According to the history books and the facts at hand, FDR, in 1937, attempted to follow economic orthodoxy at that time and attempted to balance the budget... to get a bit away from Keynesian 'prime the pump' government spending policy, this being after the Great Depression had been churning on for about seven years and with his presidency since 1932 -- five years as his responsibility. Accordingly, FDR adjusted his economic policies to stimulate the economy further after the recession of 1937, and things began to change for the better. Demand-side economics, or Keynesianism had won the day,
"Official thinking on what was proper in fiscal policy underwent considerable modification in FDR's second term. In early 1937, Roosevelt still sought to submit a balanced budget (defined the old-fashioned way) for the next fiscal year. The objective seemed reachable without undue strain. After all, 1936 had been a good year, the best since 1929, and the momentum of recovery appeared solidly established. That upbeat mood was rudely punctured in August 1937, when the economy went into an unanticipated tailspin. Production and employment fell more precipitously than they had following the stock market crash of October 1929. This sudden reversal of fortunes was perplexing. Business-cycle theorists of the time were at a loss to explain why a downturn should occur when the economy was operating at a level far short of its capacity.
The intellectual challenge posed by the recession of 1937-38 inspired the formulation of a new "model" with fresh implications for the government's economic role. Unlike the earlier claimants for FDR's attention, economists that the New Deal had brought to Washington, not eminent professors at the nation's leading universities, had developed this new mode of analysis. Prominent among these economists was Lauchlin Currie -- a 1934 refugee from Harvard, where his sympathies for New Deal experimentation had not endeared him to the academic establishment -- now on the research staff of the Federal Reserve Board.
The new model focused on links between the government's fiscal operations -- specifically the "net contribution of government to spending" -- and economic performance. Currie's post- mortem on the 1937-38 recession drew attention to the fact that the government had been distinctly stimulative in 1936, due to the payout of the Veterans' Bonus, a once-and-for-all transaction. In 1937, the impact of governmental fiscal operations reversed direction. Nothing replaced the stimulus provided by the transfer payments to veterans. Meanwhile, government had shrunk private purchasing power by beginning the collection of payroll taxes to fund the Social Security system, which was not scheduled to make regular distributions to beneficiaries until 1942.
The analyses generated by Currie and fellow governmental insiders seemed to provide a plausible explanation for the onset of recession. They also suggested that the way in which government deployed its taxing and spending powers was a significant determinant of the level of economic activity. This point of view is often associated with the analysis presented by John Maynard Keynes in his General Theory of Employment, Interest, and Money, which appeared in 1936. But a similar mind-set emerged in the United States, quite independently, as a by-product of the struggle to comprehend the recession of 1937-38. And its persuasive power was enhanced by the fact that it was expressed with an American accent. "
(Federal Reserve Bank of Boston, Regional Review)
FDR's Big Government Legacy
Summer 1997
by William J. Barber
My impression so far when they say "regulatory reforms" is he is just talking about leveraging ratios versus actually putting a spotlight on the shadow banking system once and for all and they are talking about one huge agency instead of alphabet soup agencies to streamline regulation.
I sure don't hear anything about hedge funds or regulation of the derivatives market. I could be wrong of course.
Further, although regulation has to focus first on the stability of the core of financial institutions, it cannot be indifferent to the scale of leverage and risk outside the regulated institutions. That said, the Fed official does not believe it would be either desirable or feasible to extend capital requirements to hedge funds or private equity firms. But, at the same time, regulators cannot be indifferent to the scale of leverage and risk that exists outside the regulated financial institutions.
So to me that says yeah, they might look at leverage but I don't see how specifically that tackles derivatives and these unregulated markets.
Since Rubin (this guy is a Rubin clone) was one of the main people who fought to have the Enron rule as well as the Gramm legislation, I sure don't feel confident that they are going to do a true FDR regulatory reform here.
I mean has anyone even heard mention the repeal of the Commodity Futures Modernization Act (Phil Gramm), which allows all of this unregulated CDSes, hedge funds, private equity?
I would not be surprised in the least that someone read this blog and picked up on the titling, even when you're 2nd. I've seen other catchy phrases magically appears on TV via some pundit or expert that have been on here.
