How Obama is Already Taking Charge
Obama's immediate challenge is to fill the leadership vacuum created by a lame-duck president with historically-low approval ratings who seems to have lost interest in his job (at this writing, he's out of the country) and who's disappeared from the media, and a Treasury chief who has all but punted on coming up with any workable solution to the crisis. But Obama doesn't become president until 12 noon eastern standard time on January 20 -- and the national economy is imploding right now.
How does Obama manage this feat? Two ways: (1) appoint a highly-capable economic team, and (2) tell the nation what he plans to do starting the afternoon of January 20. Specifically:
(1) The members of Obama's new economic team fit the bill. They're reported (I have no inside knowledge) to include Tim Geithner at Treasury, Peter Orszag at the Office of Management and Budget, Jack Lew and Jason Furman at the National Economic Council, and Austan Goolsbee at the Council of Economic Advisors. All have several things in common. They're relatively young, in their late 30s or 40s, representing a generational change and a fresh start. Despite their youth, they're also experienced; almost all were up-and-comers in the Clinton Treasury, NEC, and OMB.
All are pragmatists. Some media have dubbed them "centrists" or "center-right," but in truth they're remarkably free of ideological preconception. All have well-earned reputations as hard workers, well-versed in the technical details of public and private finance. They are not visible veterans of the old battles over supply-side economics or deficit reduction, nor are they well-known to the public. They are not visionaries but we don't need visionaries when the economic perils are clear and immediate. We need competence. Obama could not appoint a more competent group.
(2) The President-Elect has also signaled the country what he wants to do: enact an "Economic Recovery Plan" that will mean 2.5 million more jobs by January of 2011. In his words (from Saturday's radio address), a plan "big enough to meet the challenges we face ... a two-year, nationwide effort to jumpstart job creation in America and lay the foundation for a strong and growing economy." Again, I have no inside knowledge, but I'd expect it to be about $600 to $700 billion.
Its focus will be on infrastructure of a sort that will not only put people to work but also improve the productivity of the economy. His words: "We'll put people back to work rebuilding our crumbling roads and bridges, modernizing schools that are failing our children, and building wind farms and solar panels; fuel-efficient cars and the alternative energy technologies that can free us from our dependence on foreign oil and keep our economy competitive in the years ahead."
In short, Obama's job-stimulus plan will be a down-payment on his larger plan to increase the nation's public investment. "These aren't just steps to pull ourselves out of this immediate crisis," he says, "these are the long-term investments in our economic future that have been ignored for far too long. And they represent an early down payment on the type of reform my Administration will bring to Washington." He could not be more specific, at least while still President-Elect.
At a time when aggregate demand is shriveling because consumers aren't spending and investors have stopped investing, and exports are shrinking, Obama recognizes that government must be the spender of last resort. He will combine old-fashioned Kaynesian economics with newly-fashioned public investments to pull the economy out of its slump.
By putting his economic team in place barely three weeks after he was elected, and telling the nation what he plans to do immediately after he takes office, the President-Elect is asserting leadership at a time when the the Bush administration has all but abdicated.
Good summary, Mr. Reich.
I hope there will be a role for you, too.
November 22, 2008 6:16 PM | Reply | Permalink
Agree, but.
Obama won't be in charge of anything for another 58 days; meanwhile, Bush/Paulson have made it clear they're not interested in doing anything.
What happens during the interim? Two months is a long time, and there's always the gift-giving season to consider.
November 22, 2008 8:38 PM | Reply | Permalink
This is precisely what Obama needs to do and it's reassuring to have him make this announcement in spite of our pitiful state of "one president at a time."
I'm scared to death but optimistic that this deregulated mess will give us the opportunity to make systemic changes that would have been impossible otherwise.
Intelligent, competent people in the Cabinet. A President who speaks complete sentences and treats us like intelligent, competent people. The goodwill of people all over the world, giving hime unparalleled opportunities (in the first few months at least) ... this is change I can believe in.
November 22, 2008 6:17 PM | Reply | Permalink
It would be nice to see someone with some recognition of how the healthcare mess factors into all this - especially vis-vis manufacturing jobs like the auto industry. Employer sponsored health care and pensions put our manuafacturers at a HUGE disadvantage versus other industrialized nations.
