The bottom line on the changes suggested by Collins, Specter and Nelson added to the changes the Senate already made to the House bill is that the compromise Senate bill will create about 728,143 less jobs. This is a back on the envelope figure and very rough, but if anything it should be a slight underestimate. If you just compare the original Senate Bill to the Gang of Four compromise, it comes out to 1,271,000 less jobs
Here are the assumptions and the math.
It’s time to hit the phones for the stimulus bill. Calls are running at 100:1 against. Yes, it’s not that good a stimulus bill, I’ve said so myself, but it’s not a case of scrapping it and starting over, what looks likely to happen is that it gets badly watered down with bribes to Republicans and “moderate” Democrats like Ben Nelson to get it through. So call, because this is the only money ordinary people are going to see.
Yesterday I discussed the “let the banks go under” option. Let’s talk about the ups and downs of this possibility, because there are significant risks associated with it, which is why folks like Summers and Geithner are acting like they stared at the Gorgon and have been turned to stone.
Stiglitz is saying something slightly more radical than what I’ve been saying for some time. You don’t need the current banks. If they won’t lend, let them go under. If the Fed can lend to banks, why can’t it lend directly to banks and consumers.
Banks exist to be intermediaries between central banks and those who need credit.
One of the main reasons why the financial crisis is not getting significantly better is that governments are not willing to forcefully break contracts.
This may seem like a good thing. But if contracts are based on fraud, and if they require the future to pay the bad debts of the past, is it?
House Republicans all voted against the stimulus bill, after getting a couple key concessions. The Blue Dogs only allowed it to pass after Obama told them he would institute pay-go rules going forward, meaning that all new expenditures and tax cuts must be matched either by cuts in spending or raised taxes.
Well, it passed. After taking out family planning money and ditching bankruptcy reform, plus including significant tax cuts, not a single Republican voted for it. It’s like Democrats are negotiating with themselves. They give things up and get no votes in exchange.
The Senate has passed him through. I’m sure he will do as good a job for Obama as he did for Bush, Bernanke and Paulson.
Unlike the immigration bill, it’ll probably pass, only because there are a lot more Democrats in Congress now. Pre-compromising the bill left Obama without a left wing that’s fired up to push it, with few effective media surrogates to push back against Republican propaganda, and a bill which will be much less effective economically than it should be.