Romney tax cuts explained in graphic form

October 18, 2012

From Cut-‘n’-Edge Cartoons, an explanation for just exactly how Mitt Romney’s tax cuts work in the economy:

Romney's tax cuts explained, Cut-n-Edge Cartoons

Cut-n-Edge Cartoons

With this exception:  This chart does not show the flow of funds from the rich to the Cayman Islands and Swiss banks.

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We stopped dreaming: Tyson reprise on science policy and spending

October 18, 2012

A more melodic take on Neil de Grasse Tyson‘s “we stopped dreaming” statement:

“We went to the Moon, and we discovered Earth.”

Description from the YouTube site, by Evan Schuur:

The intention of this project is to stress the importance of advancing the space frontier and is focused on igniting scientific curiosity in the general public.

Sign the petition!: http://www.penny4nasa.org/petition
Follow @Penny4NASA1 and like on Facebook!

Episode 1:
http://youtu.be/CbIZU8cQWXc
Copyright Disclaimer Under Section 107 of the Copyright Act 1976, allowance is made for “fair use” for purposes such as criticism, comment, news reporting, teaching, scholarship, and research. Fair use is a use permitted by copyright statute that might otherwise be infringing. Non-profit, educational or personal use tips the balance in favor of fair use. All copyrighted materials contained herein belong to their respective copyright holders, I do not claim ownership over any of these materials. In no way do I benefit either financially or otherwise from this video.

MUSIC: http://itunes.apple.com/us/album/samskeyti-acoustic/id452812943?i=452813003

Credits
The Space Foundation http://www.spacefoundation.org/
NASA TV http://www.nasa.gov/multimedia/nasatv/index.html
HDNET http://www.hd.net/
SpaceX http://www.spacex.com/
When We Left Earth: The NASA Missions http://dsc.discovery.com/tv/nasa/nasa.html
Disneynature: Earth http://disney.go.com/disneynature/earth/
Planet Earth http://dsc.discovery.com/tv/planet-earth/
HOME Project http://www.youtube.com/user/homeproject
User WolfEchoes http://www.youtube.com/user/WolfEchoes?ob=0
European Southern Observatory http://www.eso.org

Is NASA a handout, or an investment?  What do you think?

If a politician tells you that he or she thinks we cannot afford NASA, doesn’t it strike you that the person does not really understand what the United States is all about?  Doesn’t it make you wonder how they ever got to Congress, or why they should stay there?

More: 

Dr. at the November 29, 2005 meeting of the NA...

Dr. Neil de Grasse Tyson at the November 29, 2005 meeting of the NASA Advisory Council, in Washington, D.C. (Wikipedia photo)


Bagley, on what terrifies the Taliban

October 15, 2012

Here’s the editorial cartoon that should win the Pulitzer for Pat Bagley of the Salt Lake Tribune, this year:

Pat Bagley, Salt Lake Tribune, October 2012

Pat Bagley, Salt Lake Tribune, October 2012

Pat Bagley, Salt Lake Tribune, What terrifies religious extremists like the Taliban

Pat Bagley, Salt Lake Tribune

Perhaps Bagley has a few he could enter in the Ranan Lurie UN cartoon judging, too.

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What if Mitt Romney were Latino? Or gay? Or a woman?

October 15, 2012

Would things really be easier for him in the election?

Here’s Rosie Perez, thinking through the possibilities. From Actually.org.

Mitt thinks he’d have a better chance of become president if he was Latino. In the first video of the Actually… series Rosie Perez explains why it will take more than being Latino for Mitt to win the election.

When lies go unchecked, we all lose. Actually.org spreads the truth, because the truth matters—even in politics. Our team calls ’em like they see ’em, and we hope you’ll support the truth by sharing Actually.org videos before Election Day.

