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Economists: The stimulus didn't help

I looked on calculated risk and today we have an atlanta fed report showing:

"The major contributor to income growth during the past several months has been transfer payments."

PersonalIncomeAtlFed.JPG


Monthly Increase, Billions (SAAR)
Jan-10 Feb-10 Mar-10​

Government Transfer Payments

Old-age, survivors, disability, health insurance benefits
-1.5, 3.1, 5.1​
Government unemployment insurance benefits
-6.6, -2.2, 11.8​

Other
33.7, 6.4, 7.8​

Reduction in Personal saving
55.1, 54, 28.2​

Total Saving Reduction and Transfer Payments
80.7, 61.3, 52.9​

Increase in Personal outlays
34.4, 58.3, 60.6​

Just looking at this I can see that the main reason for an increase in consumption was a lower savings rate and government transfer payments. These are two things the stimulus was supposed to do, how is it not helping?
 
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drz-400 said:
I looked on calculated risk and today we have an atlanta fed report showing:

"The major contributor to income growth during the past several months has been transfer payments."

PersonalIncomeAtlFed.JPG


Monthly Increase, Billions (SAAR) Jan-10 Feb-10 Mar-10

Government Transfer Payments

Old-age, survivors, disability, health insurance benefits -1.5 3.1 5.1

Government unemployment insurance benefits -6.6 -2.2 11.8

Other 33.7 6.4 7.8

Reduction in Personal saving 55.1 54 28.2

Total Saving Reduction and Transfer Payments 80.7 61.3 52.9

Increase in Personal outlays 34.4 58.3 60.6

Just looking at this I can see that the main reason for an increase in consumption was a lower savings rate and government transfer payments. These are two things the stimulus was supposed to do, how is it not helping?
Click to expand...

Has it done what you expected it to do and what Obama said it would do? Think that a lower savings rate is a good thing? Guess it is if you believe in a bigger role for the govt. but is that really what you want?

In addition please explain to me why this 800 billion stimulus plan had to be passed immediately and we now know that only 1/3 of the stimulus has been spent almost 1 1/2 yrs later? Even though that is the case the debt will be 1.6 trillion this year after a 1.4 trillion debt last year. Obama will add more debt in two years than Reagan did in 8.

By definition a stimulus is to be a short term boost to the economy, not a slush fund for Democrat initiatives. 1 1/2 years later is not short term and unemployment exceeded what Obama said it would.
 
Conservative said:
Has it done what you expected it to do and what Obama said it would do? Think that a lower savings rate is a good thing? Guess it is if you believe in a bigger role for the govt. but is that really what you want?

In addition please explain to me why this 800 billion stimulus plan had to be passed immediately and we now know that only 1/3 of the stimulus has been spent almost 1 1/2 yrs later? Even though that is the case the debt will be 1.6 trillion this year after a 1.4 trillion debt last year. Obama will add more debt in two years than Reagan did in 8.

By definition a stimulus is to be a short term boost to the economy, not a slush fund for Democrat initiatives. 1 1/2 years later is not short term and unemployment exceeded what Obama said it would.
Click to expand...

Your correct, they lowballed their estimates, but the output/unemployment gap has become much larger than most models based on historical data would have suggested at the time. I don't really care what Obama said unemployment was going to be, all I care is that the stimulus has helped, and it seems it has. The debt will be a problem, no doubt, and that massive debt was not brought about by short term spending, but rather long term issues that need to be adressed. I guess short term and long term can be subjective, but I would call SS, medicare, and military type spending long term since we will be doing that for decades into the future rather than 2-3 years. I think that getting the economy on track is an important first step towards fiscal sustainablity though, because a recession will bring about inevitable defecits.

Also, without the transfer payments, think about how low the saving rate would be (or consumption since maybe some people would not want to spend that much). Obviously the government cannot continue to supplement everyones income at this magnitude, or people cannot continue to fuel consumption by taking on more and more debt. That is why spurring economic growth is so important, so the market and jobs can grow peoples income. This is just an even greater case for using stimulus to boost the economy.
 
