Dean, you gotta make sure Obama reads this before he hits all the major networks to sell his package.

Stimulus Spin War: Obama To Go On Media Offensive

Sorry Dean, the term "stimulus" is widely recognized to mean "positive economic stimulus". Not "phony job number stimulus". If the government took all the "stimulus" money and paid people to dig holes and then fill them back in, we would have a "phony job number stimulus," and a "negative economic stimulus", but no "positive economic stimulus."

I don't think "stimulus" can have anything to do with "negative".

Your digging holes example is equivalent to wasteful spending at the Pentagon. Does spending at the Pentagon not stimulate the economy?

Mike, what if the government paid everyone $500,000 in exchange for cutting their spending this year in half. That would be government spending, but would that stimulate the economy?

In economics, there are few opportunities to conduct actual experiments, but I think Lord Keynes has suggested one. Why don't we actually take a Billion dollars, in fifty dollar notes and in gold and silver coin, and place it in various old mines in Pennsylvania and West Virginia, bury it, and announce that it is there and where approximately people will have to dig for it. Then we can acutally see if economic activity that would not otherwise exist is created and we could find out out if, through the multiplier, exceeds a billion dollars spent. I am pretty confident that Keynes is right, but this experiment would prove it one way or the other.

Sure Rick; using that energy to dig for the money might make the people hungry, and the demand for food might go up. The nation's food production numbers might go up in turn. People might consumer more gasoline to get to the mines. Oil companies would be happy. But since the extra food and gas was only needed to perform extra, unnecessary work, it isn't a real boost to the economy; it may technically boost a phony number like GDP, but it isn't a boost to anything else.

Bubble, that sounds like a pretty ridiculous and unlikely example. But if people can't spend it, then I guess they put it in the bank, and now banks have all kinds of money to loan to people (since they can't spend their own money, I guess they need to take out loans to make ends meet), and then we'd stimulate the economy that way.

Forget about a $9 trillion dollar stimulus spending program and instead raise the unemployment insurance payments to around the national medium income level of about $40,000.00 a year. For 12 million unemployed it will cost about half as much as the stimulus and we can see after a year whether or not stimulus program actually works. In the meantime we will have bailed out a lot of people.

Correction. Should read" Forgret the $0.9 trillion dollar stimulus..."

I don't think most reporters know their economic future is on the line.

Spending is stimulus sounds like a useless operationalo definition.

I can invent many spending programs which will create one job on day one and destroy two jobs on day two. It meets your definition but operationally is not the spending we want.

Dean,

I don't know exactly what was said (on what you are commenting) because you provide no link, but I think that when people say "X won't provide stimulus" they mean that it won't provide stimulus during the recession (obviously with an inherent assumption of when the recession will end). If one assumes, for example, that the recession will be over by the end of Fiscal 2010, then spending that will occur after that time (but which is enacted now) would be considered not "stimulus" per this vernacular, even though, at least in itself, it obviously does provide stimulus per the actual definition of the word.

Also, although I'm guessing this is not what was meant by those referring to some spending as not stimulus, one can, of course, argue that the net effect of some particular spending is non-stimulative, after considering the negative effects of either higher taxes to pay for that spending or higher interest rates caused by higher debt due to that spending (or the combination of the two).

Lastly, it's possible (and again, you provided no link, so this is just conjecture) that they didn't mean literally no stimulus, just little/negligible stimulus.

Please provide link.

Matt, I'd like to see some of your examples.

Brooks, http://www.npr.org/templates/story/story.php?storyId=100174153

Dean,

FALSE CHARGE BY YOU! I just listened to the NPR piece (thanks to the link provided by Mike Ryan, NOT by you -- hmmm, just an oversight on your part?).

NPR attributes the terms "non-stimulus" (in it's write-up) and "not truly stimulative", but nowhere in the segment does any Senator use such a term. Yet your headline refers to "Senators Who Complain About Spending That is Not Stimlus"

The closest to such a comment is from Democrat Kent Conrad, who expresses a desire to "reduce things that have less value in terms of stimulus and investment". That is categorically different from the straw man you put in their mouths -- an absolute statement that some spending provides no stimulus at all.

