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Rachel Maddow Proves That GOP Stupidity Is Destroying The US Economy
Rachel Maddow and her guest Professor Robert Frank make the case that it is GOP stupidity that is destroying the US economy.
Here is the video from MSNBC:
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Professor Frank said,
We’ve known for over 60 years that in a situation where we’re in now where there is persistent shortfall of demand, government can invest in public works projects and other things that will get the economy back on its feet. It could be done.
It’s quite easy to do. The workers are there who know how to do the jobs. The market’s happy to lend us the money. As Ezra said, they’re eager to loan us more money at very low interest rates. The cost of debt compared to the cost of unemployment is incredibly low. A trillion dollar deficit costs us $25 billion a year to pay the interest on that. If we have an extra ten million people unemployed that’s $250 billion lost forever each year, so it’s a 10 to 1 tradeoff. We’re focusing on deficit reduction when we really out to be focused on job creation, and we know how to do it.
Maddow and Professor Frank pointed out that if the country wants to lower the deficit, it still should be focused on job creation, “Focusing on the deficit, cutting spending that’s going to make the deficit bigger. What we’re doing now is just unimaginably stupid.”
It is stupid, and it is also easy to remedy. Maddow and Professor Frank also talked about the political hurdles a.k.a. congressional Republicans that stand in the way of getting this economy moving. Professor Frank’s analysis agrees with other Keynesian economists like Paul Krugman who have been arguing for more spending for years.
America is mired in a debate among the Keynesians and supply siders, and even though history tells us that the Keynesian approach is what the country needs, the Republican devotion to supply side economics is not going to allow any additional government spending to happen. The supply siders failed under Reagan. They helped to cause our current crisis under George W. Bush, but still their blind devotion to an economic theory that is rooted in political ideology, not economic reality remains as strong as ever.
Cutting spending is only going to lead to more woe. If consumers aren’t spending, businesses aren’t spending, and the government is not spending, it all adds up to an economy that at best will stay mired in its current state. At worst, the economy will plunge yet again. Reality tells us that the cost of deficit is less than the cost of worsened unemployment, but right now the politics of Washington are not based in the real world.
The people who are paying the price for the GOP’s spending cuts folly aren’t the ideologues in Washington, DC. The people who have been weighed down by this unsolicited burden is the unemployed, the poor, the disabled, and the elderly.
$25 billion of debt payment versus $250 billion in economic generation is such an easy tradeoff that even a child can see it.
Americans might be better off electing a slate of common sense ten year olds than the reality detached Republican true believers who are currently in charge of the House of Representatives.
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41 Responses to Rachel Maddow Proves That GOP Stupidity Is Destroying The US Economy
Rimsh0t
Aug. 5th, 2011 at 11:30 am
I would not be surprise they and their friends want to create this crisis so they can benefit from it financial. Would it not be call Insider trading cause a dip in the Stock Market intentionally and benefiting from it. The Republican belief is “If you are not for us then you are against us, therefore you are the enemy and must be destroy”. They care only for the Status Quo and against anything resembling Socialism.
Liberlism is Socialism
Aug. 7th, 2011 at 5:40 am
so you’re admitting then that Dems are FOR anything resembling Socialism.
Shiva (Moderator)
Aug. 7th, 2011 at 9:26 am
You dont know what socialism is, and you live with facets of socialism every day.
Stop using silly talking points and grow up
AcidQueen
Aug. 13th, 2011 at 11:48 am
Don’t get Medicare. Also don’t file for unemployment if you get fired. And don’t drive on public roads or make use of any other government services, because that’s socialism.
Also, do yourself a favour and go back to school to learn what “Liberalism” really is before making yourself look any more stupid.
A Walkaway
Aug. 5th, 2011 at 11:39 am
They don’t want people employed. There is a discussion in today’s (local) paper about how corporations are openly discriminating against the unemployed. They even advertise that they only will consider hiring people who are already employed (or only very recently unemployed).
The thing needed is the very thing that the Tea Party and Republicans don’t want: regulation of business.
