with Ronald Reagan’s support, crush inflationary psychology.

JFK tax cut

A disaster? Really? I was a kid in the 1960s. The economy was great in those days–until 1973, those were the best economic times I’ve experienced in my lifetime. Unemployment was low, wages were good, people like my parents were movin’ on up to the middle class. But don’t take it from me–let’s see what an actual economist has to say about this. Here’s Dean Baker at the Center for Economic Policy Research (CEPR):

Samuelson’s economic history is even more striking than the linking of Kennedy to the sequester. He notes the fiscal stimulus that was sparked by the Kennedy tax cuts (and the Vietnam War and Johnson’s Great Society programs) and the boom that resulted, and tells us that “it was a disaster.”

….

Before looking at Samuelson’s horror story here, it is worth noting what happened in the boom, which can be treated as going through 1973, in spite of the recession in 1969. Growth over the 10 years from 1963 to 1973 averaged 4.4 percent, by far the most rapid stretch in the post-World War II era.

The unemployment rate hovered near 4.0 percent for most of this period, as Samuelson complains. This led to large gains in real wages and sharp declines in poverty. The overall poverty rate fell from 19.5 percent in 1963 percent to 11.1 percent in 1973, an all-time low. For African Americans the poverty rate fell from 55.1 percent in 1959 (annual data is not available) to 31.4 percent in 1973. I suspect most folks wouldn’t mind a few more disasters like this one.

As far as the recession story, Samuelson might have told readers that we had the same number of recessions in the 13 years following 1969 as we did in the 12 years preceding 1961. I suppose those recessions were also due to the Kennedy tax cut.

There’s lots more at both links. But you have to read Samuelson’s column to believe it. He goes on to claim that because of JFK’s tax cut, we developed “the loss of budgetary discipline,” and we’re still suffering from that 50 years later. So how does he rationalize the deficit spending under Reagan and W. Bush? He doesn’t.

And over at The New York Times, Iraq War propagandist Bill Keller disagrees with Samuelson: he thinks sequestration is “Obama’s Fault.” And of course he’s still droning on about “entitlements.” Keller admits that both parties agreed on the sequestration cuts, but it’s still really Obama’s fault because he hasn’t completely destroyed the safety net yet. And here’s the best part: Obama refuses to enact Simpson Bowles.

11keller

In December 2010 the commission, led by Erskine Bowles and Alan Simpson, delivered its list of spending cuts and revenue increases, plus the entitlement reforms necessary to fortify Medicare and Social Security for the surge of baby-boom retirees.

The Simpson-Bowles agenda was imperfect, and had plenty to offend ideologues of the left and right, which meant that it was the very manifestation of what Obama likes to call “a balanced approach.”

Ummm…no, Bill, the Commission never issued a report. They couldn’t agree on a unified agenda, so Simpson and Bowles wrote up their own report which was never approved by the commission members.

Now here’s where Keller really goes off the rails:

If Obama had campaigned on some version of Simpson-Bowles rather than on poll-tested tax hikes alone, he could now claim a mandate from voters to do something big and bold. Most important, he would have some leverage with members of his own base who don’t want to touch Medicare even to save it. This was missed opportunity No. 1.

That’s really funny. If Obama had campaigned on Simpson-Bowles, Mitt Romney would be president now. Because if you campaign on really really unpopular issues, people have a tendency to like, not vote for you.

There’s much more at the link, but you get the idea.

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54 Comments on “It’s Finally Happened: Obama Has Driven the Pundits Insane!”

  1. RalphB says:

    I am more convinced every day that virtually all our media are owned by the 1% and they are doing their master’s bidding. Either that or they really are the stupidest, most ill-informed people on earth.

    They should pick one and, either way, crawl under a rock for the duration. I despise them!

  2. RalphB says:

    Dave Weigel: The GOP’s Smartly Incoherent Messaging on Spending Cuts

    I really hope voters aren’t stupid enough for this to succeed. Pundits will believe it though.

  3. mjames says:

    You know, maybe they’re getting desperate. They sure sound desperate. They keep spouting the same nonsense over and over, but more frequently and at higher decibels. Like, if they keep yammering at us, we’ll fold. But nobody – except the 1% – is buying. Well, we don’t have any money to buy anything anymore, including their counter-intuitive “solutions” that would make us all serfs, and we damn well know why. Woodward? Samuelson? Keller? Cokie Roberts? What a menagerie of fools.

    • dakinikat says:

      They mansplain to us every time they’re on the air.

    • RalphB says:

      You can almost smell the desperation at this point. If it doesn’t work soon, maybe Pete Peterson will stop paying for all this shit or die leaving them looking for another big sugar daddy?

      I heard that Paul Krugman and Morning Ho are going to debate tonight on Charlie Rose, if anyone has the stomach for it.

      • bostonboomer says:

        That could be interesting unless Charlie Rose senses that Krugman is straying too far from the approved village narrative.