Actually… is a partnership between American Bridge and JCER. Schlep Labs is a project of JCER. Actually… was produced by Amy Rubin at Barnacle Studios
http://blog.barnacle.is

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Here’s a fine kettle of apples you’ve gotten us into . . . cheapskate

October 14, 2012

Apples are an all-American success story-each ...

Apples are an all-American success story-each of us eats more than 19 pounds of them annually. Photo credit: Wikipedia

Noticed any increase in food prices yet?

Here in Texas, all meat prices are up, but especially beef.  Beef ranchers in Texas sold off their herds because they couldn’t feed them during the drought, except with very expensive imported hay.  That held prices down for a while, but now there is a lot less beef to be bought.  Prices rise.

Drought also hammered corn crops this year, and last year.  To keep corn markets growing, corn state legislators had gone whole hog into using corn for alcohol to be added to gasoline.  That demand didn’t drop with the crop decreases, however, and we’ve been hearing for months how corn-into-alcohol pressures food markets.

Lucio Machado picks Golden Delicious apples in a Washington orchard.  Goodfruit.com

Lucio Machado picks Golden Delicious apples in a Washington orchard. Goodfruit.com

Drought hammers our fruit crops, too.  Comes now news from Washington state about the added wrinkle:  Washington’s apple crops bend the tree boughs — who will pick them?

Two key problems:  First, the crackdowns on immigrant workers reduced supply dramatically.  Second, citizens or documented workers find higher pay in the turnaround in construction.

Result:  Apples may stay in the trees, boosting apple prices to consumers.

Wholly apart from the foolish denial that we need to do something about global warming, the added policy flaws of shutting off immigration flow on the chuckle-headed and wrong assumption that immigration hurts the economy, and the continued denial of our too-modest economic recovery, will now cost you money directly at the supermarket.

The Wall Street Journal reported:

PASCO, Wash.—Washington state is enjoying the second-biggest apple crop in its history, but farmers warn they may have to leave up to one-quarter of their bounty to rot, because there aren’t enough pickers.

“I’m down 40% from the labor I need,” said Steve Nunley, manager of a 3,000-acre apple orchard for Pride Packing Co. in Wapato, Wash. Mr. Nunley said he has 200 pickers right now, but needs close to 400. He has increased pay to $24 for every 1,000-pound bin of Gala apples they pick, compared with $18 last year. Even so, he expects to have to let tons of fruit fall unpicked this season.

Washington’s bumper crop, forecast at 109 million boxes of Red Delicious, Gala, Granny Smith and other varieties, comes as drought and poor growing conditions have led to dismal harvests in parts of the U.S. Michigan lost much of its apple crop this year, and poor conditions have depressed the yields in New York state and North Carolina.

And:

But Washington’s farmers can’t fully cash in on their good fortune. The national crackdown on illegal immigration has shrunk the pool of potential farm workers in the state, while at the same time, the modest economic rebound has given immigrants more opportunities than before in construction, landscaping and restaurants.

*   *   *   *   *

Not far away, outside a church in Pasco, a migrant from Mexico’s Michoacán state, 47-year-old José Carranza, said he planned to skip the fruit harvest this year. Mr. Carranza believes he can do better in construction work, which is picking up.

How bad is it, really?  Take a look at several other pieces on this issue, recently:

How much additional will you be paying for goods this year because of GOP “we-can’t-afford-to-be-great-anymore” policies, or racist immigration policies?  Will your modest tax cuts offset that expense?

Perhaps we should pay a bit more in federal money to help fix the real problems, and stop pretending that the price of everything is the same as the cost.

You know the aphorisms:  A conservative economist is a person who can tell you price of any item or service, but doesn’t know the value of education, parenting, or good social structure, and ignores the costs of doing nothing.

And the Tom Magliozzi Law (of the Car Guys):  The cheapskate always pays more.

Studies from the Federal Reserve indicates immigrants boost our economy greatly; making life tough for immigrants, or hoping they’ll “self-deport,” damages our economy.

How’s that applesauce?

