Right-wing Bubbas

The right-wing has lost any slight grasp on reality they might have had.

Mortgage Deduction Inefficiency

Awhile back I linked to an article by Peter Dreier about the mortgage interest deduction.

President Obama has proposed to cap the mortgage interest deduction for high-income taxpayers.

The National Association of Home Builders (NAHB) and the National Association of Realtors (NAR) oppose this purely out of self-interest. They also felt there wasn't a housing bubble. No doubt their self-interest in continuing to build an sell price-inflated homes led them to believe such. So, at this point, their opinions can be discarded.

As many unbiased sources have stated, some other nations don't have this silly high-income homeowner subsidy and we would probably be better off discarding the deduction altogether.

The Next Bubble?

Something interesting (and scary) to ponder.

You Oughta Be In Pictures

Here is an interesting piece by Michael Rosen which elaborates on a theme I'd posted earlier.

Pabst Farms Pork

Can we end the push for Pabst Farms already? [Hat tip to James Rowen]

Kudos to Mayor Barrett for telling the state to put the kaibash on this project and use the money to repair roads and accomplish more urgent needs.

This last thing we need right now, especially in this economy, where retail sales have fallen off a cliff, is another retail wonderland.

Media Are People Too

WOW! Sorry to get caught up on Megan McArdle in the last few posts, but WOW! Her delusions of grandeur are overwhelming.

She “debates” Glenn Greenwald on the media, often lecturing him on legal issues and the constitution (which she obviously has little knowledge, other than her usual anecdotal examples, which she seems to feel makes her an expert). But what does he know? He’s only a constitutional lawyer.

Typical Megan, just ranting on and on, never admitting ignorance.

One can always notice a running theme in her work – defending the status quo.

The bankers aren’t to blame, the Fed isn’t to blame, the media isn’t to blame, etc.

One funny thing about her style – she goes off on these tangents where she doesn’t even have a total grasp of that which she is talking about or criticizing. When official unemployment stats started being recorded, laws instructing journalism standards, etc.

Quite a bit of arrogance on display.

Regarding why the media can’t get more into detail on important topics and talk to people like adults:

“People are tired when they get home. They don’t want to hear lectures.” So therefore we can only discuss fluff, and we can’t really get into any detail or history.

So Megan is an inquisitive intellect yet most American people are just uninterested drones whom she assumes are too tired or too stupid to want to get better information provided to them by their media.

She really does like to have it both ways.

Bankers v Citizens

Whose side is Geithner on?

For Further Reading:
Banking On The Brink
Nationalize Insolvent Banks
Nationalize The Banks
The Banks Have Stolen Enough

Pushing On A String

Dean Baker tries to discuss the stimulus plan, the housing bubble, and the Federal Reserve, among other issues, with Megan McArdle (conservative/libertarian propagandist).

Megan 'seems' like a very bright person, and she even raises some good points (for the first few minutes). But too often she cuts Dean Baker off or uses deflectors like, "well, the real question is" or, "anyways, what really matters is." And sometimes she just doesn't seem to have a grasp of the facts or just won't admit that she doesn't, whereby she then rambles and morphs the discussion into a new argument.

She goes on and on about “make-work” jobs. Saying the WPA wouldn’t have been created if there was full employment. Duh! That is the purpose of demand-side stimulus. The government steps in to do that which the private sector will not or can not.

Megan implies that workers in the WPA program just recorded oral histories and painted murals. And, also (latter) in a rather immature quip she compares it to hiring people to mow their lawns. Ridiculous! She conveniently sweeps past Dr. Baker’s evidence of roads and bridges. As if to imply, the work being done added no long-term value, built nothing of value, created no jobs, nor helped the economy recover. The GDP and employment indicators of the time tell a different story.

She then goes on to say how proxies, ways of measuring, are imperfect…as if, there’s just no good way to measure anything, so therefore, we really don’t know anything, what works, or what doesn’t. But, stupendously, somehow she knows.

And, also, she makes the distinction between good and bad “make-work” jobs – if she doesn’t like the project or thinks it's wasteful, then it’s bad “make-work.”

Next, she explains how a son-in-law being hired because of nepotism is a “make-work” job. Huh, that’s an interesting one. The old saying, “it’s who you know, not what you know” didn’t come about for just any reason. So all the people who knew someone whom helped you obtain a job, because of that connection your job isn’t real. Wow, the unemployment rate is going to rise spectacularly under Megan’s new way of measuring.

To her this is all most likely bad debt. She feels we can't borrow and spend and have any good come from it. But that train of thought is debunked here, here and here.

I also was really 'charmed' by her use of phrases like “everyone knows,” implying everyone but Dr. Baker knows and he’s an idiot to even be debating her on this particular point. Or when he would squash her weak argument, she would then say, “we’re arguing about two different things,” or “that’s neither here nor there.” The only thing she seems to have done successfully here is muddle the discussion into the realm of incoherence (which is Republicans' want).

Or when she tries to sound academic and says things like the marginal product of labor ("if we value what they are creating more than we are paying them" - her definition). But this concept really supports the notion that productivity rather than debt is a better indicator of our growth and quality of life. That is, looking back years from now, even if we are paying off debt, yet we have increased our productivity (more so than we otherwise would have), the stimulus plan will have been successful.

Her whole argument also has an underlying assumption - there is no waste in the private sector. Which, if the last eight (or, for that matter, twenty-eight) years have shown us anything, this is definitely not the case. She appears to be nothing other than an enraptured ideologue.

One can only conclude Megan McArdle is a train-wreck.

During a few spots I was hoping Dean would just say, "OK. Next topic." Since it was obvious Megan only wanted to hear herself pontificate and bloviate.

