The "Object-in-Chief" Defends Spending to Nation's CEOs

"for our society to find better solutions to poverty - solutions improving our country’s economic well being as a whole."

I argue we have and through no government program. Compare poverty in the U.S. to poverty in Mexico, or Brazil, or Indonesia, or Philippines, or Russia, or India, or China. Poverty in the U.S. is quickly becoming defined as someone without a new car and an iphone. Poverty in most countries make about 2 dollars a day, compared to our 2,000 a month poverty line.

But because Americans are sheltered in American life and don't see the rest of the world, they assume the "poverty" in this country so egregious, but compared to what? My grandmother lived poverty in the 40's. They were always short on food. My mother ate bread and milk for dinner sometimes. Poverty today is nothing like that.

So point being, our nations poverty has been lifted over the years and its in no relation to government intervention, except possibly minimum wage restrictions which I am for, but it must be handled delicately.

So there is a role for government, don't get me wrong. But there is also too much government, even WAY too much government.

Posted by: drjohn “It’s rather impudent to think you're the vanguard of some new approach to poverty.” Impudent? I am convinced conservatives like you are missing the empathy gene.

OK, forget about morality and suffering – let’s stick to the economic impact. The Children’s Defense Fund has estimated that child poverty will cost our society over $130 billion in future economic output as poor children grow up to be less productive and effective workers.

America’s population has doubled since the 50s and it will double again in shorter time. Over the past 8 years more kids fell into US defined poverty that damages children in ways that harm their own future AND the nation’s future. Poor kids experience increased risk of stunted growth and anemia, more often have to repeat school years, have lower test scores and drop out more often. These are little kids. Shall we as a society simply lecture this kids to work harder and pull themselves up by their bootstraps?

And, America did not “lose” the War on Poverty. Many of the strategies implemented by LBJ were very successful in reducing the causes of poverty (such as anti-discrimination, Medicare, increasing the minimum wage, Job Corps). Others had marginal success (such as improving schools and training).

"We can’t continue to base our economy on reckless speculation and spending beyond our means..."

I heard him say this on the news and thought, "My God, he really does get it!".

So I anxiously await the abandonment of all the policies that fit the description above (TARP, Stimulus plan, etc.). And here haste is important -- we need to move before the money is spent!

KR posted “You cannot equalize humanity, it is an impossibility. It is justice to have a system that allows people to succeed or fail on their own account and not dictated by government intervention.” What if the government sees intervention is in the best interest of our country’s future?

For example, high school graduation rates peaked in the U.S. in the late 1960s, at about 80%. Since then, US educational attainment has seriously declined. There was plenty of opportunity to succeed, but kids were failing, especially in poor school districts. According to studies by economist James Heckman, it was not because of bad schools or lack of funding for college – it is because our family environments which have deteriorated over the past 40 years.

Heckman points to huge gaps in a child's ability to learn by age five when important traits are established in very young children: motivation levels, emotional stability, self-control and sociability. All those things that point children to responsibility and jobs as they grow up. It is not “suggesting communism” for our society to find better solutions to poverty - solutions improving our country’s economic well being as a whole.

Posted by: DontGet818OnMeNow | Mar 13, 2009 3:57:28 PM

You'd have to be an idiot not to hide from "rampant taxtion."

Posted by: DaveM | Mar 13, 2009 2:54:25 PM

How about YOU come up with a cleaner, safer and cheaper alternative? What's with people like you always demanding that "we" ought to do something?

YOU DO IT! MAKE IT HAPPEN! STOP WHINING!

Many of us might confuse these taxpayers (CEO's) with middle class taxpapers. These guys hide behind tax attorneys and their businesses to avoid rampant taxation. They won't realize much impact from the change in tax laws (IMHO ONLY).

Posted by: idahogirl | Mar 13, 2009 3:00:24 PM

It's rather impudent to think you're the vanguard of some new approach to poverty.

Trying googling Lyndon Johnson and the War on Poverty.

We've spent trillions of dollars on that war and we lost.

"A 2007 report on the cost of poverty in the US presented to the House Ways and Means Committee suggests that the costs to the U.S. associated with childhood poverty total about $500B per year, or the equivalent of nearly 4 percent of GDP."