More:


School House Rock update: Reforms on “I’m Only A Bill,” the story of making laws

October 12, 2012

Remember the old School House Rock?  Disney finally put all of the old episodes out on DVD and Blu-Ray.  Short songs with animation explaining grammar (“Conjunction Junction”), or math, or history, or economics.

Schoolhouse Rock!

Schoolhouse Rock! (Photo credit: Wikipedia)

One of the most popular was a later production that explained how a bill becomes law in the U.S. Congress, “I’m Just A Bill.”  You may remember how it was parodied by The Simpsons, too, and others.

It’s been updated by Fiore, now including the influence of the “American Legislative Exchange Council,” or ALEC, a Koch-brothers funded frat for conservative state legislators:

Maybe not suitable for elementary school classrooms; probably too violent for high schools, too.

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823 Texas school boards say they are “anti-testing”

October 12, 2012

Political consultant and columnist Jason Stanford out of Austin Tweeted an interesting note today:  823 school boards in Texas now have passed resolutions opposing “over-reliance on high-stakes testing.”

From the Texas Association of School Administrators (TASA) website:

Testing Resolution Update

Submitted by Alberto Rivas on October 11, 2012

As of October 11, 823 school districts representing more than 4.3 million students have notified us that they’ve adopted the testing resolution opposing the over-reliance on high-stakes testing. That’s 80 percent of Texas school districts and 88 percent of all Texas public school students.

If you believe the current testing system is strangling our public schools, imposing relentless test preparation and memorization and is stealing the love of learning from your students, then we encourage you to present the resolution to your board for consideration. You can use the sample resolution as written or modify it to meet your needs.

See the list of districts that have adopted the resolution.

Here’s the text of the sample resolution:

WHEREAS, the over reliance on standardized, high stakes testing as the only assessment of learning that really matters in the state and federal accountability systems is strangling our public schools and undermining any chance that educators have to transform a traditional system of schooling into a broad range of learning experiences that better prepares our students to live successfully and be competitive on a global stage; and

WHEREAS, we commend Robert Scott, former Commissioner of Education, for his concern about the overemphasis on high stakes testing that has become “a perversion of its original intent” and for his continuing support of high standards and local accountability; and

WHEREAS, we believe our state’s future prosperity relies on a high-quality education system that prepares students for college and careers, and without such a system Texas’ economic competitiveness and ability to attract new business will falter; and

WHEREAS, the real work of designing more engaging student learning experiences requires changes in the culture and structure of the systems in which teachers and students work; and

Whereas, what occurs in our classrooms every day should be student-centered and result in students learning at a deep and meaningful level, as opposed to the superficial level of learning that results from the current over-emphasis on that which can be easily tested by standardized tests; and

WHEREAS, We believe in the tenets set out in Creating a New Vision for Public Education in Texas (TASA, 2008) and our goal is to transform this district in accordance with these tenets; and

WHEREAS, Our vision is for all students to be engaged in more meaningful learning activities that cultivate their unique individual talents, to provide for student choice in work that is designed to respect how they learn best, and to embrace the concept that students can be both consumers and creators of knowledge; and

WHEREAS, only by developing new capacities and conditions in districts and schools, and the communities in which they are embedded, will we ensure that all learning spaces foster and celebrate innovation, creativity, problem solving, collaboration, communication and critical thinking; and

WHEREAS, these are the very skills that business leaders desire in a rising workforce and the very attitudes that are essential to the survival of our democracy; and

WHEREAS, imposing relentless test preparation and boring memorization of facts to enhance test performance is doing little more than stealing the love of learning from our students and assuring that we fall short of our goals; and

WHEREAS, we do not oppose accountability in public schools and point with pride to the stellar performance of our students, but believe that the system of the past will not prepare our students to lead in the future and neither will the standardized tests that so dominate their instructional time and block our ability to make progress toward a world-class education system of student-centered schools and future-ready students;

THEREFORE BE IT

RESOLVED that the ___________ ISD Board of Trustees calls on the Texas Legislature to reexamine the public school accountability system in Texas and to develop a system that encompasses multiple assessments, reflects greater validity, uses more cost efficient sampling techniques and other external evaluation arrangements, and more accurately reflects what students know, appreciate and can do in terms of the rigorous standards essential to their success, enhances the role of teachers as designers, guides to instruction and leaders, and nurtures the sense of inquiry and love of learning in all students.
PASSED AND APPROVED in this _____ day of _____________, 2012.