I haven't chased them down on who was first or who said what but I have seen this.
If you wrote the piece on DK then it's even more possible for they have more readers than CNN.
On here your Panic of 2008 is the most read blog piece on the entire site (see Vox Populi).
That is what it takes to pull us out of depression, jump start industry in the US, regain all those jobs lost to offshoring, Free Trade Authorities, OPIC, EX-IM, World Bank financing and indemnification of US industries to layoff hundreds of thousands of US workers and create factories in Mexico, India, China, Brazil, etc.
Think 1929. History is repeating itself.
What do you think "Fair Trade" is? Our industries must be protected from foreign slave labor, Communist supported industries that have only economic warfare on their agenda, and erosion of national sovereignty by economic invasion.
How do you think this would be achieved without "protectionism"?
The Secret Tech Lobbyists Don't Want You to Know
Post a message to Obama to let him know that you are in on the secret – and that you demand CHANGE http://www.change.gov/page/s/yourvision
Here’s the secret: the H-1b law doesn’t require employers to seek local talent or even certify that they considered the US workforce before recruiting abroad:
In a letter dated April 1, 2008 Senators Durbin and Grassley, who had introduced bipartisan legislation last year to prevent H-1B and L-1 Visa abuses, wrote to the top 25 recipients of H-1B visas in 2007,
"Most companies can explicitly discriminate against American workers by recruiting and hiring only H-1B visa holders. As the U.S. Department of Labor (DOL) has said:
'H-1B workers may be hired even when a qualified U.S. worker wants the job, and a U.S. worker can be displaced from the job in favor of a foreign worker.'”
Jesus Christ, they list the banks getting even more money. This is just unreal, these people are determined to run the United States into the ground, into the realm of "no more".
I kept trying to point to this in the primaries that in spite of Hillary being Bill's spouse, Obama was out Clintoning the Clintons in policy positions, political paybacks (this is one, he got her to switch as a super delegate) and strange as it might seem that Obama was more of a Clinton than Hillary was.
Few believed me, yet here we are.
Obama also out "punajabed" Hillary during the primary and promised NASSCOM more US jobs.
Of course Hillary also promised massive guest worker Visas and so on but in the primary she did acknowledge problems, wage repression, displacement...
But watching Obama morph into Bill more than Billary...
well, it's like the other woman really is Obama (only in a political sense mind you!).
I guess who ever gets the money starts spewing the corporate lobbyist talking points.
Just a side note, I'm now also checking out blogs, comments and overall this is the common comment, that the entire change message was an absolute joke, a ruse and just simple marketing to get elected.
People are really pissed now they realize the only thing changed was the name and face on the Presidency versus real dramatic policy shift.
* We need to ensure there is a stronger set of shock absorbers, in terms of capital and liquidity, in those institutions, banks and a limited number of the largest investment banks, that are critical to market functioning and economic health, with a stronger form of consolidated supervision over those institutions.
* We need to substantially simplify and consolidate the regulatory framework, to reduce the opportunity for regulatory arbitrage, not just in the mortgage market, but more broadly.
* We need to make the financial infrastructure more robust, particularly in the derivatives and repo markets, so that the system can better withstand the effects of default by a major participant.
* We need to redesign the set of liquidity facilities that we maintain in normal times, and in extremis, in the United States and across other major central banks. And these changes will have to come with a stronger set of incentives and requirements for the management of liquidity risk by financial institutions with access to central bank liquidity.
* And we need to make sure that the Federal Reserve has the mix of authority and responsibility to respond with adequate speed and force to the prospects of systemic threats to financial stability.
hmmmmm, nothing about regulation really and giving the Federal Reserve more power?
I found a good blog piece overviewing his views/agenda on regulation.
Note not regulating hedge funds and so on but requiring a percentage lack of exposure.
hmmmm.....
In Mr. Geithner’s view, current US financial regulation must be completely overhauled since that system is a confusing mix of diffused accountability, regulatory competition, and a complex web of rules that creates perverse incentives and leaves huge opportunities for arbitrage and evasion. It also has created the risk of large gaps in the knowledge and authority of financial regulators.
