Explaining the Stimulus (or Not)

Paul Krugman’s column yesterday offered an important reality check on political cant about the economic stimulus plan Barack Obama signed last year: more than 40 percent of the stimulus, Krugman reminds us, consisted of tax cuts. (It’s a little surprising that Obama doesn’t hit this point more often. According to PolitiFact, after all, he can accurately say that the stimulus cut taxes for 95 percent of American working families.)

For more detail, check out this handy NYT breakdown of how the stimulus was spent based on Congressional Budget Office data. And here’s Michael Grunwald’s memorable story for us about the dramatic impact the stimulus is having on America.

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  • nflfoghorn

    Ah, yes. HW’s “vision thing.”
    Why won’t BO talk about the tax cuts? Or has he been and he’s just being ignored??

  • destor23

    I think he’s said the 95% line quite a bit. The problem with the tax cut arguments is that they weren’t exactly huge. Most people saw their taxes go down but I don’t think they really got a notable boost in income out of it. In many cases people saw their federal taxes drop but the money was eaten up by increasing property taxes, increasing fees for local government services and increasing local income and sales taxes, not to mention increasing insurance premiums.

    It’s like getting a raise at work the same week your rent goes up. You would have been worse off without the raise but you don’t feel all that much better.

  • kevin

    It’s also the way people got the tax cut.
    .
    With Obama, it was a quietly rolled out reduction in payroll taxes that most people probably didn’t notice and whose effect was muted by coming in biweekly or monthly installments.
    .
    With Bush, it was a single $300-$1200 rebate check — one that was issued with great fanfare, but only after the IRS spent $42 million to send all Americans a letter announcing that the check would be coming and that they should be sure to thank George Bush for the favor.
    .
    http://www.msnbc.msn.com/id/23525100/
    .
    I guess voters would think Obama was saving them money too if he wasted $42 million bragging about it.

  • http://phd9.blogspot.com Paul Dirks

    Cutting lots of taxes spread across the entire population has a significantly less dramatic effect than directly hiring people who are unemployed. But alas we are still all adherents to the Church Of Reagan.

  • shepherdwong

    Cutting lots of taxes spread across the entire population has a significantly less dramatic effect than directly hiring people who are unemployed.

    What are you, some kind of dirty f@cking hippie?

  • shepherdwong

    Thanks for writing this, Mr. Crowley. A day late and a dollar short, I suppose, but thanks just the same.

  • allthingsinaname

    Don’t bother me with facts.

  • http://derekg.wordpress.com/ Derek

    “It’s a little surprising that Obama doesn’t hit this point more often. ”

    I imagine he is embarrassed by it and by the total inadequacy of his centrist defined, stimulus program, which is almost a complete failure.

  • allthingsinaname

    Much like the total inadequacy of your progressive(?) defined rant. I think I would be embarrassed by it.

  • http://derekg.wordpress.com/ Derek

    allthingsinana…you sell yourself short when you cling to insult as an argument form. You are a lot smarter than that.
    .
    I certainly hope examining the unemployment rate, or looking at real monthly job growth numbers, is not now considered the sole domain of radical progressives, whatever they are? How else are you supposed to measure a job creation program?

  • textee

    Krugman, Crowley, every other political activist at Time magazine and every other political activist in the Washington/New York/American press corps think that giving taxpayer money to those who pay no federal income tax is a “tax cut”. In fact, those “tax cuts” were welfare payments and Obamist/collectivist redistribution of wealth.

  • fhmadvocat

    I have got news for you, textee. Everyone who works in this country pays taxes, whether it is directly by income taxes or indirectly by the federal payroll tax. It does not matter, the effect is just the same.

    In truth, income taxes are the only non-regressive form of taxes. Other taxes don’t take into account the income of the taxpayer.

    As far the “redistribution of wealth”, if that is the case, why does Warren Buffett point out that he pays a lower percentage of his income in total taxes compared to his secretary?

  • shepherdwong

    Krugman, Crowley, every other political activist at Time magazine and every other political activist in the Washington/New York/American press corps think that giving taxpayer money to those who pay no federal income tax is a “tax cut”. In fact, those “tax cuts” were welfare payments and Obamist/collectivist redistribution of wealth.
    .
    Why don’t you save yourself the time of constantly listing everyone you don’t believe (except FOX) and just refer to them as “the sane”. The “tax cuts” were reductions in the amount of taxes just about everyone pays. Idiot.

  • allthingsinaname

    Does it only work one way Derek? I only voiced my opinion of your comment, like you voiced your opinion of Obama and his policies.
    .
    I understand your frustration; I disapprove of your over simplified complaint. Did you even read the post and the links?
    .
    Yes we could have thrown more money at the problem and even had some short term gains and perhaps saved many Democrats, most of whom you don’t like anyway, but in the long run I believe we would be in this mess again shortly. It would have been a band aid.
    .
    I believe that we have a fundamental problem with the workers and management today. I sincerely believe that there are too many in both positions that are in it to get what they can out of it for the least amount of effort and could care less who suffers for it.

  • http://derekg.wordpress.com/ Derek

    If you have a problem with something I have said why don’t you address the content of my statements, explain why I am wrong, offer a better alternative and backup your alternative with some facts. Simply referring to my comments as a “rant” is analogous to what the freepers do who believe calling someone a “libtard” is a form of argument.

  • allthingsinaname

    Because it was a rant. You didn’t offer a better alternative to the stimulus other than throw more bucks at it. I did address the the the content of of your comment; it was inadequate.
    .
    You didn’t like, or found fault with my comment? Well I am surprised, as My comment was just a the same as yours but with the names changed.

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