There will always be poverty. There is no such thing as a society without what someone deems as poverty. There is no doubt that poverty produces crime and all other kinds of social ills. But there is no way to rid ourselves of those who make less than others. 100 years ago, poverty in the US was like the rest of the world. Today, it was far and beyond better than the rest of the world, but they are still called poverty, even though their quality of life is 10x better than other countries. So when does it end? When all people make the same amount of money? Suggesting communism has the right idea cause that's been tried and hopefully we have read about, and seen how that implosion took place and the damage it did to generations of people.

There are wealthy and there are poor in the world, there are smart and there are definately stupid people in the world, there are talented and there are lazy people in the world, you cannot equalize humanity, it is an impossibility. It is justice to have a system that allows people to succeed or fail on their own account and not dictated by government intervention.

"Rather than drilling more and continueing our dependence on a dirty fossil fuel, we should come up with a cleaner, more plentiful substitute."

At some point, you are going to have to come to the realization that oil and fossil fuels are the most efficient form of energy we have. The amount of energy gain for effort to produce dwarfs that of the alternatives. We have been investing heavily in alternatives for 30 years and still nothing can compete. What you are suggesting is that we be forced to pay higher prices for less efficient energy which will cripple if not colapse the economy. When you introduce a system that costs over 4x the cost of the system it replaces, you will cause such a jump in household costs that the nation will implode.

Dont beleive me? Look at the subsidies for wind and solar power vs. oil and coal. It is 4-7 times the amount of government subsidy dollars to compensate for the much less expensive oil and coal for every megawatt of energy produced. It is a bad idea.

Should we fund research to make better technology? You bet, It's not ready yet, and may not be for decades.

KR posts: “I'm still looking for the injustice they receive.” Yes, I have seen real poverty in third world countries. I’ve also worked with poor kids in the United States – of course the poor here have a better life than in some African or Latin American nations. But that does not mean poverty is simply their fault for “not working hard enough” or government should ignore it.

You may be opposed to a moral stand against poverty, so perhaps an economic case would make more sense. When children grow up in what the US defines as poverty, studies show they are more likely than non-poor children to have low earnings as adults, which in turn reflects lower workforce productivity. They are also more likely to engage in crime and to have poor health later in life.

This reduced productive activity generates a direct loss of goods and services to the U.S. economy.
A 2007 report on the cost of poverty in the US presented to the House Ways and Means Committee suggests that the costs to the U.S. associated with childhood poverty total about $500B per year, or the equivalent of nearly 4 percent of GDP.

"By 2005 that had fallen by $4,000.
In other words, after 3 decades of explosive growth, there’s a fundamental imbalance in our economy. The Middle Class is no longer the solid secure base of this economy."

That number, if true. I haven't seen anything that reflects that in the census chart's ive seen. It bob's up and down but has been increasing by average (not mean) since 1983. In any case, this doesn't reflect a few things. Middle income earners have more and more removed from their paycheck for services like unemployment, health care, etc. This number doesn't reflect the increase in benefits for middle income earners for the same income. The numbers can be played to look however someone wants them to be played so you gotta be careful with some of these graphs.

But credit isn't anything new, and consumer driven economy isn't anything new. The Romans had both principles in their economy they were in constant struggle between public assistance, worker productivity, and consumer spending. It's no different today because it's built around a single principle that hasn't changed since man walked the planet and thats human nature. This is the force that governs economies. This much effort is worth this much reward based on what someone is willing to pay for it. Government tries to artificially elevate value on items or services that people are not willing to pay, but people get paid for. Results in less people paying, and more govenrment spending to compensate. The Romans and Greeks learned the folly of this thousands of years ago, but we don't learn, we simply repeat and pay a heavy price for it.

Joanne600 - you've been watching Fox fake news too long. You have a problem with people buying vehicles that get 50 mpg rather than 15 mpg? How absurd. Rather than drilling more and continueing our dependence on a dirty fossil fuel, we should come up with a cleaner, more plentiful substitute. The smog would lift over many cities and people could breathe again. I would much rather have my dollars going into research for a solution like this rather than giving Exxon yet another record-breaking profit!

Posted by: mad | Mar 12, 2009 9:46:58 PM

Obama's prescirptions for today are precisely those of FDR in 2933. FDR's actions are well known; the results are well known: In 1940 the unemployment rate was at 14%.
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I am sure that you are aware that the unemployment rate for 1940 included 14 year olds. In 1938 it was 19% and by 1942 it was 4.7%

what happened was ww2

Posted by: MNM | Mar 13 “That is the ‘American Dream”. I’m curious to understand how you believe your definition of the “American Dream” is sustainable.

