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"Obama unveils 21st Century New Deal":
Politico.com has the story about Obama's proposed Economic Recovery Plan. As best I can tell, the plan is to create 2.5 million jobs through public spending on rebuilding schools, government buildings, and roads.
J. Aldridge:
Who will these jobs go to, foreign born? With our exploding population 2.5 million is a insignificant number.
12.6.2008 3:48pm
Tom Round (mail):
"Pubic spending"? Is that the sex ed the Christian Right warned us the Democrats would introduce?
12.6.2008 3:54pm
John (mail):
Didn't this fail when it was tried in the 30's?
12.6.2008 4:07pm
Cardozo'd (www):
No, it tended to keep us from going bankrupt and fought off advances by any socialist agenda that was cropping up, that well got a hold of other failing economies at the time.

And it help get us out of the depression - unless you believe right wingers who still think Reagan was fiscally sound and FDR was the crazy one.
12.6.2008 4:21pm
BooBerry12:

Didn't this fail when it was tried in the 30's?


Not according to a majority of economists and historians when surveyed.
12.6.2008 4:25pm
Jim at FSU (mail):
Hasn't the economic consensus (as opposed to popular or leftist political consensus) since the 1960s been that the end of the depression was brought about through entry into WWII? Conscription and wartime production could account for the end of unemployment and the increase in GDP. Even if you argue this isn't so, then you have to admit it is an amazing coincidence.

Also, I have to take issue with the notion that our infrastructure needs rebuilding. The Wisconsin bridge collapse wasn't caused by poor maintenance, it was caused by an engineering error during construction.

And since when is this nation full of unemployed ditch diggers, road pavers and steel workers? Does Obama think that if he brings back 1930s economic programs that the American people will respond by creating a 1930s workforce?
12.6.2008 4:32pm
Joe Bingham (mail):
Sadly, these jobs won't go away post-crisis.
12.6.2008 4:34pm
Pashley (mail):
Government spending is not the most efficient spending for wealth creation. It only has some function when it serves either as a necessary foundation for private wealth creation, or, second, to pick up slack capacity in the economy. The Dem's would say that they need to spend for a better energy future, and there is some truth in that. The rest, the pouring concrete, is simply picking up spare labor (there is no spare money).

Another path of lowering the unemployment is tighten the borders and send excess workers back to their countries of orgin. Anyone bet on the Dem's following that path? Thought not.

So, instead, the proposal is to take a big part of the productive private economy, and turn it into the public sector. If that, worked, all those socialist countires wouldn't be dirt-poor. To quote Churchill, "Socialism is the philosophy of failure, the creed of ignorance, and the gospel of envy."
12.6.2008 4:40pm
TyWebb:
I am a large supporter of infrastructural overhaul, but I hope the Obama administration chooses its infrastructure projects a bit more judiciously than focusing on highways. Highways are expensive and relatively less worthwhile than certain other projects, including but not limited to an overhaul of the power grid (would save massive amounts in energy costs), the creation of a "fiber grid", and (most importantly IMO) an overhaul of ports (deepwater, coastal, and inland), and a focus on intermodal shipping. Imagine if, say, Pittsburgh could be reconnoitered as a logistics hub for the rust belt--the efficiencies could be massive, but currently our lock-and-dam system is too outdated to support such infrastructure.

Roads should be maintained and repaired, especially where they pose safety risks or could create logjams. But if we're serious about reducing emissions, eliminating congestion, and moving forward into the 21st century, other projects are more desirable.
12.6.2008 4:47pm
Ben P:

Hasn't the economic consensus (as opposed to popular or leftist political consensus) since the 1960s been that the end of the depression was brought about through entry into WWII?


The economic consensus, like most things economic is somewhat more complicated, at least to my understanding of it. Part of it is that it certainly worked to bring the economy out of it's death spiral in the early 30's, (loss of confidence causes bank runs, which wipes out money, which causes demand loss, which causes more confidence problems wiping out more banks) but then poor monetary choices brought about another problem in the middle 30's that was more or less seperate from new deal jobs programs.


And since when is this nation full of unemployed ditch diggers, road pavers and steel workers? Does Obama think that if he brings back 1930s economic programs that the American people will respond by creating a 1930s workforce?


It's kind of ...well...economics.

People readily accept that a tax cut will stimulate the economy. In economic terms government spending has a highly similar initial effect. Government spending employs people which puts more money back into the economy. This causes higher demand, and brings supply back up to match.

The monetary effects work out differently, but where that's a problem is when we're talking about a stagflation situation. Right now we're looking at deflationary shocks, and many of the drawbacks of direct spending stimulus are reduced.

Individual construction jobs are pretty fungible. The auto industry's looking to shed as much as a couple million jobs over the next year, you don't think most of those people are equally well suited to take a job in construction?
12.6.2008 4:47pm
Ben P:

So, instead, the proposal is to take a big part of the productive private economy, and turn it into the public sector. If that, worked, all those socialist countires wouldn't be dirt-poor. To quote Churchill, "Socialism is the philosophy of failure, the creed of ignorance, and the gospel of envy."


