Showing posts with label Great Recession. Show all posts
Showing posts with label Great Recession. Show all posts

Friday, February 19, 2016

Barack Obama And Race And Blacks

Official photographic portrait of US President...
Official photographic portrait of US President Barack Obama (born 4 August 1961; assumed office 20 January 2009) (Photo credit: Wikipedia)
Just getting a black guy in there as the first black president has been a monumental achievement. The self-esteem effects on black children is beyond the clock. But the substantial work has been on education, health care, job creation, and criminal justice system reform. And he has taken huge leaps on each. The impact will play out over a generation.

The first black president has done right by the black people. Why are people wearing wigs offended?

The Great Recession was harder on the black population than on the population at large. And the unemployment rate among young black folks is still too high. And that is a prescription for continued good work. Too bad we have term limits.

America is less than 5% unemployed.

India is the next China, and Africa is the next India. African Americans stand to benefit from Africa's rise. 

Friday, February 05, 2016

Six Fall Guys


  1. A black guy.
  2. A Hispanic.
  3. An Indian. Two Indians, one a diplomat. 
  4. A Chinese. 
  5. A Sri Lankan. 
  6. A Jewish guy. 
In the aftermath of the Great Recession I noticed there were six most visible fall guys. When democracy and the market are at their best, I believe that does not leave room for racism. Europeans have numerous schisms. But when those same Europeans gather in America, a white identity gets formed. Perhaps the Chinese identity is a similar melting pot identity formed over a few thousand years. It has always amazed me how a billion people can be a single ethnicity. 

When Wall Street wiped out 13 trillion in wealth, there were six fall guys, the most visible ones. 

Corruption in a city like New York where there is so much power and money concentrated in one small place is like speeding on the interstate highway. You can police it, you can get people to pay fines, but you can't perhaps eliminate it. You are essentially dealing with human nature. Greed has a tendency to creep in. 

One way to look at it is, after about 70 years banks accumulate so much in bad loans, those bad loans need to be wiped out, the slate needs to get clean. So it was not bad behavior. It was just the slate getting cleaned for a fresh start. 

But then there are other complaints. America built infrastructure in Europe, and then it stopped. Why stop? Why not go on to build infrastructure in Africa? Asia? Latin America? That was racism. A country choosing to destroy or park trillions while there is such unmet need in terms of infrastructure, credit, and clean energy is racism. 

The six fall guys point at that racism that impact billions of people. 

Also, there needs to be a less painful way to wipe out bad loans. An economy should be able to wipe out bad loans without bringing itself to the knees. Maybe this should be the last Great Recession. 



Saturday, December 26, 2015

बुश का बघदाद (२)

बुश का बघदाद

अमरिका पर बिन लादेन ने बाद में हमला किया। उससे पहले हमला बोला बुश ने। Record Surplus को Record Deficit बना दिया। इतना बड़ा टैक्स कट किया कि देश सीधे मुह के बल जा के गिर पड़ी।

जनता मुर्ख। उसने वैसा ही मैंडेट माँगा था। जनता ने दे दिया। अमेरिका के गरीब जनता को social issues पर इस तरह डिवाइड कर दिए हैं ये नियमित अपने अहित में वोट देते रहते हैं।

९/११ हुवा। तो अफ़ग़ानिस्तान पर वार करो। कि पर्ल हार्बर पर अटैक किया जापान ने और तुम ने अटैक कर दिया इंडोनेशिया? Looking Tokyo Going London? अभी भी ४०% अमेरिकी कहते हैं ९/११ किया सद्दाम ने। ४०% वो वही हैं जो नक़्शे पर प्रशांत महासागर नहीं ढूँढ सकते। २०-३०% अमरीकी कहते हैं ओबामा मुसलमान है।

कितने लोग मरे वो भी हिसाब करो लेकिन ओ अलग करो। इस ब्लॉग पोस्ट में सिर्फ पैसा की बात करते हैं। एक से १० लाख के बीच लोग मरे सब मिला के। युद्ध के कारण जो सिविल वॉर हो गया उसके मृतक भी तो गिनोगे। जितने अमरिकी ९/११ में मरे उससे जयादा इराक में।

युद्ध का बिल बुश का तीन ट्रिलियन डॉलर। वो इतना ज्यादा पैसा है लोग सोंचना ही छोड़ देते हैं। कहीं १०० डॉलर पॉकेटमारी होती है तो पुलिस बुलाओ। एक लाख डॉलर का फ्रॉड होता है तो पुलिस बुलाओ केस करो। मिलियन डॉलर करप्शन को लफड़ा हो जाता है। लेकिन तीन ट्रिलियन। उसको तो छोड़ दो।

ट्रिलियन से नीचे का तो गप्प ही नहीं है बुश काल में। पहले तो एक ट्रिलियन सबसे धनाढ्य लोगो को बाँट दिया। बाँट ही दिया। लो, मुफ्त का पैसा। मेरे बाप की कमाई। तीन ट्रिलियन युद्ध में खर्च। MasterCard swipe करो। खर्चा कौन भरेगा? चीन किस कामके? वॉल स्ट्रीट पर ट्रिलियन डॉलर का फ्रॉड। तो अर्थतंत्र जब तास के घर के माफिक गिरा ........ बिन लादेन ने तो सिर्फ वर्ल्ड ट्रेड सेंटर गिराया। बुश ने पुरे अर्थतंत्र को ही गिरा दिया। अर्थतंत्र कोलॅप्स हुवा तो १३ ट्रिलियन डॉलर ऐसे गायब हुवा जैसे पीसी सरकार ने आ के गायब कर दिया हो। सफाचट। Wiped out, gone forever.

