This Looks Like the Start of a Second Great Depression

[SpiritAlight 1]

I must confess: I did not read any of the posts other than the first one.

I propose:

Diverting the ridiculous amounts of money spent on military towards:

anything inwards like:

medicare

environment (clean up and protection)

housing

education (including retraining)

sustainable energies

rebuilding infrastructure

agriculture/farming (make it safe for human and animal consumption, keep it local)

etc...

"the economy" (whatever that means...which I believe is all of the above)

Have at it!

[Aubrey 10]

Hm, this thread is diverting to a healthcare thread... The healthcare stuff, as many have stated, is a complex issue to fix, and I don't expect it will be fixed overnight. The fact is that we pay more per person than other first-world nations and have too many under-covered or with no coverage; I don't suspect this will change in one term... So I'll re-divert back to the original story.

So did anyone else listen to Obama's speech this morning? I found it interesting that he seemed to be addressing Congress moreso than the public. I've been really skeptical about all of this spending ####### in D.C., but I was impressed and encouraged by several proposals he made today -- namely the investment in healthcare reform, doubling green energy, and expanding broadband into rural areas.

There's worrisome stuff too with this huge plan -- I still don't think throwing another tax cut at the American public will improve our economy in the long haul. Throwing another $1000 into people's pockets may encourage some to buy a gadget they don't really need, but why the hell should we encourage people to keep buying ####### they don't need? That mindset is what got us into this mess into the first place!

I think the Republicans will be hard-pressed to block this legislation however, considering that this money more directly targets "main street" and people seem fed up with the prior approach to bail out "wall street." There's plenty of partisan ####### to fight over, and I suspect that will come when they get to debating how to sure up the financial and regulatory systems again.

[nighthawk 0]

“If we don’t act swiftly and boldly,” declared President-elect Barack Obama in his latest weekly address, “we could see a much deeper economic downturn that could lead to double-digit unemployment.” If you ask me, he was understating the case.

The fact is that recent economic numbers have been terrifying, not just in the United States but around the world. Manufacturing, in particular, is plunging everywhere. Banks aren’t lending; businesses and consumers aren’t spending. Let’s not mince words: This looks an awful lot like the beginning of a second Great Depression.

So will we “act swiftly and boldly” enough to stop that from happening? We’ll soon find out.

We weren’t supposed to find ourselves in this situation. For many years most economists believed that preventing another Great Depression would be easy. In 2003, Robert Lucas of the University of Chicago, in his presidential address to the American Economic Association, declared that the “central problem of depression-prevention has been solved, for all practical purposes, and has in fact been solved for many decades.”

Milton Friedman, in particular, persuaded many economists that the Federal Reserve could have stopped the Depression in its tracks simply by providing banks with more liquidity, which would have prevented a sharp fall in the money supply. Ben Bernanke, the Federal Reserve chairman, famously apologized to Friedman on his institution’s behalf: “You’re right. We did it. We’re very sorry. But thanks to you, we won’t do it again.”

It turns out, however, that preventing depressions isn’t that easy after all. Under Mr. Bernanke’s leadership, the Fed has been supplying liquidity like an engine crew trying to put out a five-alarm fire, and the money supply has been rising rapidly. Yet credit remains scarce, and the economy is still in free fall.

Friedman’s claim that monetary policy could have prevented the Great Depression was an attempt to refute the analysis of John Maynard Keynes, who argued that monetary policy is ineffective under depression conditions and that fiscal policy -- large-scale deficit spending by the government -- is needed to fight mass unemployment. The failure of monetary policy in the current crisis shows that Keynes had it right the first time. And Keynesian thinking lies behind Mr. Obama’s plans to rescue the economy.

But these plans may turn out to be a hard sell.

News reports say that Democrats hope to pass an economic plan with broad bipartisan support. Good luck with that.

In reality, the political posturing has already started, with Republican leaders setting up roadblocks to stimulus legislation while posing as the champions of careful Congressional deliberation -- which is pretty rich considering their party’s behavior over the past eight years.

More broadly, after decades of declaring that government is the problem, not the solution, not to mention reviling both Keynesian economics and the New Deal, most Republicans aren’t going to accept the need for a big-spending, F.D.R.-type solution to the economic crisis.

The biggest problem facing the Obama plan, however, is likely to be the demand of many politicians for proof that the benefits of the proposed public spending justify its costs -- a burden of proof never imposed on proposals for tax cuts.