But nonetheless, it's a good informative hour...at least when Dean is allowed to speak.

Repeal The Reagan Tax Cuts!

Thom Hartmann

(More) Republican & Media Double Standards

Another double standard I happen to see running almost daily on television is the notion that Obama is talking down the economy. By being honest and truthful with citizens - we are facing a downturn that could be almost as devastating as the Great Depression - Obama is the cause of the downturn in the economy and also making it worse.

Yet, for years, the Republicans were the masters of the fear card. A terrorist here, a mushroom cloud there...be very afraid. The only thing that will save us is reckless signing statements, rash executive orders, and, as always, tax cuts. Bush served up the combo platter - bad policy, bad appointments, and talking everything down.

Double Standard

The mayor of Lansing reads the riot act to yet another dimwitted Fox host. [Hat tip to Michael Rosen]

For more on this, see here and here.

Opportunity Cost

How can it be that increasing our deficit for Iraq (which will cost approximately $3 trillion) is good policy - even though it has worsened national security and weakened our standing in the world - when it has not won over any hearts or minds?

Yet, deficit spending as proposed in the recently passed stimulus bill - with increased unemployment insurance, infrastructure construction projects, among other initiatives - which actually puts people who otherwise would not be working back to work, while addressing needed repairs and improvements all over the country, is bad debt.

Even when Republicans are not in power they still seem to have the ability to frame the debate and to have all the parrots on TV and radio regurgitating their nonsense.

Which would you prefer we be spending money on: Iraq or investing in long-term infrastructure projects that put people back to work now and also prepare our country for future growth?

Buying The Law

This story in the USA Today seems eerily familiar to the WMCs efforts to pack the courts with business-friendly judges here in Wisconsin (here and here).

Perspective On The Crisis

Dean Baker, in a great interview here, gives a harsh scolding to the ruling elite whom drove us off a cliff.

Development Needs Research

In Sunday's Journal-Sentinel, John Torinus has a bullet-pointed, long-winded sermon on the beauty and stimulative-nature of entrepreneurship (whatever that means). Even his title has it backwards.

There is a tone when he states, "...a heavy dependence on its historic manufacturing sector." As if we should divest ourselves of our large market share, our competitive advantage, and a continued focus of the success of one of our most lucrative sectors. Manufacturing is generally a higher paying, high value-added industry. This should be a prime focus of our research and development efforts. The hits to employment in this industry over the last few decades have more to do with trade politics (and slave labor) than with efficiency or productivity.

He also feels we should capitalize on our research and development capabilities and stengthen them. OK. Sounds good. Although, typically this type of activity is either heavily subsized by the government, or directly funded by the government through the university system and organizations such as the National Institutes of Health. Has Torinus suddenly become a tax-and-spender? Or is he just citing another example of where government and bureaucrats can be highly effective and actually improve society?

Much of his opinions regarding UWM -- it's construction projects, and it's innovative leadership, and the giant strides it has made in recent years -- are spot on. And, hopefully UWM will choose a downtown rather than a suburban location. As a former student and employee at UWM, I'm proud of their progress and their scholarship.

[Mr. Torinus mentions, "The R&D has to be turned into patents, licenses, and start-up companies." Here are numerous articles by Dean Baker that disprove the economic efficiency of patents: A, B, C, D, E, and F. The money is made being the first to create the idea, not holding that creative capacity from others to build upon it. That causes long-term inefficiency.]

But after the public sector nurtures these industries and ideas, Torinus feels we should, "...transferring the basic technology to commercial applications in the real world of business." If public entities are producing technologies and products the market wants, aren't they applying their know-how in the real world of business? And, competing quite effectively it seems. We should turn over the innovative capacity to the private sector so they can make highly leveraged bets, create gains for a select few, watch them mismanage and corrupt the endeavor, and see the whole thing collapse...to then have to be cleaned up by taxpayers (the public sector)?

It seems taxpayers' money is actually better managed and spent by the government than the private sector. The Republican propaganda campaign over the last 35 years to dispute this fact and muddle the discussion about such seems impervious to reason and clear-thinking. We'd all be better if we just ignored them.

Other than that, I'm all for Torinus' bullet-pointed research spending ideas. But, lets keep them state- or local(ly)-run centers, having well-paid jobs with health care and funded retirement plans.

"Sharing is caring," as Mr. Rogers said. If a select few would share just a minuscule amount (pay their fair share of taxes), they could initiate massive change and end the impoverished conditions of the majority on this planet. The only thing standing in the way of this is political cover, masking greed and entrenched interests.

Obviously all the ideas Mr. Torinus feels should be funded would have to be public programs. If this was "easy money" wouldn't private corporations already be making the investment? Of course, they only care about short-term gains. How we fund our societal institutions and the priorities of such, how we reach for sustainability and prosperity, these are long-term policy issues. Concerns rightfully addressed and managed by the public sector.

But WMCers and the right-wing bow to a different savior. They must keep their shareholders happy. You don't want to piss off Wall Street. Wall Street it now seems has become our defacto government. How about the change we believe in is taking our government back.

With some populist spin struggling to conceal the underlying conservative positions and giveaways to the private sector, this piece seems nothing more than typical WMC rhetoric from Torinus.

This Is Economic Development?

Public Enemies

Letting Go Of Reagan & Supply-Side

Tearing Down the Reagan Myth

The Failed Prophet

The Bush Years

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Plunder & Blunder

This is the title of Dean Baker's new book. He was one of the first over the last two decades to get it right about the stock, dollar, and housing bubbles. His new book should be an interesting and illuminating read.

Homebuyer Tax Credit

Calculated Risk has been all over this proposal, in the stimulus bill, to give homebuyers a tax credit of 10% of the purchase price up to $15,000.