यार, किसी की भी ब्रेकिंग पॉइंट होती है। अमेरिकी अर्थतंत्र का भी था, वैज्ञानिक बुश ने पता लगा के छोड़ा।

अमेरिकी सरकार का एक साल का बजेट होता है तीन ट्रिलियन। यानि कि बहुत बड़ा अमाउंट है जिसकी मैं बात कर रहा।
अभी कहानी ख़त्म नहीं हुवी। तो स्टिमुलस कह के ७०० बिलियन खर्चे करने पड़े। करना चाहिए तीन ट्रिलियन लेकिन बुश के पार्टी ने होने नहीं दिया। तो देशको monetary स्टिमुलस के रास्ते जाने पड़े। उसका मतलब प्रिंटिंग प्रेस चालु करो और पैसा छापो। Basically पैसा छापो और बड़े बड़े बैंक को मुफ्त में दे दो। जीरो इंटरेस्ट रेट पर। सब तरफ बुश के दोस्त ही दोस्त।

Quantitative Easing
Quantitative easing is distinguished from standard central banking monetary policies, which are usually enacted by buying or selling government bonds on the open market to reach a desired target for the interbank interest rate. However, if a recession or depression continues even when a central bank has lowered interest rates to nearly zero, the central bank can no longer lower interest rates. The central bank may then implement a set of tactics known as quantitative easing. This policy is often considered a last resort to stimulate the economy. ...... A central bank enacts quantitative easing by purchasing—without reference to the interest rate—a set quantity of bonds or other financial assets on financial markets from private financial institutions...... Quantitative easing, and monetary policy in general, can only be carried out if the central bank controls the currency used in the country. The central banks of countries in the Eurozone, for example, cannot unilaterally expand their money supply and thus cannot employ quantitative easing. They must instead rely on the European Central Bank (ECB) to enact monetary policy.
How the Great Recession Was Brought to an End
The U.S. government’s response to the financial crisis and ensuing Great Recession included some of the most aggressive fiscal and monetary policies in history. The response was multifaceted and bipartisan, involving the Federal Reserve, Congress, and two administrations. Yet almost every one of these policy initiatives remain controversial to this day, with critics calling them misguided, ineffective or both. The debate over these policies is crucial because, with the economy still weak, more government support may be needed, as seen recently in both the extension of unemployment benefits and the Fed’s consideration of further easing. ....... without the government’s response, GDP in 2010 would be about 11.5% lower, payroll employment would be less by some 8½ million jobs, and the nation would now be experiencing deflation. ...... When we divide these effects into two components—one attributable to the fiscal stimulus and the other attributable to financial-market policies such as the TARP, the bank stress tests and the Fed’s quantitative easing—we estimate that the latter was substantially more powerful than the former.

Friday, December 25, 2015

बुश का बघदाद

MasterCard Classic
MasterCard Classic (Photo credit: Wikipedia)
बुश जब बघदाद आया तो सबसे पहले क्या काम किया कि ट्रांसफार्मर उड़ाओ, पानी टंकी उड़ाओ। सद्दाम कहीं भी छुपा हो सकता है। अजीब आदमी है। ये नहीं सोंचा लोग पानी पीते होंगे। मरुभूमि इलाका। तबतो सद्दाम ने पानी टंकी लगवायी होगी। कि पानी टंकी लगा दो नहीं तो लोग बगावत कर देंगे। प्रेस्टीज इशू है। अगर लोग बगावत कर देते हैं तो फिर ये जो इमेज है कि सद्दाम डिक्टेटर है वो तो गयी काम से। तो बुश ने उड़ा दिया। सबसे पहले। उसको कोई परवाह नहीं कि बगावत हो सकती है।

बुलडोज़र लगाने में टाइम लगता है क्या? दो चार रोज में युद्ध ख़त्म। तो फिर तुरंत उन्ही ट्रांसफार्मर और पानी टंकी के लिए अपने करीबी दोस्तों को मेगा बिलियन का बिना कम्पटीशन का कॉन्ट्रैक्ट दे दिया। देश लिबरेट कर दिया अब लगा दो ट्रांसफार्मर, लगा दो पानी टंकी। इराकी भी क्या याद करेंगे। 

राजनीति में एक पुराना नियम है: Follow The Money. अगर आपको राजनीति समझ नहीं आती और समझना हो तो ये फोर्मुला लगा दो बहुत राजनीति आपको समझ में आ जाएगी। 

कुछ हैं conspiracy theorists वेबसाइट बगैरह बना के बैठे हैं कहते हैं ९/११ बुश ने किया, it was an inside job ---- अजीब लोग हैं। बिन लादेन को इस बात का इतना बुरा लगता था वो कभी क्रेडिट लेने से नहीं चुकता था। वीडियो निकालता था कि ईद मुबारक और अंत में जाते जाते ९ दो ११ के बारें थोड़ा हिंट दे देता था। फिर से अटैक की तयारी करो या ऐसा कुछ। ताकि अगर कोई गलतफहमी हो तो दुर हो जाए। 

९/११ बुश ने नहीं किया। बिन लादेन ने किया। लेकिन जिसको हम आप और ओबामा Great Recession कहते हैं और जिसे बुश और उनके दोस्त लोग Grand Recession कहते हैं --- वो लेकिन inside job था ---- fully documented. 

