Thursday, July 16, 2009

War is Peace. 'Stimulus' is Stabilization

With a straight face, they pull this crap.

Turns out the $787 billion "American Recovery and Reinvestment Act" (AARA) was not designed for full economic recovery, but rather to "stabilize" the downturn. That's the word from White House officials today, who held off-camera briefings with reporters on how the AARA is working so far.

"This legislation was designed to cushion the downturn," said White House Press Secretary Robert Gibbs. "That's why we have always talked about this as one function of economic recovery."

When pressed about the change in terminology, Gibbs said he was not trying to temper expectations after the fact. "I can probably find 15 or 20 occasions when I said this in the lead up," Gibbs said, explaining that he had always defined the AARA as part of a "multi-legged stool."

HT Ace. We are of the same opinion: they know the damn thing will be totally ineffective, and are hoping to kick the can to 2010 with this.


J. Strupp said...

It's intended for stabilization. It's was never big enough or focused enough to completely offset the slack in aggregate demand. No one denies this to my knowledge.

Not even back in January.

I know there is nothing that excites you more than a bit of Keynes on a Friday afternoon dadster.

Dad29 said...

Nice of you to check on my heart's condition. It's pumping, thanks...

It was CALLED "Stimulus," not "Stabilization." Size is not the question.

The terminology changed b/c it doesn't work, and won't work until 2010--if then--

J. Strupp said...

"The terminology changed b/c it doesn't work, and won't work until 2010--if then--"

Which one is it? It doesn't work or it does work but it just takes awhile.

This is about as consistant as.....government stimulus worked for the Chinese who are clipping along at around 7% GDP growth again.....but stimulus won't work here....unless it's 1942 and we are spending 120% of GDP on weapons of war which was not government stimulus either even though it pulled us out of the depression.

Dad29 said...

Wrong, Struppster.

PRC's 'stimulus' consists of direct orders to Banks to lend money like crazy to PRIVATE ENTERPRISES.

ObamaStatist 'stimulus' consists of direct subsidizations of State and Local Gummints.

Pay attention to the details and you may learn something.

Anonymous said...

Meanwhile, the largest lender of money to small and medium-sized businesses is on the verge of bankruptcy - the 4th largest bankruptcy ever. The Obama response was...... crickets.

Bail out main street and help protect the overwhelming majority of jobs in the country? Nah.... The peasants don't deserve help, they are just to be the revenue stream for an engorged government.

So much for Democrats are for the little guy.


Dad29 said...


That CIT thing is going to be a big mess, yup. It will leave GECap as the remaining major small-biz lender--and I don't think GECap does SBA, either. Nor factoring.

OTOH, if TARP was a bad idea, then it's a bad idea no matter who, right?