Wednesday, August 17, 2011

Economists for Obama no Longer Advocating for Obama...

Economists for Obama reacts to the debt-deal with this:
Yuck.

That's what I have to say about President Obama's capitulation to the hostage-taking ways of congressional Republicans.

I suppose I might change my mind, but after watching the President give in to the Boehner-McConnell blackmail axis, I don't imagine I'll be spending much of my time advocating his re-election. Assuming he's the Democratic nominee, which I do, I'll vote for Obama, because the alternative will still--somehow--be worse. But I really can't see how, in good conscience, I could defend the economic policies of a guy who has signed on to fiscal contraction in the midst of a major downturn. And that's leaving aside the President's apparent lack of understanding of the importance of bargaining from strength. So much for all that poker expertise he's supposed to have.

What a shame.
I think this is completely wrong-headed. Although I think Obama could have gotten a better deal, and should not have agreed to this, one of the key details is that it cuts budgeting authority by just $22 billion in 2012. That should reduce GDP growth by just .3 percent. Obviously, that's not the direction we want to move in, but that alone should have limited impact. My sense is that anything after 2012 will need to be ratified by future Congresses. I'm not really clear on how much "inertia" the deal will create, but I don't see how this deal is grounds to dramatically reinterpret one's support for Obama. The President could likely have gotten smaller cuts in 2012, but would have been really hard-pressed to get a small increase. Should the president have threatened default over $20 billion in 2012 spending? That seems like a judgment call...

The other issue here is, say Obama had gotten $100 billion in stimulus spending. I suspect, in that case, the Fed would not have changed its language at the last meeting (after which, two year Treasury yields plummeted). In short, not clear that fiscal policy mixed with a Fed that just isn't willing to play ball is the answer here.


11 comments:

  1. This is a wonderful article, So much info given in it, These type of articles keeps the users interest in the website, keep on sharing more... good luck. Wallet passbee Media

    ReplyDelete
  2. I really like to posting such details in according well analysis tips and resourceful information.This is a great time to make such investment.
    Assignment Writing Service UK

    ReplyDelete
  3. Obama don't think about these things he is an intelligent person he know well what to do.

    Buy Essays Uk

    ReplyDelete
  4. In politics very few people are sincere with their duties and responsibilities the rest of them only enjoys their period of rule.

    Buy Custom Law essay

    ReplyDelete
  5. Mẹo chọn quà 8/3 đơn giản không phải ai cũng biết dưới đây,với Mẹo chọn quà 8/3 các đấng mày râu có thể “tạm biệt” lúng túng...


    Vệ sinh cơ thể sai cách khiến vi khuẩn tấn công như hành động gội đầu mỗi ngày, đánh răng ngay khi thức dậy,xem Vệ sinh cơ thể đúng cách


    Quần bó là xu hướng thời trang được nhiều bạn gái ưa thích, bởi những đặc tính riêng của nó. Tuy nhiên, việc mặc thường xuyên sẽ mắc phảinhững căn bệnh không ngờ khi mặc quần bó.

    ReplyDelete
  6. IPL 2017 Useful and well written post. Thanks for the share. Continue your good work

    ReplyDelete