Is the Obama administration hurting the recovery?

myp · Jul 11, 2010

Several companies and market analysts have come out this past week, suggesting that the Obama administration is halting the economic recovery due to the uncertainty it is creating and some of the interventions it is making. Currently, many large corporations are sitting on a lot of cash as a way to offset potential risks which they just can't gauge due to the uncertainty in how the government will react.

Personally, I think this is just another downside of market intervention and I am with the companies in this instance. Projections are a huge part of almost any business and having less information about what will happen can halt progress.

el canadiano · Jul 12, 2010

It's a yes and no kind of thing, like many different things in life/the world. Your corporations just failed. They projected that the economy will raise and then it falls. Look at GM/Chrysler, any financial institution. To a certain extent, he had to do a few things that he did, such as the Credit CARD Act of 2009.

http://en.wikipedia.org/wiki/Credit_CARD_Act_of_2009

You can't let guys like Bank of America or the Credit Card companies just mislead consumers to borrow money. Debt was the primary cause of the American (and subsequently any country that relies on the American) economy from going down. Why are you just pointing the finger at someone else when something goes awry rather than realize you have to prevent the same mistakes from happening again? Oh, by the way, this was not the first time (1929).

jdsingle · Jul 13, 2010

Think you missed the point of this. It isn't placing blame on him, just questioning whether he is hurting the recovery. This recession is not analogous to the depression. We have a ways to go before we're there.

Watch the double dip recession come lol. No one has a clue what they're doing in Congress or the White House.

Companies don't mislead people, people follow what they want to believe. It is called personal accountability . We can't blame this one anyone but those who had a hand in it. Taking out mortgages they could not pay back (take a look at the Clinton administration).

Bill Clinton repealed the Glass-Steagall Act, a law that was enacted to introduce banking regulation and reforms. He then signed the Gramm-Leach-Bliley Act. This allowed bank holding companies to own other kinds of financial companies. One of the platforms Clinton stood on was making it so that the lower class (especially minorities) could afford a home. Fannie Mae was pressured to buy risky loans that were given to low income homeowners. This practice made it so that mortgage companies were giving loans to just about anyone able to sign a piece of paper. Bush is responsible for carrying on the practices of the Clinton Administration and is in effect partly responsible for the housing bubble that occurred.

David · Jul 13, 2010

jdsingle said:
Think you missed the point of this. It isn't placing blame on him, just questioning whether he is hurting the recovery. This recession is not analogous to the depression. We have a ways to go before we're there.

19.2% unemployment (U-6), jobs still being shed, economic relapse imminent and international fears over the abilities of world gov'ts to continue to function. The only thing separating this from the GD is how long it's lasted. If we end up having a recession, lukewarm recovery, recession cycle (like the GD and which seems likely) for the next decade (which also seems likely if gov't spending is cut) you'll be sing a different tune.

Frogger · Jul 14, 2010

You can never stimulate the economy by taxing people and taking money out of circulation. This is a time when there should be massive tax breaks and incentives so as to place more money back into the economy.

Obama's policies are the exact wrong policies for this economic downturn.

notimpressed · Jul 15, 2010

It amazes me how people will defend a corrupt and unethical organization that would not walk across the street to spit on them. One fo the weirdest thing about this nation is the poor who defend the rich getting richer off them by the most sinister of means.

The republicans enjoy these wars but don't want anybody taxed to pay for it..well.

Companies who receive tax break pocket the money. They will not conduct business counter to their bottom line which is profits.

myp · Jul 15, 2010

notimpressed said:
Companies who receive tax break pocket the money. They will not conduct business counter to their bottom line which is profits.

The problem right now and the argument that these companies are making here is not that there isn't still room for them to spend, hire, and expand. It is that the reason they can't go ahead with some of those plans is because of excessive regulation, taxes, and uncertainty that makes it too risky to expand.

Kyuubi · Jul 17, 2010

My main concern right now is the insane level of spending that's putting Bush's debt as of the end of 2008 to shame right now. Out of everything I think that has the longest term impacts on what will happen with the economy, look at what happened to Greece when their debts exceeded their GDP.

David · Jul 18, 2010

Kyuubi said:
My main concern right now is the insane level of spending that's putting Bush's debt as of the end of 2008 to shame right now. Out of everything I think that has the longest term impacts on what will happen with the economy, look at what happened to Greece when their debts exceeded their GDP.

Look what happened to the US when President Hoover refused to spend.

Greece spent money on social programs. We're spending money on economic expansion (our social spending is mostly from obligations for already existent programs) which is a vary different situation. We need to spend to get the economy moving. Once it does the gov't can pull back and let increased tax revenue pay off the debt.

myp · Jul 18, 2010

David said:
Look what happened to the US when President Hoover refused to spend.

