Monthly Archives: September 2011


Economist Robert Reich explains ‘big lies’ about the economy

You can read the brief introduction to this video on Raw Story, where I find many of these good items.

The video below is of Robert Reich’s Keynote Address at the Summit For A Fair Economy.


There is one thing I want to emphasize. It is about the coming battle over Obama’s jobs plan. The opposition is going to say they can accept a lot of things in the program, but the one thing they will not accept is raising taxes on the rich. This speech by Robert Reich should make it clear that, if nothing else, the one thing we absolutely must have out of Obama’s jobs bill is the raising of the taxes on the rich.

In the above video Robert Reich mentions some brief videos posted on his web site.  Please take a look.


President Obama Misunderstands The Psychology of Politics

In order to have a successful negotiation, each side needs to come away from the deal having had their needs satisfied.

What the President does not seem to understand is that the Republican politicians need to be able to tell their supporters that they came away from the deal making a huge cutback in what President Obama originally wanted.

If the President starts out proposing what the Republicans will accept, he robs them of being able to satisfy one of their primary needs from any negotiation.

Knowing what the President wants for a bottom line, he has to propose enough extra so that the Republicans can satisfy their need to cut it back.

This is not arcane psychology at all.  On a much smaller scale we have all probably been involved in a similar situation on a much smaller scale.  When you try to sell a valuable used item such as a car or a house, you need to take into consideration the need of the buyer to feel that they were tough negotiators and successfully got the price down to somewhat lower than what you asked.  (New car salesman understand this very well.)

You may say, “I am not going to play that game, I’ll just set the price low enough that it is fair and it will sell quickly.”  No matter what you do, the buyers are always going to assume that you have padded the price to put in some negotiating room. If you set the price at your bottom line, the potential buyers are going to be very unhappy that they can’t get any concessions from you.  You may fail to sell the house at your reasonable asking price.  If you had taken the psychology of buying and selling into account, you would have asked enough above your bottom line to make the buyer go away happy that he or she knocked a sufficient amount off your initial price.  You could have walked away with a sale that made the buyer and the seller very happy if you had only understood the needs of the other side.

If the President cannot see this, then he is doomed to never make the sale.  Or if he does make the sale, he will have to lower his price far below where he wanted it to end up.  In any case, he won’t arrive at a negotiation where both sides go away happy.


Advice to Senator Kerry On The Jobs Plan 2

I have rethought going through with a campaign to help get the President’s jobs plan enacted as is.

From John Kerry’s web page:

Feedback on Our Budget

Recently, John Kerry asked constituents for their thoughts on how to combine long-term fiscal discipline in Washington with job-creating policies now. He set up a special contact form for you to share your thoughts with him. Follow this link to send in your thoughts!

I used the link to send him the following message:

The President’s plan is better than I expected, but it is still inadequate.

The people who say I should compromise say that I shouldn’t let the perfect be the enemy of the good.

I have now realized that you and President Obama are allowing the expedient be the enemy of the adequate.

Another failure of an inadequate plan will kill the idea of Keynesian Stimulus for a generation.

Don’t you and President Obama do to the Democratic Party what Herbert Hoover did to the Republicans.

Beef up Obama’s plan before you have to vote No on it.

I used Senator Scott Brown’s contact web page to inform him of what I told Senator Kerry.

Think of this analogy. When you take anti-biotics to kill an infection, the doctor tells you to take the full dose even if the infection seems to go away before the dose is complete. If you don’t do that, you run the risk of leaving behind the bacteria that were able to survive the initial dose of anti-biotic.  Not only have you left survivors, but you have killed off the bacteria with which they used to have to compete.  Now the remnants are free to multiply and mutate without the control of the bacteria you did manage to kill off.  These survivors of the initial dose are the most likely to mutate into a strain that can survive even the strongest and most prolonged dose of that particular anti-biotic, making that anti-biotic useless in the future.  This is the history of the continuing need to come up with new anti-biotics.

