Where is the line?

[jsharmon7]

With the difficult economic times that our country has faced recently, it's gotten me questioning where the line of government intervention is crossed. At what point do we say that letting the government take more control than they have traditionally is okay? Many people agree that the last time our nation faced such difficult times was in the Great Depression. How much of a role did Franklin D. Roosevelt's New Deal play in the economic recovery of the nation? What would have happened if such drastic measures hadn't been taken? Look back at some of the things FDR did to save our economy and pull the US out of the Depression:

National Industrial Recovery Act - Forced industries to establish rules of operation for all companies within an industry. Basically the imposition of government oversight on free market and private industry.

Civilian Conservation Corps - Hired an "army" of civilian workers on local government projects. One of many measures FDR used of "priming the pump" in order to get money into the US economy.

Agricultural Adjustment Administration - Artificially inflated prices for commodities by paying farmers to take land out of crops and reduce animal herds.

Executive Order 6102 - Made all privately held gold the property of the US government. Could you imagine something like this today??

Tennessee Valley Authority - Largest government-owned industrial enterprise in American history.

Works Progress Authority - National relief agency for unemployed heads of household.

Social Security Act - More money out of checks to spread around.

National Labor Relations Act - Established federal rights of workers to organize unions, engage in collective bargaining, and go on strike.

By no means am I supporting Socialism or in Socializing our government, but how much slack do we tolerate in order to get the economy turned around? Does anyone see a parallel with some of the measures Obama has taken since taking over office?

 

[VN Vet]

The problem I see with all the "lines" our government have made, is that once a new line is made and crossed the government never seems to step back and erase the line. The line keeps moving to the left each time it is drawn.

 

[Doug]

There are economists who insist that if FDR had done NOTHING the Great Depression would have been over a lot sooner.
We have spent almost $400 billion and unemployment, which was not supposed to go above 8%, is at almost 10%. If you add in those who want full-time work and can't find it, the severely under-employed, the number is 17%.
The stimulus is not working as predicted.
The response will be to do more of the same: spend more money, increase the debt*, and meddle in more businesses**.

Doug

* The reason the debt increase is bad is that increased borrowing by the government will drive up interest rates. This will make mortgages and car loans more expensive, slow the economy, and cause each dollar to be worth less.

** The likely next step in business regulation is to limit executive salaries. If you can have a minimum wage, why not have a maximum wage? The effect of these kind of controls is always a shortage. Remember the gas shortage of the 80's? The government will drive our best managers to work for overseas companies and stifle inovation in the US.

 

[Dryden]

Roosevelt did not push thru all those unread/unseen/undebated programs in seven months.

 

[eatsnopaste]

There are economists who insist that if FDR had done NOTHING the Great Depression would have been over a lot sooner.
We have spent almost $400 billion and unemployment, which was not supposed to go above 8%, is at almost 10%. If you add in those who want full-time work and can't find it, the severely under-employed, the number is 17%.
The stimulus is not working as predicted.
The response will be to do more of the same: spend more money, increase the debt*, and meddle in more businesses**.

Doug

* The reason the debt increase is bad is that increased borrowing by the government will drive up interest rates. This will make mortgages and car loans more expensive, slow the economy, and cause each dollar to be worth less.

** The likely next step in business regulation is to limit executive salaries. If you can have a minimum wage, why not have a maximum wage? The effect of these kind of controls is always a shortage. Remember the gas shortage of the 80's? The government will drive our best managers to work for overseas companies and stifle inovation in the US.

Are these the same managers who work for the banking system? Fannie and Freddie? Automotive..Steel? Let em go..someone will always step up and do the job as well if not better and for less money.

 

[melensdad]

...but how much slack do we tolerate in order to get the economy turned around?

I'm not sure that I understand this question.

From everything I can tell, the more intervention by the government the L-O-N-G-E-R it will be before we see a recovery.

The Jobless Recovery - Rasmussen Reports™

The Jobless Recovery
A Commentary BY Lawrence Kudlow
Saturday, September 05, 2009 Email to a Friend ShareThis
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The jobless-recovery theme re-emerged on Friday with the arrival of a disappointing employment report. The daunting number was the unemployment rate, which jumped from 9.4 percent in July to 9.7 percent in August. This is a big-versus-small-business issue. Sort of the haves versus the have-nots.

The large companies are gradually recovering as a result of major cost-cutting, inventory reduction, and a lean-and-mean return to profitability and high productivity. So the payroll survey registered a 216,000 job loss, the smallest drop in over a year.