So you put words in their mouths and then ridicule them for saying things something that they didn't say. Remind me: this is a site supposedly dedicated to exposing false reporting (not originating its own), right??

Dean, any chance you'll admit your error, particularly given the supposed mission of this blog?

Once again it seems there is a need for a "Beat Beat the Press" blog. I don't have time to do such a concept justice, but it would be a noble public service.

I was kind of half-asleep when I heard this but Welna really sounded like he was just going down the list of GOP/Conservative commentators in perfect 'he said-she-said' fashion.

You'd never know that these were the people who put us in this mess to begin with and who, for their efforts, the American People rewarded by tossing them out of office, thus reducing their number to a marginal (albeit politically extreme) minority.

Every interview with people like this should make that clear. It's only fair.

Spending is stimulus but there are still pertinent questions
When the spending occurs?
How productive will the spending be?

There are important distinctions in the effect government spending will have on supply and demand. If the government starts hiring people to make widgets, this will have an effect on the widget market and while widgets may become somewhat cheaper, probably a lot of people will lose their jobs in the private widget industry. In other words, government spending can displace private industry if it is directed to consumer products for which there is already adequate supply. This may be good for socialists and bad for free-marketers, but it is essentially neutral economically and not stimulative.

Of course those who designed the stimulus package know this, and the spending is directed to infrastructure and other things which do not compete directly with private industry. As Dean says, many of those who are criticizing the stimulus package do not know this or much else about the subject, and object to things which would actually stimulate and otherwise get things completely backwards

Keynes knew what he was talking about when he suggested burying money in jars so people could dig it up, and so did Bernanke when he said he would distribute money from helicopters. In a recession, these things would actually be better than hiring people to make things which private industry is already making or has the capacity to make. Of course hiring people to build or repair bridges, windmills, etc. is better than either as it has long-term economic benefits. Although the US system is described as free-enterprise, it does not depend on private industry to do infrastructure.

So, in a recession:

Government spending on making consumer products or giving money to private industry to make consumer products: BAD

Government spending on things with no economic value but which do not increase consumer supply, such as digging holes, war and military items in general: BETTER

Government spending on infrastructure which is absolutely necessary for economic development: BEST

Dean,

As follow-up to my previous comment, Sen. McConnell also refers, in his full quote, to parts of the package "that won't put people to work right now." Again, not at all the same as the absolute statement that you attribute to "senators", even by different terms.

MissingTheHousingBubble, you are completely missing the point:

If you pay people to dig holes and then fill up those holes, you will create more than just those jobs. The people who dig the holes will then use their paychecks to go buy groceries, clothes, and dvd players. As long as those things don't all come from overseas, that will create jobs in the United States. And those jobs will in turn create more jobs.

The only spending that is not stimulus is spending where people put the money in their mattresses.

Why some of the specific objections of Senators raised in the NPR piece are ill-informed or otherwise bad:

1) Tax cuts do not directly address the major problem in recession/depression, which is workers and businesses dropping out of the economy. Plain and simple, tax cuts are pushed for the purpose of allowing rich people to keep more money. Republican Senators claim to be arguing for tax cuts as opposed to spending on ideological or economic grounds, but it's really a matter of who gets the money.

2) As Dean has said over and over, reinflating the housing bubble is a bad idea for many reasons. He has been suggesting other solutions to the problems of people with unworkable mortgages for many years.

Mr. Baker -

I had hoped that by commenting on a liberal site that there could be an intellectual exchange on ideas. I actually liked the pointed commentary that you provided.

That said, there is never any follow up, in fact I would state that there is a concerted effort to ignore economically inconvenient facts.

I would like to thank you for allowing me to post even though I disagreed with you - you have never deleted my comments.

This is my last post.

Thanks.

"using that energy to dig for the money might make the people hungry, and the demand for food might go up"

The income of the people who dug up the money would go up. They would spend most of that income. This would increase the revenue of the firms they buy the goods from and create jobs for the workers that produce the goods. Therefore their income would go up and they would spend most of their income. This would create more revenue for the firms and jobs for workers, etc, etc, etc.