If we allow the country to go on an incomplete dose of economic stimulus, what will be left in the aftermath may be worse than had we applied no stimulus at all.  We might have a depression so bad and a political climate so mutated that no attempt to fix the problem with Keynesian stimulus will work.  If the Democrats just walk away from the deal and make no attempt to fix the problem, we might be able to fix it later with an economy and political climate that has not grown resistant to Keynesian stimulus.

I’ll let my doctor cousins tell me if I am off base on this analogy.  Would Obama without his inadequate program be following the Hippocratic oath to first do no harm?


Economists Say Obama Plan Would Create Jobs, But …

The article Economists Say Obama Plan Would Create Jobs, But … claims the following:

Economists cautioned that it wouldn’t shift the nation’s business gears into overdrive, and it offers only modest benefits, given the headwinds the economy faces from a moribund housing sector and growing financial turmoil in Europe.

This together with what Robert Reich pointed out in his article that I reference in my like named post Two Cheers And One Jeer for The American Jobs Act:

That’s been the heart of Obama’s dilemma. Big and bold enough to make a difference, and Republicans are certain to reject it. Small and focused on tax cuts, and maybe Republicans will bite. But even if they sign on, what’s the point of the exercise if it won’t have a measurable effect on jobs and growth?

It would be nice to know what plan Obama thinks is necessary to get the economy moving again compared to the plan he thought he was forced to present to get it by the Republicans.  Since almost nothing he presents will be accepted by the Republicans, he has just negotiated with himself again to lower his initial request.  When will he ask for what he really wants and then some, before he starts negotiating his plans away?

Or as Reich suggested:

The President would have done better with a plan that was big enough to make a real difference. And then, when Republicans rejected it, campaign on it.

Better in that his future path would not be cut off by the claim that this isn’t any better than his previous stimulus which was not as successful as predicted.  The opposition will not be anxious to point out that the plan was watered down from what he really wanted because of their intransigence which was intended to make his plan fail.  Every time he accepts a watered down plan that fails, he drives another nail in the coffin of rational economic planning.  If he really wants to bury Keynesian Economics for a century, he should keep this up until he is thrown out of office.

So the problem is not just the damage that he is doing to the present economy and his own political fate that gets us so angry.  The problem is the political obstacles that Obama is building for a future, more competent, progressive President.  That is if such a President could ever get elected after Obama’s performance.

Just as Herbert Hoover was the President who is remembered as having set the stage for the Republicans to lose power for a generation, President Obama could do the same thing for the Democrats.  And people wonder why we progressives can’t have a little more patience with Obama.

When the calmer thinkers say, “Don’t let the perfect be the enemy of the good”, maybe we are thinking the “Don’t let the politically expedient be the enemy of the barely sufficient.”


Suggested Campaign To Get The Jobs Bill Passed by Congress

I have gone back and extracted the statements that President Obama made that drew applause from Vice President Biden, but not from Speaker Boehner. Just a couple of these show tepid applause from Boehner versus a standing ovation from Biden. Many of these would make good campaign spots for the Democrats and for President Obama. When I say campaign, I am not talking about just an election campaign, I am talking about a campaign to get the Jobs Bill passed by Congress.

If you have any influence on the campaign or want to promote any one of these ideas, feel free to pass any one of them or all of them on or repost them. Since all of these videos are on YouTube, you can embed them in your own commentary or even remix them.

Doing Nothing Is Not An Option, Or Is It?
Can You Wait 14 Months?
Time To Meet Our Responsibilities
G. I. Bill Of Rights
Win The Race To The Top
Keep Collective Bargaining Rights
Make America First In Manufacturing
Refinance Mortgages At Low Interest Rates
Tax Advantages For Companies Creating Jobs In America
Tax Code Where Everyone Gets a Fair Shake
Wealthy Should Pay Their Fair Share
No Middle Class Tax Increase
Extend Unemployment Benefits
Help The Longterm Unemployed
Put Our Teachers Back In The Classroom
No More Boondoggles
Put Construction Workers Back To Work
As Bipartisan As 50 Republicans
Cut Payroll Taxes In Half
Every Child Deserves A Great School

Full Speech: Obama Prods Congress to Pass $450B Jobs Package ‘Right Away’ has the entire speech from which these sound bites were taken.