823 school districts in Texas, looking out for 4.3 million students.  The Texas Lege mostly represents the Tea Party against the People of Texas these days; don’t look for quick action.

Is your school district one of the 823?

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Biden/Ryan Klash in Kentucky: Transcript

October 11, 2012

I didn’t see the whole debate, but from what I saw, it was different this week.  Obama’s problem was that he didn’t expect to have to nail Jello to a tree, and didn’t; tonight, Biden nailed the Jello, made it stick on the tree, and made it bleed.

Does the full transcript show that?  ABC already has a transcript upNPR has one, too.

And The New York Times, of course. Newspaper of record.

Here’s a twist:  ThinkProgress adds fact checking to the transcript.

What THEY said to expect:


Ben Stein off the rails again

October 10, 2012

Ben Stein is nominally a smart guy, with a degree in economics and a law degree and enough moxie to wangle his way into the movies . . . lives a sort of a charmed life.

Ben Stein

Ben Stein

Which may be good on one hand, because he runs off the rails sometimes.  Bad on the other hand if others follow him off the rails, assuming he’s smart and knows where he’s going.

Stein’s latest droppings at American Spectator include this gross misunderstanding of the drive for justice and equality (all links added here):

But right now, which is Sunday, I am looking in my favorite book, Bartlett’s Familiar Quotations, for a quote by Hayek about how you cannot clearly associate economic effects with economic causes because so many different circumstances are at work each time.

I cannot find that quote in this edition — maybe a 1976 edition — but I did find a better one from Hayek which I paraphrase here: the attempt at social justice causes more misery than almost any other factor in human life (again, a paraphrase).

Yes. The Communists. The Jacobins. The Communards. The Maoists. The Khmer Rouge. They all caused untold suffering in the phony and vain attempt to make everyone equal… phony because it was just a fig leaf for terrible people to seize power.

We are not supposed to be all equal. Let’s just forget that. We are supposed to have equal rights under law. If we do that, we have done enough. If we try to engineer outcomes, if we overturn tradition to make everyone the same, we ruin society. If we upset tradition to allow for an equal shot at the starting gate, everyone wins, except for the charlatans and would be dictators.

Yet another reason to be a Republican. Give everyone an equal shot — but do not require equal outcomes or even roughly equal outcomes by law. That way lies catastrophe.

Every soul deserves a shot at a Cadillac, but not everyone should be guaranteed a Cadillac… that way lie the tumbrels and the guillotine.

Other groups in history caused untold suffering in the phony and vain attempt to keep everyone from having equal rights.  What’s his point, that he’s forgotten history and has so far avoided a visit from Santayana’s Ghost?

Consider the anti-Jacobins, the monarchy and strict class system against which the French revolted — better?  The Jacobins themselves were mostly upper-class, including a future King of France among them, and the club being composed almost completely of wealthy people or merchants on the rise, quite like a modern Republican-leaning country club.  Does Stein really know this history?

Communards organized and rebelled against a patrician government (think Occupy Wall Street with real venom, tired of eating cats and rats, and with the support of hungry front-line soldiers who sympathized with them).  They did not perpetrate misery in support of social justice, not so much as 18,000 Communards were murdered to put down the rebellion and  continue the social injustice, several thousands more were executed, and a few thousands were “deported” to prison colonies in New Caledonia.  Stein seems to have this history exactly backwards — it was the GOP-style Bismarck-Farve alliance that delivered misery to perpetuate inequality.

