Elevator speech: What I tell people when they say "the stimulus failed"

[LuckyTheDog]

Suppose you are in what you think is a 10-foot hole. You ask for a 10-foot ladder to get you out. But then you find out the hole is really 15 feet deep.

Well, the lesson to be learned from that isn't that ladders don't work. If you climb to the top, you're still 10 feet higher than when you started. The lesson to be learned is that you need a taller adder.

That's the situation Obama was in back in early 2009. The hole was deeper than anyone realized. We needed a taller ladder. But if the GOP had their way, we would have just dug the hole deeper.

[Ian David]

1. Why should you buy a ladder when you're already in debt from buying the shovel?

Oh, wait...

[EOTE]

3. But the world's most respected economists said a taller ladder was needed from the start

So I do blame Obama for using a 10 foot ladder when a 15 foot ladder was needed.

[EFerrari]

4. Correct. n/t

[LuckyTheDog]

6. Well, at the time, they were working from faulty, out-of-date numbers

Plus, you might remember that there was just a BIT of congressional opposition to the stimulus bill. They got what they could get. But if anyone had realized how bad the recession really was, then the Obama administration might have been able to negotiate a 12-foot ladder at least.

[EOTE]

7. Once again, the most informed of them KNEW a bigger stimulus was required.

And Obama could at least have pushed for the amount of stimulus required. Then at least we'd have someone to blame. It's easy to criticize this administration for providing insufficient stimulus when they didn't listen to the best minds on the matter.

[FailureToCommunicate]

8. Agreed. Paul Krugman then...and again last night on MSNBC

http://www.huffingtonpost.com/2009/02/17/paul-krugman-stimulus-too_n_167721.html

http://video.msnbc.msn.com/the-last-word/47289355/#47289355

[kenny blankenship]

29. It was not JUST the "most informed" - the Congressional Budget Office numbers were KNOWN BY ALL

The CBO estimated a 1.5 trillion dollar hole opening up in GDP.
Obama knew it. Everyone in Congress knew it. Some economists might have heard that as well, but only a few like Krugman NOTICED it and drew the obvious conclusion. You can only hope to stop a deflationary spiral if the hole in GDP gets filled. Otherwise the destruction of credit continues.

A 800 billion dollar stimulus, half of which was composed of ineffective taxcuts was no rational response to THE FACTS presented to those in power. They chose very poorly to lowball everything. (Compromise! Moderation! Politeness!) And now we are supposed to listen to pathetic mewling excuses: oh but nobody coulda known then! Nobody had those numbers! (which, as already noted, is a BALD FACED LIE) Oh who coulda foreseen??? Who?

They were warned well in advance that there would be NO second bite at the apple. Krugman warned them. A bridge that is only half built across a gorge is no more useful than no bridge at all, he said. It won't work -and you won't get a second chance to make another installment if the first effort doesn't work. The failure of the first shot -which is mathematically guaranteed - will be used to prevent follow up efforts. I knew it too, and I'm no Nobel laureate economist. But of course that is a political not a strictly economic calculation. But if I can see that and Paul Krugman can see that, what explains the failure of the White House and the Hill Democrats to see it too?

Certain people whom we have elected are supposed to be adept at leadership and politically wise. We placed all our trust in them - as we had no other choice but to do. They have proved themselves to be at best FOOLS, or else -and this is way more likely- they are nothing more than cynical ideological weathervanes who go full-on Reagan-Thatcher when traditional Democratic policy preferences run into the SLIGHTEST resistance from big money donors.

[coalition_unwilling]

30. Stiglitz' theory (in his magisterial 'Freefall') is that the Obama administration for reasons known

best to itself decided on a strategy of 'muddle through' rather than a bold neo-New Deal set of programs.

I hold Rubin, Summers and Rahm responsible for this, while recognizing that the buck stops at the top. But it may be that Rahm was preventing Obama from hearing voices like Krugman's and Stiglitz'.

[EOTE]

32. Thanks for this information.

I was trying to play devil's advocate a bit, but yes, you are correct. The stimulus was insufficient by pretty much every standard at the time.

[EFerrari]

11. Dean Baker was warning Obama in January 2009.

You're right about Congressional opposition but it's just not the case that the White House had bad numbers or that no body knew or warned that the stimulus was too small.