This is a problem with which Keynes was familiar: giving money away, he pointed out, tends to be met with fewer objections than plans for public investment “which, because they are not wholly wasteful, tend to be judged on strict ‘business’ principles.” What gets lost in such discussions is the key argument for economic stimulus -- namely, that under current conditions, a surge in public spending would employ Americans who would otherwise be unemployed and money that would otherwise be sitting idle, and put both to work producing something useful.

All of this leaves me concerned about the prospects for the Obama plan. I’m sure that Congress will pass a stimulus plan, but I worry that the plan may be delayed and/or downsized. And Mr. Obama is right: We really do need swift, bold action.

Here’s my nightmare scenario: It takes Congress months to pass a stimulus plan, and the legislation that actually emerges is too cautious. As a result, the economy plunges for most of 2009, and when the plan finally starts to kick in, it’s only enough to slow the descent, not stop it. Meanwhile, deflation is setting in, while businesses and consumers start to base their spending plans on the expectation of a permanently depressed economy -- well, you can see where this is going.

So this is our moment of truth. Will we in fact do what’s necessary to prevent Great Depression II?

http://www.alternet.org/workplace/117808/t...at_depression_/

When invoking the Great Depression of the 1930`s, what we read is "money, money and the economy. No one who

did not live in that era knows the true hardships and suffering...There was "no money then, no economy" only

hunger and pain.

I know. I lived it...See link of two boys waiting for a government issued bowl of soup during the Great Depression.

It would be the only meal for that day.

http://www.english.uiuc.edu/maps/depressio...ges/mission.jpg

Now that is the Great Depression that I remember. It was everybody on his own. Parents abandoned their kids to

survive. The saying "to each its own" comes from that era. Only the strongest survived.

[mRx 16]

The US health care system is sad joke at best. And private enterprise has made it such.

Negative. The US health care system is a mess for precisely the intervention placed on it. (Which I explained in my last post)

The answer is less intervention, not more.

More intervention will only give us more problems, as existing intervention has shown us.

Nonsense. Less intervention will cause more people left behind - i.e. make the system less efficient as it will deliver care to an ever smaller portion of the population. A sector that should be about patient care cannot be effectively run by profit oriented entities. The bureaucratic overhead is not a result of regulation but a result of attempts by the private insurance industry to maximize profits.

What's causing people to be left behind in the first place? Do you really think affordable healthcare for all is just a politician's signature away?

People are left behind because affordable alternatives are not allowed to exist. They are not allowed to exist because of intervention, and because the AMA doesn't want it. Remember, the AMA has control of these things. This control was granted by Congress.

More intervention is not the answer to fix existing intervention; just as you don't fix a gunshot would with another bullet.

[mawilson 2,133]

What's causing people to be left behind in the first place? Do you really think affordable healthcare for all is just a politician's signature away?

People are left behind because affordable alternatives are not allowed to exist. They are not allowed to exist because of intervention, and because the AMA doesn't want it. Remember, the AMA has control of these things. This control was granted by Congress.

More intervention is not the answer to fix existing intervention; just as you don't fix a gunshot would with another bullet.

Yeah, really. If it was possible to provide high-quality affordable healthcare in the current

environment, don't you think some company would have done it by now?

[HAL 9000 96]

What's causing people to be left behind in the first place? Do you really think affordable healthcare for all is just a politician's signature away?

People are left behind because affordable alternatives are not allowed to exist. They are not allowed to exist because of intervention, and because the AMA doesn't want it. Remember, the AMA has control of these things. This control was granted by Congress.

More intervention is not the answer to fix existing intervention; just as you don't fix a gunshot would with another bullet.

Yeah, really. If it was possible to provide high-quality affordable healthcare in the current

environment, don't you think some company would have done it by now?

Someone should market it with physicians ready to make a contribution to society in this way (as well as the entire insurance infrastructure of the private effort in equal proportion to the providers). Plenty of high-quality physicians come out of medical school with lofty mindsets- even in the face of staggering loans and colleagues that are seeking monetary windfalls faster rather than later. Perhaps people are not being put together in the right combination yet.

Imagine that. But seriously... I think that all that is needed is to fix the existing "intervention." Like by calling it what it should be- oversight. Semantics, I know- but its certainly far from it nowadays in the permissive atmosphere to charge what they charge out of the only real driving force behind it all: PROFIT...