One might make a claim that the Maoists in China worked for a degree of a classless society, but not on the scale and not with the success of George Washington — which is probably a clear view into why Mao’s successors beat such a hasty retreat to more capitalistic-bent programs, but still leaving the peasants in the countryside and especially coal miners on the short end of the rights stick.  It’s simply fatuous to claim the Khmer Rouge worked to make people equal under the madman dictator Pol Pot.  It’s  a good, short debate line, but it doesn’t stand up to scrutiny of history — and remember, it was the communist North Vietnamese Army who chased Pol Pot out of power and restored order to Cambodia.

Consider the Roman Empire (which oddly is more akin to modern U.S. Republicans than the Roman Republic), or Czarist Russia before the Bolsheviks.  It’s not like the failed attempts by so-called communists brought down societies that honored equality for citizens.  Stein has the telescope of history by the wrong end, which means he really can’t see what he’s claiming to describe.

Did Hayek really say that working for social justice is error?  I doubt it.  He wrote about wrong-headed attempts to impose social justice, like keeping everyone from having a Cadillac, through formal legal means, or through informal, economic and class means such as closing off opportunities for the poor and middle class to rise.  Stein, a Jew with an Ivy League education, should be sensitive to the closing of opportunities, and appreciative that opportunities are generally open in this nation.  Religion once operated as keys the doors to Ivy League schools, to the detriment of Jews; once recast, those keys provided a door to economic and intellectual achievement for many Jews.

Stein’s column is titled “A Reason to Be Republican.”  Instead he outlines reasons to question the current Republican platform and candidates for the presidency, U.S. Senate and U.S. House of Representatives.  Somehow he confuses Republican policy with the phrase “Equal Justice Under Law,” the words engraved on the West Portico of the U.S. Supreme Court.  It’s useful at such times to remember the building was completed in 1935, and that its design and construction was supervised by Chief Justice William Howard Taft, the former Democrat.  It’s also useful to remember that the GOP has fought against those words ever since, but especially after Richard Nixon determined to jettison GOP dedication to civil rights for African Americans, women and Hispanics, in pursuit of electoral success with the votes of bigots from the South angry at the Democratic Party for having successfully pushed the Civil Rights Act of 1964 and the Voting Rights Act of 1965.  Stein wrote speeches for Nixon.  He should remember that history better, or study it more if he can’t recall.

Especially not the rich should be guaranteed a Cadillac by the government.  They already have the money to get what they need; but having money should not confer rights to take everything while walking on the heads of the middle class and poor.  Everyone deserves a shot, Stein said.  I wish he’d support that claim with his actions, his political contributions, and his endorsement of candidates.

More:


October 9 – St. Denis’s Day, patron saint for those who have lost their head

October 9, 2012

October 9 is the Feast Day of St. Denis.

Who?  He’s the patron saint of Paris (and France, by some accounts), and possessed people.   Take a look at this statue, from the “left door” of the Cathedral of Notre Dame  in Paris (Cathédrale Notre-Dame de Paris: portail de gauche).  He was martyred by beheading, in about 250 C.E.

English: Cathédrale Notre-Dame de Paris: porta...

St. Denis greets vistors to the Cathedral of Notre Dame, Paris (Cathédrale Notre-Dame de Paris: portail de gauche)

Our trusty friend Wikipedia explains:

According to the Golden Legend, after his head was chopped off, Denis picked it up and walked two miles, preaching a sermon the entire way.[6] The site where he stopped preaching and actually died was made into a small shrine that developed into the Saint Denis Basilica, which became the burial place for the kings of France. Another account has his corpse being thrown in the Seine, but recovered and buried later that night by his converts.[2]

Clearly, he is the guy to pray to about Michelle Bachmann, Rush Limbaugh, Todd Akin, Paul Ryan, intelligent design, and the Texas State Board of Education, no?  You catch my drift, you can use this factoid to some advantage, enlightenment, and perhaps humor.  In Catholic lore, St. Denis is one of the “14 Holy Helpers,” and his aid is sought to help people with headaches, or who have been possessed.