President Hoover was essentially the Bush of his time when it came to the economy and Obama the FDR. Hoover did spend and meddle in the markets, which hurt things. The better question to ask in my opinion is look what happened when Warren G. Harding didn't meddle in the markets in the early 20s during that depression.

David said:
We're spending money on economic expansion (our social spending is mostly from obligations for already existent programs) which is a vary different situation. We need to spend to get the economy moving. Once it does the gov't can pull back and let increased tax revenue pay off the debt.

I do not agree that we need to spend to get the economy moving. That logic doesn't work because for every dime spent, a dime is taken. There is no net production when the government spends, only redistribution. The way the government does it, they get that from the parts of the market that are growing because they are the ones that are taxed the most and then it is given to failing parts of the market like the Big Three autos. I would rather leave the market the certainty of non-intervention than give them the uncertainty of will this be bailed out or will that be regulated, which is what is happening right now and has made it harder to pinpoint risks and hence led to more wary spending towards growth by the private sector.

jdsingle · Jul 18, 2010

David said:
19.2% unemployment (U-6), jobs still being shed, economic relapse imminent and international fears over the abilities of world gov'ts to continue to function. The only thing separating this from the GD is how long it's lasted. If we end up having a recession, lukewarm recovery, recession cycle (like the GD and which seems likely) for the next decade (which also seems likely if gov't spending is cut) you'll be sing a different tune.

Thankfully I won't be singing a different tune. As horrible as it is to say, this recession is actually beneficial to me as a college student. I'm not looking for work and already have my tuition costs covered. If anything this recession is beneficial in the POV that when I graduate in a couple of years, our economy will hopefully be growing at a faster rate again making it easier for me to get a job.

notimpressed · Jul 19, 2010

Corpratiosn will not spend to further the good of anybody but themseleves. Giving them extra money simply will line their pockets.

myp · Jul 20, 2010

notimpressed said:
Corpratiosn will not spend to further the good of anybody but themseleves. Giving them extra money simply will line their pockets.

Agreed. The problem is, big government in our form of government will always be susceptible to corporatism. If the Federal government doesn't have the power to offer all that extra money and all those lucrative contracts, then corporatism no longer becomes a problem. A more powerful and larger Federal government in the United States would encourage more corporatism as it has during the past few decades. A smaller government would eliminate the ability for the politicians to line their pockets by offering free money and contracts since they would no longer have that power.

notimpressed · Jul 20, 2010

Your trying to change corporate and political greed by using members of both whom are all quality of it as the device for change. Won’t work. Until this citizenry of America break the cycle, nothing will ever change. Until then a supporting a corporate entity is supporting a viper that is out to do nothing but harm you. Same as when you vote for anybody stepping up on a stage and saying "I am a candidate for____"

myp · Jul 20, 2010

notimpressed said:
Your trying to change corporate and political greed by using members of both whom are all quality of it as the device for change. Won’t work. Until this citizenry of America break the cycle, nothing will ever change. Until then a supporting a corporate entity is supporting a viper that is out to do nothing but harm you. Same as when you vote for anybody stepping up on a stage and saying "I am a candidate for____"

There are still some politicians who are willing to break the cycle. Most of them are small government, free marketers like Ron Paul. If we support people like that, we can break the cycle. It is hardly efficient or plausible to stop buying from corporations today and that is less likely than my option as in mine we just need to convince 1 President and 1 Congress as opposed to 300 million people. Sure the people vote for those candidates, but it is a vote. When you ask them to boycott something, it costs them directly because often those corporations provide them with higher quality or cheaper goods which can't be found outside of the corporate sphere (when it comes to savings look at Walmart and quality a company like Google or Apple) Besides, the corporations can't really be blamed- they are doing their job by trying to make money, but the government when it buys votes is not doing it's job of looking out for the people.

notimpressed · Jul 22, 2010

I can blame the corprations real easy, underhanded and flat out crimnal more often then not.

I am not talking about boycotting corprations, I mean politicans and the political system starting with the Lobby system then moving into term limits and campaign finance. Politicans are cozy in there and they can talk about change, but when they get in, its the same ole same ole.

Dirk · Aug 1, 2010

notimpressed said:
I can blame the corprations real easy, underhanded and flat out crimnal more often then not.

Too right.

I am not talking about boycotting corprations, I mean politicans and the political system starting with the Lobby system then moving into term limits and campaign finance. Politicans are cozy in there and they can talk about change, but when they get in, its the same ole same ole.

I can't think of everything, but some suggestions:

*Remove this whole "corporations are people" thing, first of all

*No more stimulus packages

*Put a cap on campaign donations for political parties

*Introduce the power to "recall" a representative at any level - federal, state, city - on the basis of a certain percentage of signatures for a petition (lower percentages as the area concerned widens), automatically forcing another election, which the incumbent is obviously allowed to take part in.

*Abolish the Federal Reserve

This would all be a start, anyway.

Is the Obama administration hurting the recovery?

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