Yep, those dang socialists and their road building.

Since when is road and bridge and school building not "controlled" by the public sector? you think the government's actually going to stop hiring contractors for the majority of this?
12.6.2008 4:49pm
trad and anon (mail):
Roads? If there is anything this country does not need more of, it is roads. Put them to work building high-speed train lines and driving buses.
12.6.2008 4:50pm
BooBerry12:
For all those who think the New Deal failed in bringing us out of the Depression, see here:

Obviously, the New Deal may not have solely caused to lift our country out of the Depression, but it CERTAINLY didn't fail.
12.6.2008 4:54pm
BooBerry12:
12.6.2008 4:55pm
WHOI Jacket:
So, the sound stock advice is invest in CAT and Sheetrock manufacturing?

I eagerly wait for the 2.5 million framers and ditchdiggers to save the economy.
12.6.2008 5:00pm
A. Zarkov (mail):
Even if we believe that FDR programs helped end the Great Depression, it does not automatically follow that such public works projects would woek on this Depression. For one thing it takes time to plan and execute massive public works projects, so any improvement in the economy might take 1 or 2 years to take effect.

There are other problems with his plan. Who are new unemployed? Are they appropriate for these kinds of projects? For example, does anyone think unemployed lawyers will be willing to do road work? What's to stop private contractors from hiring illegal aliens for these construction projects like they do for everything else?

Here's an acid test for Obama and Congress. Will they terminate the H1-B program? Or will they continue to insist we need to import more tech workers to fill their imaginary shortages? Unless I see that, I'm inclined to regard this whole jobs program as a sham. I just don't believe people who continue to lie to me.
12.6.2008 5:12pm
John (mail):
My problem is that if the government takes money from productive people (taxes) and spends in on "infrastructure" (whatever that is) projects we deprive people of money with which they might invest in productive enterprises, creating real jobs that won't go away and growing the economy instead of just shifting money around.

I think that is what happened during the Depression, and that's why, despite the big government programs, it wasn't until the 40's that the economy recovered.

Temporary jobs are one thing; economic recovery is usually something very different.
12.6.2008 5:32pm
Malvolio:
Obviously, the New Deal may not have solely caused to lift our country out of the Depression, but it CERTAINLY didn't fail.
The Depression lasted for a decade after the start of the New Deal and led to the most devastating war in history. If that isn't failure, what the hell is?
12.6.2008 5:37pm
Lior:
If the government is planning to use tax money to pay for these "2.5 million jobs", then they are ignoring the jobs that would have been created with the money had they not collected the taxes. However, the government may be planning to spend without taxing, that is pay for these "jobs" out of loans. Of course in that case private business could also have taken out the loans, but the government can probably get loans at much better terms than small businesses.

Since labour is about to get very cheap, it is not unreasonable for the government to borrow now and get projects done that would have gotten done anyway -- if it's cheaper to build the bridge today than in 10 years, might be better to take out a loan and do it today.

My main concern, however, is that the choice of projects and the awards of contracts will be based on political rather than economic considerations. Thus, while it's theoretically possible for such intervention to be better than no action, I doubt this is the case in practice.
12.6.2008 5:43pm
Smokey:
John is right. There are only two things people can do with money: save it or spend it. Both grow the economy.

But when government takes away more in taxes for unnecessary new projects, that leaves less for investment and production.

And let me be among the first to say that faster choo-choo trains at a $billion a mile are as stupid an idea as the bridge to nowhere. If the market was there, private industry would have already started work on them.

But the market wants air travel. For under a hundred bucks you can fly from S.F. to San Diego in 1 1/4 hours. Compare that with a high speed train, which can theoretically cover the same distance in 3+ hours -- but will take considerably longer because of the stops along the way.

And the cost? Factoring in all the rights of way that must be bought from private parties, which now pay property taxes but won't with the gov't as the new owner, and the literally thousands of bureaucrats and others at highly inflated wages suckling at the public teat, and you have a huge, permanent drain on productive citizens and businesses.

But the Odumbotron has been wound up and pointed in that stupid direction, and the country will pay through the nose for something entirely unnecessary.
12.6.2008 5:53pm
Putting Two and Two...:
I don't know if the New Deal solved or lengthened the Depression. I do know that it attenuated its effects. Let's assume -- as many of you do -- that market forces would have resulted in a quicker recovery. At what cost? How many more men would have abandoned their families (as my paternal grandfather did)? How many children would have died of disease exacerbated by poor nutrition (as two of my paternal uncles did)? How many young men would have dropped out of grade school to work and beg for food (as my father did)? How many women, burdened by trying to raise 13, then 11, children by herself would have turned into tough, bitter battleaxes (as my paternal grandmother did)?