I also don't see enough about regulations.
November 23, 2008 9:11 AM | Reply | Permalink
Obama is going to have writer's cramp by the end of his first day in office. He may well sign more orders that day than any other other day he's president.
I like your analysis. Yes, hope comes not only from what we see happening before our very eyes, but when someone trustworthy tells us it will be happening - and we know there's a date certain. (As kids, we knew Santa never failed to arrive on the night of Dec 24th - and much of our trust today is akin to that. Obama has delivered before - and will again. We trust that now.)
November 22, 2008 6:28 PM | Reply | Permalink
I voted Obama. I felt he had a far better chance of becoming another FDR than poor, senile McCain. This plan is promising, but doesn't address the fundamental underlying crux of the crisis: that the post-1971 post-Bretton Woods system has vaporized; it is dead but not yet buried. The oligarchy seeks to bail it out with funds we don't even have. It is moot - there is no bailing out a dead system. Yes, we need to spend heavily and invest in infrastructure for the future, but the crushing burden of debt and over a quadrillion dollars of derivatives overhang on the world economy will destroy what's left of the real physical economy if we insist on using limited resources to bail out the paracitical financial oligarchy that created this mess.
The only thing that will work is to put the IMF/World Bank/Federal Reserve system thru bankruptcy reorg, write off the derivatives mess along with the Hedge Funds. Then regulate them out of existence. Convert the Fed into the 3rd National Bank of the US and issue new credit only for productive investments in great infrastructure projects (there is currently about an $11 trillion deficit in deferred infrastructure investment according to the Army Corp of Engineers). Convert the moribund auto companies and their crucial base of machine tool capicity and skilled labor to building trains, maglev, modular nuclear plants. Large scale wind and solar farms are nuts; they can help on the margins, but nuclear is the way to go for the massive power requirements we need if we are to have a functional and growing economy.
This is an enormous crisis. If anything, Obama understates the scale of it. We face not only a depression, but a dark age of civilization if we don't break completely with the insane policies of the oligarchy of the last 40 years. It can be solved, but not by tinkering around the edges as the conventional thinkers surrounding Obama propose to do. One can only hope that when the next phase of the collapse happens (in the next few weeks, most likely) that Obama opens his mind to understanding how the use of American System policies of the likes of Hamilton, Lincoln and FDR are the only solution.
November 22, 2008 6:35 PM | Reply | Permalink
I keep wondering though...what do we do with all nuclear waste?
November 22, 2008 7:18 PM | Reply | Permalink
If I understand you correctly, you're saying we should completely abandon monetarism, and some elements of new deal structures as well. You mean we kiss Keynes, and Friedman both goodbye?
With which ideas do you propose to replace them? Some kind of a hybrid? Don't we need a set of guiding principles upon which to base our fiscal and monetary policies?
Are there any new theorists out there?
November 22, 2008 7:40 PM | Reply | Permalink
Yes, we we kiss Keynes and Friedman both goodbye. Two sides of the same coin. Keynes famously said his policies would work best in Nazi Germany. Freidman is British Free Trade policy to the nth degree. For a starting point, read Hamilton's Report on Manufactures. Read Henry and Matthew Carey (Lincoln's economic gurus). Friedrick Lidst. FDR's great-grandfather was an ally of Hamilton's. He understood the powers inherent in the constitution to create a credit-based system (the opposite of monetarism) to promote and nurture national industry. The Bretton Woods system was set up to promote that on an int'l level and end colonialism, but unfortunately he died too soon and the system was corrupted by Keynes, Truman, et. al. Nevertheless, his reforms set into motion a long wave of relative economic prosperity, only to be undone by Nixon and Schultz in '71, by Carter and Reagan's deregulation, and Bushit's crowning blow to any notion of economic sanity.
November 22, 2008 8:07 PM | Reply | Permalink
I think you are right. While Reich lauds this new team as competent pramatists. What we need is a visionary individual to make it all work.
I beleive Obama is that persona as he has the amazing ability to synthesize disparate parts together to create an entirely new whole. The man is simply brilliant.
This is why he works best with opposing views. He is not distracted by cogent analysis of oppositional perspectives. He has the amazing ability to take the pieces of the myriad jig saw views and form a puzzle.
