More Bang, Less Buck than You Thought

By: Aaron Datesman

You may have seen this post from Dean Baker last week, in which he discusses a new analysis of the effectiveness of the 2009 stimulus bill. I clicked over to the study itself and read the abstract, which concludes with this statement:

Support programs for low income households and infrastructure spending are found to be highly expansionary. Estimates excluding education spending suggest fiscal policy multipliers of about 2.0 with per job cost of under $100,000.

Baker explains that a fiscal policy multiplier of 2.0 indicates that $1 billion of stimulus spending grows the economy by $2 billion. It is interesting to note that, at a tax rate of 33%, the cost to the Treasury of that $1 billion fiscal stimulus is only $0.3 billion. Most of the cost is offset by taxes collected on the increased GDP (33% * $2bn = $0.7bn).

A few more pieces of simple math are also highly revealing. The study finds a per-job cost of less than $100,000 – that’s at least 10,000 jobs supported by $1 billion of stimulus. I don’t have access to read the paper, but that calculation seems to refer to the nominal stimulus, not to the actual cost to the Treasury. (I would welcome any effort anyone could make to verify or refute this statement.) The true cost to the taxpayers is $0.3 billion/10,000 jobs = $33,000 per job. This compares to the national median income of approximately $44,000.

Isn’t this the definition of a virtuous circle? I guess the country is talking about reducing government spending because….because….

I got nothing.

I feel that this post also relates to a broader issue – we talk about government “spending” as though the dollars pour out and into a black hole. This is certainly true for a couple of holes in Asia, but in other cases it’s quite mistaken. There are many instances where government outlays may best be understood as investments – and we should talk about them in this way. Later this week, I’ll be writing about one instance where government outlays for research yield $20 in wealth (net present value) for each $1 of outlay. Why would anyone not spend $1 if they immediately got $20 back?

(On a personal note, I am also not dead. But I was resting. More on that soon, too.)

— Aaron Datesman

The Love That Dare Not Speak Its Name

Let's take a look again at this section of the prank David Koch phone call to Scott Walker about how much he loved an article in the New York Times:

SCOTT WALKER: The New York Times, of all things—I don't normally tell people to read the New York Times, but the front page of the New York Times, they've got a great story—one of these unbelievable moments of true journalism—what it's supposed to be, objective journalism—they got out of the capital and went down one county south of the capital, to Janesville, to Rock County, that's where the General Motors plant once was.

FAKE DAVID KOCH: Right, right.

WALKER: They moved out two years ago. The lead on this story's about a guy who was laid off two years ago, he'd been laid off twice by GM, who points out that everybody else in his town has had to sacrifice except for all these public employees, and it's about damn time they do and he supports me. And they had a bartender, they had—every stereotypical blue collar worker-type, they interviewed, and the only ones who weren't with us were ones who were either a public employee or married to a public employee. It's an unbelievable—so I went through and called all these, uh, a handful, a dozen or so lawmakers I worry about each day, and said to them, everyone, get that story and print it out and send it to anybody giving you grief.

Here's what Walker didn't say: the article in question was co-written by A.G. Sulzberger, the son of Arthur Sulzberger, the publisher of the New York Times. (Thanks to Josh K-sky for pointing that out.)

So that's ominously funny and funnily ominous in its own right. But we don't need to try to predict how honest New York Times coverage will be in the future when A.G. Sulzberger becomes publisher...because we can just examine his writing right now. Sulzberger just wrote a 733-word article about the prank call. Number of mentions of Walker loving a certain Sulzberger-written New York Times article? Zero.

—Jonathan Schwarz

Scott Walker [Hearts] NY Times

For me the best part of the Scott Walker prank call is how much he loves a New York Times article:

SCOTT WALKER: The New York Times, of all things—I don't normally tell people to read the New York Times, but the front page of the New York Times, they've got a great story—one of these unbelievable moments of true journalism—what it's supposed to be, objective journalism—they got out of the capital and went down one county south of the capital, to Janesville, to Rock County, that's where the General Motors plant once was.

FAKE DAVID KOCH: Right, right.