The household survey, however, which picks up small, owner-operated, LLC/S-Corp-type businesses, registered a devastating 392,000 job loss, which follows losses of 155,000 and 374,000 in the prior two months. This is the source of the unemployment-rate jump, as 466,000 newly unemployed were scored in the report.

So while the big companies are getting healthier, the smaller firms are being left in the dust. Unfortunately, small businesses provide most of the new job creation in the United States. Veep Joe Biden is out there saying the Obama stimulus plan has saved or created 150,000 jobs in the administration's first 100 days and another 600,000 in its second 100 days. But he sure isn't talking about small-business jobs.

In fact, it's hard to know what he's talking about. Uncle Sam has borrowed $388 billion in the second quarter and is scheduled to borrow $406 billion in the third quarter and nearly $500 billion in the fourth. In order to provide $152 billion in so-called fiscal stimulus, the government is draining close to $800 billion from the private-sector savings supply -- $800 billion that will not be invested in new-business enterprises, including small businesses.

Borrowing from Peter to redistribute to Paul is not fiscal stimulus. It's a fiscal depressant. Small businesses are having enough trouble getting their hands on credit. And now they can't find enough capital for new start-ups. The government prospers, but the small-business sector sinks. Then there are all the tax and regulatory threats related to health care and energy reform. Until Obama retreats from his plan for a government takeover of the healthcare sector and a cap-and-trade program that will cripple the energy sector, the cost of hiring the new job will continue to rise.

The threat of higher payroll taxes and energy costs is more than enough to deter new hiring. Taxes on upper-end investors are going to rise, too, and there may be a health care surtax on top of that. And don't forget that small businesses pay the top personal tax rate, which is going up. Oh, and how about the recent minimum-wage hike? Yet another business cost.

So while the government doles out money for transfer payments and one-time temporary tax credits, the ensuing increase in the private-sector tax-and-financing burden becomes a complete deterrent to new job creation, as well as capital formation.

We're going to recover. Improved ISM reports for manufacturing and services, along with better profitability for big corporations, suggest we're looking at a mild, V-shaped recovery of 3 percent. But it will be a jobless recovery.

Of course, if Obama pulls the plug on his new government-insurance plan, and all the spending, taxing, borrowing and regulating that goes along with it, the stock market will rally at least 500 points -- at least. Investors understand that an Obama retreat on government-run health care will lead to stronger economic growth for America's vibrant health care industry -- and small businesses in general.

With all this, why is Wall Street so shocked by the recent gold rally, with the yellow metal marching back toward $1,000 an ounce? The run into gold is a clear revolt against paper money and financial profligacy.

The Federal Reserve's monetarist experiment to balloon the money supply will backfire with much higher future inflation unless the economy is capable of generating enough new investment and jobs to produce the goods to absorb all the new money. Indeed, this is a worldwide problem. Too much cash chasing too few goods.

The G-20 finance ministers are meeting in Pittsburgh this weekend, although nobody there has an exit strategy from the money explosion that has been aimed at solving the financial meltdown. None of the big countries have plans to reduce marginal tax rates to promote economic-growth incentives. There is no golden anchor of currency value and no exit strategy from the potential inflation effects of the new-world monetarism.

The bottom line is that governments today have no financial discipline. And while growth will reappear, it may be a meager sort, with incipient inflation pressures plaguing the new recovery.​

 

[cbop]

Government intervention and programs to stimulate the economy are counterproductive. Spending money on the Federal level only reduces the amount of money available in the private sector that is needed to build the economy.The government does not "make" any money, it can only get it's money from the taxpayers. Most of the numbers I have heard, put the effective tax rate at around 50-60% of gross income when you add all the taxes, fees and mandated monies together. What would your personal finances be like if you had that extra 50% in your paycheck?

I understand that taxes are necessary evils but the confiscatory rates that we have now only limit the amount of money we have to buy goods and services. Why do so many people think that the government can spend our money wiser than we ourselves? Less money out of my paycheck means more money in the coffers of my local businesses which means more money in their employee's paychecks which gets spread around. All the government does is spend huge amounts in few areas, creating small bright spots in a sea of darkness. Every dollar we send to Washington to spend for us becomes less than a dollar once Washington takes their cut out of it. It is a case of diminishing return

 

[SavageEagle]

The line is coming. It'll be the 2010 elections and the final straw will be 2012. Unless they screw up ROYALLY, like another terrorist attack, martial law, or the disarming of citizens either by force or legislation. If there is a difference there....

 

[redneckmedic]

The line is coming. It'll be the 2010 elections and the final straw will be 2012. Unless they screw up ROYALLY, like another terrorist attack, martial law, or the disarming of citizens either by force or legislation. If there is a difference there....

