Re: Sally Ride Endorses Barack Obama

On Mon, 3 Nov 2008 17:58:39 -0500, in a place far, far away, "Jeff
Findley" <jeff.findley@xxxxxxxxxxxxxx> made the phosphor on my monitor
glow in such a way as to indicate that:


"Rand Simberg" <simberg.interglobal@xxxxxxxxx> wrote in message
news:49bf0e5a.3486120186@xxxxxxxxxxxxxxxxxxxx
"Last time I checked, the unemployment rate was still quite low (maybe
6%, which is almost as low as it ever gets), inflation hotted up in
the summer with gas, but will be crashing down this fall with gas
going down, and, while wages may be flat for a while, there's no
obvious sign they're plummeting.

I mean, seriously. Don't you have parents or grandparents who lived
through the Great Depression? Don't you remember the recession of
1982, with 12% unemployment? Or the stagflation of the late 1970s,
with the prime rate and hence mortgages up around 15%, inflation
running near 20%?

So far what we've seen is that a lot of fools on Wall Street are going
to lose their jobs and get their Porsches repossessed and have to sell
the Matisse. Well, boo hoo. Live on wild speculation, die on wild
speculation, huh? They knew the score when they took the job. Next
time, become a plumber, for a nice steady (but not spectacular)
income.

There are a lot of people who lost money in the markets. In fact, a lot of
people lost money in their 401k's because it's invested in mutual funds
which can be made up of stocks. This financial meltdown hurts jobs as
companies tighten their belts due to tightening of the credit markets. It
just goes on and on.

They didn't lose *all* their money, because the value of the stocks
didn't go to zero (or even close). They just took a hit in the
percentage.

Then, there are all the people who are upside down on the mortgage and
going to lose the house. Sucks, to be sure -- but whose fault is it?
If you buy more house than you can realistically afford, and then the
zooming price you'd counted on to flip the house doesn't
materialize...? Well, again, I'm having a hard time sympathizing.
Furthermore, while plummeting real estate prices sucks for homeowners
and sellers, it's great for homebuyers. I thought we liked the idea of
every man owning his own home? Lots more lower-income prudent people
are going to be able to afford these newly-cheaper homes.

There was a housing bubble to be sure, but a lot of that had to do with the
Fed holding down interest rates too low for too long making credit cheaper
(and harder to make a profit on lending). Cheaper money meant people could
afford more money for a house which drove home prices up. And I'll agree
that banks were handing out loans and extending credit to people who
shouldn't have gotten that much credit. They were also extending loans to
people which were entirely inappropriate. Interest only loans are great if
you're a builder or a small business who needs to buy raw materials to fill
an order, but they're simply not appropriate for your average homeowner.

Maxed out home equity lines of credit are very similar to interest only
loans. A lot of people with fixed rate loans still fell into that trap, now
they too owe more than their home is worth.

You neglect the fact that the banks were being encouraged by the
Congress to hand out risky loans, and when Bush and McCain wanted to
rein in Fannie and Freddie, Barney Frank and Chris Dodd (Senator from
Countrywide) blocked any effort to do so.

Hmm, well, you might say, all very true, but this uncertainty in the
credit markets, whatever its source, is going to make companies pull
their horns in, have people work overtime instead of hiring new
people. So jobs might start to get a little scarce, and boy does that
suck.

And you'd be right. So what's the solution? Jobs. The government
should do whatever it is that makes new jobs more plentiful, whatever
increases the salaries offered to new hires, whatever makes people
running companies (or about to start companies) decide to take on more
people and pay out more salaries.

And what do you suppose is the exact opposite of that policy? You
guessed it, raising taxes, particularly raising taxes on higher income
people (those with capital to invest in paying salaries) or on
businesses (duh). We've known this since FDR fucked up the economy and
prolonged the Depression by (modern economists estimate) nearly seven
long years.

This is silly. You only pay taxes on the profit you make. If you dump what
would have been profit into hiring new people, you don't pay taxes on their
salaries anymore, since that's an expense, not profit.

You miss the point. He's describing the effect on those individuals
as investors. I should note that you are not replying to me, you are
replying to one of my commenters. If you want to argue with him,
you'd be better off following the link and doing so at my blog.

<snip much remaining>

Obama and McCain seem pretty similar when it comes to energy policy (fund
all sorts of energy at the same time), but the emphasis is clearly
different. I'd like to see the emphasis there on renewable energy produced
domestically. Palin likes to say "drill baby drill". Why prolong our
dependence on foreign oil? Why make that an important goal of an energy
policy? Why repeat our poor decision making after the 70's oil crisis was
over and renewable energy resources fell out of favor?

We shouldn't prolong our dependence on foreign oil, but neither should
we ruin our economy in an attempt to rush the transition beyond what
is technologically feasible. Barack Obama wants to bankrupt new coal
plants, and double electricity prices. What do you think the effect
of that on the economy would be?
.