House passes enormous waste pork spending bill

Here's a link, there are many others. Normally, I wouldn't quote mundane news stories, but it's not every day that "our" government wastes $825 Billion dollars in payoffs, bribes, handouts, pork, and other corruption disingenuously labeled "stimulus". To put that in perspective, assuming countries tax income equals roughly 20% of their GDP, that makes this wasteful spending package alone the equivalent of spending the entire annual income for a country producing 4.125 Trillion dollars in GDP; such a country would be just behind Japan as the third largest economy in the world. And that's just what we're wasting in new sewage pork waste; that doesn't even count the projected deficit, which is even larger!

Anyway, the somewhat humorous quote from the news article is:
"We don't have a moment to spare," the president said earlier in the day[, using the same fear mongering tactics and rhetoric Bush used to pass his failed stimulus package, invade Iraq, or any of the other actions he has been ridiculed for by Obama and the other Democrats]. (clarification added, since the original news author didn't bother to note the obvious parallel)


Also of note: All Republicans and 10 Democrats in the house voted against the bill (good for them). How's that new bipartisan spirit of cooperation and compromise coming, oh leader of the Obamanation?

Comments

  1. CJJanuary 29, 2009 at 6:50 AM

    The urgency reminds me of PATRIOT Act, the invasion of Iraq, or a quick change scam. If the purpose of this spending were purely stimulus, we should get the money into people’s hands (preferably the poor and near poor) as fast as possible. Stimulus supporters would argue that spending the money on government projects, such as renewable energy, will provide a long-term increase in GDP in addition to a short-term stimulus. I agree with funding renewable energy, Medicaid, and other benefits to the poor, but it’s a pity we have to sell them as part of a stimulus package. An even greater concern is borrowing this much money. Rates could go up. We’re betting our future that this spending will really cause GDP to grow.

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  2. NickJanuary 29, 2009 at 11:23 AM

    Some of the justifications expressed are just so idiotic it borders on laughable. For example, the Democrats' rationale for not including people who make over $100k in their "tax break" (which includes people who don't pay taxes, also laughable) is that "those people tend to save extra money, rather than waste it immediately, like we want." WTF? How about this: you give me the extra money too, and I'll promise to spend it immediately: that way it's guaranteed to immediately flow back into the economy, instead of just betting on people who have a tendency to throw away any extra money they come into. F-ing liars.

    I would agree: there are debatable but tangible benefits to spending money on infrastructure projects. They don't increase the real GDP unless they are in the private sector (government expenditures don't contribute to the actual domestic product, no matter how much the bean counter fudge the numbers), but there is the potential for long-term real benefit there (not the way the Democrats are proposing, but in the general sense). Those should be debated aside from the "giant flush of 2009" bill.

    I wouldn't worry too much about borrowing rates in general, though. The last $2500 Billion of government debt was bought with newly-created money by the Fed, no foreign or domestic investors involved. As long as the Fed is buying all the newly created US debt ("monetizing" it, colloquially), we can borrow at whatever rate the Fed sets, which (since the US government kinda controls the Fed) will be artificially below market and ridiculously low compared to what market would be. The government can and will keep borrowing rates low as long as it wants to: after all, they print the money, they can print as much as is needed. I'd be more concerned about global confidence in the US dollar... you can't really print that, and no amount of obscene new government waste will reflate it...

    We're betting our future, all right... we just don't have a potential upside scenario yet. Maybe after a couple more obscene money flush bills, someone will come up with a credible recovery scenario which could happen as a result of the government actions... I'm not holding my breath though...

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  3. CJJanuary 30, 2009 at 5:32 PM

    Democrats' rationale for not including people who make over $100k in their "tax break" is that "those people tend to save extra money

    I'm not sure that stats back Democrats up on that, even though intuitively it sounds true. Anyway, if we must go deeply into debt, I'd rather give the money to the needy. Theoretically you buy the most important things with the first dollars you receive. First you buy food, clothing, and shelter. Then you buy luxuries. This is all moot, though, because no one says we must go deeply into debt.

    government expenditures don't contribute to the actual domestic product
    Actually, GDP = consumption + gross investment + government spending + net exports.

    I'd be more concerned about global confidence in the US dollar.
    Which leads to higher interest rates unless we totally give up and inflate the dollar away. I don't think that will happen. We'll just accept the higher rates and half our tax dollars going to service debt as the price for a stable dollar.

    ReplyDelete
  4. NickFebruary 4, 2009 at 10:07 AM

    I'm aware that the official GDP calculation includes government expenditures, which is why I pointed out that they don't contribute to actual GDP (despite the bogus calculation). After all, it makes no sense that the government draining money from people to give to other people would increase the domestic product of the country... otherwise countries could easily become global economic leaders by simply cycling all their private sector money through the government a few times, or even just by paying all government workers 10x as much while collecting all the extra money as extra taxes on government workers. See how idiotic that proposition is?

    We have already given up on a stable dollar, in case you missed the $2.5 Trillion in government securities the Fed has purchased with newly created money. It won't ever be politically feasible, or even really possible, for us to raise rates enough to service our debt, or even stop the Fed from continuing to monetize all the government waste. I don't think anyone who's contemplating the creation of another Trillion in wasteful spending on top of our existing $10 Trillion deficit, $2.5 Trillion Fed gambling payoffs, and $55+ Trillion in unfunded social Ponzi schemes is really concerned about a stable dollar, in word or in deed.

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