      • NW Luna says:

        Krugman must feel like he’s beating his head against a wall when he gets interviewed on TV. Yet again to try discussion with those over-groomed, brainless persons who smile brightly and blather while the rest of the us see our incomes and retirement funds erode. Aygh! Too painful to watch.

      • RalphB says:

        Every word out of Krugman’s mouth except “hello” is far from the village narrative. Rose will have a hard time controlling him, if he gets to speak at all.

      • bostonboomer says:

        Did you guys know that “the market wants more austerity?”

        … although experts estimate that sequestration could cost the country about 700,000 jobs, Wall Street does not expect the cuts to substantially reduce corporate profits — or seriously threaten the recent rally in the stock markets.

        “It’s minimal,” said Savita Subramanian, head of United States equity and quantitative strategy at Bank of America Merrill Lynch. Over all, the sequester could reduce earnings at the biggest companies by just over 1 percent, she said, adding, “the market wants more austerity.”

      • RalphB says:

        Well, Wall St and Main St are almost completely separated now.

      • dakinikat says:

        This is so eerily looking like what Lenin wrote about it’s not even funny. And he thought the guilded age monopolists and banksters were bad!!!

      • dakinikat says:

        There are a few people that I really wish would drop dead … Scalia and Thomas and Pete Peterson are right up there on my list.

      • dakinikat says:

        http://www.huffingtonpost.com/2013/03/04/joe-scarborough-paul-krugman_n_2805439.html?utm_hp_ref=tw#slide=1443436

        Scarborough knows about as much about economics as a blowfish knows about brain surgery so it’s hardly going to be a debate. More like Krugman schooling a blathering idiot.

      • ANonOMouse says:

        “Wall Street does not expect the cuts to substantially reduce corporate profits”

        Well of course they don’t because they will use the fear factor to cut wages, turn corporate employees into contract workers or temp workers who don’t get benefits or OT, and then squeeze more out of the workers who remain on the corporate payroll for less money using the “YOUR JOB IS ON THE LINE” or “THERE ARE PEOPLE WHO ARE WAITING IN LINE FOR YOUR JOB” threat. And when that ceases to work they’ll just offshore more of the work or use inferior materials in their products. They don’t care how many people can afford to buy their product as long as they can maintain their profit margins. As soon as they squeeze all of the juice out of the orange they’ll file bankruptcy, make a shitload of money in the process and move that money to the Caymans.

        Isn’t that how it works????? I’ve seen that model, in fact I’ve been one of the victims of that model

      • jawbone says:

        Re: Wall Street welcoming unemployment and furloughs because Big Bidness is doing so wll brings us full circle to the stock market shooting up on news of layoffs and downsizing back in the day.

        They do not see themselves as part of the same economy as we in the lower economic quintiles exist in.

        But — they’ll take all the “stimulus” they can wheelde or threaten out of Washington.

        If it goes to them, it is good; if anything goes to us, it’s bad.

      • ANonOMouse says:

        “Most of the big companies have gone overseas for customers by now. They could care less about the US”

        Agree!!!

    • ANonOMouse says:

      Hey, I just figured out How Seniors were determined to be the largest share of wealth holders in the U.S. Look at the number of U.S. Senior Citzens, 60 years or older, on the Forbes List of World Billionaires. Yeah, their wealth trickles down to us for statistical purposes, but not in reality.

      http://www.forbes.com/billionaires/#page:6_sort:0_direction:asc_search:_filter:All%20industries_filter:All%20countries_filter:All%20states

  4. bostonboomer says:

    Hilarious WSJ op-ed by some guy from the AEI: Republicans and Their Faulty Moral Arithmetic

    He’s focusing on a real problem, but his solutions are wacky.

  5. dakinikat says:

    The Rude Pundit ‏@rudepundit

    Mitt Romney Is a Blithering Dick: http://shar.es/jKKZZ

  6. dakinikat says:

    Charles P. Pierce ‏@ESQPolitics

    The Job Creators Are Not Creating Jobs http://esqm.ag/6013nwRd

    It’s not often that you see an entire putative political philosophy dropped from a high building until it splatters on the concrete and feral dogs and cats come to lick up that which remains, only to stagger off gagging and puking because not even they can stomach it any more. For going on 30 years now, but especially ever since That Person got himself elected twice, it has been the stated Republican economic faith that the reason that job growth is sluggish is because the Job Creators are “uncertain” about what That Person is up to there in the White House and that if we just knuckled some poor people and some old people a little, the job creators would give the country many good jobs at very good wages, even though there was absolutely no force strong enough any more to make them do it.

  7. HT says:

    Hate to be cynical (although it’s becoming a habit) but DDSS. That would be different day, same shit. The media as it is today would not know what used to be a “scoop” if it came up and bit them in the arse. They are fed their issues, check in and do not do any journalism. Basically they are secretaries.

