Answer:
(CNN) - House Speaker Nancy Pelosi Wednesday strongly defended her party's support of the federal food stamp program - a day after former Republican Speaker Newt Gingrich argued that GOP candidates should use the growing number of people on food stamps against Democrats on the campaign trail.
At a press conference in her home town of San Francisco, Pelosi explained that the program's multiplier effect –the amount of money generated in the local economy as the result of the subsidy– far exceeds the nearly $60 billion spent this year by the federal government and is a sure-fire way to stimulate the economy. For every dollar a person receives in food stamps, Pelosi said that $1.79 is put back into the economy. The U.S. Department of Agriculture cites an even higher figure of $1.84.
"It is the biggest bang for the buck when you do food stamps and unemployment..."
As usual, Nancy is being defensive when she should go on the offense. What she said is true enough, although like most true statements in economics, it has its limits: if we all go on food stamps, we won't have an economy 179% bigger than the one we have now.
ReplyDeleteSpeaking as someone who has never been on food stamps, who has managed to pay my own way even after losing my last full time job over a year ago...
...we have a larger number of people on food stamps now than we did two years ago, because of policies Newt Gingrich has been prominent in pushing for, including the repeal of Glass-Steagall in the 1990s. It brought us to the brink of Depression. We barely pulled back from the edge of disaster. There is nothing wrong with providing food stamps to get through the resulting crisis without doing too much damage to the families who have lost jobs and income.
It does help sustain other parts of the economy. It does keep the grocery and transport and food supply businesses in better shape than they would be otherwise, and helps families pay the rent with their scarce cash while still getting food.
But this does highlight what is wrong with the Dodd Frank bill. It did far too little. We need to put Glass Steagall back in, lock stock and barrel. It was one of the main reasons we didn't face another Depression for 50 years. Bankers can't be trusted. They will always run their business in ways that will provide huge bonuses for themselves, and wreck the entire economy for the rest of us.
Right, blame it all on Gingrich.
ReplyDeleteFran/Dodd? The two prime architects of the banking mess.
Spoken like a true Marxist! It is the evil banks and bankers that brought us to ruin! Comes the Revolution, we'll put them all up against the wall! Workers Unite!
ReplyDeleteIt happens you are dead wrong about what caused the meltdown in the housing industry. It was the programs to get people into home ownership whether they could afford it or not. When Bush tried to get the industry regulated in 2003 and later, the Democrats, primarily Barney Frank, Chris Dodd, and Maxine Waters, that called it the attempt Racist.
See http://www.youtube.com/watch?v=_MGT_cSi7Rs&feature=related
and
http://www.youtube.com/watch?v=63siCHvuGFg
The banks and finance companies securitized those lousy mortgages but it was a house of cards because the underlying mortgages were no good.
Read The Big Short or any number of other books about what happened in the sub prime mortgage business that triggered everyone else.
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As to Nancy Pelosi's economic theories, it would follow that since food stamps help the economy so much and now that we have the highest number of Americans getting food stamps, the economy should be booming. The Democrats are the Party of Food Stamps and the Republicans are the Party of Pay Checks. (That is Newt Gingrich's observation, not mine)
ReplyDeleteIt holds that the more people you incentivize to go on welfare, the more welfare recipients you will have. You forget that to get the money to pay for food stamps, you have to take it out of the economy with taxes (or borrowing). You take out of the productive sector of the economy, who would otherwise be expanding and creating jobs with that money, and give it to the government who in turn give it to people on relief and not producing anything. That is after the government skims off its payoffs and pays for its own bureaucracies which is more waste ... but I suppose by the exact same logic the corrupt politicians spend their payoffs so that helps the economy again according to the Jenkins/Pelosi Theory of Economics.
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Yeah, blaming it all on Gingrich is ridiculous. Blaming it on Dodd is perfectly sensible!
ReplyDeleteNo one on unemployment wants to be on it. The same for food stamps. Many are embarrassed to be on it. They find that the discretionary income that they once had is gone. Instead of steaks it is ground meat. Instead of a night out for movies and dinner, it is videos and home cooking. They have changed their lifestyles very fast and not for the best.