Crazy GOP members who I suspect of having been possessed give me and America a headache.  St. Denis seems to be our man.

Who else do you know of, in this election year, who keeps talking after losing his/her head?

As Rod Stewart sang, just “let your imagination run wild.”  Maybe St. Denis is listening.

More:

Statue to St. Denis, in Cluny

Another portrayal, in sculpture, of St. Denis. Notice how this one’s face doesn’t really look like the one above? Ouvre du Musée de Cluny, Wikipedia photo by Guillaume Blanchard (Aoineko), June 2001, FinePix 1400Z.

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Why Obama Now?

October 7, 2012

Obama’s own words, with animation provided by Lucas Gray, a veteran animator from The Simpsons and Family Guy.

Andre Tartar wrote about it at the New York Magazine website:

Your average campaign ad involves lots of black and white B-roll, ominous music, and floating newspaper headlines. So this nearly 4-minute illustrated reel by Lucas Gray, a veteran of the Simpsons and Family Guy animation departments, is a welcome bit of color. Using audio from a speech President Obama gave at the Associates Press Luncheon in April, “Why Obama Now” is a jaunty mix of cartoon Americans driving their Model T Fords off the assembly line onto the American Dream, graphs and charts sprouting up as the president rattles off statistics, and little bobblehead meanies providing comic relief: Bush and Cheney with a pile of gold (the Clinton surplus), Sarah Palin, Bill O’Reilly, and the rest of the conservative pundit gang. It also includes the best (though not most convincing) explanation of trickle-down economics we’ve seen yet: “If you feed the horse enough oats, some will pass through to the sparrows.”

At the website for WhyObamaNow.org, the sources are listed:

  1. Obama’s speech to the Associated Press luncheon on April 3, 2012, at the Marriott Wardman Park
  2. Other sources for graphs shown throughout the video
  3. Transcript of the entire speech

The entire speech (58 minutes — 36 minutes for the prepared text, plus Q&A):


Doubt, about the science of tobacco consumption, DDT, and global warming

October 6, 2012

From The Climate Reality Project.

(Yes, there is a bias.  Several biases exist there simultaneously, actually, so we should say there are biases.  The most important for you to know about are the biases for good science and accuracy, especially historical accuracy.)

More:

Graffiti: BIAS

Graffiti: BIAS (Photo credit: Franco Folini, via Flickr) (Creative Commons)


Veterans speak out: We’re not just laundry

October 6, 2012

From the Truman National Security Project, a video featuring testimony from veterans of Iraq and Afghanistan especially, questioning whether Mitt Romney has what it takes to be Commander-in-Chief of the U.S. armed forces:

This is rather the opposite of  “swift boating,” isn’t it?  An established organization active on national security issues, with a distinguished staff and board of directors, working on a shoe-string, with identified spokesmen.

The Truman Project’s blog lays out the case for President Obama’s election with respect to his initiatives on behalf of veterans.  As much as I would prefer to see those positive achievements emphasized, campaigns don’t really allow much time for careful, thoughtful explanation.

Will there be any effect from this advertisement?  What do you think?

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One more time, again: Why “supply side” economics doesn’t work without demand

October 4, 2012

I posted a short excerpt from a recent column by economist Paul Krugman, explaining why GOP reliance on magic to fix the economy probably won’t work.  Commenter David Xavier took issue with Krugman’s analysis.  David’s comment brought home to me just how badly many self-described conservatives misunderstand basic economics, especially the keystone free enterprise principles of supply and demand.

My explanation of why supply side economics can’t work came out for the 21st time at least.  Let’s make a post of it, in hope that more people may read it and view it, and understanding may increase.