अमेरिका का अपना पैसा तो था नहीं। चीन से उधार में लो और इराक में खर्चा करो। बुश ने क्रेडिट कार्ड स्वाइप कर के युद्ध किया। Paid for by MasterCard. ..... कहते हैं There are somethings money can't buy, for everything else there is MasterCard. तो बघदाद का पानी टंकी बगैरह वो MasterCard केटेगरी के थे। 

अगर आप के देश का बजेट हो १०० बिलियन और आप ३३ बिलियन युद्ध में होम दो तो क्या होगा? उसी हिसाब से अगर आप के देश का बजेट हो तीन ट्रिलियन तो? 



नेपाली में कहते हैं भ्वांग। मैथिलि में कहते हैं भुम। हिंदी में क्या कहते हैं? 

तो ये सबके सामने हो रहा था तो वाल स्ट्रीट वालो ने फोटोकॉपी मार दिया। घर गिरबी रख के लोग लोन लेते हैं। लेकिन एक ही घर पर चार बार पाँच बार लोन लो तो क्या होगा? घर बैंक का है आप का अभी हुवा भी नहीं लेकिन आप ने लोन निकाल लिया। बैंक ने वैसे ढेर सारे घरो का बनडलिंग कर दिया और किसी दूसरे बैंक को होलसेल में बेच दिया। वैसे ही दो चार राउंड हो गया। उसको कहा गया innovation ---- यानि कि हम financial instruments बना रहे हैं। सब लोग अपना मंथली पेमेंट करते रहे तब तक पता नहीं चलता। लेकिन कुछ लोग ऐसे निकले घर खरीदने के स्थिति में नहीं थे फिर भी डाउन पेमेंट कर चुके थे। पियर प्रेशर। नौकरी चली गयी। मंथली पेमेंट बंद। पैसा रहेगा तब न दिजिएगा। आप बुश हैं जो चीन से उधार लोगे। 

तो पुरा घर तास के पत्ते के घर के तरह गिर गया ----- now THAT was an inside job. वो बिन लादेन ने नहीं किया। हालांकि वो क्रेडिट लेना चाहता था। उसका था कि अमेरिका को ऐसे युद्ध में घिंचो कि वो afford ना कर सके। 

Great Recession में कितने ट्रिलियन डॉलर ध्वस्त हो गए अभी तक हिसाब हो रहा है। बहुत मिडिल क्लास और लोअर मिडिल क्लास अमेरिकी का पेंशन गायब गया। उनकी क्या होगी वो तो जब वो रिटायर होंगे तब पता चलेगा। 

अमेरिका में भी बहुत घपला है।

चिनिया कहते हैं non-interference ----- वो लेकिन कह रहे हैं युद्ध बहुत खर्चिला होता है अच्छा बिजनेस नहीं। युद्ध से अच्छा बिजनेस हैं लोगों को लोन दो, विशेष कर के उन्हें जो युद्ध करना चाहते हैं।

टेक्सास में काऊबॉय कल्चर है।




Sunday, July 26, 2015

The 4%

speaking at CPAC in Washington D.C. on Februar...
speaking at CPAC in Washington D.C. on February 10, 2011. (Photo credit: Wikipedia)
First Donald Trump started going after Mexicans (and never stopped). Then Jeb Bush said people should work longer hours if they want more money. Now Hillary said something about black guys in hoodies (like Mark Zuckerberg?) being scary.

This is not a good sign. The leading people running to be America's next President don't feel it is possible to take America back to a 4% growth rate. They are feeling the squeeze. The problem is nothing new. It all goes back to 2008.

Economists did not see the Great Recession coming. And once it hit, they did not have remedies. You can't keep at zero interest rates. Because if another recession hits, you have nothing left to throw at it.

My diagnosis back in 2008 was, just like the Great Depression added macroeconomics to the arsenal, before that there was only microeconomics, now was the time to add a new layer on the top, called globoeconomics. Did not happen.

A genuine world government is the only cure to Climate Change, and terrorism, the two big menaces most heads of state fumble around. Add to that poverty and disease. But that might also make way for the globoeconomics.

Here's just one symptom: money is not supposed to just sit around. It is supposed to get invested and give returns of 5-10%.