We fell into the Great Depression not only due to rampant greed and financial manipulation - the buying power of the populace was basically not enough to sustain the productivity of a capitalist economy. So, after WWII, we became a consumer economy – you know, make things less durable and convince people to buy more things they don't need - throw things away, buy something new, and we'll all have jobs for the "American Dream”.

We were able to sustain this for awhile, but ultimately consumers had to start borrowing to continue buying things we didn't need. For decades from Reagan to GWB, Americans borrowed and eventually embraced credit cards like candy. We borrowed against our future earnings, our home equity, and then our children's future - to maintain the illusion of the “American Dream”.

Meanwhile, Alan Greenspan reduced interest rates and the Fed was printing more money each year than the economy grew in real terms. Couple that with our government implementing mechanisms for the rich to rake off ever more money, and the Middle Class fared worse and worse. While companies were rewarded for outsourcing, only 5 Million jobs were created over the past 8 years.

Since the mid-1970s the richest 1/10th of Americans have seen their wealth jump astronomically – and the top 10% has enjoyed income gains. But the rest of us, the remaining 90% have experienced a drop in “real income”. According to the US Census, the last best year was 1973 when the average income was $33K in today’s dollars. By 2005 that had fallen by $4,000.
In other words, after 3 decades of explosive growth, there’s a fundamental imbalance in our economy. The Middle Class is no longer the solid secure base of this economy.

So how do we re-build the “American Dream” in a sustainable economy? The less energy we use, the more the energy companies will have to charge. IMO, any attempt to return to buying stuff just to keep the economy turning moving ahead is doomed. So how do you believe we sustain the “American Dream”?

how stupid is this guy my my ?

"Could it be that our government policies have somehow helped this widening between rich and poor? Or do you think these ex-Middle Class people were simply not working hard enough?"

You do realize that the government sets the poverty line? Have really seen poverty of other nations compared to ours? In my time in the military, I've seen real poverty. Sizable cities with no waste management or electricity or running water. No refigeration and the only fresh meat they get is tied to a stake in the yard clucking, where 4 families will share the meal cause they all pitched in for it.

Yet 80% of our poverty has DVD players and a car.

So when the government says this is the "poverty" line, it's something that politicians deem as poverty, not to any real standard of what poverty is. I volunteered to do taxes one year and a couple who made 28k a year was below the poverty line, one was going to college on a grant and they had 2 kids, 2 cars, and a house. They paid 3k in taxes and got a 6k return check from the government. I'm still looking for the injustice they recieve.

KR | Mar 13, 2009 11:58:57 AM – “It's complete and total propaganda that somehow one class is being deliberately held down by another.” OK, maybe it's just perception, but how is it that today 15,000 families in the top 0.01% of the population have drawn 5.5% of the nation’s total income, an even higher share than during the "Gilded Age". And, according to the US Census, the number of people living under the poverty line rose by 5.7 million since Bush first took office, to 12.5 percent of the population. Could it be that our government policies have somehow helped this widening between rich and poor? Or do you think these ex-Middle Class people were simply not working hard enough?

What a breathe of fresh air; a President who is candid, funny and thinks long term. Hopefully we can turn this economy around and do it while focusing on solving the deeper, systemic issues for why we're in this situation. Obviously bad banking's a good place to start, but there are other issues, like global poverty, that have huge economic and geopolitical ramifications.

The Borgen Project (www.borgenproject.org) has some interesting insight into addressing the issues of global poverty, something we can remedy easily and sustainably.

Some interesting figures to ponder:
$30 billion USD: The annual shortfall to end global poverty.
$550 billion USD: The annual US defense budget.

Our heart goes out to those who fail, but we should cheer those who succeed and want to be like them. Giving up and hoping the government will bring success to your life is a falsehood created by those who want power. Nothing, even under full government control, is going to enhance your life. You are the only one who can do that and you have to expect, even anticipate failure but when you do, learn from it and keep trying.
Posted by: KR | Mar 13, 2009 12:33:01 PM
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Absolutely. That is the "american dream".
It is what motivates people to do more.
It is what set us apart from the rest of the world.
American ingenuity and achievement will be seriously diminished with these new, dare I say it, euro-socialist policies, that simply place too much burden, taxes and the rest , on citizens. It won't be worth the effort.
When that happens there will be fewer and fewer rich to pay the taxes, and as has happened all over Europe the very high taxes will filter down to everyone, not just the supposed rich.
The american dream will simply be the american handout, very ordinary, nothing special.