Obama Goes Wobbly Over More Stimulus

Nov. 1, 2009

What is the President Afraid Of?

Obama Goes Wobbly Over More Stimulus

By MIKE WHITNEY

The recession is over. Yesterday's report from the Commerce Dept. confirmed that the economy expanded in the third quarter by 3.5 percent, better than most economists estimates. GDP had contracted in the four previous quarters in the longest and deepest recession since the Great Depression. Massive government stimulus, cash for clunkers, and inventory restocking accounted for most of the surge in economic activity. Consumer spending grew at 2.36 percent while consumer credit continued to contract at a near-record pace of 4.5 percent. Unemployment swelled to 9.8 percent, "with nearly nearly 26 million workers—17 percent of the workforce — unemployed or underemployed," according to economist Mark Zandi. The economy remains extremely weak and is expected to lapse back into recession if the Obama administration fails to provide a second-round of stimulus.

But President Barack Obama hasn't requested more stimulus and recent polls indicate that a majority of people are against more deficit spending. The administration has done a poor job of explaining the advantages of reducing the output-gap or--for that matter--the overall objectives of Obama's economic recovery plan. Many people heap the bank bailouts (TARP) with the fiscal stimulus. This is a mistake that's easy to make. But the point needs to be clarified so more people don't needlessly suffer. It's up to Obama to articulate the differences in policy so the country can muddle through the tough days ahead. The problem is, Obama is afraid to use his skills as a communicator, because he thinks his message will offend financial industry constituents who wield tremendous power at the White House and on Capital Hill. The bankers and brokerage mandarins are more than happy with the present arrangement, which means that the conveyor-belt connecting the US Treasury to Wall Street will continue to operate at full-throttle diverting ungodly sums of money to broken banks and financial institutions rather than for unemployment benefits, work programs, and state aid.

Obama supporters who think that the president is right to treat the banks with kid gloves, should consider how Franklin Roosevelt dealt with the same situation 70 years ago. His first Inaugural Address, March 4, 1933, sums it up pretty well:

http://www.counterpunch.org/whitney10302009.html

He states his premise: "The recession is over."

And yet, just a few sentences away:



Okay, here's the thing:
-If: government stimulus spending accounted for most of the activity

and;

-If: More stimulus will be required to stave off 'another' recession

then:

The recession -- a.k.a. depression -- has not yet ended.

I immediately filled in what I think was an implied blank, as in "The recession is over....according to TPTB"

Within that context, it makes sense and fits with his usual thinking.

he made it himself, and used the report as validation of his statement.

I can see your point, but if that's the case, he should have attributed the statement. It reads like a premise, IMO.

Sometimes in writing, it's a matter of context and juxtaposition of ideas. The context is Mike Whitney, who traditionally writes that the economy is screwed, and in this article goes on to say that.

And then I took the opening to sentence 2 as implied attribution for sentence 1. So I think he's being covertly sarcastic/facetious in his opening sentence, which is the "hook" in writer's terms. ;)


The recession is over. Yesterday's report from the Commerce Dept. confirmed that the economy expanded in the third quarter by 3.5 percent...


In other words, my reading is that what he really is saying is "The recession is over (right :eyes:) according to the Commerce Dept....and continue reading to see why they're so wrong."

in that context I think you are right. :)

"Many people heap the bank bailouts (TARP) with the fiscal stimulus. This is a mistake that's easy to make."

At first glance it may be a mistake, but when you look down deep it's not a mistake at all. Both are eXtreme giveaways of borrowed dollars to people who shouldn't be receiving it, and both add to the mind-bogglingly large burden we've placed on future generations to repay our debts (like that will happen).

:dem:

-Laelth