ReplyDeletePelosi is crazy. There is no way that being on either or both builds up the economy. A good paying job does that.
Lance,
ReplyDeleteI suggest you check into Dodd's relationship with Countrywide and the Friends of Angelo.
The fact is that Dodd, Frank and maxine Waters are most to blame for the mortgage meltdown or whatever you call it. I've written about it numerous times on this site.
Lance,
ReplyDeleteDid you view the videos? You think they were made up or false in any way?
You are still in cognitive dissonance.
Facts are stubborn things. If you want to hold on to your convictions about who to blame you either have to ignore the facts or mock them. You choose to mock them but they still exist. This time they are captured on video and can't be denied. The record is clear on who tried to curb the mortgage lending mess and who blocked the effort.
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Miggie, as usual, indulges in casual name calling, then shouts whatever is on her mind several times over until she convinces herself that it is true.
ReplyDeleteSay something direct about Glass-Steagall Gary. Tell me straight, that you think relaxing regulation on banks is the path to sustained prosperity. Remember the Savings and Loan scandal? Are you going to blame that on Frank and Dodd also? I know their ties to the banks are too close. That's why their reform bill didn't do nearly enough.
Wow. Miggie wrote a comment using the phrases "cognitive dissonance" and "facts are stubborn things." Man, that's something I haven't seen before. Can somebody please buy him a new book of catchphrases so his posts will stop being so darned repetitive and boring?
ReplyDeleteI see that you continue to be an arrogant blowhard. Remember that time you insulted me and "debunked" me by posting links on paleontology and evolution? And yet they didn't have ANYTHING to do with the topic at hand? I mean, they were COMPLETELY irrelevant! I spent all that time reading them, wondering how it made your case, and then I realized that you sent me on a snipe hunt!
Now there's a stubborn fact for ya! (And why I don't bother looking at your links - or take anything you say seriously - anymore.)
Oh, but I would like to add that by reading your response to Siarlys, you wouldn't know a Marxist if he wrote his manifesto on your posterior.
Lance,
ReplyDeleteI don't think it is necessary to call someone an arrogant blowhard.
Siarlys,
ReplyDeleteI'll have to google glass-steagle because I never heard of it. What I do know is this; Barney Frank threatened to bring discrimination charges against lending institutions if they didn't start lending to poorer folks (who couldn't pay them back). Dodd got goodies from Countrywide and Waters made sure her husband's bank was taken care of with TARP funds. It goes on and on.
I don't think it is necessary to call someone an arrogant blowhard.
ReplyDeleteYou're right, but I wonder if you'll call Miggie out the next time he insults me. I doubt it.
And BTW, Siarlys keeps referring to Miggie as "she". I assumed that it was a nickname for "Miguel" and assumed that Miggie was a he. Which one is correct?
Miggie is a he.
ReplyDeletePersonal attacks and caviling are the weapons of choice of the Left. They believe it substitutes for dealing with the issues.
ReplyDeleteThere probably is nothing wrong personally with Siarlys or Lance however they are both badly mistaken in their economic theories and ability to respond directly to video tapes which disprove their causation theories.
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Oh Miggie, you are the master of the ironic, aren't you?
ReplyDeleteMiggie is a he? Noted.
ReplyDeleteBefore Miggie goes rambling on about the weapons of choice of the left, he should read my post:
http://aleksandreia.wordpress.com/2010/07/28/why-i-am-a-conservative/
If he then clicks on the link at the right on my name, he will find my denunciation of the lawsuit to overturn Proposition 8, among many other things.
Miggie is probably a perfectly nice guy to have lunch with, but he seldom knows what he is talking about.
Writing separately on Glass-Steagall:
ReplyDeleteGary, if you don't know what it is, you have NO BUSINESS at all commenting on financial matters or what caused the recent near-miss with a second Great Depression. You are, clinically, and meaning no personal characterization, woefully ignorant.
Glass-Steagall is the New Deal legislation which severely limited the lines of investment that depositor banks could put their money into, which was partly rolled back by Reagan in the name of reducing "government regulation," and repealed by the unholy alliance of Clinton and Gingrich, leading directly to the mess we are in now.
