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Thread: CBO: Obama stimulus harmful over long haul

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    Re: CBO: Obama stimulus harmful over long haul

    Quote Originally Posted by RightinNYC View Post
    I would assume that the CBO is considering the compounding of the GDP as well.

    To eliminate any confusion:

    What I am contending that the CBO is saying is that if there are two universes, one where we don't implement the stimulus and one where we do, the GDP in the universe where we don't implement the stimulus will be .1-.3% higher as of 10 years from now. That seems like a completely reasonable projection to me, because it makes sense that we would pay a long term premium for a short term fix.

    Ok, I still don't know if there is a diffference in what we are saying. The universe where we don't implement the stimulus will have a GDP .1 to .3% higher in 2019 for that year. That is to say this:

    Suppose GDP, without the stimulus, would be 10,000,000,000,000 in 2018 and would be 10,300,000,000,000 in 2019 because the change in GDP for that year is projected to be 3%.

    Now, one of the things I think we are disagreeing about is the level of GDP when we get 10 years out. It is my contention that, even with the long term negative impact, GDP level will be higher than otherwise at that point, but that the change in GDP will be lower, at around 2.7 to 2.9%.

    I will show the numbers in a minute, but it is important to keep in mind that the CBO never states what the overall impact of the stimulus will be. It is the commentators trying to spin it that are saying the impact is negative.

    Now for some real numbers. In the analysis I have drawn up below, I have used actual numbers and projections for the baseline GDP and baseline change in GDP for first three years (2009, 2010, 2011). For the remaining years, I did a reasonable projection of the change in GDP.

    CBO: Obama stimulus harmful over long haul-stimnumbers-jpg

    As you can see, GDP is better off, even by 2019, with the stimulus, even though the impact for the years 2012 to 2019 is negative for those years.

    If you will run a similar projection for what you think will happen, then we can concretely understand how we differ.
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    Re: CBO: Obama stimulus harmful over long haul

    So if the CBO is negative on the stimulus, what isn't Congress paying attention to them?
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    Re: CBO: Obama stimulus harmful over long haul

    Quote Originally Posted by American View Post
    So if the CBO is negative on the stimulus, what isn't Congress paying attention to them?
    The CBO isn't negative on the stimulus. Please provide a quote from the CBO which indicates that the CBO considers the stimulus to be an overall negative for the economy.

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    Re: CBO: Obama stimulus harmful over long haul

    Quote Originally Posted by Dezaad View Post
    Ok, I still don't know if there is a diffference in what we are saying. The universe where we don't implement the stimulus will have a GDP .1 to .3% higher in 2019 for that year. That is to say this:

    Suppose GDP, without the stimulus, would be 10,000,000,000,000 in 2018 and would be 10,300,000,000,000 in 2019 because the change in GDP for that year is projected to be 3%.

    Now, one of the things I think we are disagreeing about is the level of GDP when we get 10 years out. It is my contention that, even with the long term negative impact, GDP level will be higher than otherwise at that point, but that the change in GDP will be lower, at around 2.7 to 2.9%.

    I will show the numbers in a minute, but it is important to keep in mind that the CBO never states what the overall impact of the stimulus will be. It is the commentators trying to spin it that are saying the impact is negative.

    Now for some real numbers. In the analysis I have drawn up below, I have used actual numbers and projections for the baseline GDP and baseline change in GDP for first three years (2009, 2010, 2011). For the remaining years, I did a reasonable projection of the change in GDP.

    CBO: Obama stimulus harmful over long haul-stimnumbers-jpg

    As you can see, GDP is better off, even by 2019, with the stimulus, even though the impact for the years 2012 to 2019 is negative for those years.

    If you will run a similar projection for what you think will happen, then we can concretely understand how we differ.
    Again, we're coming back to the same disagreement about what the CBO means.

    I completely understand what you're saying. If the GDP increases now, then a small decrease later might still leave us better off than otherwise. If your interpretation of what the CBO is projecting is correct, then you'd be right.