A Walkaway
Aug. 5th, 2011 at 11:40 am
url to article: www.theledger.com/article...
crsytalwolfakacaligrl
Aug. 5th, 2011 at 12:41 pm
When the unemployed benefits were running out last year and POTUS was trying to get a stim going, I saw on PLENTY of blogs RWNJ who said they owned businesses and would NOT HIRE any one who was unemployed for any reason!
That’s job discrimination! And you know why? They want the country to fail on Obama’s watch. That’s why. And that is why I call ALL of them…ANY of them TERRORISTS! They want to destroy the country.
Shiva (Moderator)
Aug. 5th, 2011 at 12:51 pm
Interesting read about millionaires and taxes 2009
www.newser.com/story/1251...
Parrotshavesmallbrains
Aug. 6th, 2011 at 12:05 am
Shortly after assuming the republican leadership, Boehner himself loudly proclaimed that his number one priority was to see that Obama is not re-elected. He didn’t say his number one priority was the will of the people or the public good. No, he proudly stated that his sole motivation is a political vendetta, and his party cheered. How is this not a direct a violation of his oath of office? Ironically, for that moment at least his statement made him an honest politician.
Liberlism is Socialism
Aug. 7th, 2011 at 5:46 am
uh, the will of the people is requesting to see that Obama is not elected. So Boehner’s number one priority is simply prioritizing what America is demanding, because it will benefit the public good.
Shiva (Moderator)
Aug. 7th, 2011 at 9:27 am
I know you wont be back, but do you have anything to back yourself up with?
jlt
Aug. 5th, 2011 at 12:08 pm
When is r. maddow not prescient?
Abbey
Aug. 5th, 2011 at 12:10 pm
You know who is also a supply side fan? Barack Obama.
Jason Easley
Aug. 5th, 2011 at 12:31 pm
Yeah, because we all know that supply siders take office and the first thing they do is sign trillion dollar stimulus packages into law that feature hundreds of billions of dollars in government spending. You can’t possibly really be this dumb?
craigtamy
Aug. 5th, 2011 at 1:50 pm
What, did you see the catch phrase, “GOP Stupidity” and chime to prove the point?
Shiva (Moderator)
Aug. 5th, 2011 at 12:32 pm
What do you do when you have a wall street that rewards companys who lay people off then drop like a rock on bad jobs numbers?
Wall Street itself is killing us
But jobs will always be number one and hopefully the republicans will be voted out on that condition alone
Yucon
Aug. 5th, 2011 at 7:49 pm
Wall Street is supporting the president with big bucks. So is he now the enemy too.
C’mon
It’s his economic policies.
majii
Aug. 5th, 2011 at 8:20 pm
It’s not very profound to respond with “it’s his economic policies” without providing specifics because it’s an easily identifiable dodge and rw talking point!
crsytalwolfakacaligrl
Aug. 5th, 2011 at 9:29 pm
Yes b/c POTUS said there were “shovel Ready” jobs…yet the house has done nothing!
These jobs could be shoring up bridges & roads, yet Nothing from Boner and the house.
mikeyhatesit
Aug. 5th, 2011 at 12:43 pm
Every government employee out there represents a private employee that can do the same job for much less and hand the remainder of the paycheck to the owners of those private companies. Public employees cut into the costs of running a government that the Fortune 400 and their puppets resents being regulated by through not just rules that ensure public safety, but the taxes that eat at their profits.
When we left the demand-only economy, thanks to the industrial revolution, we essentially turned those conveyor belts into needles, and transformed the upper class into addicts. And since some addicts have sold their own children to maintain their habits, we really need to get over our surprise at how willing they are to destroy themselves (and us).
Parrotshavesmallbrains
Aug. 5th, 2011 at 11:54 pm
So, Mikey, on what do you base your analysis of the efficiency of public employees versus private? On average, public employees perform no better and no worse than private, and in fact government subsidies and tax breaks for private companies make it hard to even tell the difference.