He did the same thing with the primaries. No one understood what he was doing until after Super Tuesday, at which point the 'greatest political machine' of our time was dead in the water with absolutely no math to victory.
November 23, 2008 3:11 PM | Reply | Permalink
Unmitigated Audacity:
Your post is neatly summed up in your username. I agree with you that this crisis requires a look at fixing things on even the macro level.
For example, it's absolutely ludicrous to insist that the working class is nothing more than a "human resource" that is both expendable (to be used up for what? our common good?!?) and that needs to be "competitive" within the global market.
A belief in the "human resource" concept allows our leaders (like McCain in Michigan during the campaign) to offer that the loss of good, family-supporting jobs in Detroit and elsewhere is no big deal; that we can provide retraining of these "uncompetitive" workers when their jobs are sacrificed to the lowest common denominator within the world market. Train them for what, I ask? How many barristas do we need in this economy? Perhaps we can train them to become hedge fund managers or corporate CEO's, eh?
I insist instead that we need to ensure that the economy works for us all rather than judge an economic system a success by how completely it manages its "human resources." We can no longer expect the working stiffs to continually grow evermore productive while reducing the compensation (including both wages and benefits, i.e. health insurance and pensions) they receive for their efforts.
It is also fundamentally unsound to pretend that we can develop a consumer-driven economy on a global scale. The world's resources will be quickly overwhelmed in our present assumption that all peoples of the world should be encouraged to be paying consumers of the products the ruling class provides. On this, I'm unsure what the alternative solution might be that will provide a sustainable economic system that works for all of us. In terms of being an economist, after all, I'm the first to admit I make a pretty good truck driver. But I know we cannot sustain the present objective of driving our global economy on the backs of an increasingly impoverished working class who are nevertheless required - for the good of the economy - to spend money as the targeted consumers of our GDP.
My suggestion of the need to reexamine our economic priorities will cause the Paulsons and Bernankes of the world to complain that I promote "class warfare." To that, I respond "Bring it on!"; that it is finally time for us working people to engage the battle that has been thrust upon us in the last number of years of so-called trickle down (pissed on?) economics. It’s time, at last, for us working stiffs to look the Masters of the Universe and the economists-in-charge in the eye and demand “Hey! Wait just a cotton-picking minute! What’s in this for me?”
November 22, 2008 8:03 PM | Reply | Permalink
My suggestion . . . will cause the Paulsons and Bernankes of the world to complain that I promote "class warfare."
And the Geithners, Volckers, Rubins, Summers, Goolsbees and the rest of the Obama economic clique (oops! "wise men") to complain you don't know what you're talking about.
November 22, 2008 9:47 PM | Reply | Permalink
Yes, yes, yes. Class warfare goes on every single hour of every single day in this country and guess which class wins every single hour of every single day? As SleepinJeezus says, bring it on!
November 23, 2008 3:33 AM | Reply | Permalink
SleepinJeezus says:
Class warfare? Of course there's class warfare, it has been present in every society that ever existed, its a part of evolution of civilizations, and class warfare is what brought upon every revolution since the beginning of time as more and more of a society's wealth and power were accumulated in the hands of a select few. Sound familiar?
But of course "class warfare" is presented to the public by demagoguing conservatives as some nefarious liberal plot to make life harder on most; and sadly, too many people, needing an enemy to point to, are quick to believe.
November 23, 2008 10:02 AM | Reply | Permalink
The oligarchy seeks to bail it out with funds we don't even have.
Of course we have the funds! There called dollar bills and we get them by turning on the printing press.
There are only two questions: 1) who gets those dollar bills and 2) at what stage in the printing run does inflation raise its hoary head.
Presently, "dollars" -- balance sheet assets and liabilities -- are being destroyed, and the newly printed dollars simply replace those destroyed -- a non-inflationary zero-sum game. But sometime time in the future the debt destruction will end. Will we stop printing the dollars?
In the mean time whose balance sheets should be shored up. Banks? Industrialists? Investors? Home owners? Credit card consumers?
We have a choice of whom to give these "dollars" to. Is anybody -- Obama included -- making it?
