Comments on: The Federal Government Has Jumped The Shark

By: Da Goddess

Da Goddess — Wed, 18 Feb 2009 15:55:06 +0000

This is how to mainstream people onto the dole. That’s all it’s meant to do.

By: Rob Sama

Rob Sama — Wed, 18 Feb 2009 01:55:13 +0000

Gosh you’re so smart.

Of course, none of that is the subject of this entry, but whatever. I’m evidently obliged to solve the world’s problems in each and every individual blog entry, right?

In any event, my commentary on the causes of our current crisis can be found here, written about 4 months ago.

By: PT

PT — Tue, 17 Feb 2009 23:56:23 +0000

Amazingly superficial commentary. What about Wall St’s massive demand for fraudulent mortgages that could be packaged and resold fraudulently to institutional investors around the world? What about cooperating bond ratings agencies? What about cooperating anti-regulatory SEC staff? What about cooperating fraudulent mortgage originators? What about cooperating fraudulent property assessors? Etc. Etc.

By: Rob Sama

Rob Sama — Sun, 15 Feb 2009 00:31:36 +0000

If we're suffering from a capital and liquidity problem because banks can't make normal loans to businesses, which in turn reverberates throughout the economy, then the most direct way to alleviate the problem is to directly inject liquidity into businesses. Eliminating the corporate income tax would be a good start. The corporate income tax only constitutes about 7.5% of the annual federal government revenues, which makes eliminating it affordable, even if it's repealed only temporarily (7.5% of $2.568 trillion is $192 billion, which is about a quarter of the current "stimulus" plan). And it would benefit well run businesses and let businesses that suck fail.

By: John

John — Sat, 14 Feb 2009 22:14:58 +0000

I think Henninger hit on a key point when he commented that public doesn’t care about the economics. Most people do not understand any of it and won’t try to (though they will have an opinion on it), and so any politician is stuck doing something that makes no sense – so we have “let’s spend lots of money” this time around, versus “small tax refunds for people unlikely to use them in economically productive ways” last time around, and it’s equally silly.

Seems to me that if you really wanted to create stimulus, you’d start by rolling out a dramatic expansion of unemployment benefits – just enough to give people who’ve lost their jobs money to spend – and you’d have a large (and growing!) group of people who are likely to use it on basic goods and services and very, very unlikely to save or invest the money out putting some more cash into the economy. It would be fast, and it would have the side benefit of easing some of pain of unemployment and the resulting dislocation.