Sunday, February 08, 2009

The Big Other Upside of the Stimulus

The upside of the stimulus is that it works as planned and saves jobs. But the other potential upside is that it's wildly successful and republicans learn that government can be useful and that spending can stimulate. But the stimulus money has to be spent properly by those who get a piece of it.

The stimulus package, which now has $281 billion in tax cuts in the Senate's version and $182 billion in the House version, is expected to pass after both versions are combined and whittled.

The main talking point against the stimulus now is JAPAN. On Meet the Press, John Ensign, R-Nevada brought up Japan, which misused a stimulus and 10 years later has a deficit. Read lessons of Japan here:
In addition, economist Barry Eichengreen of the University of California, Berkeley, says that one problem with Japan's stimulus spending was that it was slow and halting. "My reading of Japan's experience is that fiscal stimulus didn't work because it was delayed, sporadic, undersized and inadequately front-loaded," he argues.

The other big lesson from Japan, says Mr. Eichengreen, is that "fiscal stimulus alone won't bring a deep recession caused by a banking crisis to an end. You need to fix the banking problem and get financial markets going again at the same time you replace some of the private spending that has evaporated with public spending."
Ensign, of all people, should want to create jobs. People in his state are suffering more than people in many other states. To start, Nevada tops nearly ever social ills list -- teen pregnancy, huge high school drop out rates, few kids that go on to college. You name it. Nevada suffers it.

Now, its troubles are being compounded by the recession. Nevada is ruled by the Casino party, which of course, is made up of republicans.

John Ensign said the bill in the Senate is a one-party rule. Yep. But that's okay. Notice, it is the moderate republicans who are supporting the bill, which says something about the bill. It says that reasonable people support it.

Claire McCaskill looked in Ensign's eye and said democrats negotiated with republicans who wanted to and "by the way, that door was open." It's a given that the stimulus is so against conservative republican ideology that they didn't even bother.

Republicans seem to be unaware of the economic moment. Mike Pence, R-Indiana, compared this economy to post 9-11. Not quite dude.

Barney Frank said spending nearly $1 trillion in Iraq was a waste. War spending is the republican version of a stimulus. Frank is going to be hosting a barbecue on Wednesday, when CEOs will be called up in front of his House Financial Services committee. That's going to be a must-see. At one moment, Frank and Pence got into it and Pence looked like he was going to clock him. Folks don't usually argue on MTP.

On Daschle, McCaskill says Daschle was a wake-up call. Obama saw so much of the good in Daschle, that he could get the job done, that he didn't see the bad, she said. 

After the politician roundtable, Tom Ricks, a writer for the Washington Post, said Iraq is going to change Obama. Ricks said Obama's not going to be able to withdraw from Iraq. He's promoting his new book, "The Gamble."

Ricks said Pakistan is a "problem from Hell" and he has no idea how it could be solved.

A side note, David Gregory is doing a terrific job hosting the show. He's maintaining the show's integrity by being nonpartisan.

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