November 22, 2008 9:27 PM | Reply | Permalink
Taking that back when debt destruction ceases and private debt creation begins to ratchet up again, well, that will be the hard part. And predicting when, and how far off the mark the government will be, will also be the hard part. Meanwhile, figuring out to whom to lend, and for what purposes, is the hard part.
November 23, 2008 12:22 AM | Reply | Permalink
For anyone paying attention at the state and local level, it is just all too obvious that we've let the infrastructure go to hell for decades. And let's look at the electrical grid and port and railroad security while we're in a spending mood.
This shouldn't be called a stimulus package, or recovery plan it should be called an investment in our future.
Let's get something for our tax dollars other than a smoldering Middle Eastern country.
November 22, 2008 6:36 PM | Reply | Permalink
optimistic that this deregulated mess will give us the opportunity to make systemic changes that would have been impossible otherwise.
Yes - as 9/11 and Katrina gave Bush the opportunity to seize inappropriate power, rob the treasury blind, and shred the constitution, let's hope that the financial meltdown gives Obama the opportunity to fix the healthcare stranglehold that's financially killing employers and physically killing citizens and to revive the middle class with a fairer taxation system and jobs that decrease global warming and infrastructure disasters.
If Bush cared a bit about this country he'd offer to sign Obama's plan into legislation as soon as it gets through Congress.
Instead, Bush is AWOL and McConnell has already redoubled his plans to continue the obstructionism of the 2006 senate.
We need Collins, Snowe, McCain, Specter and Gregg to get onboard and make sure that the usual cast of criminals (Schumer, Feinstein, Salazar, et al) stay out of their smoke-filled rooms and stop their internal sabotage.
November 22, 2008 6:39 PM | Reply | Permalink
And PLEASE - no outsourcing of any of this! That's how we lost so much money on Iraq, Katrina, etc. These need to be government jobs with no corrupt corrupt middlemen.
November 22, 2008 6:42 PM | Reply | Permalink
I agree with your focus on the competence of Obama's economic team. That's really all that counts. That's why I react with eyes rolling when I see statements such as:
"They're relatively young, in their late 30s or 40s, representing a generational change and a fresh start."
Who the hell cares about whether or not they represent a generational change? It makes no differnce at all. It's a peeve of mine I'll admit, but it is an utterly meaningless symbolic point that distracts from the issues at hand.
On the infrastructure/stimulus program I think it's okay, but over and above the emphasis on solar and wind farms what is different about this from the usual Democratic boilerplate about spending on all these neglected areas? Very little I suspect. Of course, the amount of money spent on these things will be important but I'll also look to see if Obama and his people have the foresight to pump a great deal of money into mass transit (both operations and infrastructure) because if they're serious about reducing our dependence upon foreign oil they have to provide real, useful, and convenient alternatives to the private, gas powered auto. The best and most efficient of any present transportation alternatives is mass transit. Most of our cities have some form of mass transit but it is underfunded both operationally and from the standpoint of infrastructure. They need to put billions upon billions into this nationwide and they also need to invest heavily in a real, modern and extensive passenger rail system nationwide.
November 22, 2008 6:48 PM | Reply | Permalink
Excellent Dr. Reich!
November 22, 2008 6:50 PM | Reply | Permalink
Nice to read something hopeful after finishing the latest from Dr. Doom
http://www.rgemonitor.com/roubini-monitor/254515/the_deadly_dirty_d-words__deflation_debt_deflation_and_defaults__and_how_central_banks_will_have_to_resort_to_crazy_policies_as_we_have_reached_such_bermuda_triangle_of_a_liquidity_trap
Tomorrow's NyT piece on Rubin's Citigroup isn't exactly uplifting either
November 22, 2008 6:53 PM | Reply | Permalink
Just finished it. Whew. What a mindbender, huh? O better have some very very smart people working on this. Or... I don't want to think about it.
November 22, 2008 8:50 PM | Reply | Permalink
Maybe it's a good thing that Bush is out of the country/loop both figuratively and literally because he probably would screw it up even worse.
Obama is the one that has to step it up now. Before FDR took office, Hoover was a lame duck all the way until March 4th and during that time the economy got worse.