Siarlys,
ReplyDeleteThanks for the history lesson. You sure know a lot of stuff. Maybe you could explain your views on the Frank-Dodd bill.
I just don't think there is any communication going on here, Gary. It is like trying to talk to a TV set.
ReplyDeleteI'm going to TRY to just write what I believe and let others take it or leave it as they choose. Or better yet, not read what I write at all ... absolutely fine with me.
The convictions people already have determine how they read and interpret things. The stronger the pre-disposition, the less likely it is that that they will change an opinion, no matter what and I mean no matter what! It's a shame because this technology provides this fabulous communication tool that should make it easy to communicate, but in practice no information flows back and forth ... only talking points.
You can even send videos which make a point and the response is, "Here is the REAL reason ... you ignoramus!"
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Miggie,
ReplyDeleteWelcome to the club. Sean Hannity warned us about trying to debate with liberals.
Debating with Liberals is like talking to a wall. You get a better answer from a wall.
ReplyDeleteWow. Are you guys familiar with the concept of projecting? Wikipedia's definition: "Psychological projection or projection bias is a psychological defense mechanism where a person unconsciously denies their own attributes, thoughts, and emotions, which are then ascribed to the outside world, such as to the weather, a tool, or to other people."
ReplyDeleteSeriously you guys...come on. I could write a master's thesis on you two.
I just don't think there is any communication going on here, Gary. It is like trying to talk to a TV set.
ReplyDeleteMainly, Miggie, it's because you never address the point of the other person. Instead you just like to throw out your ad hominems about "Marxists" and then conclude with your catchphrases.
The convictions people already have determine how they read and interpret things. The stronger the pre-disposition, the less likely it is that that they will change an opinion, no matter what and I mean no matter what!
Hello, Pot. Have you met Kettle?
It's a shame because this technology provides this fabulous communication tool that should make it easy to communicate, but in practice no information flows back and forth ... only talking points.
Talking points like "facts are stubborn things" and "you're experiencing cognitive dissonance"?
Speaking of cognitive dissonance, when are you going to address those links you sent during the debate about paleontology, Miggie? You know, the time when you insulted me and claimed to be debunking me. Yet somehow, neither of those links even addressed the debate at hand? What exactly were you thinking when you did that? Were you hoping that I wouldn't bother to actually read them? Did you not comprehend what they said and just hoped that they'd debunk me? Give me a reason why I should bother looking at any link you provide ever again, please.
You can even send videos which make a point and the response is, "Here is the REAL reason ... you ignoramus!"
And again, I must ask Mr. Pot if he has met Mr. Kettle.
Okay, found myself up a bit early, and while I should probably have my head examined, I checked out the links. The first one is obviously heavily edited - not even well edited - so I don't put much stock in that. The second is from Fox News, which has a clear agenda. This of course doesn't make them wrong, but they seem to be pretty selective with the facts that they do get right.
ReplyDeleteLook, I have no problem accepting that guys like Barney Frank played a role in this whole mess. However, it makes for a convenient talking point that ignores the big picture. From what I understand, there is plenty of blame to go around. I think that Factcheck does a good job with this (scroll down to "The Real Deal" for the relevant bit of information.) Shoot, even common sense goes against laying so much blame on Barney Frank when the Republicans were controlling two branches of government.
Siarlys has an even broader view on the subject, and I won't even pretend to be in his league when it comes to this issue. I don't really have a head for all this stuff, but I'm smart enough to recognize that neither Gary nor Miggie do either.
Lance,
ReplyDeleteI believe the original thesis of my post was that Pelosi is a dolt for claiming that food stamps and unemploykment checks create jobs. I will stand by that assertion.
Saw this interesting entry on another site:
ReplyDelete"Having spent most of my career on Wall Street in a senior executive position...
Almost all of the focus on Wall Street's misdeeds is correct, but I think that there has not been enough focus on other actors in this drama. Again, none of this excuses Wall Street. But I believe there are other serious culprits in who are escaping detailed scrutiny.