Some people who analyze the experience 80 years later conclude the New Deal prolonged the crisis. Many people who lived the experience credited the New Deal with saving their lives, and they rewarded the Democratic Party with near-lifelong loyalty. (That's what sticks in the craw of the former group and, perhaps, drives their certainty.)

That said, I'm not sure how a major infrastructure-building project today would help much. My father was packed off to the forests of the Northwest as a teen with a shovel and an axe. Low-skill, manual labor isn't how we build big things anymore (not to say we couldn't go back, but things aren't that dire).
12.6.2008 5:53pm
Andrew Maier:
Something that's being ignored in this discussion is that some of the New Deal was not one thing. Parts of it were good (largely the kinds of things that Obama is referring to right now), and parts of it were really terrible (like the price floors, wage floors and the idiotic killing of young livestock in order to inflate food prices). Right now, it seems to me that Obama is choosing the right sorts of things to work on as far as gov't spending goes. If he starts trying to inflate the price of houses or something stupid like that, I'll be one of the first to thrust my palm angrily against my forehead.
12.6.2008 6:21pm
Oren:
Bringing the internet to rural American can be the electrification of this century.
12.6.2008 6:32pm
Dave N (mail):
Oren,

Where exactly is the internet not available in rural America in 2008?
12.6.2008 6:39pm
Andrew MacDonald (mail):
[Deleted by OK on civility grounds]
12.6.2008 6:39pm
DDG:
I think we're in the "farce" stage of history. Obama is really trying to follow the FDA playbook -- an economically disastrous playbook that was extremely successful politically.

We came out of the Depression because of WWII, not the New Deal. There's very little evidence that the New Deal helped much or was necessary -- we came out of every other previous recession or depression just fine. Only in the USA was the Depression "Great". But there are two parts to the end of the Depression: (1) the massive increase in demand from wartime spending and (2) the end of FDR's schizophrenic policies towards business. FDR's New Deal punished and scared business and others with capital to the point that they wouldn't invest it.

I'm certain any Obama-administration promoted high speed trains, for example, would be a boondoggle -- larded up with corrupt payouts and make work for powerful constituencies. Congress has used Amtrak as a patronage mill and political sop for years. There are routes that make money -- the Northeast corridor line is the big one -- but there are many other routes that exist solely because they have powerful political sponsors. In a private market, those routes would have been closed up years ago.

Amtrak developed "high speed" trains -- Acela -- that were a nearly complete failure. They're a little faster from point to point, but not nearly as fast as they could be. Because of design errors, they can only run at full speed for very small stretches of time. (I'm not so sure that the market wouldn't like these trains. It's hard to tell because Amtrak distorts the hell out of the market).

The thing to watch is how this program is administered. If it's parceled out to private contractors on a non-politicized bid system with appropriate incentives for good performance, it might work. But if it involves direct government hiring, well, we're in for a bad time. We also need to watch how programs are chosen -- is this going to be one big pork-barrel give-away, or is it going to be decided by a nonpartisan commission?
12.6.2008 6:43pm
calmom:
1. Will Obama enforce Real ID so that only Americans get these jobs or will taxpayer dollars go to illegal alien construction workers?

2. This electronic medical records system is already in most doctor's offices and hospitals and why should the government pay for doctors and private hospitals to upgrade their records keeping anyway? I think that's in the plan only to make it look like there are computer jobs in the plan. Otherwise most of the jobs are for manual laborers.
12.6.2008 7:13pm
Oren:

Where exactly is the internet not available in rural America in 2008?

From my experience -- Northern Maine, North-Central Washington, Idaho panhandle and large chunks of central and southern IL had nothing better than POTS. Improving service to rural areas is not a telco priority.
12.6.2008 7:21pm
John Smithy (mail):
Excuse me, but where is the money coming from to pay for all of this?

Taxes, printing more money, or just borrowing?

Inquiring minds would like to know. Also, I'd like to know where the words "budget deficit" fall in all of this.
12.6.2008 7:23pm
Andrew MacDonald (mail):

Amtrak developed "high speed" trains -- Acela -- that were a nearly complete failure. They're a little faster from point to point, but not nearly as fast as they could be. Because of design errors, they can only run at full speed for very small stretches of time. (I'm not so sure that the market wouldn't like these trains. It's hard to tell because Amtrak distorts the hell out of the market).


This is a myth. FRA regs mandate that trains have certain clearance requirements when passing each other on double-tracked rail.

The Acela trains have a feature that allows them to tilt when going around corners that allows them to run at high speeds; however, allowing European-levels of tilt has the problem that the clearance requirements would have been violated. This is because many of the sections of track are quite old. So the amount of tilting allowed (thus influencing how fast the train can go) was limited.

In fact, if we could use more off the shelf European rail technology, passenger rail would probably be a lot more profitable in the US. However, the FRA has been essentially owned by freight rail companies. These companies generally don't care about speed (contrary to passengers), so their solution to safety is heavily fortified trains running at low speeds, as opposed to more active safety devices required for high speeds.