Tax havens: Super-rich 'hiding' at least $21tn
A global super-rich elite had at least $21 trillion (£13tn) hidden in secret tax havens by the end of 2010, according to a major study....... The figure is equivalent to the size of the US and Japanese economies combined....... his $21tn is actually a conservative figure and the true scale could be $32tn. A trillion is 1,000 billion. ....... His study deals only with financial wealth deposited in bank and investment accounts, and not other assets such as property and yachts. ..... the super-rich move money around the globe through an "industrious bevy of professional enablers in private banking, legal, accounting and investment industries. ...... "The lost tax revenues implied by our estimates is huge. It is large enough to make a significant difference to the finances of many countries. ...... "From another angle, this study is really good news. The world has just located a huge pile of financial wealth that might be called upon to contribute to the solution of our most pressing global problems," he said. ......... the impact on the balance sheets of 139 developing countries of money held in tax havens that is put beyond the reach of local tax authorities. ....... since the 1970s, the richest citizens of these 139 countries had amassed $7.3tn to $9.3tn of "unrecorded offshore wealth" by 2010. ...... Private wealth held offshore represents "a huge black hole in the world economy," Mr Henry said. ....... Mr Whiting, though, urged caution. ...... if tax havens were stuffed with such sizeable amounts, "you would expect the havens to be more conspicuously wealthy than they are". ...... At the end of 2010, the 50 leading private banks alone collectively managed more than $12.1tn in cross-border invested assets for private clients ...... The three private banks handling the most assets offshore are UBS, Credit Suisse and Goldman Sachs ...... Less than 100,000 people worldwide own about $9.8tn of the wealth held offshore. ....... it was difficult to detail hidden assets in some individual countries, including the UK, because of restrictions on getting access to data. ..... A spokesman for the Treasury said great strides were being made in cracking down on people hiding assets......He said that in 2011-12 HM Revenue & Customs' High Net Worth Unit secured £200m in additional tax through its compliance work with the very wealthy........ He said that agreements reached with Liechtenstein and Switzerland will bring in £3bn and between £4bn and £7bn respectively.
Wealth doesn't trickle down – it just floods offshore, research reveals
The world's super-rich have taken advantage of lax tax rules to siphon off at least $21 trillion, and possibly as much as $32tn, from their home countries and hide it abroad – a sum larger than the entire American economy. ...... sifting through data from the Bank for International Settlements (BIS), the International Monetary Fund (IMF) and private sector analysts to construct an alarming picture that shows capital flooding out of countries across the world and disappearing into the cracks in the financial system. ...... Comedian Jimmy Carr became the public face of tax-dodging in the UK earlier this year when it emerged that he had made use of a Cayman Islands-based trust to slash his income tax bill. ...... Despite the professed determination of the G20 group of leading economies to tackle tax secrecy, investors in scores of countries – including the US and the UK – are still able to hide some or all of their assets from the taxman....... large investors usually hold in cash .... "Inequality is much, much worse than official statistics show, but politicians are still relying on trickle-down to transfer wealth to poorer people. ...... for three decades extraordinary wealth has been cascading into the offshore accounts of a tiny number of super-rich." ...... 10 million individuals around the world hold assets offshore, according to Henry's analysis; but almost half of the minimum estimate of $21tn – $9.8tn – is owned by just 92,000 people. And that does not include the non-financial assets – art, yachts, mansions in Kensington – that many of the world's movers and shakers like to use as homes for their immense riches. ..... "If we could figure out how to tax all this offshore wealth without killing the proverbial golden goose, or at least entice its owners to reinvest it back home, this sector of the global underground is easily large enough to make a significant contribution to tax justice, investment and paying the costs of global problems like climate change" ........ estimates of the cumulative capital flight from more than 130 low- to middle-income countries over almost 40 years, and the returns their wealthy owners are likely to have made from them. ......

In many cases, , the total worth of these assets far exceeds the value of the overseas debts of the countries they came from.

...... The struggles of the authorities in Egypt to recover the vast sums hidden abroad by Hosni Mubarak, his family and other cronies during his many years in power have provided a striking recent example of the fact that kleptocratic rulers can use their time to amass immense fortunes while many of their citizens are trapped in poverty. ...... Oil-rich Nigeria has seen more than $300bn spirited away since 1970, for example, while Ivory Coast has lost $141bn. ...... Assuming that super-rich investors earn a relatively modest 3% a year on their $21tn, taxing that vast wall of money at 30% would generate a very useful $189bn a year – more than rich economies spend on aid to the rest of the world. ......... standard measures of inequality, which tend to rely on surveys of household income or wealth in individual countries, radically underestimate the true gap between rich and poor. ...... both the very wealthy and the very poor tend to be excluded from mainstream calculations of inequality. ...... "There is rarely a household from the top 1% earners that participates in the survey. On the other side, the poor people either don't have addresses to be selected into the sample, or when selected they misquote their earnings – usually biasing them upwards." ...... Globalisation has exposed low-skilled workers to competition from cheap economies such as China, while the surging profitability of the financial services industry – and the spread of the big bonus culture before the credit crunch – led to what economists have called a "racing away" at the top of the income scale. ....... The surveys that are used to compile the Gini coefficient "simply don't touch the super-rich" ..... some experts believe the amount of assets being held offshore is so large that accounting for it fully would radically alter the balance of financial power between countries. .......... "the wealth held in tax havens is probably sufficiently substantial to turn Europe into a very large net creditor with respect to the rest of the world." ........ In other words, even a solution to the eurozone's seemingly endless sovereign debt crisis might be within reach – if only Europe's governments could get a grip on the wallets of their own wealthiest citizens.
IMF Report



Solar is almost there. I think we are at the cusp of solving the energy crisis. Which means, we should be able to bring forth another era of high growth rates across the world. But a new global layer in politics and economics has to be imagined for that to happen.

Thursday, June 25, 2015

Bobby Jindal: Louisiana Record

English: Baton Rouge, LA, September 3, 2008 --...
English: Baton Rouge, LA, September 3, 2008 -- President George W. Bush and Governor Bobby Jindal greeting EOC employees, during disaster recovery efforts for Hurricane Gustav. Jacinta Quesada/FEMA (Photo credit: Wikipedia)
I get the impression Bobby Jindal has been too ideologically pure. The Left "accuses" Hillary of not being pure. Note that. This guy should be running a think tank, not a state or country. Makes you wonder about think tanks though. What are they preaching? Louisiana is starting at the bottom. Bill Clinton's Arkansas was like that. And after Bill Clinton was done with it, Arkansas was still at the bottom, with slight improvements. There is just something about Louisiana. Maybe it is too close to Haiti.

Governing is a dynamic situation like sailing. You are supposed to respond to the winds, something Bill Clinton got accused of. Why is the boat not steady? Well, the wind be blowing left and right.

Tax cuts funded by swiped credit cards might make rich people happy, but I don't see how that contributes to economic growth. Raising the minimum wage, on the other hand, is instant stimulus.