I think that Obama can't wait (and he isn't) to kind of take charge because if he waits too long this economy will be down the tubes and will be HARDER for Obama once he takes office.
November 22, 2008 6:54 PM | Reply | Permalink
I think there is a very good reason for having a generational change. In my opinion too many of the people that are part of that older generation have lived with the conservative economic philosophy have come to believe in it, if only unconsciously. Lower taxes don't create jobs, and there is no "magic invisible" hand that will automatically readjust the markets.
It's all BS that the conservatives have been laying on us for years and years. With any luck at all these younger persons will have studied how this "magical" thinking has helped ruin the economy and get rid of them once and for all.
And in case you think I believe this because of my age, you'd be right. I'm 65 and I've been watching this crap for a long time. And everyday I see someone mindlessly repeat some of it. I'm all for younger brains taking over, it's about damn time.
Thank you Mr. Reich, your blog is one I rarely miss.
November 22, 2008 7:29 PM | Reply | Permalink
You know, I have always been impressed by the successful federal endeavors led by President Eisenhower to build the interstate highway system or the Hill Burton Program which built hospitals and clinics around the country as a "public good" - public works systems - funded outright by federal dollars. It has always been confusing to me why environmentally protective efforts to use tidal flows, wind power or solar energy through solar panel use were promoted merely by tax incentives to "subsidize the market" and left up to individuals and companies to initiate the projects. Think what would have happened if the interstate highway system was left up to the collective, sporadic, and uncoordinated effort by millions of citizens. In fact this does not have to be a thought experiment. Consider what happened to New Orleans after Katrina. This public works program announcement by President-elect Obama not only heralds a new era of functional public policy, it marks the end of the catastrophic free market ideology of the self-serving Republican businessmen and their legislators.
November 22, 2008 7:35 PM | Reply | Permalink
I have always been impressed by the successful federal endeavors led by President Eisenhower . . . .
They paved paradise, put up a parking lot.
November 22, 2008 9:53 PM | Reply | Permalink
Larry Summers will be Obama's National Economic Council Director which means that he will be the head of Obama's economic team in the White House.
I think that Geitner/Summers combo will be needed to get us out of this ditch.
November 22, 2008 7:41 PM | Reply | Permalink
Those 3 (Obama,Geithner and Summers) are definitely the three to do it. I remember Obama saying that if he were president during the Rubin vs Reich time (reduce deficit or invest in infrastructure) he says he would have taken Reich's side. I hope you have a place in the administrain Secretary Reich.
November 22, 2008 8:10 PM | Reply | Permalink
We have only two things to say about Tim Geithner, who we do not know: AIG and Lehman Brothers. . . . Geithner, in our view, deserves retirement, not promotion. Institutional Risk Analytics
November 22, 2008 10:25 PM | Reply | Permalink
I read that article the other day. I was disappointed that Janeway didn't say more here:
"In terms of just the history of capitalism, there are a number of events which call into question whether these are in fact stationary processes. There is some really, really promising work being done in this area. In Star Wars terms there is a "new hope." This is an empire which is crumbling. But there is a new hope. "
The article puts the hope out there but doesn't give any reasons for hope (specifics).
November 22, 2008 11:12 PM | Reply | Permalink
3-6-3 The banker's credo.
Take in deposits at 3%; loan them at 6%; and be on the golf course by 3.
Maybe that's the "new hope."
November 23, 2008 1:01 AM | Reply | Permalink
Ah, seeing how quickly they'll turn against you? Soon, real soon.
Keep up the good work.
November 23, 2008 12:54 PM | Reply | Permalink
What? We can't just tell folks to go out into their garage and invent software, like Desidero advocates in his reader blog, in order to revitalize the economy?
November 22, 2008 8:01 PM | Reply | Permalink
; )
November 22, 2008 9:08 PM | Reply | Permalink
Right, the new economy works on the advice of bankers and lawyers, rather than the innovation and drive of real people.
Once upon a time companies like FedEx and Apple and Google started in peoples' garages. But not the new economy - we need government intervention to tell people what to create - it won't work any other way.
Back in 1990 the US started the Human Genome Project. By 1998, it was puttering along at a slow pace, and Craig Venter decided he'd step in to compete - within 2 years he'd caught up with the government effort.
