Bloomberg: "Federal governnent getting out of the business of trying to spur the economy"

[Better Believe It]

Debt Deal Puts U.S. on Austerity Path as Economy Falters
By Rich Miller and David J. Lynch
August 2, 2011

The federal government looks to be getting out of the business of trying to spur the economy just as the U.S. expansion shows increasing signs of faltering.

A deal struck over the weekend to cut $2.4 trillion or more off budget deficits over a decade marks the beginning of a prolonged effort to put the government’s finances into better shape. While the immediate economic impact from the agreement is likely to be small, it will add to a reduction in growth next year of 1.5 percentage points coming from the expiration of past stimulus programs, according to economists at JPMorgan Chase & Co. and Deutsche Bank Securities.

In choosing austerity, the U.S. is embarking on a course that some European nations already have pursued with mixed results. A new coalition government in the United Kingdom last year enacted a program of reduced spending and tax increases aimed at closing the budget deficit.

The economy is at stall speed even before the public expenditure reduction starts to kick in,” Magnus said. “The omens for this in the U.S. are really poor. The situation is quite comparable.”

Read the full article at:

http://www.bloomberg.com/news/2011-08-02/debt-agreement-puts-u-s-on-path-to-end-stimulus-just-as-economy-falters.html

[xchrom]

1. Recommend

[Loge23]

2. The original "Stimulus" was also "negotiated" away.

Lets not forget that the original Stimulus bill, which many of us thought would include significant job-creating infrastructure re-development, was effectively whittled away by the same cretins on the right that now scream about it!
Lets also not forget that our President effectively allowed this to happen in the ever-present bipartisan spirit!

[FreakinDJ]

4. Yep - Tax Cuts over Hwy projects

we all see how well that worked out

[Better Believe It]

3. President Obama: "I've never believed that government's role is to create jobs or prosperity"

Excerpt)

The White House
Office of the Press Secretary

For Immediate Release September 08, 2010
Remarks by the President on the Economy in Parma, Ohio
Cuyahoga Community College West Campus, Parma, Ohio

"Now, we have a different vision for the future. See, I’ve never believed that government has all the answers to our problems. I’ve never believed that government’s role is to create jobs or prosperity. I believe it’s the drive and the ingenuity of our entrepreneurs, our small businesses; the skill and dedication of our workers -- (applause) -- that’s made us the wealthiest nation on Earth. (Applause.) I believe it’s the private sector that must be the main engine for our recovery.

I believe government should be lean; government should be efficient. I believe government should leave people free to make the choices they think are best for themselves and their families, so long as those choices don’t hurt others. (Applause.)"

http://www.whitehouse.gov/the-press-office/2010/09/08/remarks-president-economy-parma-ohio

Now I understand why the Obama Administration didn't lift President Reagan's ban prohibiting direct WPA type federal jobs programs. President Obama believes it's not the governments role to lead this nation out of the Great Recession by creating useful public works jobs and economic demand. A "lean government" stays out of the way and lets Wall Street and corporate America (entrepreneurs) perform their magic.

Some magic.

Well, they did make almost 10 million jobs disappear. BBI

Excerpts from two articles by Alec MacGillis -

By Alec MacGillis
Washington Post Staff Writer
Sunday, November 8, 2009 and
Monday, November 9, 2009

Why has a White House that talks so much about boosting employment steered clear of the most direct strategy that could keep Americans on the job? .... aside from a small summer employment program for young people, it has not sought to create jobs on the public payroll, something the country did in the 1930s and 1970s.

President Richard Nixon gave jobs programs another go in the doldrums of 1973-74 with the Comprehensive Employment and Training Act (CETA).

The program withered under President Ronald Reagan, who added prohibitions against public service employment (except for summer programs and natural disasters) that endure today. That the Obama administration shows little indication of lifting this taboo is a sign of how free-market tenets persist even when financial turmoil has called them into doubt, said John Russo, co-director of Youngstown State University's Center for Working-Class Studies.

As for direct job creation: there's a real nervousness about setting up anything that looks like a WPA-style jobs program. It's that reluctance that my piece is calling into question -- after all, is it really more politically damaging to be seen as doing a jobs program than to be facing double-digit unemployment?

.... we had direct job creation programs in place throughout the '70s, as my article recounts. It was called CETA, and it ramped up under Nixon in '73-'74 recession. Reagan ended the program, and implemented a new federal restriction against federal jobs programs, with exception for summer youth programs and national emergencies.

The Labor Department does have various job training programs in place, such as Job Corps. But the federal government is prohibited against doing direct jobs-program style hiring a ban that Reagan put in place and that the Democrats so far have balked at trying to lift.

Read the full articles at:

http://www.washingtonpost.com/wp-dyn/content/article/2009/11/06/AR2009110601900.html?sid=ST2009110604712

http://www.washingtonpost.com/wp-dyn/content/discussion/2009/11/06/DI2009110603214.html

[EC]

5. According to the repubs and tps

it was Wall Street that wanted the cuts to begin with. So now they are worried that cuts will stall growth?

[ej510]

6. What else would you expect from a third way dem.

[steve2470]

7. k&r nt