Sunday, September 27, 2009

Opinion: Is the economy improving? Have the stimulus programs helped to improve the economy?

http://www.cnn.com/2009/POLITICS/04/17/interactive.economy.rescue/index.html

41 comments:

MKlinka said...

It's quite difficult to gauge the improving of an economy without first defining economy. For me, it seems silly to call what we have in the united states an economy, in the same way I find it silly to refer to a house that you're still paying off as your house. So, I say that there can really be no improvement until the nation is debt free, until the deficit is gone. In this vein though, assuming we refer to the "economy" where we're horrendously in debt ; we really aren't improving much. Slowly but surely, yes, but there's no real telling what if the same would have happened if we just left well enough alone. This is because the stimulus programs, touted as panaceas, really aren't doing much of anything, the government is taking money from it's coffers for programs like cash for clunkers and for stimulus checks, and then our consumers are spending that money on foreign goods, so the money starts to flow out again, making any benefits scant and short term.

Tyler Kehoe said...

Sadly, I agree with Klinka. The entire "economy" of the United States is falling apart. The national deficit NEEDS to be gone before any new government programs are implemented. The United States of America right now can not litterally afford to bail out companies. It is there own faults that they went under and I am not saying that I do not support American companies, but what they did is just basically bad buisness strategies. CEO's making billions of dollars a years before they went bankrupt and now were paying them basically there salary right back through this stimulus package. Whatever happened to this "capitalism"? So the real question, has the stimulus money helped the economy? No, unemployment is still high, and those people are not spending money to buy goods. Unless the stimulus programs improve unemployment soon, they are a failure.

Mikef said...

I respectfully disagree with both MKlinka and Mr. Kehoe although it is a mild disagreement. The "economy" (why everyone is doing that in quotations baffles me so I'll continue the trend) while now many people and companies are in debt to the federal government, which in turn is in debt to other countries like China. We are definitely in a better situation than this time last year. Many people including myself were expecting a quick recovery at the beginning, but then it went worse then it had to be a greater recovery every time we thought we had found a perfect solution. So yes the economy is improving compared to last year, is not in the state it was during the pre 9/11 days.

Mikef said...

I respectfully disagree with both MKlinka and Mr. Kehoe although it is a mild disagreement. The "economy" (why everyone is doing that in quotations baffles me so I'll continue the trend) while now many people and companies are in debt to the federal government, which in turn is in debt to other countries like China. We are definitely in a better situation than this time last year. Many people including myself were expecting a quick recovery at the beginning, but then it went worse then it had to be a greater recovery every time we thought we had found a perfect solution. So yes the economy is improving compared to last year, is not in the state it was during the pre 9/11 days.

EBilton said...

I think that the economy is improving because the foreclosed houses are being bought, but the economy is getting worse because of employees getting laid off. I also agree with MKlinka because the country is in so much debt that it will take us years to get out of

Brandon D said...

Id have to say that i am in agreement with Mikef. Compared to last year, our economy has improved to a certain extent. It is still struggling but has made slow yet steady steps towards recovery.

Alex said...

The first thing I have to say is that debt will never be actually paid off. Ever. Since our country's inception, we have continuously accrued debt. With the increased spending of the world wars of the early twentieth century, the national debt skyrocketed. Throughout the rest of the century, the debt built as more and more various governmental programs were started. Basically, right now, we are just shy of $12 trillion in debt (zfacts.com). I feel as if we can't judge the improvement of the economy by the size of the national debt. It is important, though, to get a balanced budget that will do everything in its power stay that debt. The current administration is pumping a lot of money into the system to attempt to save the economy. They feel that the economy needs more money in this time of trouble. Truely, I'm not sure how I feel about this, but I know that it will probably get worse before it gets better.

K-Iglinski said...

The economy is not improving as a whole, but in some small areas it is. The car industry was improving for a while until the cash for clunkers ended and even some of the companys were still not showing improvement. We will later than probably sooner see the economy begin to jump back to its former self. It will be a long and hard process and will take a very long time to even gain back what we have lost in a month in these bad econimic time. We need to start to stimulate the economy. Everyyone cant just get paid and hold on to their money, they need to spend it to get the economy flowing with money. So to answer the question again the stimulus programs for the time being are not working, and for now the economy is not improving as a result of that. People are thinking that if they just hold on to their money that the economy will just go back to the way that it was. WRONG, the economy needs to have a sufficient amount of money flowing through it to begin to work again. People don't have to go spend the money that they earn on pointless stuff like ipods and electronics, but on the essentials such as food, cloths, ect. We need to start putting the blood (money) back into the animal (economy).

nsomers said...