There are places where government is very necessary, and places it should get out of the way as quickly as warranted.
November 23, 2008 1:11 PM | Reply | Permalink
The "ditch metaphor" does not work. It presumes that we can stay in the car, right it, and get it back on the highway. Okay, we may need to call a tow truck.
Not so. Things are more serious than that. Time for a new vehicle and a new roadway. We need a fundamental economic change, not just a political change.
Also, we make a mistake, if we neglect the rail system. It is time for 21st century transit and rail. Autos and airlines are already in shambles. We are lagging pitifully in rail, and it will provide plenty of jobs and more options to move goods and people.
November 22, 2008 8:42 PM | Reply | Permalink
Couldn't agree more about the rail system (as I commented below). Perhaps Vice President-Elect Biden will have some say, he's supposed to be a fan of trains.
November 22, 2008 9:52 PM | Reply | Permalink
Why a train? Why not a house? Unless we maintain a Shelter, I don't plan on riding the rails unless you think we can become HOBOS.
But stay away from Bridges, I hear they're unsafe. But then again if we're all unemployed, I suppose there will be fewer autos on the road.
Fewer autos on the road and we probably don't need road crews.
Heck look at all the money we'll be saving, sitting in the parks because we didn't keep people in their homes.
Fresh, open air
November 22, 2008 11:53 PM | Reply | Permalink
"I think there is a very good reason for having a generational change. In my opinion too many of the people that are part of that older generation have lived with the conservative economic philosophy have come to believe in it, if only unconsciously"
I'm not so sure about this. It seems to me that people (especially men) c. 40 are economic libertarians, believe social security is doomed, and that we are all engaged as isolated individuals in a Darwinian struggle (that can nevertheless be helped along quite a bit with a little glad handing)--and that's exactly the way it should be. I think there is more diversity of opinion amongst older people because they actually know something else. Most younger people don't think about economics in any systematic way (and outside business schools and the econ dept they are certainly not taught to), but think that education cures all ills--and that's exactly the way it should be.
"It can be solved, but not by tinkering around the edges as the conventional thinkers surrounding Obama propose to do."
Obama is *himself* a conventional thinker. Sure, that was helpful in getting elected, but it's not necessarily reassuring at the present time, to me. I continue to find people's enchantment with him completely befuddling, and not just for ideological reasons.
November 22, 2008 8:45 PM | Reply | Permalink
. . . 2.5 million more jobs by January of 2011.
More than what?
November 22, 2008 9:14 PM | Reply | Permalink
My thoughts exactly. 2.5 million more than we have now - which would be what we need to barely maintain current employment levels - or 2.5 million more than we would expect to have based on current (negative) trends.
November 23, 2008 9:06 AM | Reply | Permalink
Back of the Envelope
U.S. Pop. 304,000,000; Annual growth rate: 0.883% CIA Fact Book
Labor force participation (% of population): 63%
Additional jobs required to stay even with population growth: 304M x 0.883% x 63.0% = 1,691,000 (2009) and 1,706,000 (2010)
We need 3,397,000 additional jobs over the next two years just to stay even.
What's Obama talking about?
November 23, 2008 12:43 PM | Reply | Permalink
Oops!
The 63% is the rate of employment of the potential working population which is about 77% of the total population. So --
The additional jobs needed would be 2,615,000 -- about what Obama's promising.
Is that all he's talking about?
November 23, 2008 12:55 PM | Reply | Permalink
That was my first thought. 200,000 jobs per month is considered decent growth. 100,000 jobs is barely holding even with population increase.
Krugman pointed this out back when Bush was crowing about 2003 job growth figures. But now with the shoe on the other foot we'll promptly forget reality-based math.
November 23, 2008 1:14 PM | Reply | Permalink
Transportation projects sure would help in Virginia. I hear this Atrios fellow is hoping for SUPERTRIANS. It would be very cool to work on trains as well.
Love the wind farms, solar panels, etc. ideas. Also--how about some intelligent green architecture? So many buildings are just cookie-cutter. New materials, design that is aware of the south versus north side of the building. Save energy. That gets me Fired Up!