Bobby not making sense to me is probably good for him. Even Dems start out on the Left before the primaries, and should they get past them, then conveniently move to the center. But Bobby is starting with really low numbers. It will be interesting to see how he plays out with the voters. How many primaries before he is out! Bust!

The guy won two elections in a row. Can't say he is a bad politician.

Bobby Jindal Does Not Offend Me



As Jindal’s G.O.P. Profile Grows, So Do Louisiana’s Budget Woes
here in the Louisiana capital, there is mostly one topic on everyone’s mind these days, and it is quite distressingly close to home: the fiscal reckoning the state is facing for next year and perhaps for multiple budgets to come. ...... “Since I’ve been in Louisiana I’ve never seen a budget cycle as desperate as this one” ..... Louisiana’s budget shortfall is projected to reach $1.6 billion next year and to remain in that ballpark for a while. ..... culprit: the fiscal policy pushed by the Jindal administration and backed by the State Legislature. ..... In a state the size of Louisiana, the shortfall is huge. But it is all the more daunting considering that the governor has unequivocally ruled out any plans for new revenue, bone-deep cuts have already been made to health care and higher education, ad hoc revenue sources have been all but drained and robust economic growth has yet to materialize. ...... Mr. Jindal’s first term began in 2008 with a heady surplus of around $1 billion, high oil prices and a stream of federal disaster recovery money after Hurricanes Katrina and Rita in 2005. He threw his support behind the largest tax cut in the state’s history and, for a time, had reason to boast about an economy that outperformed the nation’s. But oil prices are fickle, and the recovery money dried up and the recession arrived, if late and in a milder strain than in other states. Since 2010, here as elsewhere, middling has been the new normal. ..... a slower-than-ideal recovery is not unique to Louisiana. How the state has dealt with it is the root of the problem ..... “the vast majority” of the shortfall to the downturn in oil prices and insisting that a shrunken state government was the goal, not an unfortunate side effect. .... per capita income in the state is at its highest ....... next year Louisiana State University, the state’s flagship institution, is facing a potential 40 percent cut in its operating budget. Possible cuts to health care for next year, when compounded by the loss of matching federal dollars, could approach $1 billion. ..... Trust funds for infrastructure and low-income older adults have been sapped, buildings sold, tax amnesties repeatedly declared, legal settlements spent and reserves drained. ..... the plunge in oil prices, “muted job growth” and “a structural deficit.” .... how “fiscally irresponsible” the state had been for the last seven years.
Bobby Jindal says Louisiana's growth has outpaced the nation's since the recession
Jindal said, "The Obama economy is now the minimum wage economy. I think we can do better than that." ..... the per capita income of Louisiana, you were 47th lowest in the United States, not all under your watch. ..... In Louisiana, we now have more people working, highest incomes in our state's history. Larger population than ever before. And the president can't say all those things about the country. Our economy has grown 50 percent faster than the national GDP, even since the national recession.......... Between 2007 and 2012 (the last year for which data is available), inflation-adjusted GDP grew by 2.5 percent nationally, but by 6.4 percent in Louisiana. ...... For 2008-12, Jindal would also be correct. During that period, Louisiana growth (7.9 percent) easily outpaced United States growth (3.2 percent). ..... But he’d be wrong for 2009-12, when United States growth (6.7 percent) exceeded Louisiana growth (4.6 percent)..... And he’d also be wrong for 2010-12, when the United States economy grew (4.1 percent) and the Louisiana economy actually shrank (by 1.2 percent)...... United States growth also exceeded Louisiana growth between 2011 and 2012 -- 2.5 percent to 1.5 percent....... "Louisiana's economy is highly dependent on the energy sector which, no matter where in the business cycle we lie, is always in demand," he said. "So, when the economy is in a recession, we tend to do better than average. When the economy is doing better, energy demand is somewhat higher, but not dramatically so. So when the economy is doing well, we lag behind the U.S. average. I suspect that we were doing better when the economy was in the heart of the Great Recession, but we have fallen behind as the overall economy has rebounded."
Bobby Jindal’s Troubles at Home
Jindal is quick to say, private-sector job growth and the economy in Louisiana have outpaced the national average during his tenure as governor...... here’s what Jindal doesn’t say: Louisiana’s budget is hemorrhaging red ink, and it’s getting worse. He inherited a $900 million surplus when he became governor seven years ago, and his administration’s own budget documents now show the state is facing deficits of more than $1 billion for as far as the eye can see. There are no easy solutions today because Jindal has increasingly balanced the budget by resorting to one-time fixes, depleting the state’s reserve funds and taking money meant for other purposes....... Meanwhile, the state’s unemployment rate has risen from 3.8 percent when Jindal took office, a point below the national average then, to 6.7 percent today—nearly a full point higher than today’s national average. ..... As the son of Indian immigrants who was a Rhodes scholar, Jindal, 43, has stood out as a national GOP star since his 2007 election as chief executive of Louisiana, with an image invariably described as wonky. In 2009, he was chosen to give the GOP response to Obama’s State of the Union address, but his unnatural singsong delivery was mocked. Since then, he’s back to fast talking and reeling off numbers while he courts Republicans outside of Louisiana. A year before the Iowa Republican primary, he has shifted his political emphasis by making an obvious pitch for religious conservatives, highlighting his faith ...... We have serious, serious problems with our budget. For seven years, we have spent more than we’ve taken in ..... (A governor in Louisiana has so much power that he appoints the speaker of the House and the president of the Senate, along with committee chairmen.) ...... Jindal blamed the state’s budget woes on factors beyond his control. “The oil price drop has been good for consumers, but it’s had a big impact on our revenue” ..... Jindal’s aversion to tackling politically tough issues and his tendency to resort to ploys to paper over the problems. .... In 2003, as a private citizen running for governor (he narrowly lost), Jindal promised to “oppose and veto all efforts to increase taxes.” ..... As governor, he has taken the “no tax” commitment to such lengths that in 2011 he vetoed legislation supported by dozens of Republicans that sought renewal of a 4-cent portion of the state’s 36-cent-per-pack cigarette tax, the country’s third lowest. “His only reason is that he’d taken the crazy position that if you renew a tax or suspend an exemption it was a tax increase,” said state Rep. Harold Ritchie, a Democrat and smoker who sponsored the measure. Lawmakers found a way to approve it without Jindal being able to exercise a veto..... Louisiana has 33,000 fewer state workers than when he took office, in large part because he got the legislature to privatize the public hospitals. ..... The conservative Tax Foundation ranked Louisiana as having the 46th lowest tax burden as a share of state income. Louisiana also scores at the bottom in education and health care....... The state legislature cut income taxes for higher-end earners by a total of about $700 million per year...... He then shaved another $341 million in the middle of the 2009 budget cycle to avoid ending the year with a deficit. Jindal—buoyed by the tax cuts, his anti-government rhetoric, a growing state economy and his opposition to abortion—won reelection in 2011 with 65 percent of the vote.