    • ANonOMouse says:

      All the secretaries I ever knew were basically the most well informed, efficient and productive employees in the company.. So today’s media would be more like the slimey green shit that floats on top of the pond, I think it’s called, pond scum! :-)

      • HT says:

        Mouse, I should have thought more thoroughly before the comparison to secretaries. You are absolutely right and any efficent secretary would be insulted to be compared to today’s toadies masquerading as “journalists”. Speaking of toadies, they are more alike to Toad from “Wind in the Willows” with one exception. Toad is actually likeable.

  8. janey says:

    It always amazes me that the financial pundits never consider the wars in talking about booms and busts and taxes. The Vietnam war probably was what put the brakes on the growth that Kennedy started. Look what two wars have done to our economy.

    • jawbone says:

      The wars….or the massive transfer of wealth to the Tippy Top of the One Percenters. What they don’t get, the lower echelon One Percenters get.

      • jawbone says:

        Oh, and, like, the massive unemployment becoming endemic to this nation.

        Raising taxes on the rich would have affected the economy adversely, per the pundits,, but, somehow, our MCMers and pols don’t see huge numbers out of work for extended periods as affecting the eocnomy.

        Now, that is so dumb as to be a total confirmation of the Upton Sinclair quote, that it’s hard to make a man understand something when his salary depends on his not understanding it.

    • RalphB says:

      Don’t leave out the huge price spikes due to oil shocks which kicked off all that inflation. Take them out and we’d be doing much better today. The massive corporate thievery started then, I believe, because of the availability of ready excuses.

  9. jawbone says:

    Charlie Rose is one of the NYC branch of the DC Very Serious People. He will do whatever is necessary to curtail Krugman speaking truth to the public.

    I’ve totally dropped him from my TV watching; he’s just too bought and sold out.

    Good luck, Paul!

    I fear Charlie will suck up to Joe and let him fillbuster, talk over you, fill the studio with the chaff of lies and half truths.

  10. Joanelle says:

    Well, we’re seniors and certainly not close to wealthy. I found this on TED – tak about how wealth is divided in the good old US of A.

    https://www.youtube.com/watch?v=QPKKQnijnsM&feature=player_detailpage

  11. bostonboomer says:

    Robert Kuttner: Economy Sick, Politics Deadlocked? How About a Trade Deal!?

    You don’t know whether to laugh or cry. This is a classic case of changing the subject to a cause that will not address any of the economy’s deeper ills and could well worsen them.

    It recalls the very old joke about the drunk looking for his keys under a lamp post. He mentions to a cop that he lost the keys somewhere else, but “this is where the light is.”

    Bipartisanship is not doing so well this season, but the one thing that Republicans and Wall Street oriented Democrats can agree on is more free trade deals.

    The fact is that there is already massive trade between the U.S. and Europe — about $650 billion last year, an increase of two-thirds just since the turn of the 21st century. Tariffs are already at very low levels.

  12. RalphB says:

    Paul Krugman: Urk, Charlie Rose Edition

    Well, we’ll see how it comes out after editing, but I feel that I just had my Denver debate moment: I was tired, cranky, and unready for the blizzard of misleading factoids and diversionary stuff (In 1997 you said that the aging population was a big problem! When Social Security was founded life expectancy was only 62!) Oh, and I wasn’t prepared for Joe Scarborough’s slipperiness about what he actually advocates (he’s for more spending in the near term? Who knew?)

    A useful reminder, I guess, not to take anything for granted. But I’d rather not learn my lessons with the camera rolling.

    Update: By the way, considering how things eventually turned out, having a Denver moment isn’t the worst thing that can happen. Ask Mitt Romney.

    This is a bit of a surprise only in that Krugman wouldn’t be prepared for a politician to lie in his face about his beliefs for debate purposes.

    • dakinikat says:

      Yup, but how are you supposed to know which lies he’ll use?

    • dakinikat says:

      http://www.politico.com/story/2013/03/morning-joes-accuracy-deficit-88376.html?hp=f3

      Opinion: Morning Joe’s accuracy deficit
      By ALAN S. BLINDER | 3/4/13 2:09 PM EST

      In POLITICO on February 15th, Scarborough invoked me as being on his side of the debate — which was news to me. While there are nuances of difference between my views on the budget issue and Krugman’s, and notable differences in rhetorical style, our positions are broadly similar. I’m probably a tad more hawkish than my colleague, but there’s not much distance showing between us.

      So why had Scarborough declared me a deficit hawk?, I wondered when someone informed me of the alleged schism within the Princeton economics department.

      BAZINGA!

  13. RalphB says:

    TP: Theatrical Slut Shaming: Daily Caller Attacks Ashley Judd For Nude Scenes

    Republocans may really fear Ashley Judd after all.

    • HT says:

      Isn’t Depends guy Vitter a Republican? The party may want to reconsider going this route when they have so man closeted secrets and uncloseted scandals.