In general, you're right that a lot of Amtrak's routes are loss-makers. But this is because 1/ major underinvestment in rails (most of the popular routes have at least parts that are single tracked) 2/ priority in the regulations really favors freight rail, as mentioned above.

This country subsidizes the investments in roads, why can't we do the same for rail (the infrastructure anyway)? As an added bonus, trains are faster and more fuel efficient than cars.
12.6.2008 7:47pm
Oren:
Andrew is right. It is an underestimated benefit of having all of your railway lines blown to smithereens that you get to rebuild them to modern spec. Our rail dates to the 19th century in some places (e.g. Boston, for which a passenger still cannot travel straight through -- go to Amtrak and try to take a train from NYC to Portland, ME to see what I mean).
12.6.2008 7:51pm
A. Zarkov (mail):
Where is Obama going to get the money to pay for these projects? Borrow it? From who? Even if it can borrow the money, how will it pay it back? The debt would be a tremendous drag on future economic growth. Public and private debt is already more than 4 times GDP, an all time record high. The only period that comes close-- 1929. That leaves printing money which the Fed is doing right now at a fantastic rate. If a country can create prosperity by printing money then Zimbabwe should be the richest country in the world.
12.6.2008 7:56pm
A. Zarkov (mail):
Rail service in the Northeast corridor makes sense, although I thought the trip from Union Station in DC to Penn Station in New York City was way too expensive. The Acela train was a joke. Why spend all that extra fare to save 20 minutes?

On the other hand, a new high-speed train down the Central Valley California makes no sense. Unlike the Northeast there are too few significant places to make stops. Besides I-5 is just not that crowded until you get near Santa Clarita. Are people really going to pay $400 for the train when they can take Southwest Air for a $100?
12.6.2008 8:07pm
PersonFromPorlock:
Hmm... Frédéric Bastiat, please call the office!
12.6.2008 8:11pm
CB55 (mail):
New Orleans is testimony to disaster. It was hit long before Katrina by government and business as usual corruption long before Katrina, but more than 3 years after Katrina it is a monument a new wave of government and business corruption, mismanagement and stupidity at city, state and federal levels. The NOLA disasters might be prelude to the current bailouts for the banking and auto industry under the Bush Admin colored with corruption and the coming disaster under the Obama Admin also painted with the broad brush of corruption, hubris, cronyism, greed, and stupidity so massive that it splits the fabric of space-time (it's worse than having both eyes poked out by Jesus Christ).


I might be the uncle of the village idiot, but I bet the Obama plan just might be the golden age for outsourcing jobs and services to foreign workers, foreign companies and American companies that rape American workers with discount wages at basement benefits.
12.6.2008 8:24pm
David Warner:
Cardozo,

"And it help get us out of the depression" Not really. I'd put the end of the Depression at Bretton Woods.

"unless you believe right wingers" I'm not a right winger.

"who still think Reagan was fiscally sound" He wasn't, though I think he intended to be. The people didn't, and so elected Congresses that reflected their wishes.

"and FDR was the crazy one." He wasn't crazy, his gifts just didn't run to the economic.
12.6.2008 8:34pm
David Warner:
I thought we elected a Progressive. Why are we regressing 80 years? The New Deal is now well past its sell-by date. This is like FDR resurrecting the Van Buren administration.

Forget the "job creation" agitprop. Our infrastructure could use some upshoring and innovation, and public funding is likely the least bad means of producing public goods.
12.6.2008 8:38pm
Nick056:
Currently fear has shocked investors into withdrawing an enormous amount of capital and it has turned potential consumers into egg-watching hens; I think it can safely be wagered that massive, continued government guarantees will be necessary if not sufficient to help restore the confidence of investors and consumers. It is possible and indeed likely that currently we've hit a relatively solid bottom on the DOW of 8000 -- excepting one brief dip to below 7500 -- but it is also possible and likely that a prolonged rally will not occur unless it follows the annoucement of some sustained, expansive government-expenditure stimulus. Proponents of free-market theories -- a rhetorical figure, since, actually, that includes at least everyone posting to the VC -- will all do well to realize that a market paralyzed by cascading failures in the banking industry is waiting not for a decent quarterly report from Macy's, but for government guarantees.

This is why the bailout of Wall Street was sensible; it is why the bridge loan to the Big 3 will be sensible, even if it frustrates our desire to let losers lose. If America sends a message that even now, massive business failures will meet with their day of reckoning without thought to the implications for the national economy, the warrented assumption will be that America does not have a national economy stable enough to merit investment.