Even totally wasteful expenditures, like the infamous Bridge to Nowhere, since building it would require workers to be hired and paid provides an economic stimulus.

Brooks, it sounds like you're referring to the AP article NPR included w/ a link to the broadcast, which is not a transcript of NPR's piece.By the way I *think* this is what Baker is referring to. All I did was a search on NPR's site for "stimulus Republicans" or something similar which aired today.

Mike, what if the government paid everyone $500,000 in exchange for cutting their spending this year in half. That would be government spending, but would that stimulate the economy?

Posted by: MissedTheHousingBubble

Wow, could you think of a more inane scenario? Government spending stimulates the economy, because it puts money in the pockets of people...now get this MTHB...who will spend it!

Now your "hole-digging" example wouldn't be the best method of stimulus - workers wouldn't be producing anything tangible - but the spending would create some stimulus.

The reason that the Democrats got outspun is that they let the Republicans get away with creating a false distinction between spending and stimulus. They made the mistake of not vigorously defending the expenditures which the Republicans mislabeled as "pork" and for which they falsely claimed that they would not provide a stimulus, like, for example, the fanily planning expenditure and the plan to repair the Mall in D.C., both of which would have been highly stimulative.

The truth is that any expenditure that results in workers being employed and paid brings about an economic stimulus. To regain control of the debate, the Democrats have to harping on this fundamental point.

The ONLY wasted stimulus money is that given to banks. (even bankers KNOW that bankers can't be trusted anymore.)

All we have to do is look at some of the projects undertaken during the GD to see what stimulus can include. One project went to prisons in the South to record African American work songs--many of which descended from slave times. Another was an oral history project that found the few remaining African Americans who had been born in slavery. Most of the interviewees were slaves as children, but our knowledge base is greater for having those stories.

I think it very likely that those who produced this work stimulated the economy just as much as those who built dams, improved roads and constructed park facilities. The Republicans just don't like spending money on arts, health care and the like.

People who have been talking about wasteful government spending for decades are afraid to oppose the very idea of a stimulus. So they come out in favor of the stimulus while still opposing government spending. They can only do this because they don't think at all, but just get by by mouthing slogans.

My hopeless, clueless Congressman, Collin Peterson, is talking about "paygo" now.

Mr. Bubble is just noise.

John Emerson has it right. And it's so easy to see what happened here. The GOP saw the title of HR 1, The American Recovery and Reinvestment Act and knew that they would lose the framing battle. So they started pretending that there is a real difference b/t spending and stimulus. Stimulus = good. Spending = bad. It's all nonsense but they have stayed on that message from the day they thought it up, successfully burying the idea of investment and recovery, which is what the country needs.

They win. They always win this sort of battle b/c they are unified, slavishly devoted to one message and they get more chances to spread their messages than the Dems do in the MSM. If only they could govern even a thousandth as well as they spin, we'd be in okay shape. But they can't and we're in the hole we're in today because of that.

Does spending at the Pentagon not stimulate the economy?

It does, but it doesn't create lasting jobs, or productive economic activity.

Paying people to build roads or pyramids or whatever is fine, but taking money from productive activities to fund activities which may or may not be productive and sustainable on their own is not a long-term path to prosperity.

Mike,

Re: Brooks, it sounds like you're referring to the AP article NPR included w/ a link to the broadcast, which is not a transcript of NPR's piece

No, I listened to the accompanying audio (the NPR segment), and that is to what I was referring regarding the Senators' comments (and supposed comments that did not really exist in the segment). The only exception is when I referred to NPR referring to "non-stimulus", which appears in the NPR overview that appears above the AP story.

Mike,

Above comment (1:49pm) was me (Brooks).

Also, you had the correct link. I see that Dean has now included it in his post.

eRobin, I disagree that the Republicans are winning the spin battle. In fact, I think that because they will be viewed by most people as being obstructionist in the face of the ecomomic crisis, any good points they MIGHT actually be making will be lost if not discredited.