Is Bobby Jindal Getting Started or Already Finished?
Jindal is polling in the low single digits in early Republican primary polls. ..... none of them, not one, can match our record of actually shrinking the size of government. .... He's a candidate who can hold his intellectual ground with anyone, and he has dominated Louisiana politics for the better part of a decade. Yes, it's a crowded field. And yes, it would take a momentum-kindling moment on par with then-Sen. Obama's legendary "Blue America-Red America" speech. But Jindal has been preparing for this moment for years, and he may yet have a second wind.
Bobby Jindal’s Fiscal Record
Jindal took office in January of 2008, and 2015 will be his last year in office. He has scored well on the Cato Fiscal Policy Report Card on America’s Governors earning an “A” in 2010, and a “B” in both 2012 and 2014. All three report cards commend Jindal’s resolve to cut Louisiana state spending. ..... Since fiscal year 2009, the first full fiscal year of Jindal’s term, state general fund spending has decreased by 7 percent. Per capita state spending has fallen from $2,089 in 2009 to $1,883 in 2015, a decrease of 10 percent. This spending restraint is quite remarkable. For comparison, per capita state spending grew nationally by 8.5 percent during the same time period. ..... Total state spending, which includes money from the federal government for programs like Medicaid, stayed constant while Jindal was in office. It was $28.9 billion in 2008 compared to $29.1 billion in 2014. ...... State government employment has decreased 26 percent since he’s been governor ...... State higher education spending fell from $1.1 billion a year in 2009 to $535 million in 2015. His 2016 budget includes further cuts to the state higher education system ....... Jindal’s strong fiscal record is partly undercut by Louisiana’s generous economic development programs, i.e., corporate welfare. Jindal helped expand the state’s wasteful film tax credit program. In 2013, the state wasted $250 million on the program, which is one of the largest film giveaways in the nation. The state offsets 30 percent of the cost of film production expenses. An episode of Duck Dynasty, the popular television show, represents $330,000 in tax credits to its production company. His administration also gave $36.5 million to the New Orleans Hornets, the professional basketball franchise, to encourage them to stay in New Orleans through the 2024 season. ...... Louisiana general fund spending has fallen during Bobby Jindal’s tenure as governor. At a time when states were increasing spending, Jindal instituted reforms that cut the state workforce and lowered per capita spending. This feat makes Jindal unique among Republican contenders for the presidency.
How Bobby Jindal Wrecked Louisiana
The Jindal administration is talking about cutting up to $300 million from state support to colleges and universities — that calculates to about $1 billion in higher ed reductions since Gov. Bobby Jindal took office in 2008 — and hacking another $200 million or so from health care. State agencies are looking at 15 percent to 20 percent removed from their budgets, which could translate into furloughs and reduced services. ..... “We’re going to end up placing fees and all kinds of things on ordinary citizens, just so” Jindal can say on the presidential campaign trail that he didn’t raise taxes ...... Jindal is sacking his own state to preserve his viability as a Republican presidential candidate — specifically, so he can say that he never raised taxes, but rather cut them. Even Quin Hillyer, the conservative columnist for the Advocate, thinks the state’s tax policy, under which the poor pay a greater percentage of their income in taxes than the rich, is a “moral abomination.” ........ Since taking office, Governor Bobby Jindal has cut taxes a total of six times, which included the largest income tax cut in the state’s history – giving back $1.1 billion over five years to the hard working tax payers across the state, along with accelerating the elimination of the tax on business investment, making Louisiana no longer one of only three states in the country that taxes manufacturing machinery. ........ when the state faced a $341 million budget shortfall, Governor Jindal chose to make state government more lean by finding strategic costs savings in the budget, rather than making across the board cuts or passing the bill on to taxpayers. ........ The cut was a giveaway to the rich, and Jindal, a reform Republican, was against it. But it was popular with the GOP legislature, so he embraced it — and it blew a massive hole in the state budget ....... What he won’t tell you about is his refusal to cut corporate welfare, which costs that state treasury a fortune every year ....... “Duck Dynasty” is the most popular show in the history of A&E. Wal-Mart is the world’s largest retailer. Valero is America’s biggest independent refiner, earning $6 billion in profits last year.... But despite all that success, they’re all receiving generous subsidies from the taxpayers of Louisiana, through programs that funnel more than a billion dollars every year to coveted industries. ...... During Kathleen Blanco’s four years as governor, the value of some of Louisiana’s largest tax breaks doubled. Since Bobby Jindal took the reins in 2008, the cost has more than doubled again ....... In his first year in office, the only year he did not have to resort to such tactics, Jindal himself deplored such bookkeeping, comparing it to “using your credit card to pay your mortgage.” ...... The state is facing a projected $1.6 billion budget shortfall next year, and higher education institutions have been told to prepare for $300 million to $400 million in reduced funding in the coming academic year. If that happens, LSU could be on the hook for more than $60 million, roughly 40 percent of the university’s operating budget. ........ LSU (and other state universities) will be getting only 25 percent of the state funding it received when Jindal took office. Think about that. It’s a disaster. Gov. Jindal and the GOP legislature have been a catastrophe for higher ed in this state. ...... that has meant that lawmakers only have room to maneuver within the higher ed and health care budgets. Last year, voters protected Medicaid from further state cuts, which leaves higher ed as the only target left. ......... But Jindal has done a number on health care for the poor too. He has largely privatized the state’s public hospitals, and refused as a matter of principle to take the federal Medicaid money due the state because of Obamacare. So now he can tell GOP primary voters nationwide that he stood up to Obamacare. ....... Services are now closed. There is now no emergency room in north Baton Rouge, where the majority of the city’s poor, uninsured people live. .......... We have serious, serious problems with our budget. For seven years, we have spent more than we’ve taken in. ...... governing not as a commonsense manager, but as an ideologue ....... He was first elected as a conservative, clean-government technocrat, and brought a lot of hope to many Louisianians. .... Yes, I’m fully aware that Louisiana is bound to break your heart. … [But] I think [Jindal’s] going to write the next great Louisiana story. Maybe just this once, it’s not going to be a farce. ....... The higher ed funding crisis does NOT exist because of a lack of willingness to spend on education. Louisiana actually ranks 18th in higher ed spending per capita. The problem exists because we have way too many four-year universities. In New Orleans, UNO and SUNO literally sit right next to each other. In the sparsely populated northeast part of the state, we have LA Tech, ULM and Grambling. This is, again, a structural problem that isn’t Bobby Jindal’s fault. What is needed is not cuts to LSU, but the bravery in the legislature to change a couple of lower-tier 4-year institutions into community colleges, killing duplicative programs that accomplish little and graduate almost no one. ........ Tuition at Louisiana’s public universities is also the 4th lowest in the nation, meaning that the cuts could probably be ameliorated by raising tuition, which is something that is almost guaranteed to happen...... he’s certainly right about the unsustainability of the state university system — a problem that was there before Jindal, and will remain long after he’s gone. The problem is that all the pols are standing together on this, because those universities are very important to their towns. But this can’t go on forever. The state needs something like the federal base-closing commissions, to give political cover to closing down institutions that ought not be kept open.
Republicans will have to spin struggling state economies in 2016
From New Jersey to Wisconsin to Louisiana, GOP governors with their eyes on the White House have presided over unbalanced budgets, unfunded pension liabilities, credit downgrades and sluggish job growth. .... That comes in contrast to an increasingly rosy economic picture nationally, with a strong December jobs report that capped off the best year in terms of economic growth for the nation since 1999. Unemployment, at 5.8 percent, was below predictions, and job growth has continued for month after month. ........ "In my judgment, they are so tied to an extreme ideology that they don't want to be confronted by the facts and the truth about what their approach, their trickle-down approach leads to: Greater deficits, a weaker economy, and greater inequality" ....... Louisiana has become more business-friendly under Jindal's watch, according to a number of nonpartisan rankings ...... Kansas Gov. Sam Brownback, whose promised conservative "experiment" of implementing steep tax and spending cuts has crippled the state's economy, as evidence the conservative vision of governance doesn't work.
How Bobby Jindal Broke the Louisiana Economy
Louisiana State University President and Chancellor F. King Alexander said that the state’s flagship university, which could lose 80 percent of state funding after years of already deep cuts, was developing a worst-case scenario plan for financial exigency—basically, the academic equivalent of bankruptcy. ....... Jindal, a hard-charging former Rhodes scholar, has always nursed grander ambitions, and voters generally gave him a pass. ....... While he was popular and powerful enough to avoid a reelection fight in 2011, by 2015 his approval rating had sunk to 27 percent, according to one poll; a friendly survey by his own consulting firm pegged the number at 46 percent, hardly a resounding vote of confidence. ........ He spent 165 days out of state in 2014 ...... Jindal chalks up the current budget shortfall to the drop in oil prices, and that’s definitely contributed. A larger piece of the puzzle has been his determination to maintain a pure record on taxes. ....... These days it’s hard to think of anyone who has as much influence over what Jindal’s willing to do than Norquist, whose rigid rules for what constitutes a tax increase line up perfectly with Jindal’s. In practice, that means the governor has insisted that the budget be balanced without tax increases, despite the prospect of devastating cuts to higher education and health care, the two main areas that don’t enjoy constitutional or statutory protection. ....... there’s not much left. Gone are $800 million from the Medicaid Trust Fund for the Elderly and $450 million for providing development incentives, and the rainy day fund has dropped from $730 million to $460 million on his watch. ....... the Republicans running to replace Jindal in this fall’s election. All three .. say they will look for a way to accept the Medicaid money and take an open-minded approach to examining tax exemptions. ..... in a clear swipe at Norquist, he added that, “I represent the people of Louisiana; I don’t represent someone who lives in D.C.”
How Bobby Jindal is leaving a budget mess for Louisiana's next governor: News analysis
Gov. Bobby Jindal refused to roll back income tax cuts or ever-increasing corporate tax breaks. Instead, he raided reserve funds and sold off state property. ..... "They've used all the smoke that was in the can and all the mirrors that they could buy and now they're out of tricks. Their solution is to gut higher education like a fish," said Republican state Treasurer John Kennedy. ....... "Our budget has been full of sleights of hand -- it's almost a Ponzi scheme of moving moneys around, one-time money around, to serve recurring needs," Lt. Gov. Jay Dardenne, one of the Republicans vying to be Louisiana's next governor, said at a recent forum. .... national credit rating agency Moody's Investors Service described Louisiana'sbudget as having a "structural deficit" ...... The governor has successfully trimmed some spending by cutting more than 30,000 full-time state employees. He's reduced the state's vehicle fleet, privatized much of the Medicaid program, turned over the state's charity hospitals to outside managers and looked for ways to make state government more efficient. ...... The state owes $190 million to federal officials for improper Medicaid spending in hospital privatization deals, an order being appealed, and a $270 million repayment to the state "rainy day" fund in 2017 as part of a legal settlement. Economic development deals will cost the next governor at least $340 million over his first four years..... Far fewer savings accounts will be left to pay those liabilities because Jindal drained or reduced trust funds. ....... When he talks of his record in national appearances, Jindal doesn't mention the budget troubles. He describes cutting Louisiana's budget from $34 billion in 2008 to $25 billion -- but doesn't explain much of that drop comes from spending down one-time federal recovery dollars after hurricanes Katrina and Rita. ..... New money hasn't rolled in, despite promises that tax revenue would increase from multibillion-dollar manufacturing and petrochemical projects announced by the Jindal administration in the last few years. ...... In his first year in office, Jindal signed off on the largest individual income tax cut in Louisiana history, stripping hundreds of millions from the state treasury at the same time the national recession hit. ....... The Legislature's chief economist, Greg Albrecht, has described Louisiana's tax break programs as spending with no annual oversight from state lawmakers before the money goes out the door. ...... As they ran into Jindal's resistance to tax break changes, lawmakers who voted for budgets packed with the governor's patchwork funding say removing the dollars would force harmful cuts to colleges, public safety and health care. For the upcoming session that begins in April, lawmakers are scrambling to find loopholes to generate new money but allow Jindal to call the plans "revenue neutral." ..... "Everybody says, 'Oh, you're using one-time money.' I tell people that say that, 'Well, tell me what you want to cut,'" said Senate Finance Committee Chairman Jack Donahue, a Republican. "'Is it higher education? Or is it health care? What university do you want to close?' The truth is, from a political standpoint, that's not possible."