It is also why infrastructure spending is an excellent use of government funds at this point in time. As states and cities lose cash and face an inability to upkeep public services, the immediate result of a funds infusion to maintain the status quo or see to long needed, ultimately more efficient improvements will be a sense of confidence that the country, to be blunt, is not about to flush itself down the toilet in defense of the principle that only evil people ever levy taxes, preserve flagging industries to maintain employment and healthcare, and pour cash into public transportation, schools, and energy efficieny in government operations.

The eventual solution to this crisis may involve a tax rebate as an incentive to invest (even though all manner of taxes will at some point be required to pay down the debt we're assuming). But as Smokey said, people either invest or spend money -- and all present signs indicate that, absent government action, they're too cautious to do either. I will freely admit that some value of this infrastructure plan will be on a purely optical level; if people like what they see, their optimism will translate into a return to the marketplace. And so long as they can establish a line of credit, we may sell a few American cars in the process.

This is not the whole story. Like I said, I believe these expenditure plans are merely necessary. How to ease the mortgage crisis and attempt to locate some value in all of our troubled assets is an entirely separate question.
12.6.2008 8:41pm
John (mail):
Just a follow on--this is a quote I found at Greg Mankiw's blog. It's from one of Obama's economists in the new Administration, Christina Romer:

"Given the key roles of monetary contraction and the gold standard in causing the Great Depression, it is not surprising that currency devaluations and monetary expansion became the leading sources of recovery throughout the world....the new spending programs initiated by the New Deal had little direct expansionary effect on the economy."

This seems consistent with the view expressed by a few commenters here that government spending programs are not particularly helpful in spurring the economy.
12.6.2008 8:45pm
Fidelity (mail) (www):
I'm just wondering how many people here have experience building roads and installing HVAC systems.

Are you going to apply your college degree to that shovel?

This is such a joke.

Buy a gun.
12.6.2008 8:51pm
MadHatChemist:
A 20th century solution to a 21st century world.

Obama will create these labor intensive jobs, then open the borders to fully staff them. He gets to play FDR while increasing a relatively controled voting block big time.

*Sigh*
12.6.2008 8:54pm
theobromophile (www):
Amtrak developed "high speed" trains -- Acela -- that were a nearly complete failure. They're a little faster from point to point, but not nearly as fast as they could be. Because of design errors, they can only run at full speed for very small stretches of time. (I'm not so sure that the market wouldn't like these trains. It's hard to tell because Amtrak distorts the hell out of the market).

Some of the problem with the Acela is the numerous stops. It doesn't run straight from Boston to NYC, but makes six intermediate stops. At, say, four minutes per stop, that's almost an extra half-hour right there. Granted, someone may want to go from Stamford, CT to Washington, DC, but making a stop in Stamford isn't the right way to go about that.

Rather than the 16-stop system they've devised (that runs between Boston and D.C.), they could shrink it to four or five: Boston, NYC, Philly, DC, and maybe one other. Get those other twelve out of there and save yourself an hour.

As for the impossibility of taking a train from, say, NYC to Maine, that stems from the fact that Boston has two train stations (North Station and South Station), which aren't even connected by the same subway line. It's either a 15-minute walk or a Red Line -> Green Line (or Orange Line) -> North Station route to get there.

As mentioned above, the advantage to trains is that you're bringing people into the city centre as opposed to a remote airport (e.g. Penn Station v. JFK), and it can replace driving if you're going to a city in which people typically don't rent cars (East Coast cities and Chicago, Vegas).
12.6.2008 9:23pm
CB55 (mail):
Fidelity:

High Tech Ceo's opine that they do not need more college grads, just more mechanics and gents like those ITT grads from India.
12.6.2008 9:26pm
DogshirtJones:
I see nothing wrong with the President-elect's making non-crippled and non-psychotic welfare recipients put in forty plus hours a week digging ditchs or picking oakum as a mandatory part of their welfare as we know it package.

Many decent people have taken a fifty percent haircut on their equity-based retirement plans. Would it not be appropriate to require union guys 'n' gals who hollowed out our entire industrial manufacturing base to work as unpaid toilet attendants or worse?

As the elephant mohel employed by the circus once remarked, the pay is not so great but the tips are huge.
12.6.2008 9:32pm
CB55 (mail):
DogshirtJones:

Retired army general Powell said that the army trains people to do only two major things, killing people and blowing things up, the minor things are logistics and intelligence. The New York times reported, " A 2007 survey for the Veterans Affairs Department of 1,941 combat veterans who left the military mostly in 2005 showed nearly 18 percent were unemployed as of last year. The average national jobless rate in October was 6.5 percent.
A quarter of those who found jobs failed to make a living wage, earning less than $21,840 a year.

Just what will happen to all of those men and women after after using shovels to build and repair or public works according to budget? They will join the lines of the unemployed with returning vets.

Our solution to surplus labor is welfare, temp work or prison.
12.6.2008 9:59pm
Roger Schlafly (www):
Why can't you put some text in the RSS feed, as all the other conspirators do?
12.6.2008 10:27pm
Simon Kardner (mail):

Of course in that case private business could also have taken out the loans, but the government can probably get loans at much better terms than small businesses.



