The financial mess in California continues. One side says there won't be any drastic cuts: the number of government workers and their pay remains no matter what, and the only way to have a budget is to charge everyone with enough taxes to pay. The other side says there's no room for more taxes in what is an overtaxed state to begin with. A continuing drama. People are leaving the state because they can't pay the taxes.
It is essentially the way the classical political philosophers would have predicted that democracy would go. It's not so much that the voters vote themselves largess from the public treasury, although that certainly happens; it is that those with a particular interest, such as civil servant including teachers and prison guards unions will always organize effectively while those who are affected less directly won't, and the result will go in one direction. We're certainly getting an illustration of that in California.
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"JAKARTA - MEMBERS of an Islamic group held a protest outside the US embassy in the Indonesian capital on Monday.
The protestors held placards in a demonstration against the upcoming visit by Secretary of State Hilary Clinton, who is on her first mission overseas as President Barack Obama's chief diplomat." AFP
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Anti "stimulus" protest in Seattle!!! Next in Denver today and soon to happen in Nashville, North Carolina and NY. Anybody have any tea??? Roast pig anybody?
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The Rasmussen Consumer Index, which measures consumer confidence on a daily basis, fell two points on Sunday and another point on Monday to 55.7. This is the third time in February that the daily Consumer Index has fallen to a record low. Confidence is down a point from a week ago, down six points from a month ago, and thirty-one points since the financial industry meltdown began in mid-September. During that time, confidence in the nation’s banking system has plummeted. Shame we can't go back to those good years, January of 2004, when the index was at it's highest.
As long as the people of Kah-lee-fornya lack the courage to end the idiocy of one wingnut's wet dream and FINALLY repeal Proposition 13, they will continue to swirl down into the ceramic whirlpool. It truly is the kind of bargain one would expect crafted between a lunatic and a sociopathic moron.
Peter, how do you like it?
Posted by DeminNewJ at February 17, 2009 04:44 AMCali needs dough? No problem. Arnold can just ask his buddy, President "skinny legs/scrawny arms" Obama. You know, the guy with the "empty ideas".
Posted by TIKI AL at February 17, 2009 05:54 AMCan Cali borrow/get bailouts from the Fed?
Posted by idiosynchronic at February 17, 2009 06:12 AMAnti "stimulus" protest in Seattle!!!
I saw the news report. Then all 6 of them walked down to Tully's for a coffee. There were only 6 protesters? 6...hmmmm... Fortunately, DHS was able to get all of their personal information and log them into the terrorist databases.
We are quite lucky that republi-KKKons know exactly what to do with the stimulus.
Shame we can't go back to those good years, January of 2004, when the index was at it's highest.
Why? You want to relive watching your 401 tank again?
Posted by phidipides at February 17, 2009 08:12 AMIt could be that Senator Correa remembers how well the Democratic Party (and voters) rallied to support Governor Davis when the anti-tax crowd came after him with pitchforks and torches.
Like the national Democrats, California Democrats never seem to make their argument to the public. Instead, it is all about apologizing for not being Republicans.
The complete absence of any leadership among California Democrats is appalling.
No one likes tax increases. No one likes cleaning the bathroom either. But everyone knows that some things need to be done. Like every other bit of bad news that people get in life, it can be explained. But it takes time and concerted effort.
And another thing. Do people still believe that electing an actor was a good idea? If so, why do they believe that?
Explain to me, please, what are the significant achievements of the Arnold Era?
During the campaign Obama promised a tax cut for 95% of Americans, the middle class. Today he delivered.
Singles making up to $75,000 will receive an $8 a week tax cut.
Married couples making up to $150,000 will receive a $13 a week tax cut. About $6.50 each.
It feels good knowing that President Obama is finaly helping people out. Now people can pay medical bills, save for college and retirement, and get through the bills every month.
Thank you!
Posted by Dennis at February 17, 2009 02:02 PMThank you!
You seem to be quite welcome!
