I’m interested in this statement….”But please keep in mind that Bush’s tax cuts did not reduce federal revenue. They actually increased markedly for most of his terms.” Could you provide more detail on this or provide a link?

Sounds we could use the emergence of the “anti-party.” One that does everything that people hate… “Higher taxes! Cut programs!”

But what’s bringing more outcry now is the sheer size of the deficit. CBO is projecting deficits of over $1 trillion for the next few years — heretofore unheard of levels — and Obama’s plan to reduce it going forward is essentially to spend much more on healthcare now to supposedly reduce spending later. To put it mildly, there is a huge risk that this won’t work, and deficits will be even larger than projected. And oh, by the way, regardless of the stimulus, we face the ticking time bomb of 42 trillion in unfunded medicare and SS liabilities.

I think you are right that just about any administration would have enacted some stimulus, but what Obama did barely qualifies as such. Consider two facts: one, as this post demonstrates, much of the money was directed to uses that fall outside what we regard as stimulus — funding for schools, etc. You may think that funding is a good idea, but it’s not the kind of thing that gets plants back on line, banks lending money, people buying cars, etc. Two, and more importantly, very little of the stimulus money has actually been spent. Something on the order of 8%. A stimulus is supposed to be a jolt of money injected into a sagging economy. What we have here is a very slow drip of funds into areas where the stimulative effect is weak, at best.

What’s most interesting to me is that we are now seeing where this kind of fiscal irresponsibility ends — California’s budget crisis — and we’re ignoring its lessons. Hell, half of California itself is under the delusion that the state has a revenue problem, not a spending problem, when if they had just retrained spendiong growth to population groowth + inflation, they’d have a surplus right now.

One last comment — I agree that the Republicans have not been fiscally responsible. But please keep in mind that Bush’s tax cuts did not reduce federal revenue. They actually increased markedly for most of his terms. People seem to assume that tax cuts = less revenue, but on the federal level, it has rarely worked that way. We’re now headed straight for the worst possible scenario, which is huge tax hikes in the midst of 10% unemployment. Obama has already all but reneged on his pledge to tax no one making less than $250k, and I think folks earning over that line will be looking at marginal tax rates over 50%.

It’s hard to keep a conversation about the federal stimulus focused because it’s not like the fed is using money it has (would the opposition to a stimulus be any different if the fed had a surplus and no debt?). No, it’s putting itself in even more debt. So, immediately we’re (myself included) not just talking about the philosophy of a stimulus package but we’re weighing it against the effects of an increased national debt. And as Eric pointed out, then folks start throwing around the word trillions and our collective head explodes.

I don’t disagree that we have serious money problems. But I think that people that judge Obama as typical tax and spend are measuring him against some politician that doesn’t exist. Democrats “tax more and spend more” and Republicans seemed to have decided that we cut taxes, but still spend. I think the current President is pragmatic enough to realize the dangers of running insane deficits. But he came into office with a huge frickin’ problem. Show me one individual voted into office that wouldn’t sign a stimulus at that moment from either party. Watch as people loose their jobs and everyone blames the man or woman in charge. That’s an unrealistic expectation. And what about the tax cut portion of the bill? Does that count for nothing?

The Federal Debt is a huge problem, but nobody wanted to talk about it before Lehman. In my mind, that’s the larger crime here, regardless of how much more poorly that plays on the airwaves compared to $18 million for pig research!

Here’s what it comes down to for me…regardless of whether the stimulus “works”, I at least understand why it was enacted. On the other hand, I have no clue why no one in power cared about the deficit prior to the collapse. That’s how I weigh the bad vs. worse.

Please don’t mistake my arguments as statements that I can do better. The main point I am trying to make is that so many major decisions that have repercussions way beyond today are being made so quickly and without the necessary due diligence. Even with the downturn, the American economy is resilient enough to wait out a thorough review of the options available for making it strong again (including letting the most successful free market in history fix itself without government involvement).

The press and government (on both sides of the aisle) throw out the word “trillion” with seemingly reckless abandon these days. But I am scared witless no one is stopping to consider just how much a trillion dollars is. A thousand billion dollars! I can’t even conceive of that amount of money, especially when our country just doesn’t have it.