What loans? We're in a credit crunch.
12.6.2008 10:41pm
Ken Arromdee:
A 2007 survey for the Veterans Affairs Department of 1,941 combat veterans who left the military mostly in 2005 showed nearly 18 percent were unemployed as of last year. The average national jobless rate in October was 6.5 percent.

How does it compare to the jobless rate among people of similar age, sex, and education, instead of to the average national rate?
12.6.2008 11:57pm
OrinKerr:
Why can't you put some text in the RSS feed, as all the other conspirators do?

Roger, you've mentioned this before, and I believe I raised it with Eugene when you did: I have no idea why text isn't showing up in my RSS feed. . If you have some idea of how to get my text to show up in the RSS feed, please e-mail me.
12.7.2008 2:19am
Alexia:

-- if it's cheaper to build the bridge today than in 10 years, might be better to take out a loan and do it today.


SO, that fact that we have have already borrowed so much money that we ran out of credit just a wee bit over a month ago doesn't matter?

Krugman isn't my economist of choice. He always starts out with a decent theory, then uses incomplete data to get to an erroneous conclusion. The depression would have lasted less than 2 years if the market had been allowed to correct itself. Instead, the government spent the country into a spiral and it took a world war to get us out of it. And, we had manufacturing jobs to fall back on. THat's not the case these days.
12.7.2008 2:51am
Smokey:
Andrew MacDonald:
This country subsidizes the investments in roads, why can't we do the same for rail?
Huh?? Amtrak receives $billions in federal subsidies, yet constantly complains that it isn't enough.

A. Zarkov:
Where is Obama going to get the money to pay for these projects? Borrow it? From who? Even if it can borrow the money, how will it pay it back? The debt would be a tremendous drag on future economic growth.
Obama and the Democrats will raise the gas tax [along with many other taxes and fees], probably by a dollar a gallon. Those who voted for Obama were voting to part with tens of thousands of dollars a year, every year, from now on. What were they thinking?? That it is the messiah who deserves more of their after tax money, instead of their own families? And for what, exactly? For pie in the sky promises?

The Democrats' new taxes are a strong economic headwind against economic growth, which will greatly exacerbate the current recession and jack up unemployment much more than it would otherwise be without the heavy new taxes.

And of course, a gasoline tax is super regressive. But Obama doesn't care about those in the lower economic strata; he was groomed by white wine and brie liberals, who shoveled unearned money at him and his wife. His goal is power, pure and simple -- not what is good for the country.
12.7.2008 6:56am
Pecos Pete:
The Dems flog the Bush Administration for "Halliburton" and complain about war profiteering in the military/industrial complex. Infrastructure investment is different, yes? The government won't be doing construction, they will bid out projects to private firms. The opportunity for immense graft and waste is significant.

New Mexico just finished constructing a $500 million commuter rail from Albuquerque to Santa Fe. The state budget is now $500 million in the red. Next comes the projected operating deficit of approx $20 million per year. The related construction jobs will disappear and the long-term jobs created will be the train crews and ticket agents. Government at its best. But hey, it takes cars off the road, right?
12.7.2008 9:09am
Oren:

Obama and the Democrats will raise the gas tax [along with many other taxes and fees], probably by a dollar a gallon.

I wouldn't mind a reverse-graduated (e.g. goes down as price goes up) dollar a gallon tax. I survived at $2.99 (hell, I survived at $4.25) so bumping the current $1.99 up by a dollar is no sweat.
12.7.2008 9:58am
William D. Tanksley, Jr:
Pecos Pete: yeah, you think YOUR state is stupid... Check out California. Massive deficits, governor running hat in hand to beg for bailout funds... And we go and pass a spending mandate for a bullet train. Ten Billion Dollars mandated, and no end in sight. Here I thought Prop 71 was the fiscally stupidest measure ever, and they went and exceeded all expectations... Oh well.
12.7.2008 10:59am
ITDoc (mail):
This electronic medical records system is already in most doctor's offices and hospitals and why should the government pay for doctors and private hospitals to upgrade their records keeping anyway?


You are wrong. EMRs do make records instantly accessible, but most private doctors do NOT use EMRs -- they are expensive to buy and maintain, they lower productivity and damage quality of care.

Government likes EMRs because what you can measure you can regulate. EMRs turn the medical record into a computer database to track and enforce trivial measures of "quality" and document compliance with elaborate billing regulations. As far as Medicare is concerned, doctors are all cheats who will over bill every chance they get. EMRs force doctors to fill in lots and lots of data boxes for each visit, proving they actually listened to the lungs - check, heart - check, abdomen - check.

Corporate medicine (including large multispecialty clinics) likes EMRs because they track business expenses and activity, and they prove compliance with elaborate govt regulation.