WALKER: They moved out two years ago. The lead on this story's about a guy who was laid off two years ago, he'd been laid off twice by GM, who points out that everybody else in his town has had to sacrifice except for all these public employees, and it's about damn time they do and he supports me. And they had a bartender, they had—every stereotypical blue collar worker-type, they interviewed, and the only ones who weren't with us were ones who were either a public employee or married to a public employee. It's an unbelievable—so I went through and called all these, uh, a handful, a dozen or so lawmakers I worry about each day, and said to them, everyone, get that story and print it out and send it to anybody giving you grief.

Given the New York Times' century-long hatred of labor, it's funny that Walker thinks the story he's talking about is somehow unusual. But in any case, the picture the article paints is horribly sad—of people who've been brutalized by Wall Street and GM blaming each other for what happened, with no understanding of who's done this to them and how.

JANESVILLE, Wis. — Rich Hahan worked at the General Motors plant here until it closed about two years ago. He moved to Detroit to take another G.M. job while his wife and children stayed here, but then the automaker cut more jobs. So Mr. Hahan, 50, found himself back in Janesville, collecting unemployment for a time, and watching as the city’s industrial base seemed to crumble away...

He says he still believes in unions, but thinks those in the public sector lead to wasteful spending because of what he sees as lavish benefits and endless negotiations.

“Something needs to be done,” he said, “and quickly.”...

“Everyone else needs to pinch pennies and give more money to health insurance companies and pay for their own retirement,” said Cindy Kuehn as she left Jim and Judy’s Food Market in Palmyra. “It’s about time the buck stops.”...

Crystal Watkins, a preschool teacher at a Lutheran church, said she was paid less than public school teachers and got fewer benefits. “I don’t have any of that,” she said. “But I’m there every day because I love the kids.”

In Palmyra, a small village bounded by farmland and forests, MaryKay Horter remembered how her husband’s Chevy dealership had teetered on the brink of closing after General Motors declared bankruptcy, for which she blamed unions.

Ms. Horter said she was forced to work more hours as an occupational therapist, but had not seen a raise or any retirement contributions from her employer for the last two years. All told, her family’s income has dropped by about a third.

“I don’t get to bargain in my job, either,” she said.

You have to admit, the people who run the U.S. do a great job.

—Jonathan Schwarz

An Experiment in Politeness

I was raised to be polite and rational. So when engaging in my hobby of trying to get powerful U.S. institutions to correct inaccurate statements, it's hard for me to be anything but—even though, in at least 100 attempts on my part, being polite and rational has literally never worked.

But you never know! So let's try again.

Yesterday WAMU's Kojo Nnamdi Show had on Alec Ross, who's "Senior Advisor for Innovation to Secretary of State Hillary Clinton." He has 327,000 followers on Twitter. And here he is on Facebook.

The subject of the show was "Internet Freedom and U.S. Diplomacy," and dealt in part with Hillary Clinton's speech a week ago—the speech from which Ray McGovern was forcibly ejected and bloodied for engaging in a silent protest. (He stood up and turned his back on Clinton.)

Someone called in and asked Ross to comment on this. Starting about 28:30 there was this exchange:

KOJO NNAMDI: On the case of Ray McGovern, that was brought up by several people...Ray McGovern of course was a protester, a silent protester, at a George Washington speech delivered by Secretary Clinton. Video showed him being escorted out—or in the eyes of some, being brutally roughed up.

ALEC ROSS: Yes, so, he was a handful of rows away from me, and he wasn't silent. [Chuckles] You know, Hillary Clinton was trying to give a speech, and he was yelling. So, look, you know, he was a guest, and if you're going to stand there and make a lot of noise when the Secretary of State is trying to give a speech, then, you know, you're probably going to be an unwelcome guest. I will say that I didn't see him being "roughed up." I mean, I didn't see until the end there, but my point of view was that cops did exactly what they ought to do. That's their job.

You can listen to segment here:

Of course, what Alec Ross says was inaccurate. Ray McGovern was not "yelling"—he was engaging in a silent protest when the security roughly grabbed him. Now, it's true that (by my count) seven seconds after he was grabbed he did shout, "So this is America!" But the fact that you say something when you're seized by cops does not make a silent protest retroactively un-silent, and it therefore legitimate for them to haul you out. And even if he had been yelling, McGovern should not have been manhandled in the way he was.

Now, someone as polite and rational as myself assumes everyone has good intentions. It's likely Alec Ross just isn't aware of what happened—and will therefore be happy to publicly correct himself on twitter, on facebook, and (if they'll let him) on the Kojo Nnamdi Show. An apology to Ray McGovern would also be nice.