Plagiarized in it's entirety from a tax website:
* Tax credit for workers: for 2009 and 2010 there is a "making work pay" tax credit of up to $400 for working individuals and up to $800 for couples
* Temporary suspension of taxation on unemployment benefits: the jobless get a little more help with a $25 increase in weekly benefit checks through 2009 and suspension of federal tax on the first $2,400 of unemployment benefits received in 2009
* Retirees and disabled individuals: those receiving Social Security benefits and individuals on disability will receive a one-time payment of $250
* First-time home buyer credit: increased to $8,000 for qualified first-time homebuyers purchasing homes after Dec. 31, 2008 and before Dec. 1, 2009; repayment requirement waived unless sold or no longer principal residence within 36 months
* "American Opportunity Tax Credit" for education: an 'enhanced' Hope credit that provides 100% credit for the first $2,000 and 25% for the next $2,000 on qualified expenses such as tuition and books; the credit is 40% refundable, meaning even taxpayers who have no tax liability can receive a credit for 40% of qualified college expenses, up to $1,000
* 529 plans: qualified computer technology and equipment is now allowed as higher education expenses from the plan, so distributions from 529 plans to buy a computer, for example, for college will not be taxable
* Earned Income Tax Credit: increased EITC amounts for families with 3 or more children and additional marriage penalty relief
* Additional Child Tax Credit: earnings threshold is lowered $3,000, helping more people qualify for the credit and receive more money; for 2008 the earnings threshold was $8,500
* Vehicle purchase: state and local sales taxes paid for purchases of qualified new motor vehicles are deductible
* AMT: a one year patch for 2009 of the Alternative Minimum Tax (AMT) to prevent as many as 24 million middle-income households from being hit with a tax that was originally designed to prevent the very wealthy from avoiding taxes
I guess there are a few more things I like in it. At least $60 billion (instead of the $15 billion he promised during the campaign...an amount I was not too happy with) for new green technologies...and ending the loan guarantees for "clean" coal and nuclear! Woo hoo!
And what did the press secretary say? They are going back for more? Fuck you, republi-KKKons!
Posted by phidipides at February 17, 2009 03:08 PMThe Obama administration is legally defending a last-minute rule enacted by President George W. Bush that allows concealed firearms in national parks, even as it is internally reviewing whether the measure meets environmental muster.
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AG Holder uses the "State Secrets" defense so often used by President Bush in a trial held in SF.
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CIA Director Panetta states Rendition is still a policy of the US.
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President Obama announces a 17,000 soldier "surge" in troop deployments to Afghanistan.
Bush III in progress...
And in Kalifornia, the layoffs begin even as our president signs the "stimulus".
Posted by peter at February 17, 2009 03:32 PMPeter: Good to see you back from under the rock. I thought we lost you after the solid defeat of McOld. One problem though. You are back with the same Republican talking points. Don't you have any thoughts or ideas of your own?
Do not bother to repeate the talking points. We hear them all the time from Republican Congressmen and Senators.
So you guys are betting on our economy getting even worst so that you guys can win in the next election. What pathetic bunch of morons you republicans are. Party first, country second.
Posted by suresh at February 17, 2009 03:46 PMNo Suresh, I've been here just about every day. Must be some other person under that rock. About the economy, funny that Speaker Pelosi's CBO stated this recession would be over later this year without even a stimulus. No, I have no bad wishes about our economy. We need it to be successful. My problem is that this bill signed today isn't what the doctor ordered. It is but a down payment on something else much bigger...a $787 billion down payment! And the CBO says we don't need it.
Any president would love be sitting in Obama's seat...having the ability to spend large numbers of money with little recriminations.
Posted by peter at February 17, 2009 04:02 PMI believe peter is actually a parrot wearing little computer key shaped booties and was trained to type gop talking points which are directly wired into its little bird brain.
Posted by TIKI AL at February 17, 2009 04:05 PM...funny that Speaker Pelosi's CBO stated this recession would be over later this year without even a stimulus.
No. The CBO reports that you have your head up your ass. They said: "The stimulus bill could by the fourth quarter of 2009 provide an increase of anywhere from 1.4 percent to 3.8 percent in what the GDP would otherwise have been, reports the Congressional Budget Office (CBO)."
I'll let you cut-n-paste to find the source.
AG Holder uses the "State Secrets" defense so often used by President Bush in a trial held in SF.