    However, I think that it's clear from the text of the CBO's letter and from the context that what they are saying is not the same as what you're saying. In my reading, their statement that the GDP in 2019 will be lower than it otherwise would is not referring simply to the year over year % change in GDP, but rather is referring to the cumulative change of the GDP over the entire period. It simply wouldn't make sense for the CBO to calculate their numbers like that, because that information would be totally pointless if, as you are asserting, the total GDP would still be higher than otherwise.
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    Re: CBO: Obama stimulus harmful over long haul

    Quote Originally Posted by American View Post
    So if the CBO is negative on the stimulus, what isn't Congress paying attention to them?
    Because Congress is making the entirely reasonable calculation that the long term costs are worth the short-term gains.

    It's the same thing that all of us do when we take out loans.
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    Re: CBO: Obama stimulus harmful over long haul

    Quote Originally Posted by RightinNYC View Post
    Because Congress is making the entirely reasonable calculation that the long term costs are worth the short-term gains.

    It's the same thing that all of us do when we take out loans.
    Well the same thing except for the facts that they do not expect to be a physical part of its being paid back, and are betting on the fact that someone else will end up making the sacrifice much later in the future.

    I would be pretty sure they also do not plan to be losing their jobs or their family wealth as most Americans may see happen from further reduction in US manufacturing from new pressures on our legislators to allow an increase in imports from those who are actually holding paper on most of our debt as a country.

    Where does this end?
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    Re: CBO: Obama stimulus harmful over long haul

    The way he tried to pushed it through REEKED of evil carsales-man. But dirtpoor is just some crazy young kook.
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    Re: CBO: Obama stimulus harmful over long haul

    When president Bush "invented" the amount of 700 billions to bailout banks and other corporations and only a few people was opposite to such measurement. I myself have been against such bailout which I still calling it as the worst investment ever made by the US government. The money is directed to the banks and corporations and not so to the affected ones who are the population in general.

    Now president Obama wants to pull 900 billion to be invested creating jobs, this is to say, giving the money straight to the companies and workers. To this action, the opposition is growing, and the more exited to attack the idea of president Obama are the ones who own the banks and big corporations.

    My position still the same, do not give a single cent to the corporations and create more jobs.

    And yes, the government creating jobs is a need at this time, because people must get busy and work. This measure must be in charge until the economy recovers itself.

    My suggestion is to use the 350 billion left from the former pull out of money, and use them as part iof the 900 billion proposed to incentive the economy, and this proposed action is justified because the banks have failed to present the records of how the bailout money given to them was used.

    President Obama must not only demand for the explanatory records but impose the immediate return of the money if the banks fail to do so.

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    Re: CBO: Obama stimulus harmful over long haul

    Quote Originally Posted by Dezaad View Post
    Ok, I still don't know if there is a diffference in what we are saying. The universe where we don't implement the stimulus will have a GDP .1 to .3% higher in 2019 for that year. That is to say this:

    Suppose GDP, without the stimulus, would be 10,000,000,000,000 in 2018 and would be 10,300,000,000,000 in 2019 because the change in GDP for that year is projected to be 3%.

    Now, one of the things I think we are disagreeing about is the level of GDP when we get 10 years out. It is my contention that, even with the long term negative impact, GDP level will be higher than otherwise at that point, but that the change in GDP will be lower, at around 2.7 to 2.9%.

    I will show the numbers in a minute, but it is important to keep in mind that the CBO never states what the overall impact of the stimulus will be. It is the commentators trying to spin it that are saying the impact is negative.

    Now for some real numbers. In the analysis I have drawn up below, I have used actual numbers and projections for the baseline GDP and baseline change in GDP for first three years (2009, 2010, 2011). For the remaining years, I did a reasonable projection of the change in GDP.

    CBO: Obama stimulus harmful over long haul-stimnumbers-jpg

    As you can see, GDP is better off, even by 2019, with the stimulus, even though the impact for the years 2012 to 2019 is negative for those years.

    If you will run a similar projection for what you think will happen, then we can concretely understand how we differ.
    Projections are fallacious, because it is dependent on the velocity of money to be at a constant, when this current situation proves it to be otherwise. GDP numbers are constantly revised from years back, as they are extremely lagged by incoming and conflicting data.

    I would love to see your math on the matter though, if you do not mind...
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    Re: CBO: Obama stimulus harmful over long haul

    Quote Originally Posted by Indy View Post
    And thank you for your input. Now, if you will excuse us we'll go with the plan of the man we voted into office.
    I'm sure you felt exactly the same way 2001-2009.

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