Further, although regulation has to focus first on the stability of the core of financial institutions, it cannot be indifferent to the scale of leverage and risk outside the regulated institutions. That said, the Fed official does not believe it would be either desirable or feasible to extend capital requirements to hedge funds or private equity firms. But, at the same time, regulators cannot be indifferent to the scale of leverage and risk that exists outside the regulated financial institutions.
There is no such thing as anyone running on "protectionism", that is a pure public relations made up term by the lobbyists and their multinational corporate agendas.
True "protectionism" has tariffs, big tariffs and no one is even remotely suggesting that in terms of fair trade policy agenda.
Of course that will wear off real quick. How wonderful he was involved in handing over huge money to AIG and the bail out, the biggest financial rip off in recent history.
So, we're keeping the ponzi scheme going then?
Richardson is yet another corporate tool.
So it's looking like multinational corporations and their lobbyists win, Progressives - squeezed out. Populists - probably banned from D.C.?
How about Hillary? Notice that if she is Secretary of State then that would shut her down completely on health care, domestic issues.
and their overpopulation and India's is just not my concern either. They need to address it, China has, India...well, not exactly. It's true because they are way over populated, 1.3 billion China, about 1 billion India, they are way more vulnerable in down times due to the large raw numbers of people.
In terms of the U.S. becoming overpopulated that can happen also and seemingly policies are determined to make that happen at this growth rate through illegal and legal immigration.
True is China and India are slated to take over the United States so those horror stories of famine, economic calamity might be more applicable here and in terms of land that can produce agriculture, one might be especially leery of war against the United States to gain control of those lands...
although considering the U.S. is getting cremated economically I think China and India have already won the war through economic means.
The United States right now has people going hungry, millions of homeless. Literally the United States has Doctors without borders setting up Clinics periodically for free medical care and they cannot take care of all of the people who show up.
There is a mind set that somehow the United States will never be 3rd world or that these 3rd world countries still are 3rd world. They plain are not anymore. Their PPP is right below the United States, their GDP is expected to exceed the United States very soon.
As it is the United States has greater economic inequality than India and will probably exceed China and only Latin America will have more income inequality.
So, instead we might be looking for humanitarian aid from these countries for the United States.
According to the history books and the facts at hand, FDR, in 1937, attempted to follow economic orthodoxy at that time and attempted to balance the budget... to get a bit away from Keynesian 'prime the pump' government spending policy, this being after the Great Depression had been churning on for about seven years and with his presidency since 1932 -- five years as his responsibility. Accordingly, FDR adjusted his economic policies to stimulate the economy further after the recession of 1937, and things began to change for the better. Demand-side economics, or Keynesianism had won the day,
"Official thinking on what was proper in fiscal policy underwent considerable modification in FDR's second term. In early 1937, Roosevelt still sought to submit a balanced budget (defined the old-fashioned way) for the next fiscal year. The objective seemed reachable without undue strain. After all, 1936 had been a good year, the best since 1929, and the momentum of recovery appeared solidly established. That upbeat mood was rudely punctured in August 1937, when the economy went into an unanticipated tailspin. Production and employment fell more precipitously than they had following the stock market crash of October 1929. This sudden reversal of fortunes was perplexing. Business-cycle theorists of the time were at a loss to explain why a downturn should occur when the economy was operating at a level far short of its capacity.
The intellectual challenge posed by the recession of 1937-38 inspired the formulation of a new "model" with fresh implications for the government's economic role. Unlike the earlier claimants for FDR's attention, economists that the New Deal had brought to Washington, not eminent professors at the nation's leading universities, had developed this new mode of analysis. Prominent among these economists was Lauchlin Currie -- a 1934 refugee from Harvard, where his sympathies for New Deal experimentation had not endeared him to the academic establishment -- now on the research staff of the Federal Reserve Board.
The new model focused on links between the government's fiscal operations -- specifically the "net contribution of government to spending" -- and economic performance. Currie's post- mortem on the 1937-38 recession drew attention to the fact that the government had been distinctly stimulative in 1936, due to the payout of the Veterans' Bonus, a once-and-for-all transaction. In 1937, the impact of governmental fiscal operations reversed direction. Nothing replaced the stimulus provided by the transfer payments to veterans. Meanwhile, government had shrunk private purchasing power by beginning the collection of payroll taxes to fund the Social Security system, which was not scheduled to make regular distributions to beneficiaries until 1942.