2012, What will happen then?

 

[ihateiraq]

2012, What will happen then?

it doesnt matter what happens in 2012. the mayan calender ends.

 

[eatsnopaste]

end of the Mayan calendar?

 

[eatsnopaste]

arrrrg..beat me to it!

 

[SavageEagle]

 

[jsharmon7]

There are economists who insist that if FDR had done NOTHING the Great Depression would have been over a lot sooner.

There are just as many, if not more, economists who insist that the programs FDR proposed did NOT prolong the Great Depression. In 1995, Robert Whaples of Wake Forest did a survey of academic economists which proposed the statement that, "Taken as a whole, government policies of the New Deal served to lengthen and deepen the Great Depression." Of the economists who responded as to whether they agreed or disagreed with the statement, 51% disagreed with that statement on its face, 22% agreed WITH provisos (study doesn't say what provisos), and only 27% agreed with the statement on its face. Only one in four respondents in that study agreed with the statement on its face, so I don't think it can be said that the New Deal definitively helped or hurt the nation's recovery from the Great Depression.

Even if I concede that the New Deal may or may not have helped the nation's economy during the Great Depression, I think it's at least fair to say some of the programs that were adopted are helping us today. The FDIC, Social Security, end of the Gold Standard, the National Labor Relations Act, the Rural Electrification Administration, etc., are all important to us today.

The point of the original post I made, as there was confusion, was that not everything Obama is doing may be bad. I didn't vote for him nor do I support his politics overall, but I think it's wise to be open to some new thinking from time to time, especially during tough economic times.

 

[Denny347]

2012, What will happen then?

Then 2013 happens

 

[SavageEagle]

The ancient calendars are based on celestial events. Chances are the end of the Mayan calendar will just be the end of some celestial event or the beginning of one.

No, I fear that if things don't turn around in Washington by 2013, I.. fear the worst.

 

[PeaShooter]

I think it's at least fair to say some of the programs that were adopted are helping us today. The FDIC, Social Security, end of the Gold Standard, the National Labor Relations Act, the Rural Electrification Administration, etc., are all important to us today.

I don't believe that the social security, end of the gold standard, or the national labor relations act are helping us today. To the contrary, I whole heartedly believe that they are part of the problem.

Social Security - originally thouthght if as a safety net only to be used if completely unable to take care of yourself. Now it is looked at as everyone's retirement plan. Everyone expects it, not just a safety net.

End of the gold standard - allowed the government to print fiat money that had no intrinsic value other than what the govt says it is worth. Allows for inflation and continued printing of money with no backing.

National Labor Relations act - Unions used to empower people to work, now they empower people not to work. I work in union plants and non union plants, and let me tell you there is a marked difference in them. Just think of the difference between GM and Toyota, which is coming out on top.

As I see it, the problem is the government in the way and in the middle. It needs to get out of the economy and let the private sector do its thing. The only thing governments do is to gain more power for government, and they never relinquish it.

Just because Congress passes a law and the president signs it, doesn't make it constitutional. None of these acts are constitutional, as the founders wrote it, but Rosevelt stacked the Supreme court and forced the measuers through and once the power was taken, it was never given back.

If you can't do something yourself, you can't have the government do it for you and have it be constituional.

 

[Metro 40]

Then 2013 happens

Then 2014, then 2015, etc, etc......

Life will go on. Even for those who have decided that is a way of life.

I'm not worried about the future. I vote for the candidate who best represents my views, and I donate to causes that I believe in. The number one thing that I can do to make the future better for my children is to set the example, by working hard for what I have, and to improve myself through continual learning and education. Lead by example.

You can talk to your children all that you want about politics, government, etc....but in the end, if they see a layabout who contributes very little to his own lot in life, they will wind up exactly the same. No one who does not pull his own weight by earning his keep has any right to speak out against socialism....for living off of the sweat of other people is the very heart of socialism.

Actions always speak louder than words. While it is important to keep abreast of political developments, it is vastly more important to lead a life of example, and to concentrate on what is truly important in this life. All of this talk of Mayan calendars, brownshirts behind every tree, Nazi "indoctrination" programs, and other such nonsense is ludicrous. I know a couple of people like this in real life. I don't see why the hell they are worried about what happens in Washington....they don't even control what happens in their own house!

Given the hyperbole I see posted here by a small minority of posters on a regular basis, I wonder how long it has been since they've seen the outside of their bunker. And in their frantic attempts to prepare for "survival" in the coming "apocalypse", I wonder if they really understand what it is to live.