This past Sunday, I heard one of their spokesmen, Sen. DeMint, say on one of the TV talk shows, that government spending is almost always bad, that we should instead rely mainly on the "private market." RIGHT! The same "private market" that, IMHO, most people think has only just RUINED the economy. To the extent that this position is a subtext of the "stimulus vs. spending" fram --- and I think it IS --- it further undermines their supposedly successfil spin.

Addendum: though I strongly disagree with most of the critics of Dean's viewpoint, I appreciate greatly Dean's allowing such folks to freely have their say.

EconDumbo (and Dean),

Yes, I always give Dean credit for allowing even harsh criticism of his posts.

It's more than I can say for Mark Thoma, Brad DeLong, or the censors at Angry Bear, RedState, and a spinoff of RedState (whose name I won't mention because I don't want to raise awareness of it and thereby help their traffic). With the exception of DeLong, who deletes comments without any explanation or notification of others of a deletion, these other blogs usually delete comments and ban participants under some absurd pretext (such as inappropriate tone, based on a blatant double standard), rather than honestly saying that it is because they don't want tough challenges on their insular, hyperpartisan blogs.

More welfare and unemployment checks for a long time.

Or spending to create jobs, build infrastructure, educate, train and prepare the workforce for the future.

This is the choice.

Why should the rest of the country be hostage to a bunch of Southern know-nothing red necks that want to revive the plantation economy?

The public looks at Republicans like turds in the punch bowl.

I've never caught that... but its obvious. It sounds like a cynical statement but thanks Mr. Baker for pointing out the utterly obvious.

This argument is all over the local media here in the ATL GA.

Brooks:

"FALSE CHARGE BY YOU! .. you put words in their mouths and then ridicule them for saying things something that they didn't say. ... Remind me: this is a site supposedly dedicated to exposing false reporting (not originating its own), right?? ... Dean, any chance you'll admit your error, particularly given the supposed mission of this blog?"

Can't you reserve this kind of over-the-top, saliva-spraying rant for real mistakes instead of nit-picking? The title is "NPR Talks to Senators Who Complain About Spending That is Not Simlus". This blog is about the Press. NPR is the one Dean implies needs to be taken to task for using the phrase: "Critics say the current proposal is loaded with too much non-stimulus spending."

Hey, c'mon. If our blogger makes an error, or forgets a link, let's not assume that he's trying to put one over on us. (And why would he do that, ferhevensake?) Just send a private email and note that he forgot the link or misspelled a word or left something out or whatever.

And I don't think anyone is being forced to read this blog, so if you really think he's dishonest or whatever, you're not required to read it.

The same "private market" that, IMHO, most people think has only just RUINED the economy.

You might want to educate yourself a bit. The Federal government has over 100 agencies and commissions whose sole purpose it is to intervene in the "private market" in one way or another.

The idea that a market facing this much intervention/manipulation is "private" or "free" is ridiculous.

TH and PeonInChief,

I respect the views you've expressed, and your criticism of my criticism is understandable, particularly if you are unfamiliar with the history of much worse misleading assertions and misrepresentations by Dean that I have criticized here on Beat the Press*, most of which contained more than a bit of irony considering the supposed mission of this site.

For what it's worth, my guess is that Dean did not deliberately leave out the link. But he did attribute to U.S. Senators a view that they did not express. And yes, if he was to criticize anyone, it would be NPR for putting words in the mouths of the senators (at least vis a vis the statements of senators they provided in the segment). Dean's headline gives the impression that the attribution by NPR is correct and that the NPR reporter just lacked the wisdom to call those senators on their supposed ignorance. Such a charge is incorrect and quite unfair to those senators, as well as misleading to his readers. And although I would consider any such misrepresentation by a blogger worth criticizing, it is particularly so on a blog whose mission is supposedly the exposure of misleading/false reporting by the press.

Regarding:
I don't think anyone is being forced to read this blog, so if you really think he's dishonest or whatever, you're not required to read it.