The analyses generated by Currie and fellow governmental insiders seemed to provide a plausible explanation for the onset of recession. They also suggested that the way in which government deployed its taxing and spending powers was a significant determinant of the level of economic activity. This point of view is often associated with the analysis presented by John Maynard Keynes in his General Theory of Employment, Interest, and Money, which appeared in 1936. But a similar mind-set emerged in the United States, quite independently, as a by-product of the struggle to comprehend the recession of 1937-38. And its persuasive power was enhanced by the fact that it was expressed with an American accent. "
(Federal Reserve Bank of Boston, Regional Review)
FDR's Big Government Legacy
Summer 1997
by William J. Barber
http://www.bos.frb.org/economic/nerr/rr1997/summer/barb97_3.htm
They try to paint it as bad and it also means tariffs which most trade refomers are not saying.
The idea is strategic trade, and tariffs can start trade wars, shut down trade and that will hurt a domestic economy in a global one.
So, what most good trade reform people are saying is the U.S. is a loser for it's national economy and it's citizens..
so our corporate pundits call us protectionists trying to scare people in thinking this means tariffs and it does not.
I wrote and entire blog piece on this, which has gotten a lot of reads.
But unfortunately because people do not understand trade theory or what's going on in depth with those agreements, still we get this false argument.
Geithner as Treasury Secretary has some of his testimony and opinions either in the piece of in comments.
My impression so far when they say "regulatory reforms" is he is just talking about leveraging ratios versus actually putting a spotlight on the shadow banking system once and for all and they are talking about one huge agency instead of alphabet soup agencies to streamline regulation.
I sure don't hear anything about hedge funds or regulation of the derivatives market. I could be wrong of course.
So to me that says yeah, they might look at leverage but I don't see how specifically that tackles derivatives and these unregulated markets.
Since Rubin (this guy is a Rubin clone) was one of the main people who fought to have the Enron rule as well as the Gramm legislation, I sure don't feel confident that they are going to do a true FDR regulatory reform here.
I mean has anyone even heard mention the repeal of the Commodity Futures Modernization Act (Phil Gramm), which allows all of this unregulated CDSes, hedge funds, private equity?
I would not be surprised in the least that someone read this blog and picked up on the titling, even when you're 2nd. I've seen other catchy phrases magically appears on TV via some pundit or expert that have been on here.
I haven't chased them down on who was first or who said what but I have seen this.
If you wrote the piece on DK then it's even more possible for they have more readers than CNN.
On here your Panic of 2008 is the most read blog piece on the entire site (see Vox Populi).
I am proposing "protectionism", absolutely!
That is what it takes to pull us out of depression, jump start industry in the US, regain all those jobs lost to offshoring, Free Trade Authorities, OPIC, EX-IM, World Bank financing and indemnification of US industries to layoff hundreds of thousands of US workers and create factories in Mexico, India, China, Brazil, etc.
Think 1929. History is repeating itself.
What do you think "Fair Trade" is? Our industries must be protected from foreign slave labor, Communist supported industries that have only economic warfare on their agenda, and erosion of national sovereignty by economic invasion.
How do you think this would be achieved without "protectionism"?
Dana
Globalization is a LIE!
The Secret Tech Lobbyists Don't Want You to Know
Post a message to Obama to let him know that you are in on the secret – and that you demand CHANGE
http://www.change.gov/page/s/yourvision
Here’s the secret: the H-1b law doesn’t require employers to seek local talent or even certify that they considered the US workforce before recruiting abroad:
In a letter dated April 1, 2008 Senators Durbin and Grassley, who had introduced bipartisan legislation last year to prevent H-1B and L-1 Visa abuses, wrote to the top 25 recipients of H-1B visas in 2007,
"Most companies can explicitly discriminate against American workers by recruiting and hiring only H-1B visa holders. As the U.S. Department of Labor (DOL) has said:
'H-1B workers may be hired even when a qualified U.S. worker wants the job, and a U.S. worker can be displaced from the job in favor of a foreign worker.'”