Corporate medicine also likes the liability protection EMRs give. Two-click boilerplate records, with all the right boxes checked, let EMRs quickly document what should have happened instead of what did happen. Night nurses document complete physical exams -- neuro exams, mental status exams! -- every four hours all night. Hundreds of individual data points, for 20 patients, every four hours. If all they did was sit at the computer and type they couldn't enter all that info, let alone actually do any medical work. They don't. They hit "Enter" and the computer fills in 'normal' over and over.

I remember a patient who had a big operation at a national Clinic. The operative note was incredibly detailed; every step carefully recorded. All the complications looked for and ruled out. Everything done just right. 6 pages of detailed notes. Very impressive. Only they nicked the bowel and had to go back in. The op note for the second surgery was IDENTICAL. Word for word. All 6 pages. The whole fucking op note was a lie. All their op notes are lies. All boilerplate, written by the lawyers.

It is no longer possible to read a medical note and tell what happened medically. If the doctor is typing himself the note is brief to the point of triviality. Or he's just checking boxes.

Half the doctors in training in internal medicine are now foreign medical graduates. Is it any wonder why?
12.7.2008 11:00am
A. Zarkov (mail):
ITDoc:

Great post. Nothing like hearing from someone who actually know what's going on as the result of direct experience.

BTW on the whole I'm not impressed by the foreign medical school grads and I avoid them. I still remember the argument I had with my mother's FMS doctor. He had given her precisely the wrong directions on how to use an inhaler extender tube. I read him the instructions printed on the side of the tube, which say not cause the whistle to activate. He told her the opposite. He tried to tell me the directions didn't say what they did. It was very embarrassing for him, to say the least.
12.7.2008 11:33am
A. Zarkov (mail):
William D. Tanksley, Jr:

"Pecos Pete: yeah, you think YOUR state is stupid... Check out California."


Let me second that as a resident of California myself. This state is beyond stupid. In fact CA has the fourth lowest average IQ of all the continental states. Only New Mexico, Alabama and Mississippi are lower, and not by much.
12.7.2008 11:40am
trad and anon (mail):
As mentioned above, the advantage to trains is that you're bringing people into the city centre as opposed to a remote airport (e.g. Penn Station v. JFK), and it can replace driving if you're going to a city in which people typically don't rent cars (East Coast cities and Chicago, Vegas).
And you don't have to deal with our oh-so-important post-9/11 "security" regulations. No need to take your shoes, jacket, and belt off. Bring as much water and shampoo as you like. No need to arrive super-early in case the security lines are too long. Trains are more comfortable than planes too—more leg room.

It's unfortunate though that the price is not competitive with air travel. And outside the Boston-NYC-Philadelphia-Washington corridor the "schedule" is anything but because Amtrak has no rights of way.
12.7.2008 11:59am
Oren:
Yeah, I like the Amtrak but the unreliability is insane. How hard could it possibly be to lay down another set of tracks solely for passenger service instead of piling us behind those g...... freight trains?!
12.7.2008 12:07pm
Dan Weber (www):
Both Mayo Clinic and VHA have enjoyed success with electronic medical records. But many other places have not seen any reduction in costs or health improvement.

If your medical system and its incentives are screwed up to start with, adding medical informatics just makes it a lot worse. It is possible to do it well, but you need to realize that it's possible to do it poorly.
12.7.2008 2:22pm
Allan Walstad (mail):

This is why the bailout of Wall Street was sensible; it is why the bridge loan to the Big 3 will be sensible, even if it frustrates our desire to let losers lose. If America sends a message that even now, massive business failures will meet with their day of reckoning without thought to the implications for the national economy, the warrented assumption will be that America does not have a national economy stable enough to merit investment.

If America sends a message that massive business failures will be met with bailouts, the warranted assumption will be that America will never have a national economy stable enough to merit investment.

This is the reason the Wall Street bailout did not make sense: Government meddling with the money supply, along with pressures to make bad loans, produced a malinvestment in houses that people could not actually afford, and a malinvestment in loans that would not be paid off. That malinvestment needs to be liquidated. The way that happens is that banks that made bad loans go bankrupt; the assets are obtained at way-reduced costs by investors who are in a position to sort out loans that can be saved by renegotiated terms, from those where foreclosure and re-sale at reduced price are the answer. The market can accomplish that process efficiently. The bailout short-circuits it.
12.7.2008 2:42pm
Allan Walstad (mail):

This country subsidizes the investments in roads, why can't we do the same for rail (the infrastructure anyway)? As an added bonus, trains are faster and more fuel efficient than cars.

Perhaps the force of the argument works the opposite way. Why IS it necessary for the feds to subsidize long-distance highways? If they hadn't built the interstate system, maybe trains would be more profitable and maybe we'd be using less gas. Maybe private investment would have built highways as well as railroads, all of which would have had to meet the test of the market rather than be determined by political pandering to various special interest groups.
12.7.2008 3:09pm
Ben P:

That malinvestment needs to be liquidated. The way that happens is that banks that made bad loans go bankrupt; the assets are obtained at way-reduced costs by investors who are in a position to sort out loans that can be saved by renegotiated terms, from those where foreclosure and re-sale at reduced price are the answer. The market can accomplish that process efficiently. The bailout short-circuits it.


