Out-of-state welfare money being used around Orlando attractions

What Andy said. Business hire because they have demand for what they provide. Even Mark Cuban gets this.

Exactly. We're currently renegotiating the union contract with our shop workers, and amid all the "uncertainty" regarding Obamacare, taxes, stimuli and so on, not to mention the volatile auto industry and Midwest economy, we're in the process of hiring around a dozen new employees. And it is absolutely a direct result of increased demand (via the bailed out GM).

"I don't know any small business owners (not that I know that many anyway) who base their hiring on taxes and health care more than they base it on demand for their products."

I made the assumption this was understood. The other factors are uneccessary uncertainties that are propogated by government officials who threaten tax increases, succeed in passing an overhall bill for 1/5th of the economy, etc. The point being that our government has not implemented any policy that has EVER (?) been shown to assist a stagnant economy. In fact, the response (stimulus) is 180 degrees opposite of what most successful economies have been doing the last quarter of a century.

The truth is Government is useless to jump start an economy. The only thing a government can do is get out of the way and foster a climate where the market can work with as minimal impediments possible. This is why the majority of governments, specifically those with growing economies have lowered taxes and lessened regulation the past 25 years. Those governments who stubbornly kept taxes the same, raised them, added to their social spending, etc simply fell behind. The EU is the prime example of where we are heading.

If you don't believe that the majority of countries who lowered taxes knew what they were doing...then maybe we could find ONE example of a country taxing its way to prosperity.

The stimulus was NEVER going to work and every politician on both side of the isle knew it. I found this quote from an article in my 2009 folder.

• The CBO reports that the stimulus bills now before the House and Senate might provide a small amount of short term economic uptick, and add a few jobs, but by 2011 the effects would be nil. Yet the damage is long-lasting- the CBO reports that this new trillion dollars in spending will dangerously increase debt to the point where it will lead to a LOWER GDP (Gross Domestic Product) over the next decade than if the government did nothing. The CBO further reported that the real cost of this bill is hidden- because the interest or “service” on the debt will add hundreds of millions, if not billions, to the true cost. Further, in the long run, all this government borrowing and spending will cost the private sector billions of dollars in available capital- thereby killing jobs and damaging GDP.

A "lower GDP over the next decade than if the government did nothing." And now the very same politicians who gave us this job killing fiasco are dropping hints of another stimulus. This is the non-partisan CBO words BEFORE we passed the stimulus. Not my opinion.

I don't pretend to have any answers for a way out of this. But I know those politicians and internet reporters caling for more taxes and more stimulus either don't have a clue about economic theory or they are purposefully lying for more sinister reasons.

All I hear is the teacher from Charlie Brown. Everyone else is done with the subject but Aamilj still blabbers on.

My finger scrolls down faster when I see a post from him. Woosh... lol

The topic's still interesting. I just skip his War and Peace posts.

It's almost time for his token quarterly coaster post to validate why he's here in the first place.

Which had more pages, War & Peace or The Stand? Cause his posts could be mistaken for either.

But The Stand is actually interesting.

Feel the love Aamilj - Come to the dark side. I will give you credit for your perseverance.

it is absolutely a direct result of increased demand (via the bailed out GM).

U.S. Boosts Estimate of Auto Bailout Losses to 23.6 Billion (Detroit News November 14th, 2011)

http://www.detnews.com/article/20111114/AUTO01/111140434/1361/U.S.-boosts-estimate-of-auto-bailout-losses-to-$23.6B

There's an important piece of context in there: "The new estimate means the government doesn't believe it will make an overall profit on its bailouts."

I think the public perception has always been that it would take a loss. If TARP as a whole loses a few billion in the end, I'd argue it was money well spent in the long run. That most of the banks have paid their loans back is an important point to me. It was never an issue of "too big to fail," in my opinion, it was an issue of credit resources, the lubrication of commerce, going away.

I am not sure you can separate the issue of "too big to fail" from credit resources, etc. Without the largest lenders, the credit markets in essence don't exist. So they needed to continue if credit was going to get flowing again. They are basically opposite sides of the same coin.