There are many, many public employees busting their asses and doing the best work they can do,for the same reason that plenty of private employees do, and for less pay than they could get in the private sector. The internal mechanisms of our government are actually fairly efficient because they aren’t focused on short term profits. It is the leadership in our government that has failed. Public sector employees will do what you pay them to do efficiently, but if you direct them to do stupid, inefficient things, stupid inefficiency is what you will get.
And for the record, I’m private sector.
Liberlism is Socialism
Aug. 7th, 2011 at 5:52 am
“And for the record, I’m private sector.”
You’re probably unemployed then. Thank Obama for that. His stim plan was going to stop the increase of unemployment, but he FAILED.
DaveM
Aug. 7th, 2011 at 10:30 am
So going from losing 75,000 jobs a week to adding a couple million is a failure? By what measure?
shel3364
Aug. 5th, 2011 at 1:28 pm
I think, based on the FAA mess, that Republicans have proven that they do not understand basic math.
mel in oregon
Aug. 5th, 2011 at 3:52 pm
rachel is right that the republicans will ruin the economy to insure obama’s defeat. but there’s a lot more to it than that. you have to know history to understand the present. go back to when we were the only super power at the end of world war 2. we rebuilt europe under the marshall plan & helped japan get back on her feet. was this because of altruism? of course not, we needed trading partners & a buffer against the soviet union. for a long time america’s middle class propered, & it looked like part of the prosperity was due to our strong military. it also helped that truman, ike, jfk & lbj were committed to keynesian economic policies. but starting with carter there was a subtle shift in economic policy, & under reagan there was a wholesale desire to undo the new deal. also the military has been expanding at an enormous rate. we currently are in wars in afghanistan, iraq, pakistan, libya, yemen & somalia. plus we have 800 military bases all over the world. so due to the reagan & bush tax cuts the rich have decided they aren’t going to pay for the wars & bases. they are having too much fun partying with tax dodges in over 30 principalities to the tune of over $10 trillion. plus thanks to bill clinton glass-steagall was repealed so banks & financial institutions are free to speculate on dubious loans without having to have the reserves in case of losses. the result? taxpayer bailouts as sen bernie sanders has pointed out of $15 trillion. now was obama ever going to change anything? of course not. “by their deeds yee shall know them”. his whole cabinet & all his advisors are from wallstreet. again thanks to clinton global capitalism is a reality as are the moving of millions of jobs to slave labor countries. global capitalism is protected by the wars & bases. but since the wealthy won’t pay for them, the only alternative is to cut funding on programs that help the poor & middle class. make no mistake about it, both republican & democrat parties are committed to maintaining the american empire at all costs, the only difference in the two parties is the democrats pretend like they give a damn about the poor & middle class, republicans make no bones about caring if granny starves or not.
Rmuse
Aug. 5th, 2011 at 4:08 pm
I think we all have to come to grips that the teabaggers and GOP want the economy devastated. They know what works and are deliberately doing the opposite. Find and peruse the Koch Industries policy meeting notes. When the economy is gone, industrialists and corporations will “buy” the government and prop it up. This is more than stupidity, it’s planned and working nicely. If it’s not halted, America will be privatized.
Yucon
Aug. 5th, 2011 at 7:44 pm
Try to read this point of view
mises.org/daily/5489/The-...
Kurt Schendel
Aug. 5th, 2011 at 8:59 pm
Yucon, without spending the next few hours on reading what the ‘Austrian’ solution to our economic woes may be, all I read is the same excuses for supply-side economic theory which, obviously, hasn’t worked for the past 40 yrs. or so.
Keynesian theory is NOT the economic policy we have been toiling under for the past decades, in fact, I don’t believe this particular theory has EVER been tried here in the US. While there are some flaws in the theory you cannot escape the fact that ALL capitalistic economies are based on consumption, pure & simple.
We are led to believe that companies, today flush with cash, are supposed to be reinvesting this largess back into their businesses & thereby, by default, providing jobs & wages which then further consumption. In a perfect world, greed free, this might work but today we have an entire new global market AND dirt cheap labor with which to exploit & American businesses as a whole are eager to spend the capital earned here in overseas markets where they believe even greater profit awaits them. The problem with this idea is that it takes American dollars out of our economy & provides other countries with large amounts of cash with which they can use to build their own economies. China is a glowing example – they are building infrastructure at a blistering pace.