Well, of course, no one is forced to read anything. Just as Dean isn't forced to read the press he criticizes. But he considers it important to try to set the public straight (and to advance his political/ideological [and perhaps also personal] agenda -- and when the two come into conflict, I think setting the public straight sometimes takes a back seat on this blog), and so do I. Do you want to go ahead and tell Dean that no one is forcing him to read the press he criticizes, particularly those he criticizes most often (WaPo, NPR, etc.)

* Most notable is Dean's very frequent, gross misrepresentation of the the relationship between Social Security (in particular, SS "solvency") and our overall fiscal imbalance.

wow, I missed all the fun down here. To allay the suspense, I didn't include the link originally because it was not on NPR's site when I wrote the initial post.

They tend to put their material up a bit later in the morning. When I do a post from Morning Edition, I usually try to add the link when it is up, but don't always get around to doing so.

Dean,

Again, you referred in your headline to "Senators Who Complain About Spending That is Not Stimlus"

Any chance you'll admit that you put words in the mouths of U.S. Senators (by implicitly confirming NPR's attribution of such an assertion to the Senators in the segment) and then criticized them (along with criticizing the NPR reporter, not for the misattribution but for not pointing out how wrong those Senators obviously were in their supposed assertions -- the assertions they didn't really make, that is)?

This site is "Beat the Press", right? Dedicated to exposing errors and misleading statements by the press, right? Will you practice what you preach, at least in this one, relatively minor case*?

* I don't expect you to come clean on the much larger, more important matter of Social Security. I've tried many times to get you to discuss it, but on those occasions when you reply, your replies have always been straw men or otherwise irrelevant to the argument I actually made (to the point that it always seems like you don't even read my comments to which you are replying).

Question: if the U.S. government paid workers exorbitant wages to knock out all the windows on corporate offices, would that not "stimulate" the economy? After all, the government would not just be creating the window-busting jobs, but those workers would then spend those wages on goods and services, thus leading to more job creation in other sectors of the economy. Furthermore, all those buildings in need of new windows would energize the nearly-dormant window-making industry, leading to even more economic activity . . . right?

Charlie - It would do all of those things you mentioned. That's the idea behind stimulus.

The question you forgot to ask is where does the government get the money, and how does that effect the economy? Does the negative effect of the government's taxing, borrowing (or printing) outweigh the positive effect of the spending?

Patient Renter, though for different reasons than you, I agree that the "market" is not "free." It is, however, almost exclusively "private."

Great job crushing Cavuto tonight! He doesn't seem constrained by fact or truth, so it was nice that, at least for one segment, some light was shed and FDR's legacy defended.

Jeff,

Dean did indeed make Cavuto look like a fool (with much help from Cavuto himself).

Cavuto had nothing, threw out at least one obvious non sequitur that I can recall, brought up and made a big deal out of an unemployment stat (for 1941 I think) that he was way wrong about and Dean was much closer to right, etc.

Cavuto wasn't clever enough to realize that instead of questioning Dean's premise that government paying people to do useless work (e.g., to dig holes then just fill them back up) is stimulative, he should have asked if it has a net positive impact on our standard of living beyond the short term.

Stimulus is stimulus, yes indeed, but there are qualities and quantities.

Everyone digging holes and filling them up again is high-quantity, low quality. What is the end product? No net gain. You can't sell the hole unless you dig it out again, you can't sell its contents without digging them up. Folks can stand around these holes (dug or filled) and contemplate those assertions while they munch on their carrots. (Hey, What's up, Doc?) Then, they cn go off and watch a DVD of vintage cartoons - the Information Economy version of digging holes and filling them up again. What is really produced here? Food? Shelter? Transport? No, just entertainment - like in a Bugs Bunny Cartoon. Or are those holes we dug and filled worth more because we've seen the dirt in them and put it back?

But if lots of folks dig holes, plant seeds in them and then fill them up again, they are doing high quality high quantity work: tend the hole, and you'll wind up with a feed.

Wouldn't it be nice if the government gave community grants to grow and harvest food in local communities, so that the energy and resource intensive agribusiness and grocery industries had some competition from people who want to show some independence?,

I would go one better Liberal.
ANY executive found to have actively pursued this fraud on the American people will be prosecuted.