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ricksfolly said:
I'm surprised at you Prof. Surely You must know that Obama can only suggest and appeal to the crowd. Congress enacts all the policies and laws.

ricksfolly
Click to expand...

oh, please

popular presidents INTIMIDATE the opposition into coming over

these days, opposition says NO and the electorate rewards it with TWENTY FIVE POINT swings in its favor

the klutz, in contrast, can't even carry his own caucus

Senate Democrats to W.H.: Drop cap and trade - Lisa Lerer - POLITICO.com

Obama: There 'may not be an appetite' for immigration bill this year - The Oval: Tracking the Obama presidency

Rifts emerge among Dems over federal powers on consumer financial regs - TheHill.com

it's cuz he perpetually picks pigs to push which are so unpopular

he's a putz

did you see the voter turnout in tuesday's primaries in 3 ultra important states?

Dem Turnout Falls Off A Cliff - Hotline On Call

red representation, in colorful contrast, was WAY UP

worry
 
drz-400 said:
I don't really care what Obama said unemployment was going to be
Click to expand...

most americans do, he's sposed to LOOK like he knows what he's doing

Democrat: Obama should not have said unemployment would peak at 8 percent - The Hill's Blog Briefing Room

Obey slams administration for stimulus reporting errors - The Hill's Blog Briefing Room

unemployment's sposed to go DOWN

he's incompetent

are you following the goings on in europe?

did you see the dow this week?

jitters, jitters, jitters

the same, by the way, is happening in our airports

everyone's about to jump outta their seats cuz someone dropped a suitcase

this is what ineptitude at the top produces, naturally

IN TIMES LIKE THESE
 
drz-400 said:
I don't really care what Obama said unemployment was going to be
Click to expand...

most americans do, he's sposed to LOOK like he knows what he's doing

Democrat: Obama should not have said unemployment would peak at 8 percent - The Hill's Blog Briefing Room

Obey slams administration for stimulus reporting errors - The Hill's Blog Briefing Room

unemployment's sposed to go DOWN

he's incompetent

are you following the goings on in europe?

the populi are pretty plain---they're not prepared to PAY

did you see the dow this week?

jitters, jitters, jitters

the same, by the way, is happening in our airports

everyone's about to jump outta their seats cuz someone dropped a suitcase

this is what ineptitude at the top produces, naturally

IN TIMES LIKE THESE
 
drz-400 said:
Your correct, they lowballed their estimates, but the output/unemployment gap has become much larger than most models based on historical data would have suggested at the time. I don't really care what Obama said unemployment was going to be, all I care is that the stimulus has helped, and it seems it has. The debt will be a problem, no doubt, and that massive debt was not brought about by short term spending, but rather long term issues that need to be adressed. I guess short term and long term can be subjective, but I would call SS, medicare, and military type spending long term since we will be doing that for decades into the future rather than 2-3 years. I think that getting the economy on track is an important first step towards fiscal sustainablity though, because a recession will bring about inevitable defecits.

Also, without the transfer payments, think about how low the saving rate would be (or consumption since maybe some people would not want to spend that much). Obviously the government cannot continue to supplement everyones income at this magnitude, or people cannot continue to fuel consumption by taking on more and more debt. That is why spurring economic growth is so important, so the market and jobs can grow peoples income. This is just an even greater case for using stimulus to boost the economy.
Click to expand...

It does seem that too many people do not understand exactly how much is 800 billion dollars, nor do they understand stimulus, emergency legislation, and degree of so called help.

When you say the Stimulus plan helped, gee, I would hope so, 842 billion dollar stimulus plan better help but the question is to what degree and did we get our money's worth. The answer obviously is NO, if it was a true emergency then more than 1/3 of the money would have been spent and it wouldn't have taken 1 1/2 years to generate the results you posted which are meager at best.