I agree with Tyler Kehoe in that the economy will not improve untill people stop getting laid-off and go back to work. The stimulus programs so far have only moderately trickeld down to the middle and working classes. The cash for clunkers program was generally utilized by those who already had available cash, so it did help the economy because the spike in new car sales put some auto workers back to work.

Tereza said...

I agree with Alex regarding the national debt and that it's not an accurate way to measure the state of our economy. The confidence in the American economy is down altogether. Americans will never spend like they used to because a lot of their spending was piled into debt, through credit cards and whatnot. Until the public gets back to work and pays off their personal debt, spending will likely increase slightly. In regards of the stimulus programs, I think some have been successful, but as Klinka has pointed out, Americans have used these programs to spend on foreign goods. I think it's just un-American to get cash for clunkers and buy a Kia, as some of the consumers did. I can't say for sure whether the economy is improving, all I can do is hope that close attention is paid to the types of programs being established to insure the betterment of our country's economic state.

AAgostini said...

In my opinion, the measure of whether or not there is improvement in the economy is not whether or not there is a deficit, but whether or not the people are feeling relief of the financial burden.The help the American Recovery and Reinvestment Act should bring to tax payers, education, energy, and health care seem to show a positive turn for the future. However, seeing an immediate improvement in economical circumstances is unlikely. The biggest improvement that can be seen at the moment is unfortunately not a particular concrete occurrence but rather the fact that the economy has been made a top priority and that plans are been set forth for a long term, albeit, gradual, improvement.

Mr. Bretzmann said...

GLOBALIZATION:
IRVINE, CA - August 21, 2009: Introduced in 2002, the original Kia Sorento midsize SUV marked a huge step forward for Kia Motors, challenging established brands and beginning the process of changing perceptions of Kia Motors as solely a maker of small cars. That process will continue with the arrival of the all-new 2011 model year Sorento CUV, which is scheduled to begin rolling off the assembly line at Kia’s first U.S. plant – Kia Motors Manufacturing Georgia (KMMG) in West Point, Georgia – later this year, and offers improved fuel economy and more passenger room and seating capacity than the previous model.

MKlinka said...

In response to what Alex posted, we HAVE been debt free, starting January 1835 of Andrew Jackson's presidency, the United States had entirely paid off it's national debt, that ended when Jacnkson left. But while it may be silly to judge the economy by how much debt the country has, it plays a factor. Example, we are obligated to trade with the countries we are indebted to, those countries drain our economy with an influx of cheap foreign-made goods (hey there Mr. China), rinse, repeat. We do this because it's the best way to attempt to keep soft power with our "allies", as a country, we seem to consider this more important than a good economy. Anyway, judging off of what we have the capacity to have in terms of the country's economy, the economy is staying pretty stagnant, the stimulus programs haven't helped as much as other programs would have, and while they may be effective, the gains certainly aren't substantial.

Jackson/Polk '12

Astoiber said...

It is hard to gauge whether or not an economy is improving or not. An economy is an abstract idea. In America the problem isn't capitalism, it is how the government attempts to control the economy. Capitalism allows people to prosper through hardwork. America has an enormous debt. My solution: Skrew it. Don't Pay it. Start from scratch without government intervention and don't make deals with other countries that you can't follow through on. yes it is a very crude and rudimentary concept, but I am sick of hearing about "tough times in America". Obama is brainwashing the public in to thinking they need to rely on the government for their every need. Private enterprise is slowly being destroyed by government control. The stimulus package was one of if not the largest waste of money in the nation's history. States have all of this government money they don't know what to do with so they start useless projects that create more waste. Instead of tossing around billions of dollars and promoting Obama's government=god, I can do whatever I want because I am the president attitude, America needs a free market without government regulation so that businesses can prosper, therefore allowing the people to prosper. And to answer your questions. no. Nothing is improving. don't tread on me

MKlinka said...

@ AStoiber
a freemarket approach wouldn't solve anything unless we went isolationist.

Why?

because other countries can make things cheaper, and when they do, we'll accrue debt because we'll buy more foreign imports than we can export, because individuals in America can make more of a profit. But the nation will still have debt.

No, I think the best solution, strictly speaking in economic terms and completely ignoring foreign policy, is to add a tariff to imports making USA made goods competitive.

jreichart said...