Let's see what happens.

—Jonathan Schwarz

IBM's Hillary-Bot Not Ready for Prime Time

You have to admit IBM's Watson computer was impressive on Jeopardy!. But I think before rolling out the new Hillary 8000 they should have programmed it with the capacity to imitate human emotion:

Good News

It's not surprising to see the Republican party move to directly dismantle the 20th century in Wisconsin (while the Democrats meekly acquiesce or actively help out). But it is exciting to see Americans finally fighting back. I was beginning to think we truly didn't have it in us.

—Jonathan Schwarz

I Am Curious (Obama)

Here's Barack Obama yesterday:

OBAMA: In these difficult times, I know that the Egyptian people will persevere, and they must know that they will continue to have a friend in the United States of America.

I believe the term Obama actually meant to use here was "friendo."

I wish that someday I could have a beer with Barack Obama (or anyone who's intelligent and perceptive and has risen to a high level in U.S. politics) and ask how they justify to themselves the brazen lies they (apparently) have to tell as part of their job. I think I understand how they see it (my opponents are worse! it's not my fault!) but I would like to know for sure.

—Jonathan Schwarz

Now That's More Like It

When Obama talked about "Change We Can Believe In," he apparently meant our Egyptian strongman was going to change to a guy who tortures people personally:

Egypt figured large as a torture destination of choice, as did Suleiman as Egypt’s torturer-in-chief. At least one person extraordinarily rendered by the CIA to Egypt—Egyptian-born Australian citizen Mamdouh Habib—was tortured by Suleiman himself.

In October 2001, Habib was seized off a bus by Pakistani security forces. While detained in Pakistan, at the behest of America agents he was suspended from a hook and electrocuted repeatedly. He was then turned over to the CIA, and in the process of transporting him to Egypt he endured the usual treatment: his clothes were cut off, a suppository was stuffed in his anus, and he was diapered and “wrapped up like a spring roll.” In Egypt, as Habib recounts in his memoir, My Story: The Tale of a Terrorist Who Wasn’t, he was repeatedly subjected to electric shocks, immersed in water up to his nostrils, beaten, his fingers were broken and he was hung from metal hooks. At one point, his interrogator slapped him so hard that his blindfold was dislodged, revealing the identity of his tormentor: Suleiman. Frustrated that Habib was not providing useful information or confessing to involvement in terrorism, Suleiman ordered a guard to murder a shackled Turkistani prisoner in front of Habib, which he did with a vicious karate kick. In April 2002, after five months in Egypt, Habib was rendered to American custody at Bagram prison in Afghanistan, and then transported to Guantanamo. On January 11, 2005, the day before he was scheduled to be charged, Dana Priest of the Washington Post published an exposé about Habib’s torture. The US government immediately announced that he would not be charged and would be repatriated home to Australia.

On the other hand, our big favorite in Iraq for a while was Iyad Allawi, who personally shot seven prisoners. So maybe Suleiman is step up.

—Jonathan Schwarz

Nixonland in Egypt

If you've spent much time on this planet, you won't be surprised to find the Egyptian government's hired right-wing has accused the protestors of being somehow "foreign"

The protesters who had been fighting on that corner for two days were grimy but happy; they ate a breakfast of cheap rough country baladi bread and foil-covered triangles of Laughing Cow cheese. Mohammed Gazi, a chemist, wanted the world to know that they were not eating “Kentucky”—a reference to taunts from the pro-Mubarak people about Kentucky Fried Chicken, meaning that the protesters were being fed by the America and the West.

You also won't be surprised the hired right-wing was exactly what they accused their opponents of being—not just ultimately funded by outsiders (the U.S.), but literally eating at Kentucky Fried Chicken:

Those in the square say they have captured dozens of men from the pro-Mubarak side who wear civilian clothes but carry police, ruling-party or government identification cards. Demonstrators have been repeatedly attacked by such men in recent days, with hundreds of people injured and at least nine killed. It would be easy for a mob mentality to take hold.

But the protesters show a measure of empathy for their captives. The identification cards, protesters say, show that their foes come from poor areas of Egypt, and many have confessed to being promised a reward if they try to storm the square -- usually about $20 and a meal at Kentucky Fried Chicken.