Some of the banks repaid the loans because they didn't need the money. Treasury forced a broader spectrum of institutions to take loans because they didn't want to single out the banks that did need them (nor did those banks in need want to be singled out).

TARP as originally proposed by Paulson (buying 'toxic assets' from banks) made sense to help them become solvent and able to lend. But then TARP became a slush fund for politicians. Made sense for politicians looking to get re-elected but not for the country as a whole particularly not in the long run.

Talks of profits from TARP only started with politicians when TARP became a political hot potato. Just politicians trying to deflect criticisms for the program that they supported that many/most in the country do not.

Which is weird, because if you try to be objective, I would argue that TARP overall was a successful program. It seems that most savvy economists believe the recession could have been much worse without it, some going as far as to argue we'd have an outright depression. Not that you could ever explain that to anyone angry about loaning money to enormous corporations right now.

I don't think the issues now are whether TARP was needed or whether is worked, based on whatever criteria a person wants to use. The problems for me are if we really want a handful of companies to be so large to be "too big to fail." That if any of a number of things that could make them fail happened, it could throw this country or most of the world into a financial catastrophe.

Second, it doesn't seem that any lessons have been learned from the last episode. The largest banks have gotten even larger since 2008 by acquiring other banks that failed-- with money that was supposed to be used to lend to businesses to stimulate the economy. By some accounts, many of them have gone right back to the same reckless behavior that brought us to the brink before.

Third, the "too big to fail" mentality isn't that different from the welfare authority many of us are calling out in this thread. There's an expectation that if it comes down to it, the taxpayers will bail them out again and again, because the alternative is much worse.

I see your points, but I'm not sure I totally agree. "Too big to fail" is such a loaded term. No one "wants" a huge company to be in that position, but if that's what the situation was, would it have been responsible to allow that massive failure at the expense of a giant destabilization of the world economy? I'd be inclined to fix it now, and then figure out what the next step is so market forces could enforce their own brand of natural selection.

Which leads to the second point. Consolidation happens in every industry over time, so I'm not at all surprised to see the bank acquisitions. We've seen it happen in the last ten years in the amusement industry as well. I think that's a market force as well, whether the feds would have loaned them money or not.

As I've said many times, there's plenty of blame to go around. The political mood of the nation suggesting that government involvement in anything is bad isn't going to restore or establish some of the better common sense regulation toward the financial industry (or any industry, for that matter). As long as it's black and white in people's minds, it won't change. I think lenders will be pretty gunshy in the short term, but you're right, they might get stupid over time. And if Americans are stupid enough to take those loans, and I tend to think they will be, we could end up right back where we started.

To me the solution is that holy triad: Consumers- don't be stupid. Banks- don't be stupid. Government- regulate logically (or, don't be stupid).

RatherGoodBear said:
Third, the "too big to fail" mentality isn't that different from the welfare authority many of us are calling out in this thread.

For the record, I'm against corporate welfare too.

I'm a very 'leave the economy do its thing' kind of guy. :)

I think they should have taken the bail out money and spread that out to the American public so we could blow it on what we wanted. I need an iPad.

No, that's what they should have done with the *stimulus* money.

Of course most of this goes back to the outrageous run-up in real estate sale prices (notice I don't say "values") that was really driven by nothing more than positive feedback. And of course, consumers paid those inflated prices...first, with the market running on positive feedback, that was the market price, and second, the mortgage brokers came up with schemes to make those big mortgages "affordable".

I think there is a Nobel prize in the offering for the person who figures out how to prevent positive feedback from causing markets to run wild, then crash. It's not that the negative feedback isn't there, it's that in the pursuit of greater profit, smart people figure out how to reduce or short-circuit the loop. So the negative feedback that should be controlling the system doesn't function. But the underlying source of that feedback still exists, and ultimately causes the system to crash.

--Dave Althoff, Jr.

    /X\        _      *** Respect rides. They do not respect you. ***
   /XXX\      /X\     /X\_      _     /X\__      _     _        _____
  /XXXXX\    /XXX\   /XXXX\_   /X\   /XXXXX\    /X\   /X\      /XXXXX
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"Too big to fail" means we already failed - anti-trust legislation enacted after the First Great Depression was intended to prevent that from being able to happen. IMO. ;)