Obama told us all, never let a good crisis go to waste and that is what he did to pass this slush fund which we all are going to pay for. As it is the debt the past two years will exceed 3 trillion dollars and that is with 2/3 of the stimulus money not spent. Hopefully you see the problem here as there hasn't been that strong PRIVATE sector economic growth and job creation and that is where meaningful GDP Growth occurs.
 
exactly

the 862B dollar stimu... RECOVERY ACT has NOT been paid for

EVERY PENNY president pie-in-the-face puts out, at this point, is PAWNED
 
The Prof said:
most americans do, he's sposed to LOOK like he knows what he's doing

Democrat: Obama should not have said unemployment would peak at 8 percent - The Hill's Blog Briefing Room

Obey slams administration for stimulus reporting errors - The Hill's Blog Briefing Room

unemployment's sposed to go DOWN

he's incompetent

are you following the goings on in europe?

the populi are pretty plain---they're not prepared to PAY

did you see the dow this week?

jitters, jitters, jitters

the same, by the way, is happening in our airports

everyone's about to jump outta their seats cuz someone dropped a suitcase

this is what ineptitude at the top produces, naturally

IN TIMES LIKE THESE
Click to expand...


God could not fix the mess the last administration created.
 
USA-1 said:
God could not fix the mess the last administration created.
Click to expand...

Notice that you ran from the tough questions asked of you but instead prefer to revert back to the bash Bush tactic.

You and others like you haven't a clue. Answer the posts prior to this one and explain to us what the Congress did under Democrat Control and with Obama in the Senate beginning in 2007? The tell us what Obama did with the 842 billion dollar stimulus plan and here we are 1 1/2 years later and only these results?

You really aren't this misinformed, are you?
 
USA-1 said:
God could not fix the mess the last administration created.
Click to expand...

of course, HE could

obama must if he wants to win reelection

and the putz better pick up speed

it's been an awful long sixteen months

and it's getting really intense this week, all around our intricately interconnected world

he's simply not up to it

greece plays the role of lehman brothers

Stocks, Euro Slide on Debt Concern; MSCI World Erases 2010 Gain - Bloomberg.com

UK budget deficit 'to surpass Greece's as worst in EU' | Business | The Guardian

BBC News - Freddie Mac seeks further $10.6bn in US aid

Spain downgraded as Europe debt crisis widens - Yahoo! Finance

Spain jobless rate tops 20%, adds to debt worries - Yahoo! News

Portugal?s Debt Rating Lowered by Fitch on Finances (Update3) - Bloomberg.com

Euro market meltdown resumes despite Greek deal - Yahoo! Finance

China May ?Crash? in Next 9 to 12 Months, Faber Says (Update3) - Bloomberg.com

Half of U.S. Home Loan Modifications Default Again (Update1) - Bloomberg.com
 
The Prof said:
of course, HE could

obama must if he wants to win reelection

and the putz better pick up speed

it's been an awful long sixteen months

and it's getting really intense this week, all around our intricately interconnected world

he's simply not up to it

greece plays the role of lehman brothers

Stocks, Euro Slide on Debt Concern; MSCI World Erases 2010 Gain - Bloomberg.com

UK budget deficit 'to surpass Greece's as worst in EU' | Business | The Guardian

BBC News - Freddie Mac seeks further $10.6bn in US aid

Spain downgraded as Europe debt crisis widens - Yahoo! Finance

Spain jobless rate tops 20%, adds to debt worries - Yahoo! News

Portugal?s Debt Rating Lowered by Fitch on Finances (Update3) - Bloomberg.com

Euro market meltdown resumes despite Greek deal - Yahoo! Finance

China May ?Crash? in Next 9 to 12 Months, Faber Says (Update3) - Bloomberg.com

Half of U.S. Home Loan Modifications Default Again (Update1) - Bloomberg.com
Click to expand...

Aren't these the countries that Obama wants us to be more like? The European Social Model caused these problems with their cradle to grave coverage. Now they are paying the price.
 
ouch, good point

actually, he's accelerating our advance towards eu mores

look at the link for freddie above

look at the housing piece, half those he hamp'ed have already re-defaulted

his answer: more
 
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Here you can more easily see the effect of the stimulus on income:

RecessionMeasureIncome.jpg


Conservative said:
When you say the Stimulus plan helped, gee, I would hope so, 842 billion dollar stimulus plan better help but the question is to what degree and did we get our money's worth. The answer obviously is NO, if it was a true emergency then more than 1/3 of the money would have been spent and it wouldn't have taken 1 1/2 years to generate the results you posted which are meager at best.
Click to expand...