The market can process this efficiently with the help of government intervention in the form of protecting them from their debts when they file for bankruptcy?

That's an interesting statement from someone insisting that government intervention was the result of the whole problem anyway? Why not just let the creditors handle it themselves?
12.7.2008 3:19pm
Brian K (mail):
You are wrong. EMRs do make records instantly accessible, but most private doctors do NOT use EMRs -- they are expensive to buy and maintain, they lower productivity and damage quality of care.

i've worked in hospitals that use both EMRs and paper records. the worst designed EMR system was no better than the paper systems, but the well designed electronic systems were absolutely fantastic! you had instant access to all of the patients records at that hospital, didn't have to do with reading chicken scratch, multiple people could access the same chart at the same time and notes were generally better written because it's easier to proof read electronically. i have no idea where you got the notion that they damage quality of care as i haven't seen that myself. and EMRs certainly seemed to raise productivity as you didn't have to spend 20 minutes to find each chart...that's a lot of time saved when you have 10 patients.
12.7.2008 3:54pm
Allan Walstad (mail):

The market can process this efficiently with the help of government intervention in the form of protecting them from their debts when they file for bankruptcy?

That's an interesting statement from someone insisting that government intervention was the result of the whole problem anyway? Why not just let the creditors handle it themselves?

I didn't make that statement, Ben P. Go back and read my post.
12.7.2008 4:45pm
darrenm:

Bringing the internet to rural American can be the electrification of this century.


Dams straight. Those hicks in the backwoods have the right to conveniently download their porn like the rest of us.
12.7.2008 5:10pm
A. Zarkov (mail):
I been to the Mayo Clinic and their EMR system appears (from the patients' point of view) to be successful. They have also digitized all their radiological data. Every physician station is able to access the patient data. But Mayo seems to do most everything well. So I'm not surprised that their EMR works. That does not mean that others will make a success of their EMR systems. A poorly function EMR is often worse than paper. BTW Mayo's old paper records system also worked well.
12.7.2008 5:14pm
darrenm:
I can see how goverment spending could help the economy, but not if it's just taking money from one pot and putting it into another. It would have to be borrowed, not from taxation. Economics is a quasi-social science despite all the numbers economists like to throw around in an attempt to equate it with the hard sciences (physics, chemistry, etc.) I tend to think the important ingredient is consumer confidence. I suppose government spending might increase this confidence. (It also might conceivably undermine it.) I'd think the important thing in the long run is to have stable and predictable markets and regulation.
12.7.2008 5:18pm
CB55 (mail):
darrenm:

I think you and I are paying a tax to bring the Internet to rural America. If you have 2 or more phones you pay a tax. If you have an Internet connection, you pay a tax. Part of those taxes pay to connect rural schools, hospitals. public buildings and residents to telephone and Internet service.
12.7.2008 5:24pm
Aleks:
Re: Hasn't the economic consensus (as opposed to popular or leftist political consensus) since the 1960s been that the end of the depression was brought about through entry into WWII?


One way of looking at WWII is that it was a government jobs and spending program on a very massive scale.
12.7.2008 9:36pm
Thorley Winston (mail) (www):
This electronic medical records system is already in most doctor's offices and hospitals and why should the government pay for doctors and private hospitals to upgrade their records keeping anyway?


According to the Robert Wood Johnson Foundation, as of about a couple of years ago only 5 percent of hospitals and 25 percent of physicians used electronic health records.

As far as why should the government provide incentives for doctors and private hospitals to adopt EHR, I think the argument is that the while EHRs do create benefits in the form of lower costs, fewer unnecessary tests, fewer contraindications, etc. – these benefits usually go to payers (of which the government is the largest) and patients whereas the costs of adopting EHRs go to hospital and doctors.

In addition, a lot of physicians have smaller practices which means that the cost of adopting EHRs is comparatively more expensive (especially if they have a smaller support staff to learn how to use it) and will take longer for them to recoup the costs. Add to that the issue of an aging physician population (for whom adopting a new record system is probably not a priority in the last years of their practice) when we have a physician shortage and we’re looking at increased demands for health care services as the baby boom generation ages.

While I’m not normally a fan of government subsidies for private organizations, the public benefits of EHRs seem pretty substantial and unless we’re going to open up market forces to medicine (which is my preference) so that physicians can recoup the cost of this investment, it may be warranted to have the public pay for at least part of the upgrade. Especially if we want these benefits to begin before we have some 60 million baby boomers and want to improve services in rural areas where smaller physician practices are located (and less likely to have EHRs).
12.8.2008 12:58pm

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