[SCantiGOP]

13. As soon as the Administration realized

that the problem was twice as big as the economists had originally estimated, he did go back and ask for a second round of stimulus, but it wasn't possible to get Congress to even consider it by then.

[EOTE]

15. Then they were very late to the party.

Because all the major economists knew that a much larger stimulus was required. And the resistance they got from the GOP should have been all the more reason to get it right the first time.

[newspeak]

24. yep, they're running the ad right now

how they gave obama his wish for the stimulus and it didn't work. that obama shipped jobs over seas with that stimulus. Lying sack of shite. What they're not saying is the wheeling and dealing obama had to do to get even part of that stimulus and what little riders the repugs wanted.

respected (and I mean respected, not the randian trickle on economists) stated that a massive stimulus was needed to get the economy rolling.

[newspeak]

25. also, I'd like to ad, they're still claiming that lower taxes for the rich and infamous

creates jobs. After ten fekking years of the little boot's tax cuts, they're still attempting to sell the people on how those tax cuts create jobs.

[coalition_unwilling]

31. The stimulus, such as it was, actually DID work. We were

hemorrahging 750,000 jobs per month in January 2009 and the stimulus stopped that and actually started to produce small positive numbers.

But the stimulus was too small by a factor of 2 and much of it went to tax cuts for the already well off, one of the least effective ways to stimulate the economy.

If the American people are stupid enough to vote for Romney because of their economic illiteracy, then they will rightly deserve the 25% U3 unemployment rate they will have in short order.

[BlancheSplanchnik]

16. yes, I remember that, now that you mention it.

congress....

[LuckyTheDog]

23. Yep. But I keep forgetting...

... that defending Obama here is almost as dangerous as doing so on Free Republic.

[MrTriumph]

5. Good visual. But most of the country knew the economy was in much worse shape.

Bush & Obama rescued the bankers, never prosecuted them and left businesses on Main St to fend for themselves.

[abelenkpe]

9. Government always does less than what is needed

If that administration had been good at negotiating they would have asked for more and accepted what was needed. Instead they compromised with republicans who didn't want to spend anything at all.

[progressoid]

10. The banks got their 15 foot ladder.

We're still waiting.

[sendero]

27. EXACTLY.

.... they did just enough "stimulus" to save the banks and nothing else.

[JBoy]

12. Republicans would have the poor and middle class lie down in the hole

and have the 1% climb out on their backs.

Tada! No ladder needed.

[LASlibinSC]

14. Blame Obama

if you want. I would rather be standing on a 10ft ladder than standing in the water at the bottom of the 15ft hole

[progressoid]

18. When the hole is full of water a 10 foot ladder is an insult.

[LASlibinSC]

20. Well played!

Touche!

[BlancheSplanchnik]

17. Great explanation! Important too, bec. those who think the stimulus failed

also think that repuke's harping on austerity for the middle-class and punishment for the poor is the solution.

A metaphor for the repuke solution would be more like...piling up the bodies of the poor and newly jobless ("new-poor", a sad new term for the early 21st century?) for owners of corporations to climb out on, while lining the walls of the hole with tv screens blaming social programs, civil workers, women, gays and "the war against kkkristians" for the catastrophe.

[EFerrari]

21. The truth is the stimulus did fail as was predicted

and the right wing is doing that any way.

Let's try to keep a grip on reality even as we push back on the wingnuts, shall we?

[newspeak]

26. actually the stimulus could not be called a failure

some of that money provided infrastructure work in nevada. It did create some jobs in nevada, as well as, upgrade some infrastructure.

[Romulox]

19. They gave the BANKS a 15' ladder, and told us that they would pull us up once they were safe...

Still waiting...

[cthulu2016]

22. Total BS: "The hole was deeper than anyone realized."

[ThoughtCriminal]

28. GOP Solution

Only give ladders to people who were never in the hole.

[Proud Liberal Dem]

33. Good analogy

and should be simple enough for the teabaggers and Fox News zombies to understand.........maybe.

[JoePhilly]

34. I ask them 2 questions ... 1) Why is UE down to 8% from a high of 10%? ...

2) Why is the DOW up about 5000 points since the day Obama took office?

The response depends on which kind of Republican I'm dealing with.

More moderate Republicans struggle to come up with a logical response, other than "It should be even better." But they can't come up with something that would have actually made it better.

The Tea Party types just start screaming about socialism and losing their liberty and how Obama is turning America into the Soviet Union. I just giggle at them.