November 22, 2008 9:49 PM | Reply | Permalink
You guys are so cute! The way you think you know more than Obama and his economic team. I especially like Unmitigated Audacity's comment that he hopes Obama opens his mind and that he is understating the scale of the problems we face...aaahhh, they grow up so fast.
November 22, 2008 10:46 PM | Reply | Permalink
I dunno.
One would have to work at to know less.
November 22, 2008 11:15 PM | Reply | Permalink
America is in trouble Today, who say's we can wait till tomorrow?
The lame duck has abdicated his responsibility.
His Chief agent in charge is Mad, and all we hear is how Obama will lead us on Jan 20th.
WTH,. What this Country needs immediately is leadership, and where is it?
Oh! There can only be one President at a time, and the one is out of town and has no clue and the other one is giving excuses.
Great, we’re F
Finished ;)
November 22, 2008 11:42 PM | Reply | Permalink
"...They are not visionaries but we don't need visionaries when the economic perils are clear and immediate. We need competence. Obama could not appoint a more competent group...."
Nonsense. They are visionary...as visionary as the new deal. They are also competent workers, professional in their fields. Their vision is to put America back to work while rebuilding our infrastructure. Corporate market gambling will have to cease to make room for the praactical which is simple ...if people have no money to buy goods and services our economy collapses. Those who wish to sell goods and services must hire Americans and pay salaries high enough to afford their goods and services for sale.
Corporations have used cheap labor abroad to maximize profits but finally see that if we have no well paid labor at home no one will buy and profits are lost. One depends on the other for survival.
Some got too greedy at the top but bringing back tariffs and eliminating tax cuts for the wealthy and and giving tax incentives to companies operating within America will be the way to get the funds to hire labor to rebuild infrastructure. To say this is not visionary is ludicrous. This labor stimulus with be very effective in getting our economy rolling again benefiting all rather than a few at the top. It is a prerequisite to strengthen the middle class while we are regulating the market place to prevent a future collapse from unregulated greed.
The big question is how will republicans obstruct this progressive agenda. "Country First" is a hypocritical statement for republicans as they want power at any cost. It's always been "Party first" so they will try (as they have the past 2yrs in the senate) to block any progress to prevent its success for purely political reasons. Only by getting democrats to fail do they have a chance of regaining power. They've already robbed the treasury in secret so watch out Obama (as I'm sure you are).
November 23, 2008 12:30 AM | Reply | Permalink
There is plenty of blame to go around.
If the American Worker, the American people would have bought "Made in America", or "Union Made", the Wal-Mart’s and discount stores would not have purchased and stocked cheap foreign goods, goods that would have sat on the shelves as unsold.
The Idiot American worker only has himself to blame.
Cutting his own throat, and then crying about it.
Is that a self-destructive nature? Is that an example of American workers, being smarter or better than the rest of the World?
Doesn't it just peeve you to hear; if only the American worker had a level playing field, we could compete?
Compete against what, CHEAP GOODS?
November 23, 2008 8:54 AM | Reply | Permalink
"The Idiot American worker only has himself to blame. Cutting his own throat, and then crying about it."
And don't forget about the American love affair with cheap gas and more horsepower.
I'm hardly sympathetic to the management decisions made by GM and the other domestic car manufacturers which have led to many of their problems. I am perplexed, however, at the insistence by many that these companies have somehow "made cars that nobody wants."
Hummers and SUV's have been extremely popular for so long as gasoline was less than $2/gallon. The recent and sudden price spike to over $4/gallon caused the American consumer to suddenly become concerned about energy conservation and renewable energy. "Why is Detroit still making these dinosaur's," is the question that is now asked "when we want plug-in electric and hybrid vehicles instead?"
The answer is that the auto industry - whether domestic or foreign - is inherently incapable of turning on a dime in developing/changing its product line to respond effectively to the whims of the consumer such as we witness here in America. Whereas Detroit has now been given their marching orders to develop and offer for sale only efficiently "green" cars for the market, I can assure you that the recent collapse in gasoline prices will soon have the American consumer once again scrambling to get the latest gas-guzzler offered and to spit on the Prius and the Volt as being insufficient for their needs.
If we are truly interested in stabilizing the market for our automobile manufacturers (and also "greening" our transport choices in responsible fashion) it is necessary to first stabilize the gasoline market. Fixing gas prices at $4/gallon or above is probably the singularly most important policy change we could make in support of our automobile industry, our environment, and our desire for energy independence.