Politics: always and everywhere the same.

(Of course, I guess it's possible that the protestors are lying here and are using Kentucky Fried Chicken in exactly the same way as the Mubarak forces, as a sign of ultimate non-Egyptian decadence. Which is very funny in its own right.)

—Jonathan Schwarz

Happy Lying Anniversary

Eight years ago today, Colin Powell went to the UN and lied and lied and lied:

Powell's lies were a successful attempt to give the U.S the opportunity to do this:

On the upside, Colin Powell is supposedly quite personable.

(Thanks to vastleft for the reminder on this too.)

—Jonathan Schwarz

Ten Dollar Saturday

Since I'm a day late with Five Dollar Friday, ten dollars today will go to Chris Floyd, who deserves it every week but especially now that he's had to deal with the aggravation of getting hacked constantly.

(Thanks to vastleft for the nudge.)

—Jonathan Schwarz

Quality Control Collapses at New York Times

The New York Times has a firm rule: they will at all times cover the news absolutely without fear or favor. As long as what they're writing about took place more than 50 years ago. Until then it's all lies.

So something's gone very wrong over there, as you can tell by the first sentence of this column a few days ago by Ross Douthat:

As the world ponders the fate of Egypt after Hosni Mubarak, Americans should ponder this: It’s quite possible that if Mubarak had not ruled Egypt as a dictator for the last 30 years, the World Trade Center would still be standing.

WHAT THE WHAT? Sure, everything Douthat says after that is the standard blend of mendacity and warm, gooey pap. Still, someone really needs to be fired for this.

—Jonathan Schwarz

Shocking!

>

—Jonathan Schwarz

Power!

I'd been wondering what Samantha Power had been up to in the bowels of the White House—apart from making up excuses to herself about why it's fine for her to stay in an administration that has failed to recognize the Armenian genocide, even though Power herself explicitly promised Armenian Americans that Obama would 'cause he's so honest.

But it turns out she's on the job!

White House officials sent an e-mail to more than a dozen foreign policy experts in Washington, asking them to come in for a meeting on Monday morning. “Apologies for the short notice in light of a very fluid situation,” the e-mail said.

The Roosevelt Room meeting, led by Benjamin Rhodes, the deputy national security adviser for strategic communications, and two other National Security Council officials, Daniel Shapiro and Samantha Power, examined unrest in the region, and the potential for the protests to spread, according to several attendees.

Among the people invited was noted expert/criminal Elliot Abrams. Here's Abrams' mother-in-law Midge Decter being admirably honest in 2004:

"We're not in the Middle East to bring sweetness and light to the world. We're there to get something we and our friends in Europe depend on. Namely, oil."

Lucky Egyptians.

—Jonathan Schwarz

Current Worst Person Alive Chimes In

—Jonathan Schwarz

Something's Gone Wrong

Why isn't the U.S. backing Mubarak to the hilt, or failing that, being more proactive about creating Mubarakism-without-Mubarak? This is not the U.S. government I know! Clearly something's gone wrong. What is it?

1. The U.S. government and foreign policy elite has had a sudden change of heart after 235 years and all of a sudden genuinely cares about democracy.

I think we can disregard this possibility.

2. The U.S. empire is in serious decline, perhaps more so than we lilliputians understand.

This seems to be a significant part of it. We're so overextended militarily and maxed out economically that the mandarins have judged we couldn't come up with the resources—including just plain propaganda—to make the necessary crackdown work.

If so, this may be one of the few cases where it does matter who's in the Oval Office. Obama is at least intelligent enough not to throw away the American Empire's resources on lost causes. But I think we can be pretty sure that President Huckabee would be giving the order to make the streets of Cairo run red with blood, without realizing that he was thereby hastening the Empire's demise.

3. Satellite TV, the internet and cell phones change the equation significantly.

This also seems to be a big part. It's not the case that twitter=revolutions, but that breaking the information blockade in general does have a big effect on people's consciousness. Sociologist Zeynep Toufecki has thought about this seriously.

4. Lots of pissed off young men.

I assume demographics play a role.

5. Egyptians are very brave.

Let me tell you, I'm not sure I'd be out there protesting a government that does things like this. On the other hand, there are lots of brave people all over the world, including in places where we've engineered massive bloodbaths, so I'm not sure what this proves.

—Jonathan Schwarz