As a citizen who is merely a consumer along with the majority of people in the united states, our perception of the economy is vastly shaped by the media's influence on us. As our main source of information, media is free to shape the information as much as they want. I believe the economy's improvement is a matter of opinion depending on what your current situation is. For someone who has just lost their job and struggling financially, the economy is most likely not going to seem as if it is on an upswing. On the contrary someone who is still employed and maybe not doing the best, but still scraping by might think differently. In reality and in this day in age, we are most likely never going to be debt free as a nation. I believe someday the economy is bound to improve. When this may happen is up in the air at this point for me though.

KLatour said...

I really agree with Matt's first comment here. His analogy is sickly accurate in my opinion. I think very slowly, but surely the economy will take shape again and return to its "normal" state. I really don't think the stimulus programs are helping too much because you still hear of people losing jobs or in some cases not finding a new job after previously losing their job. As "helping" is a very subjective term, there is definitely no clear way to answer. However, overall I would say that the economy is still in a very rough way and any improvements that have been made, are incredibly small and, for the most part, have gone relatively unnoticed.

K-Laz said...

Ideally it would be nice to see a debt free America, but lets be realistic. If you do look at the debt as your gauge to whether the economy is doing well or not i think everyone can agree that it is doing terrible. But most don't. The way our economy has been most people have lowered their standards on the way they see our economy. Guessing whether or not the economy will improve is like guessing which stock will rise or fall. It's nearly impossible. To answer this, i don't believe our economy hasnt changed much since the transfer of power. The stimulous plans didn't prove to be miracles, and they certainly didnt improve unemployment. The economy hasn't made a jump to where the media would cover good news about it for once. The only way to improve it is for consumers to spend, not the gov't. If consumers spend, then the companies will have revenue and will not need to lay off workers. Thus helping unemployment and jumpstarting the economy. Sure it seems like a simple plan, but it can't just be done by one person. The nation as a whole has to realize that they are doing it to themselves. People must spend money and stop holding onto it. The economy cannot fix itself. ( i.e. k-inglinski).

PMiner said...

We are in a tremendous amount of debt and i dont see the number dropping anytime soon. I believe the number will rise again before it goes down. and its not to say that the stimulus package is or is not working. The economy is and has been suffering for quite some time now and no matter what type of action you take, nothing is going to work right away...
Hopefully the Obama administration can find a solution sometime soon, but for the time being i see the economy getting worse maybe even in the near future

Ryan Paprocki said...

Completely agree with AAgostini. I remember all of the right-wingers on Fox News were quick to say that the stimulus failed after only 2 months of it's release. Not surprising that they can't(didn't?) read the fine print. This will be a slow recovery. We haven't even nearly spent all 787 billion dollars yet.

Klinka,
We could've easily pursued a free market solution. It's called the great reduction of taxes and regulation. That IS the free market solution. It's either that or the stimulus package; both lead to the same end. Except, well one doesn't rob money from our future generations and is arguably a faster recovery. It's simply arrogant to think that the only answer is to be keynesian.

Many nobel prize winning American economists and professors disagree with keynesian economics.

http://www.cato.org/special/stimulus09/cato_stimulus.pdf

One day Mr. Bretzmann made a claim that FDR's New Deal actually worked (still a debated topic to this day) and therefore stimulus packages must work (like the one Obama signed in February.) I then asked him why Japan's 10 trillion dollar stimulus didn't work to which he didn't have a response.

As for our national debt...

http://americasaynotodebt.com/

Selling Alaska, or "borrow" it for several hundred years, to another country to get out of our debt ASAP is becoming more and more popular and I think It's a very interesting idea. Less than 700,000people live in Alaska anyways.

Mr. Bretzmann said...

For the record, Mr. Bretzmann said that the New Deal programs helped the economy, but it was WWII that got the United States out of the Great Depression. Among the many other things that it was, WWII was a huge spending program. Hence the gradual economic recovery.

For the other record, I didn't have a response because I haven't studied Japanese economic plans or Japanese Government and Politics. I would have had a similar response if someone had asked, "Isn't it true that Sumo is more popular than Jujutsu?" It wouldn't imply that one was better, just that I don't know the answer.

Finally, when you let someone use something you lend it to them. You can only borrow from someone, not to someone.

JakeK said...