David Xavier said:

Krugman wants the government to spend as this will drive demand. But “demand is constituted by supply”. To buy something you must first produce and sell something. The selling is what gets you the money, but the production of value adding output is what first allows you to sell. Without value adding activity, there is nothing to sell and therefore there is no basis for demand.

I replied:

Well, there’s the problem. You don’t understand either the law of supply, nor the law of demand. You’re talking “supply side” economics, which we discovered didn’t work way back in 1982 through 1988.

Supply does not stimulate demand, ceteris paribus. It’s the other way around. Henry Ford’s Model A didn’t created demand for transportation; the demand for transportation, coupled with a demand for transportation that didn’t involve horses and their natural effluents, created a demand for a horseless carriage. Ford created a machine that met that demand, and could manufacture it in enough quantity to matter.

Demand is not “constituted from supply.” Demand comes from needs, and wants. If supply can be created to meet that demand, demand can be met from supply.

But demand comes first, as Krugman, a Nobel-winning economist, well understands.

If consumers have no money to buy, the quantity supplied cannot matter in the least. If there were no demand for transportation at all, Henry Ford is sunk.

The law of supply explains how producers go about meeting demands — if prices are higher, they are happier to supply more. Again, if consumers have no money to purchase the good or service offered, the amount of supply is completely irrelevant.

Before Henry Ford’s mass production of automobiles created a demand for gasoline, gasoline was cast off from oil refining as a waste product from the production of kerosene for lanterns. Refineries from Standard Oil dumped millions of gallons of gasoline into rivers — no demand, the massive supply simply did not matter.

And as we can see from that example, demand not only creates the market, it can make a product considered to be waste, into the economic equivalent of gold.

Without demand, supply is simply excess manure, or gasoline by-product from the production of kerosene, to be dumped into a river (and thereby pollute the hell out of the river).

You’re right to say that without value-added activity, there is no economic activity. But tell that to Mitt Romney, who thinks finance is the magic, and not production.

A key problem with all of Republican economics is the ignoring of consumers, and ignoring the reality that consumers need money to stimulate demand. Tax cuts can’t help the hungry, who cannot eat tax cuts, nor the unemployed, who cannot take to the bank tax cuts on non-existent income.

Your odd myopia — maybe blindness — to the reality of how economics works, is shared by a lot of so-called conservatives. It’s a tragedy; it’s a tragedy I hope voters will put an end to, soon.

Did you ever notice that no supply-side economist has ever won a Nobel? Have you noticed that few supply-side economics articles are available in journals? Has your search for the numbers to back up the Laffer curve been as unproductive as they have been for everyone else — including Arthur Laffer? (Laffer promised to publish an article explaining how supply side economics work, as soon as he got the numbers together. That was in 1982. 40 years later, there is still no real intellectual foundation for GOP claims of tax cuts creating wealth. Those studies that have been done suggest tax rates maximize revenue when taxes hit about 70%, more than three times the rates Laffer proposes. History shows a much different story than Laffer claimed: Tax cuts in the Harding and Coolidge administrations led to bubbles that collectively burst in October 1929, leading to the Great Depression; tax cuts in 2001 led to bubbles in housing and the stock market, which burst in 2008, leading to our Great Recession.)

Right now, businesses are sitting on a pool of about $2 trillion, profits they’ve accumulated since 2008. If supply side economics worked, that money would be invested in manufacturing and service creation, and we should have an unemployment rate in negative numbers. The disproof of supply side economics is our current situation. Employers have plenty of supply of money, but they refuse to hire without demonstration of demand from consumers. Unemployed consumers, lacking money, cannot make that demand up from thin air. Magic does not work, in the real world of supply and demand, in economics.

Nota bene:  Videos come from a delightful series on economics created and put up on YouTube by Dr. Mary J. Glasson, licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.  Glasson’s series is available at YouTube and covers almost every topic in an entry-level survey undergraduate economics course.  Look for “mjmfoodie” at YouTube.com.