Of course, there literally isn’t enough resources on this planet with which to build many more 1st world powers – there really isn’t enough coal, oil, timber & minerals to make the entire world just like us so that, in a matter of time, one country wins, the other loses. Or, as if by magic, all of the globe balances out. Which won’t happen.
In the long run all of the profits made cannot “buy” an economy as the consumers who spend have no money left to spend on anything but survival essentials. Your $500 widget becomes useless because no one can buy it. Innovation dries up, research dries up & there is nothing left to consume.
Meanwhile, all that idle cash continues to be invested in speculative investments, like derivitives, which continue to feed ‘bubbles of opportunity’ in the markets which eventually collapse as the bubbles burst on the reality of no consumption. Trillions of dollar evaporate &, after a short time, another bubble emerges, stoked with idle cash looking for a gain.
Supply-side economics has been discredited for decades now along with globalization. If we want to keep the economy of the US strong then we need to dump this theory & try something else.
Wired
Aug. 6th, 2011 at 5:50 pm
Keynesian economics is what they teach in school – insert joke here about why the majority of Republicans do not understand it.
railroadmike
Aug. 5th, 2011 at 11:24 pm
I study a little history. The Wall Street bankers and Republicans just finished the job they started in 1934. It was called the “Business Plot”. The media will not print the story nor broadcast the story. In fact only 400 librarys accross the nation even have books on the subject . Thank god for the internet. Its on Google and Youtube now.
turdfire
Aug. 6th, 2011 at 4:30 pm
The reason they are “acting” stupid is to make the economy look bad by election time. They created the “crisis” that they now blame on Obama.
The worse part is that come election time, the ill-educated masses who support their shenanigans will have forgotten the real cause. Or, more likely, not care or even be aware of it.
The only thing these so-called “less government” proponents want is to be employed by the government and suck off the public teat.
Joe Mostowey
Aug. 6th, 2011 at 5:28 pm
Some questions concerning governing policies:
Reagan lowered taxes on the premise that wealth would trickle down, and jobs would be created. Bush and the GOP majority Government of 2000 said the same thing.
Where’s the wealth, and the jobs, and why is the middle class shrinking if the trickle down theory is valid? Why are the number of poor on the rise- everywhere!
Republicans say they are the “jobs” party.
Why then does very action they take result in layoffs and unemployment, such as federal workers and state workers such as policemen and teachers? And where are the jobs?
Why does the folks (20 percent of Americans) who own 93 percent of the financial wealth in the USA pay only 68 percent of the taxes?
That means the 80 percent of Americans who own only 7 percent of the financial wealth in the USA pays the other 32 percent of taxes. Sounds disproportional to me.
Why are fees paid to government entities, such as licensing and registration for automobiles, and tolls collected on highways, or fines paid for traffic tickets, ect. etc. not part of the “don’t raise taxes” mantra? As Shakespeare said “a rose by any other name…” A tax is a tax, is a tax, is a tax.
Fees (and fines) seem to have exploded in red states over the past ten years.
If shrinking government is so great, why, during the years a republican president and congress were office shrinking government at the federal and state level was the end result the country going into what is truly a depression (not a recession)?
Is it so difficult to understand that for an economy to function, it must have fuel?
When the government spends money, however wisely that spending may appear, it pumps money from the investment side of the economy into the consumer side of the economy. Most civil servants are middle class. The tax dollars they are paid with purchase goods and services from the private sector. They keep money that would nominally be stored in an offshore account, or is being used to finance America’s competitor’s (such as China) buildup of manufacturing and their internal infrastructure, all growing at the detriment of our economy. Such investments make our competition stronger and the USA weaker. Such competitors can quickly become enemies, as happened in WWII.
When money is stuck in banks or the investment economy, it strangles the domestic consumer economy.