Alex, you are correct. The debt has been as American as apple pie since the days of Alexander Hamilton, but the national debt and the state of the US economy are two inherently different matters. However, to contradict that last statemant, the blunders of Obama's national debt will have to be paid through means including but not limited to taxation. This will affect the wallets of American citizens and in turn, the economy. As for our current state, I like to think of it as the eye of the storm. While we are not noticing the same hits in the Nasdaq as we were a year ago, the stimulus programs have been nothing more than wasteful spending. Cash for clunkers? Really federal government? Who thought that was gonna be a good idea? But that's for a different day. What is scarry at this point in time is inflation. Funny thing about inflation, it's what drove the Germans away from the Wiemar Republic and to you know who after WWI. What's more is my buddy Barack is totally oblivious to the prospects of a worse, inflation-driven recession on the horizon as he is too busy going around beating his cheast on how he "brought America back". So in conclusion, future= kinda scary, Dollar= might not be that valuable, Michael Moore= dumb.

MKlinka said...

If a free market solution leads to the same end as the stimulus, like you said Paprocki, why do it?

Also Alaska is experiencing some of the highest population growth, percentage-wise in the nation, people are going there now, then there's the oil we have there, so why would we lend it to another country, would you like to wake up a chinese citizen? This might fix the problem, but it seems a little, well I dunno, sacrificing the good of the few communistic.

rlepak said...

I have to agree with Alex in that we cannot judge the improvement of the economy on the size of the national debt. The country was in a huge debt before we hit this recession and we will still be in debt when we come out of it. However, I find it difficult to answer this question. People are still out of jobs, but the stock market seems to be bouncing back. Also, I don't believe the stimulus programs have helped. It may have benefitted a small number of people, but in the long run the money the government is spending is our own. It will eventually be paid for with our tax money.

Tyler Kehoe said...

Right now, we need to focus on getting people back to work. Just giving people and other companies is pointless because that money only will last for so long. The long term solution is helping people get back to work. Now to answer the real question here. The economy isnt being helped with these stimulus programs, only the corrupt and bankrupt car and bank organizations are thriving because they have certain friends in higher places. We can not say the economy has gotten better until most people are back working again

Tereza said...

My comment on Ryan Paprocki's posted link to americasaynotodebt.com is: This is a terrible idea. Aaron Biston's approach to the national debt is to lend/ sell Alaska, This situation cannot be handled as a real estate deal, this is America. What nation/s would even be a contender for such a large bid on Alaska? AND How could we insure that we can maintain an alliance if a bid would go through? Honestly I cannot believe I'm throwing out such ludicrous questions because there is no way such a solution would be set into motion. As Klinka has said, we've got oil on the premises.

ayork said...

Be careful on your word choice Mr. Kehoe. You claim that giving money to companies is "pointless." You also claim that Americans need to lower the unemployment rate. However, on some level, would not the two go hand in hand? Americans lost their jobs because the companies couldn't afford to pay them. The companies haven't miraculously accrued massive amounts of money since firing their employees. Historically, one thing stimulus programs have done is get Americans more jobs (i.e. New Deal).

To Ms. Tereza: you referred to the buying of a foreign made car as un-American. This I disagree with. I hesitate to use the word "free-market" to describe capitalism, but that, in principle, is what it is. We must remember that the reason why American car companies became so powerful was their response to tough competition in the auto field. Competition is what personifies capitalism. If Kia is making a better car than Ford or GMC, then Americans should buy a Kia. Then, if companies like Ford and GMC want to stay afloat, they would respond and change their companies to make them more efficient and capable of producing a better product.

KLatour said...

I'm with Tereza! The idea of selling Alaska is beyond ridiculous. Although the National Debt counter is certainly eye-opening, it cannot simply be solved by a real estate deal! Not only should the the people of the united states have a problem with this attempted solution, but the government, as well. Its complete nonsense that a deal like that would ever go through. Also, problems would absolutely snowball after that with regards to who is buying it, if it is a lease type deal, or a full out sale, or if in the future, it would become part of the United States again, etc...

Tyler Kehoe said...

Maybe pointless would be the wrong word. My question is why put money into companies that have failed already. Lets send billions and billions of dollars to companies that are going to cut jobs anyway to stay afloat. We as Americans live in a capatalistic society and there shouldnt be any exceptions. These companies are supposed to eventually pay all of this money back to the government which will probably never happen. So basically what the whole stimulus package has done has made the government put money into failing systems. And yes Mr. York, it is "pointless" to put money into failing buisness'; we need spend our money wisely and not just give this money out like candy like its trick o' treat.

jreichart said...

That whole selling Alaska thing is ridiculous. It would never happen. I completely agree with Al in the fact that it is not "un-American" to purchase foreign cars. As a consumer, we should have the right to purchase the best and most reliable product. I would argue that while people feel it is somewhat patriotic to be giving our money to failing american car companies that help our economy stay afloat, in these hard times we want the best product money can buy. If foreign cars are making a better product the majority of citizens will buy it and the consumer should not be chastised for doing so. Also I agree with jake (who by the way should be doing other things on a sunday night like watching entourage) in the fact that this awesome cash for clunkers deal has done nothing other than create a false sense of rising sales in the auto industry that has lead to sales now being lower than ever.