No. Just reviewing it. It's probably because of this little holdover from you guys. At least we know the source of all those Cheney "Terra" warnings! YOU GUYS!!!!
I believe peter is actually a parrot wearing little computer key shaped booties and was trained to type gop talking points which are directly wired into its little bird brain.
Hell, I was afraid peter had been shot when they said Travis the chimp could type.
Peter:
Your dear leader took the car (country) in the ditch. What Obama is doing is just trying to get it out. He said very candidly that he does not have all the answers and this stimulus package may not be perfect. But we need to move fast and move in a big way to get us out of this mess. All major economists including the one who advised McCain agree with this approach. So why not give it a try? What your dear leader did was to double the defecit. Republicans did not complain about it then. By the way to stimulate economy you must spend. Ask any economist including any Republican economist. So you guys calling this as spending bill shows how smart you guys really are. Or it is just oppose anything that the Democrat president does? I think it is the latter. I am that much smart to figure this out.
Posted by suresh at February 17, 2009 04:32 PMAfter years on the brink, it has finally come to this: California is going out of business.
How did this happen? Sure, the economy is bad. But this is a state whose money comes from the most bankable economic assets on Earth - the Long Beach ports, the Central Valley agricultural region, the defence contractors out in the Mojave desert, Silicon Valley, Napa Valley... Hollywood. How do you tax all this and end up amassing debts at the present rate of $1.7 million per hour?
Didn't Gov. Davis try to raise taxes just before he was recalled?
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There's something very important about this that even an economist needs to account for. Because the overall mood of the country prohibits a quick return to spending and investment, the multiplier effect of the stimulus will be muted. It will perform far below expectation. On top of that, its effects will not stimulate the economy in any permanent way, but will rather dissipate as soon as the stimulus does.
The standard argument against cutting or abating taxes as a tool of countercyclical policy, is that people will save rather than spend the money. Keynesianism targets current-period GDP as the measurement that matters above all, so saving more in a recession is a Bad Thing.
But the people don't want higher GDP. They want stronger balance sheets, amid a sense that hard times are ahead. If anything, the stimulus debate has exacerbated this sense. Why? Because the people want to save more money, but they see their elected leaders proposing to borrow and spend more, and they think: "these people have no idea what's really going on."
So this will attenuate the effects of fiscal stimulus even more. It's going to be a big bust. While people are cutting their own consumption in order to reduce their personal indebtedness, they're disgusted to find the government increasing their public indebtedness at a heroic rate. They'll respond to this by cutting consumption even more.
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Particularly worrying are those endlessly fawning Obama supporters who argue that Republicans who oppose the underpants-on-the-head insanity of the $787 billion “stimulus package” are unpatriotic and care more about their political careers than they do about saving the country from certain destruction.
This kind of talk sounds awfully familiar to me. We heard it in 2002, when the endlessly gung-ho supporters of one George W. Bush were telling Democrats that, unless they signed up to the underpants-on-the-head insanity of the Iraq invasion, they were unpatriotic and cared more about their political careers than they did about saving the country from certain destruction.
We rushed into AUMF, we're rushing into this stimulus...and yet he took 4 days to sign.
The bottom line, as Krugman seems to imply, is that we're far from the end of fiscal stimulus spending. If we're to replace 7 percent of lost GDP for the next three years or even longer, the fiscal-deficit spending will keep coming, far more than is being discussed now. Stimulus will NOT catalyze sustainable growth directed by the private sector.
The economic wizards are so intent on following their models and ignoring the people, that they will waste tremendous resources trying to postpone a reckoning that is fated to come. What we really should be talking about is mortgage finance. We have to figure out how to reduce the burden of mortgage debt on millions of people (including people that can perfectly well afford their payments, but are unaware of the creeping effects of deflation on their purchasing power).
President Obama may have wasted his creds on this piece of crap that he won't be able to lead the way solving the mortgage problem.
And don't worry, Walmart seems to be growing ever bigger with nary a worry in the world.
Posted by peter at February 17, 2009 07:41 PMWhew! That was alot of hopping around the keyboard! Petee wanna cracker?
Posted by TIKI AL at February 17, 2009 11:07 PM