When investors utilize low tax rates to shield their income, what it really means to the middle class is that via those low tax rates for the wealthy, the middle class funds the acquisition of wealth for the upper class, and wind up paying for their gains with higher taxes on the middle class. Further, because taxes are deferred on those investment funds, the owners of such funds can, if the tax rate at the time they do use the money is even lower than when it was earned, make another financial killing.
Every project, every domestic purchase by the Federal government pushes more money into the consumer economy of the USA. Infrastructure funding such as roads, bridges, buildings, even computer networks, is handled by private contractors, who employ millions of workers nationwide. For instance construction projects keep stone quarries producing raw materials open, employing truck drivers and equipment operators who spend their paychecks in local stores, purchase automobiles and houses, buy fast food, watch moves, buy electronic devices, hire their grass cut, or their homes cleaned and take vacations . Such actions fuel the hiring of people to support all these previous actions, distributing that money into the consumer economy, fueling wealth in the private sector in a growing ripple effect. This is why in the past so many congressmen and senators pushed for earmarks because they saw their constituents getting more money, creating more wealth for them – as well as the people in the upper 20 percent. The wealth created a market, which created a demand for raw and manufactured goods, creating a demand for workers.
When government spending stops, so do the ripples, and the economy shrinks.
When taxes on the upper 20 percent shrinks, so does government spending – just as it did in the 1920s leading to the great depression.
So, if the GOP is for jobs, why do their actions create so many layoffs, so much unemployment?
If they are for saving taxpayers money, why do their recent (and past) actions cost the tax payers money? The debt fight cost how many millions? The resulting downgrade will cost how many trillions in higher interest rates?
With friends like these, who needs enemies?
Kurt Schendel
Aug. 7th, 2011 at 9:35 am
Exactly correct, Joe!
Why in the heck isn’t there an ‘uber-like’ button on this page??
Allan
Aug. 6th, 2011 at 5:46 pm
The Republicans have been killing the US slowly for the last 4 decades (Detroit), they left it in total dissaray (Bush) and left it for Obama to clean up, and now they want it to look like it’s his fault.
Do yourselves a favor, FIRE YOUR POLITICAL SYSTEM. ALL OF IT. Find a way to start over. You can’t run a country with just two parties, they waste too much time and money trying to screw the other over for the next election. Politics is a dirty game. US politics is just plain filthy.
(With love from Canada)
Mike B
Aug. 6th, 2011 at 5:48 pm
The Republicans are not blind, stupid or ignorant. They have a plan and that plan is to create a Corporate, christian Pluocracy. Anyone ever watched the movie “The Hand Maids tale”. Thats what they want. Thats really what they want, and they are willing to do or say whatever it takes to get it!
It looks like their plan is going pretty good too!
Bojangles
Aug. 6th, 2011 at 9:32 pm
This is your argument? The government should spend money because the private sector isn’t? This was tried as soon as Obama came into the office with his stimulus package and are we any better off? Now the definition of insanity is doint the same thing over and over and expecting a different result. Don’t listen to Keysian economists, they are also the ones who didn’t see the economic collapse, listen to some Austrian Economists, one comes to mind who saw the fake economy since 2003, wrote a book about it as well. That would be Peter Schiff.
john
Aug. 6th, 2011 at 11:32 pm
That was proof of something? An Economics Professor who lives in the make believe world of Academia. What businesses has he ever run? How many jobs has he created? None of them have the best interest of the American people, anywhere near the top of their list of priorities. They are all equally to blame. White house, Dems, Rep., the Senate, the Congress, are all co-conspirators.
Simpson
Aug. 7th, 2011 at 1:49 am
GOP is racist and to defeat Obama they are willing to destroy America. About 50% of Tea Party members are benefiting from Govt. programs. Let us get ride of 50% congressmen/women and 50% senators that will save tons of money for US. But people who complain do not go to vote and they deserve to be punished by crookish GOP politicians.
Kevin
Aug. 8th, 2011 at 5:39 am
If one has nothing of substance, always attack with name-calling – the way of the neoconned
pF
Aug. 13th, 2011 at 8:19 am
Uhhh… he said 10 million laid off would cost us 250 MILLION not BILLION a year.