K-Laz said...

(Sarcasm 101) If we lent Alaska to a foreign country that would open jobs in America because companies that make flags would have to produce new flags with 49 stars on them. (End of Sarcasm 101)
I wasn't aware 700,000 people could considered ONLY 700,000 people. The idea of lending Alaska to a foreign country is beyond ridiculous. Most of our oil is found in Alaska. And even if this proposition was looked at, it would take years for it to even move close to being looked at by congress. I dont like this idea at all and im sure the few 700,000 people living there would love to become part of some foreign country.

TyKant said...

I agree with Brandon D because the economy is finally starting to come around slowly but surely. I believe that the reason that people think that it's not coming around is that everyone thinks that things just bounce back right away, when in reality, things take time. So i believe that the new stimulus programs will eventually come into effect, it just takes time for things to develope.

TyKant said...

I agree with Brandon D about the economy turning around. I believe that the economy will eventually turn around, but all things take time to develope. I think that is where people are doubting it, they are not giving it time to come around. They expect it to just show up overnight, when in reality there is a lot of things that go into the stimulus programs.

PMiner said...

York, Kia? honestly? at least use Toyota as your example...
but with all joking aside, i agree with you. Buy the best quality and force the American companies to up there game in order to stay in business.
Selling Alaska is bogus, we should sell Hawaii(point to nose) since half the people who think President Obama is not a real citizen also believe that Hawaii isn't even a real state...

quite honestly I'm a bit surprised no one has mention a certain company yet... oh I don't know... maybe AIG...

dlang said...

In my eyes, i think the economy has improved a little bit but it has a very and i mean very long time before the economy gets back to the way it was. The stimulus programs have not helped in my opinion because people are still losing jobs and companies are folding. Like i said the economy is improving very slow but is improving and we have a long time before we get back to where we were.

dlang said...

In my eyes, i think the economy has improved a little bit but it has a very and i mean very long time before the economy gets back to the way it was. The stimulus programs have not helped in my opinion because people are still losing jobs and companies are folding. Like i said the economy is improving very slow but is improving and we have a long time before we get back to where we were.

dlang said...

In my eyes, i think the economy has improved a little bit but it has a very and i mean very long time before the economy gets back to the way it was. The stimulus programs have not helped in my opinion because people are still losing jobs and companies are folding. Like i said the economy is improving very slow but is improving and we have a long time before we get back to where we were.

dlang said...

In my eyes, i think the economy has improved a little bit but it has a very and i mean very long time before the economy gets back to the way it was. The stimulus programs have not helped in my opinion because people are still losing jobs and companies are folding. Like i said the economy is improving very slow but is improving and we have a long time before we get back to where we were.

Brandon D said...

I also agree with Dlang's statement that the stimulus plans are not really helping.Companies are still struggling and unemployment is extremely high. We are a long ways away, but gradually taking steps in the right direction.

EBilton said...

I also agree with dlang and Brandon D. The economy is gradually increasing but only a little at a time. It will take years to improve. The stimulus packages aren't really helping because people that get them don't use them to help out businesses they put them into their savings accounts.

aprichard said...

WOW. 10.6232 trillion dollars. Most likely China's money since we can't pay for it. With our outrageously high national debt (thank you Paprocki) China should be able to by us pretty soon. Or is it more fun just to watch us squirm? Seeing that there are no new posts here goes.
I can understand the importance of allocating money to help our economy because it is slowly dying. Yes we were under worse circumstances recently and experts have said its improving, but lets face it that doesn't mean much. Lets just give the starving child a taste of bread and hold the loaf in front of him where he can't reach it.
Experts have said that it is improving, but I don't think it has. We live in a more affluent area so we haven't been hit as hard, but it is still present. In this secluded and protected enviroment I do not see myself fit to determine whether or not it is improving due to the area I live in.
As for stimulus programs... Yes they have helped. Cash for Clunkers was a pretty good investment and I heard lots of people talking about how useful it was. However, this aids the members of society with cars and does not overall help our economy. It just creates an illusion to those getting new cars that it is getting better. But public moral. Thats what counts right?
The unemployment money helps and the bail out money helps. If we can keep people working and making money we can at least stall the inevitable. It has certian aspects that help and others that have been a waste of china's money. We need to be preparing for the long term.