First, government. And no, not the Bush Administration. One need only go back to the Clinton Administration to study the changes they forced on the Community Reinvestment Act.. Check out the history of Bruce Marks of the Neighborhood Assistance Corporation. Or even the properly vilified ACORN. All were involved in forcing lenders to "improve" their community focus by making loans to under-qualified borrowers in poor neighborhoods, most of which would later come to be called "sub-prime".
Or, check out the history of Barney Frank and Chris Dodd in avid support of Fannie Mae and Freddie Mac policies now roundly vilified, correctly, as adding to the problem.
But, at the bottom of the pile, there are the literally millions of everyday Americans who decided to use housing as a get-rich-quick scheme. Looking for the "next big thing" after the dot-com bubble burst, millions of Americans saw the government's new tax law as a guaranteed way to make money. First, the tax law was changed so that as long as you lived in a primary residence for two years you could sell it with no tax on the profits. Second, everyone "knew" that housing prices always rose. Third, money was readily available at low interest rates, and the recent history of interest rates showed they hadn't gone up at all over a few years. In fact, you could finance 95% or even 100% or more of the purchase price without even documenting your income. There was just one little fly in the ointment. In order to get one of those loans, you had to swear undr oath that your income was more than you actually made. No problem! Millions of Americans did just that. There was large print in every piced of paper. UNDER PENALTY TO PERJURY, I SWEAR I HAVE FILLED OUT THIS APPLICATION HONESTLY AND COMPLETELY. Then they signed it. The media would have you believe that these people were just duped by commission-seeking mortgage brokers, and I'm sure they were. But the BASE of the mortgage crisis was otherwise honest Americans KNOWINGLY LYING ON THEIR MORTGAGE APPLICATIONS, claiming income that simply didn't exist, and doing it knowingly and willingly, in an attempt to speculate in residential real estate.
There is no excuse for Wall Street, but there is no excuse for mortgage cheats either."
– Richard P, Boston
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Findalis, see that "psychological projection" definition. Seriously.
ReplyDeleteGood article, Miggie. I can't really find anything to quibble with on that one. (No sarcasm - seriously. I realize it's hard to tell with me.)
ReplyDeleteWhy Findalis, hell just froze over about a week ago, and already you claim that talking to me is like talking to a wall? Or maybe you meant to exempt me from the category of "liberal"? That would leave Lance, Gary, and Miggie. Miggie is a bit of a liberal, in my book, and I don't mean that as a compliment.
ReplyDeleteDodd-Frank:
ReplyDeleteIt imposes a fraction of the necessary and appropriate regulations on the financial services industry. It doesn't do enough, partly because both of them are far too beholden to the industry, and partly because they had to compromise with others even more beholden to get anything passed at all.
What we really need, and what Glass Steagall went a long way to provide, is separation of different financial service businesses into distinct roles, so that each serves its stated purpose, and risk is sorted out between sectors with strong firewalls.
Investment banking will be done with investors' funds, not depositors' funds.
Savings banks will retain adequate cash reserves.
Savings and Loans are not for sale to private equity investors.
Etc. Properly done, nothing is "too big to fail," individual depositors are insured without necessity for huge taxpayer-financed bailouts, and damage to the general economy from any given business failure is contained.
Dodd-Frank fell far short of that.
Siarlys,
ReplyDeleteIf I recall in 2004 the Bush administration was sounding alarms about Freddie Mac and Fannie Mae. Dodd, Frank and Waters sprang to their defense, said there was no problem and shut down any effort to investigate them.
Gary, you keep impugning the integrity of Dodd and Frank, a point I'm not contesting, rather than speaking to what sort of common sense regulation we do need so that certain financial conglomerations are not "too big to fail" and don't take the whole economy down with them when the over-reach. I'd like to let the greedy suckers fall, but not if it results in 30 percent unemployment.
ReplyDeleteThere is plausible scholarship (nothing much in historical interpretation is ever certain) that Woodrow Wilson took the U.S. into WW I after J.P. Morgan convinced him that if England and France weren't in a position to repay loans to the House of Morgan, the bank would go bust, and if it did, there would be a massive Depression in most major industries with tremendous layoffs. It might even have been true.