I don't think it is obviously no. Certainly there are programs out there that have been extremely inefficient, in my opinion such an example is the first time homebuyer tax credit. However, a large amount if the stimulus money was allocated efficiently as well, such as the extension of unemployment benefits, which was shown to have a rather large multiplier effect.
 
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drz-400 said:
Here you can more easily see the effect of the stimulus on income:

RecessionMeasureIncome.jpg




I don't think it is obviously no. Certainly there are programs out there that have been extremely inefficient, in my opinion such an example is the first time homebuyer tax credit. However, a large amount if the stimulus money was allocated efficiently as well, such as the extension of unemployment benefits, which was shown to have a rather large multiplier effect.
Click to expand...

The question is the degree of so called help that the stimulus generated. We are 1 1/2 into the program, 1/3 of the money spent, unemployment remains close to 10%, 3 trillion is being added to the debt, very little private sector GDP growth. Frustrating when people don't seem to understand terms like billions and trillions.

How anyone can look at spending billions to get these kind of results and call the stimulus successful is beyond me. Stop buying what you are told and realize what the American people could have done with that 842 BILLION had it been given in tax cuts.
 
The Prof said:
of course, HE could

obama must if he wants to win reelection

l]
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Obama will never win re-election unless the GOP puts a clown like Palin up against him. Obama was done as soon as he took the oath of office, for he became the scapegoat for the economic disaster. Bush got out just in the nick of time.
 
USA-1 said:
Obama will never win re-election unless the GOP puts a clown like Palin up against him. Obama was done as soon as he took the oath of office, for he became the scapegoat for the economic disaster. Bush got out just in the nick of time.
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Did you ever take a civics class at any level of your education? Using the word scapegoat shows that you really don't have a clue. Where was Obama in 2007-2008? He sold you a bill of goods, you bought it, and he still is in campaign mode today.
 
USA-1 said:
............unless Palin runs.
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You really have a problem with GOVERNOR Palin for some reason. Palin had more experience than the one you voted for in the WH. She actually has executive experience, something Obama never had, and we are paying the price for that people you ignored.
 
USA-1 said:
............unless Palin runs.
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LOL!

you've GOT the presidency

you concede it's LOST

yet you find some (to me) really WEIRD consolation in dumping on whom, again?

such a microscopic view of things
 
The Prof said:
LOL!

you've GOT the presidency

you concede it's LOST

yet you find some (to me) really WEIRD consolation in dumping on whom, again?

such a microscopic view of things
Click to expand...

LOL....I've got the presidency? Talk about microscopic view of things. Everyone isn't a democrat or republican, believe it or not.

I didn't vote for Obama, but I do hope he is successful. You see I am an independent. Unlike people like you I do not blindly follow a party. I vote for who I believe is the best candidate. Hopefully the GOP will give me a choice this time.
 
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USA-1 said:
LOL....I've got the presidency? Talk about microscopic view of things. Everyone isn't a democrat or republican, believe it or not.

I didn't vote for Obama, but I do hope he is successful. You see I am an independent. Unlike people like you I do not blindly follow a party. I vote for who I believe is the best candidate. Hopefully the GOP will give me a choice this time.
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I keep hearing people say "I want him to succeed" or "I want him to fail." Please tell me your definition of succeeding?

I am afraid that far too many look at success in the short term. If the unemployment rate drops due to all that govt. spending is that a good thing or a bad thing? Unfortunately most do not understand the debt being accumulated and the debt service alone that is going to cost. It really is a shame for if they understood debt, size of govt., and even basic economics they could answer the questions I posted better.

Based upon all that spending, based upon that massive expansion of govt, based upon the debt service especially with the upcoming rising interest rates, I pray he fails as his economic policy is a nighmare.
 
USA-1 said:
I didn't vote for Obama, but I do hope he is successful. You see I am an independent.
Click to expand...

who cares

obama is big

palin is small potatoes
 
The Prof said:
who cares

obama is big

palin is small potatoes
Click to expand...

Who cares? I care about this country and it's future. Why don't people like you? It's almost like you hope our leaders fail.
 
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