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Readers: we welcome you to ask a question about the U.S. economy for tonight’s debate at 6pm ET with former OMB Director Peter Orzag, former Reagan budget director David Stockman, and Reuters’ Editor at Large, Sir Harry Evans.
We will pick 3-5 questions for the debate tonight! You can also send questions on Twitter/Tumblr with #ReutersLive hashtag. Follow @ReutersLive for live coverage. (Photo: REUTERS/Joshua Roberts)Our community editor Margarita Noriega will be there to share your comments and questions. What would you like to ask our panelists?
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We are actually in a classic depression. A depression is when nobody wants to spend. Everybody wants to pay down their debt at the same time. Everybody is trying to pull back, either because they got too far into debt, or because if they’re a corporation, they can’t sell because consumers are pulling back. The thing about an economy is that it fits together. My spending is your income. Your spending is my income, so if we all pull back at the same time, we’re in a depression. The way to get out of it is for somebody to spend so that people can pay down their debt, so that we don’t have a depression. So that we have a chance to work out of whatever excesses we had in the past, and that somebody has to be the government.
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Felix Salmon explain the EU crisis using Legos.
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Visa Exposed As Massive Credit Card Scam (via The Onion)
SAN FRANCISCO—In coordinated raids Monday at locations in Delaware, South Dakota, and California, federal agents apprehended dozens of executives at Visa Inc., a sham corporation accused of perpetrating the largest credit card scam in U.S. history.
According to indictments filed in U.S. District Court, Visa posed as a reputable lender, working through banks to peddle a variety of convincing-looking credit cards carefully designed to dupe consumers into spending far more money than they had.
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![tableclothcape:
Last week in its annual revision the Bureau of Economic Analysis revised economic growth data from 2007 to the present, though only the data from 2008 onward was significantly impacted. Figures were universally revised downward, and to an extent that should have put the fear of Keynes into Congress but, unfortunately, didn’t.
For serious: S&P be damned, as this sort of abysmal growth isn’t the sign of a lost economy looking for a pointer out of the woods. It’s marooned, building a signal fire, and laying stones out in a sixty-foot-tall ‘SOS.’ Yet rather than organizing a rescue party Congress opted to do worse, leaving our domestic economy on its own to befriend the inanimate volleyball of unnecessary spending cuts while forcing it to organize its own rescue using only what precious few things might wash ashore. And, sadly, at this point we’re short on FedEx packages and long on the badly-beaten corpses of our Eurozone pilot friends.
[Ed. note: currently house- and cat-sitting, Cast Away only available DVD.]
Anyway, let’s look at this graph I’m stealing/hotlinking from Worthwhile Canadian Initiative, a blog that I will never stop recommending.
The most concerning thing here is that the United States economy peaked in the second quarter of 2008 (08:2) and even three years later at the second quarter of 2011 (11:2) it still hasn’t returned to its starting point. (This is called a peak-to-peak recovery.) So while this wouldn’t have been the absolute worst point to have needlessly self-inflicted a fiscal crisis on itself, the United States clearly could have stood to wait at least one or two more years. That growth has also noticeably slowed (0.4% growth in the first quarter of 2011) is also deeply, deeply concerning.
If you’re interested in reading more depressing BEA data you can read last week’s release here. I’d suggest taking them with a stiff drink.](http://24.media.tumblr.com/tumblr_lpirxpmEdd1qa5280o1_500.png "http://soupsoup.tumblr.com/post/8571676345/tableclothcape-last-week-in-its-annual-revision")
Last week in its annual revision the Bureau of Economic Analysis revised economic growth data from 2007 to the present, though only the data from 2008 onward was significantly impacted. Figures were universally revised downward, and to an extent that should have put the fear of Keynes into Congress but, unfortunately, didn’t.
For serious: S&P be damned, as this sort of abysmal growth isn’t the sign of a lost economy looking for a pointer out of the woods. It’s marooned, building a signal fire, and laying stones out in a sixty-foot-tall ‘SOS.’ Yet rather than organizing a rescue party Congress opted to do worse, leaving our domestic economy on its own to befriend the inanimate volleyball of unnecessary spending cuts while forcing it to organize its own rescue using only what precious few things might wash ashore. And, sadly, at this point we’re short on FedEx packages and long on the badly-beaten corpses of our Eurozone pilot friends.
[Ed. note: currently house- and cat-sitting, Cast Away only available DVD.]
Anyway, let’s look at this graph I’m stealing/hotlinking from Worthwhile Canadian Initiative, a blog that I will never stop recommending.
The most concerning thing here is that the United States economy peaked in the second quarter of 2008 (08:2) and even three years later at the second quarter of 2011 (11:2) it still hasn’t returned to its starting point. (This is called a peak-to-peak recovery.) So while this wouldn’t have been the absolute worst point to have needlessly self-inflicted a fiscal crisis on itself, the United States clearly could have stood to wait at least one or two more years. That growth has also noticeably slowed (0.4% growth in the first quarter of 2011) is also deeply, deeply concerning.
If you’re interested in reading more depressing BEA data you can read last week’s release here. I’d suggest taking them with a stiff drink.
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“Spend less money, create more jobs” is the kind of world one normally finds only in Woody Allen movies, and it’s a profoundly unserious stance for any politician to take. Spending cuts, whether they’re implemented by the public sector or the private sector, are never going to create jobs. And there’s simply no magical ju-jitsu whereby government spending cuts get reversed and amplified, becoming larger private-sector spending increases.
Boehner’s rhetoric, here, is a cynical play on our nation’s economic illiteracy. But the jobs crisis is far too big and too important to become a tactical political football. Now more than ever, it’s the job of government to come together and to do something constructive to create high-quality, long-term employment. Fast. Instead, the House majority is giving us aggressively harmful stupidity. Today’s a bad day in the annals of job statistics. But it’s equally bad in the annals of public service.
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