Durbin's letter
http://durbin.senate.gov/showRelease.cfm?releaseId=295338
http://www.dailykos.com/storyonly/2008/11/20/111927/07
http://www.facebook.com/ext/share.php?sid=34206479483&h=6rJ7e
http://www.h1bfacts.com
http://www.brightfuturejobs.com/blog/index.cfm?Fuseaction=ViewBlog&BlogT...
Update #6: even with a new administration, not even a term in office will be enough catapult our country to economic prominence.
Get a non-interest bearing "transaction" account?
Jesus Christ, they list the banks getting even more money. This is just unreal, these people are determined to run the United States into the ground, into the realm of "no more".
I kept trying to point to this in the primaries that in spite of Hillary being Bill's spouse, Obama was out Clintoning the Clintons in policy positions, political paybacks (this is one, he got her to switch as a super delegate) and strange as it might seem that Obama was more of a Clinton than Hillary was.
Few believed me, yet here we are.
Obama also out "punajabed" Hillary during the primary and promised NASSCOM more US jobs.
Of course Hillary also promised massive guest worker Visas and so on but in the primary she did acknowledge problems, wage repression, displacement...
But watching Obama morph into Bill more than Billary...
well, it's like the other woman really is Obama (only in a political sense mind you!).
I guess who ever gets the money starts spewing the corporate lobbyist talking points.
Just wonderful. More center-right Clintonesque politics from the Democrats.
The left-wing of this country will continue to be ignored.
Just a side note, I'm now also checking out blogs, comments and overall this is the common comment, that the entire change message was an absolute joke, a ruse and just simple marketing to get elected.
People are really pissed now they realize the only thing changed was the name and face on the Presidency versus real dramatic policy shift.
located on NY Fed site.
hmmmmm, nothing about regulation really and giving the Federal Reserve more power?
I found a good blog piece overviewing his views/agenda on regulation.
Note not regulating hedge funds and so on but requiring a percentage lack of exposure.
hmmmm.....
There is no such thing as anyone running on "protectionism", that is a pure public relations made up term by the lobbyists and their multinational corporate agendas.
True "protectionism" has tariffs, big tariffs and no one is even remotely suggesting that in terms of fair trade policy agenda.
Then who will want to be an engineering or science professional?
Of course that will wear off real quick. How wonderful he was involved in handing over huge money to AIG and the bail out, the biggest financial rip off in recent history.
So, we're keeping the ponzi scheme going then?
Richardson is yet another corporate tool.
So it's looking like multinational corporations and their lobbyists win, Progressives - squeezed out. Populists - probably banned from D.C.?
How about Hillary? Notice that if she is Secretary of State then that would shut her down completely on health care, domestic issues.
41 new Senators ran on fair-trade protectionism campaigns- and a 42nd is up in a runoff election today in Georgia.
That's more and more what it's looking like. Straight globalization, multinational corporations running the show DLC agenda.
God. I just hope you uncover some huge blow out against Robert Rubin and his Hamilton Project gang but I sure doubt it!
and their overpopulation and India's is just not my concern either. They need to address it, China has, India...well, not exactly. It's true because they are way over populated, 1.3 billion China, about 1 billion India, they are way more vulnerable in down times due to the large raw numbers of people.
In terms of the U.S. becoming overpopulated that can happen also and seemingly policies are determined to make that happen at this growth rate through illegal and legal immigration.
True is China and India are slated to take over the United States so those horror stories of famine, economic calamity might be more applicable here and in terms of land that can produce agriculture, one might be especially leery of war against the United States to gain control of those lands...
although considering the U.S. is getting cremated economically I think China and India have already won the war through economic means.
The United States right now has people going hungry, millions of homeless. Literally the United States has Doctors without borders setting up Clinics periodically for free medical care and they cannot take care of all of the people who show up.
There is a mind set that somehow the United States will never be 3rd world or that these 3rd world countries still are 3rd world. They plain are not anymore. Their PPP is right below the United States, their GDP is expected to exceed the United States very soon.
As it is the United States has greater economic inequality than India and will probably exceed China and only Latin America will have more income inequality.
So, instead we might be looking for humanitarian aid from these countries for the United States.
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