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More magic than a cape and red underpants needed to fix economy; but that’s all GOP offers

October 4, 2012

Despite the few details he leaked in the Denver debate — which contradict almost everything he and his campaign had said earlier, not to mention the GOP platform — Mitt Romney offers not much in the realm of a program to do better than President Obama in economics, in pulling the nation out of our economic doldrums.  Nobel-winning economist Paul Krugman explains:

Winner of the Nobel Memorial Prize in Economics, Paul Krugman - Tavis Smiley Productions image

Winner of the Nobel Memorial Prize in Economics, Paul Krugman – Tavis Smiley Productions image

As many people have noticed, Mr. Romney’s five-point “economic plan” is very nearly substance-free. It vaguely suggests that he will pursue the same goals Republicans always pursue — weaker environmental protection, lower taxes on the wealthy. But it offers neither specifics nor any indication why returning to George W. Bush’s policies would cure a slump that began on Mr. Bush’s watch.

In his Boca Raton meeting with donors, however, Mr. Romney revealed his real plan, which is to rely on magic. “My own view is,” he declared, “if we win on November 6, there will be a great deal of optimism about the future of this country. We’ll see capital come back, and we’ll see — without actually doing anything — we’ll actually get a boost in the economy.”

Are you feeling reassured?

In fairness to Mr. Romney, his assertion that electing him would spontaneously spark an economic boom is consistent with his party’s current economic dogma. Republican leaders have long insisted that the main thing holding the economy back is the “uncertainty” created by President Obama’s statements — roughly speaking, that businesspeople aren’t investing because Mr. Obama has hurt their feelings. If you believe that, it makes sense to argue that changing presidents would, all by itself, cause an economic revival.

There is, however, no evidence supporting this dogma. Our protracted economic weakness isn’t a mystery; it’s what normally happens after a major financial crisis. Furthermore, business investment has actually recovered fairly strongly since the official recession ended. What’s holding us back is mainly the continued weakness of housing combined with a vast overhang of household debt, the legacy of the Bush-era housing bubble.

By the way, in saying that our prolonged slump was predictable, I’m not saying that it was necessary. We could and should have greatly reduced the pain by combining aggressive fiscal and monetary policies with effective relief for highly indebted homeowners; the fact that we didn’t reflects a combination of timidity on the part of both the Obama administration and the Federal Reserve, and scorched-earth opposition on the part of the G.O.P.

But Mr. Romney, as I said, isn’t offering anything substantive to fight the slump, just a reprise of the usual slogans. And he has denounced the Fed’s belated effort to step up to the plate.

Read more at the New York Times.

Why do I disbelieve?

  1. For more than a year Romney’s been pushing tax cuts as a solution to everything.  It’s rather late to back out of that now.
  2. Tax cuts can’t stimulate the economy — we tried them for 8 solid years, and they crashed the economy.  One can make a great case that the Obama economy is not soaring because he agreed to extend the tax cuts, in return for getting about half of the stimulus we needed.  At some point, people hurting in this economy will realize that they can’t benefit from a tax cut if they aren’t paying huge taxes, and they aren’t paying huge taxes if they are unemployed.
  3. Tax cuts cannot be revenue neutral.  They hurt deficits.  For months Romney’s been talking about defense spending and tax cuts that add between $5 trillion to $7 trillion in to the deficit.  If he wishes to argue that deficits hurt, he’s in trouble.  If Obama argues that deficits should be used to help people, Romney will be unable to make the math work on his plan if he tries to reply.
  4. Economic theory isn’t with Romney.  Can he make that big of a snow job on voters?  Even if he does, the economy won’t take it.

Now’s a good time to beef up on the high school economics most of us took, or the college class we took.  Can you see any way to make an austere, Spain-style economy work in the U.S. without putting us into a death spiral?

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