Perhaps even more importantly, stabilizing the price of gasoline will do much to support the development and marketing of alternative fuels that will at last move us away from our present reliance on fossil fuels. Allowing the fuel market to instead swing as wildly as it has these last number of years is to cause the domestic auto industry, our renewable energy industry, and our economy itself to go completely dead in the water with the weight of the oil companies and the foreign oil producers tied around our neck.
November 23, 2008 12:32 PM | Reply | Permalink
I agree with you,
A friend of mine who ran a hard drive division, pretty savvy person. Told me to look for the auto industry to cut production of trucks, creating a shortage. Then when the consumer wants a pickup truck, the consumer will have to be prepared to pay a premium to receive one.
The Ford F150 is a prime example, imagine the clamor for green vehicles, and of course the Industry will say, "WE hear you" reducing the supply of the most popular truck.
Under the guise of meeting the demand for green vehicles, the industry will retool for this new line. The main goal, of course is a disguised attempt, to manipulate the market.
Taking a high demand product, reducing supply and because of demand, the consumer will pay more.
A nice plan for homeowners too, reduce supply, and with existing demand, values will go up.
Your idea of the stabilized Gasoline prices was a good idea when Ross Perot’s ideas [in the 1992 campaign] were often innovative-including the politically unpopular position of imposing a fifty-cent-a-gallon gasoline tax increase to help pay off the deficit.
November 23, 2008 4:24 PM | Reply | Permalink
A friend of mine . . . Told me . . . .
Was he wearing a tinfoil hat at the time?
November 23, 2008 9:10 PM | Reply | Permalink
Ellen, I'm surprised.
That friend was a very successful businessperson sent to Asia to run the marketing and development division.
I'd have to say, I don't know too much about your credentials, but evidently you know a thing or two about tin foil hats?
November 23, 2008 11:40 PM | Reply | Permalink
Sleep says:
And don't forget American's love affair with saving 20 cents by purchasing an "I Support the Troops" car magnet on sale at Walmart, and while there buying that washing machine that's $20.00 cheaper than the one at Sears.
We may be "saving" ourselves into the poorhouse.
November 24, 2008 9:45 AM | Reply | Permalink
Always good to read Robert Reich.
P. S. Please change incorrect spelling Kaynesian to the correct Keynesian. We wouldn't want anybody to think RR can't spell the name of so famous an economist.
November 23, 2008 1:05 AM | Reply | Permalink
Agreed and agreed. I just re-read this. The misspelling made me cringe even worse this time than did the first.
-AF
Andrew Sullivan Is A Fraud
November 23, 2008 5:19 PM | Reply | Permalink
It is pretty impressive to come to a site and read Robert Reich. This man is not some gassy outsider. As he stresses, pragmatism does not mean left or right or center or diagonal. But a 700 billion dollar jobs bill is not some old conservative's dream. Robert Reich's report really gives me hope that change is really coming, and the new Administration is not just going to give lip service to certain parts of his constituency, and stay on some pretend middle ground.
November 23, 2008 3:21 AM | Reply | Permalink
Ah, seeing how quickly they'll turn against you? Soon, real soon.
Keep up the good work.
November 23, 2008 12:57 PM | Reply | Permalink
So the anwer to US economic troubles is a massive building spree? That doesn't jibe well with no tax hike for 95% of the population. Unless Obama plans to take everything the other 5% have, I don't see how this can be done. I know the left drools over reviving the WPA, but I just don't see the need nor where the resources would come from. The US has a good infrastructure, it could be improved, but there already are enough roads, railways, airports, telephones, electric lines, power plants, harbours, hospitals and schools.
November 23, 2008 10:34 PM | Reply | Permalink
Even here in CT gasoline is now close to $2 and still falling. Now is the time to impose a dollar a gallon tax -- and every time the price of gas rises by one cent, raise the tax by one cent. This will encourage us to stay off the SUVs, provide income for infrastructure, and help keep prices down by limiting demand. Otherwise I think gas will be headed back up again real soon now.
November 24, 2008 5:02 PM | Reply | Permalink