What U.S. Economic Recovery? Five Destructive Myths

And let's not forget the youth-unemployment crisis. There's now a generation of young workers who are in danger of being permanently sidetracked in the labor markets and disconnected from society.

Even some Republican economists and Nobel laureates like Paul Krugman argued that it was too small. Republican economist Mark Zandi, who advised John McCain on economic issues, when asked about the stimulus said, "I think we'd be in a measurably worse place if not for the stimulus. If we had not had the stimulus,.we'd have fewer jobs today than we actually have." Zandi was responding to when John Boehner contented that stimulus spending "has gotten us nowhere." Asked whether he agreed with Boehner, Zandi said "no." "Without the stimulus spending instead of a 9.5% unemployment rate, we'd have an 11.5 % unemployment rate" Zandi insisted. This is a Republican economic advisor, who, regardless of his politics understands modern economics – this is not Rush Limbaugh or Sean Hannity commenting.

I don't know how it is in your community, but in mine (Northern California) it appears that high school students choose their courses so as to avoid any possible course that might give them a marketable skill. Mathematics, the hard sciences, and English composition are all ignored to concentrate on soft sciences and the arts--not because the students have any real interest in these subjects, but simply because they are less demanding. This does not bode well for their future, but they seem oblivious to that correlation.

Yet another piece that claims the stimulus was not a failure insofar as it wasn't enough.

...Our analysis suggests government spending quickly crowds out private consumption and investment, because forward-looking households and firms will consider eventual increases in future taxes, government debt, and interest rates...

Conclusion
In sum, this empirical examination of the direct effects of the three countercyclical
stimulus packages of the 2000s indicates that they did not have a positive effect on consumption and government purchases, and thus did not counter the decline in investment during the recessions as the basic Keynesian textbook model would suggest. Individuals and families largely saved the transfers and tax rebates. The federal government increased purchases, but by only an immaterial amount. State and local governments used the stimulus grants to reduce their net borrowing (largely by acquiring more financial assets) rather than to increase expenditures, and they shifted expenditures away from purchases toward transfers.

The central question is whether fiscal stimulus can do anything to raise the level of output. The question is not whether the “multiplier” exceeds one – whether deficit spending raises output by more than the value of that spending. The baseline question is whether the multiplier exceeds zero.

Organized public works, at home and abroad, may be the right cure for a chronic tendency to a deficiency of effective demand. But they are not capable of sufficiently rapid organisation (and above all cannot be reversed or undone at a later date), to be the most serviceable instrument for the prevention of the trade cycle.

Small businesses struggled with cash shortages because they had to pay their overhead when due, but wait months for hard cash from customers. Mr. Petrakis managed the same way other small entrepreneurs did: To get money quickly, he took his customers' postdated checks to banks and sold them at a discount.

If he had a check for €1,000 that couldn't be cashed for five months, a bank would give him €800 right away, then another €100 on the date the check became cashable, his lawyer, Aggelos Zervos, says. The bank would keep the remaining €100.

This story puts a human face on a Greece's slow economic downward spiral,

Greek Crisis Exacts the Cruelest Toll

An honorable hard working man turned to desparation through no direct fault of his own.
I had never heard of this technique used by banks (domestic or as is the case here foreign) before either, at least not till reading this story:



Could a scenario like the one portayed in this article happen, here in the U.S. ? If so, why, and if not, why not ?

Rhody...

This story puts a human face on a Greece's slow economic downward spiral,

...

Could a scenario like the one portayed in this article happen, here in the U.S. ? If so, why, and if not, why not ?

Rhody...

This story puts a human face on a Greece's slow economic downward spiral,

Greek Crisis Exacts the Cruelest Toll

An honorable hard working man turned to desparation through no direct fault of his own.
...

"The present government has done absolutely nothing during the last 12 months to speed up privatizations, reduce the public sector or open up closed professions," Athanasios Papandropoulos, a leading economic analyst, told me recently in an interview. "In these 12 months it has not fired even one civil servant. The only thing it is doing is trying to tax the private sector out of existence.
...
"Whereas more than 1,000 Greeks were losing their jobs in the private sector every day in August, the government was assuring civil servants with lifetime tenure that their job privileges were not in danger."

Could a scenario like the one portayed in this article happen, here in the U.S. ? If so, why, and if not, why not ?

Starting Nov. 1, Starbucks will collect donations of $5 or more from customers to stimulate U.S. job growth through its "Jobs for USA" program. The Seattle-based coffee chain is collaborating with the Opportunity Finance Network, a nonprofit that works with nearly 200 community development financial institutions to provide loans to small businesses and community groups.

Starbucks says 100% of donations will go toward loans for companies and organizations that can add jobs or stem job losses.

Starbucks wants $5 more, to create U.S. jobs

For any contribution 100% voluntary, I am all for. I have a problem when the government, state, local, or federal mandates a tax or fee and you have no choice but to pay it.

Rhody...

This state epitomizes a problem the Obama administration may face even if it is able to turn the economy around by 2012: People have suffered in this recession, and even when back on their feet, they have long memories of what they lost along the way.

and

But Williams is losing his $1-million home in Montana to foreclosure, and spent his first few months in North Dakota camped out in a tiny RV with his family, going to the bathroom in a bucket and living without running water.

"We're starting over again at 60, and we're adaptable. But our hopes and dreams got washed by the wayside," he said, as he fed his grandsons carrots and potatoes in his kitchen, where he and his wife sleep on a foldout couch each night. Light bulbs hang from the ceiling near exposed sockets, and the yellow, peeling walls are stuffed with sacks of fiberglass for insulation.