Friday, May 22, 2015

Blaming Hillary For Benghazi = Blaming W For 9/11



Obama's Peace With Iran = Less Threat For Israel

It was George W's responsibility to protect the World Trade Center and he failed. It was Hillary's job to protect the ambassador in Libya, and she failed. Blaming Hilary for Benghazi: all is fair in love, war and a sexist country. If you ask me, W's failure was much greater. One life lost versus 3,000 lives lost. Not to say the damage to property, the economy and prestige. I don't see anyone, Republican or Democrat, blaming W for 9/11. How come? Blaming Hillary for Benghazi does not make you patriotic (I could argue the opposite might be true, you are sending a message to ISIS: kill someone and they will just blame it on Hillary! How convenient! .... okay, okay, I got confused between ISIS and the Al Qaeda there, but I don't expect the Republicans to figure that out), it makes you a facts-free sexist. Facts-free, as in someone completely unhinged from facts and logic. While you are at it, let's also blame Hillary for the 2008 recession. She was in the Senate at the time, was she not? What did she do to prevent the Great Recession? Why hurt the feelings of the white guys on Wall Street? Or the white guys in the White House, for that matter. I would not be surprised if Dick Cheney comes out to blame Hillary for the recession. Where is Dick when you need him?

Wait, maybe it was not her job to protect the ambassador. Maybe it was the job of the Department of Defense. Sorry for being a facts-free sexist in the paragraph above. My bad.


Thursday, December 04, 2014

The Theoretical Void In Economics

English: Total Solar eclipse 1999 in France. *...
English: Total Solar eclipse 1999 in France. * Additional noise reduction performed by Diliff. Original image by Luc Viatour. Français : L'éclipse totale de soleil en 1999 faite en France. * Réduction du bruit réalisée par Diliff. Image d'origine Luc Viatour. (Photo credit: Wikipedia)
The 2008 economic meltdown came out of nowhere. Literally no one saw it coming. No economist of any renown had foreseen it. That is like having an army of astrophysicists none of whom can predict the next solar eclipse. I am not too impressed with the economists of the world. Reality is ahead of theoretical progress in the field, obviously.

And even when the crisis hit, the prescriptions were hotchpotch. They were coming from policymakers who sort of kind of knew what needed to be done. That is a sad state of affairs. I still see that theoretical void. It goes unfilled.

One prescription was the 700 billion dollar stimulus. That helped but was too small to make full use of the crisis. Another prescription was the Fed simply printing and pumping dollars into the economy. And that is intriguing to me. Simply by printing more dollar bills, the Feds were also having positive impacts on far flung countries. 

Wednesday, February 05, 2014