Video: The Gingrich-Pelosi food fight

posted at 2:15 pm on October 7, 2010 by Ed Morrissey

Well, it’s not exactly Animal House, but watch what Newt Gingrich does here.  He draws a fairly clear delineation between Democrats and Republicans by calling the former the party of foodstamps and the latter the party of paychecks.  Not only does Newt deride “liberal math” — which we’ll address in a moment — but Newt also underscores how the Democrats have dumped massive uncertainties into the business environment and killed job growth for much longer than necessary in a post-recession period.   It’s as stark a contrast and as memorable a comparison as we’ve seen yet in this midterm cycle:

Pelosi, for her part, continues to insist that food stamps and unemployment stimulate the economy, and claims that every dollar spent in food stamps returns $1.79 to the economy.  She floated this notion earlier this summer while trying to defend more borrowing to pay for yet another extension on jobless benefits rather than funding it through monies already authorized in Porkulus.  That argument assumes that the $1 food stamp in question got plucked off the food-stamp tree at no cost to the government, rather than costing the full dollar plus the administrative costs of distribution and accountability.  Even then, that dollar won’t generate a 79% ROI as it travels through the retail sector; if that were true, investors would put their money into nothing else.

That dollar comes at the expense of private-sector opportunities as well.  I noted that in my rebuttal to Pelosi in July:

  • “This is one of the biggest stimuluses to our economy” — No, it’s a net drain on the economy, although for understandable purposes.  It reroutes capital from production to non-production.  We are paying people who aren’t working by using capital that could otherwise go to creating jobs.  It’s a policy tradeoff and understandable, although not for 99 weeks, which is what Pelosi is attempting to extend further.
  • “It injects demand into the economy” — Not at the rate in which the capital gets destroyed.  Remember, the money for this program gets confiscated from producers and passed through the government bureaucracy to non-producers.  What winds up back in the hands of producers is much less than what left their hands in the first place.
  • “It creates jobs faster than almost any other initiative” — No, it doesn’t.  In fact, it depresses job creation, which is part of the policy tradeoff.  If this was right, we’d be at zero unemployment by now.  Tax cuts, especially on capital gains, creates jobs by getting capital into the hands of job creators.
  • “It’s impossible to think of a situation where we would have a country without unemployment benefits” — That’s not actually the debate.  No one is suggesting that we eliminate all unemployment benefits.  The debate is whether we will keep extending them further.

Gingrich has this correct.  Pelosi and her caucus want an electorate dependent on government handouts.  Republicans want an environment where people get paychecks rather than perpetual welfare and economic vitality rather than stagnation and lost opportunities.


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Awwww from the couch talking about AGW to throwing food due to poor people. Isn’t political love grand!

upinak on October 7, 2010 at 2:17 PM

Gingrich has this correct. Pelosi and her caucus want an electorate dependent on government handouts. Republicans want an environment where people get paychecks rather than perpetual welfare and economic vitality rather than stagnation and lost opportunities.

This election could not be more distinctive and clear.

Foodstamps/moochers/looters/taxscroomers/leeches/sheep/plantation dwellers, from diapers to the grave

Paychecks/producers/independents/liberty adherers/job creators/tax payers/charitable lots for those in need

Schadenfreude on October 7, 2010 at 2:21 PM

Pelosi [...] claims that every dollar spent in food stamps returns $1.79 to the economy.

Huh?

I must have slept through that lesson in economics class.

UltimateBob on October 7, 2010 at 2:23 PM

Awwww from the couch talking about AGW to throwing food due to poor people. Isn’t political love grand!

upinak on October 7, 2010 at 2:17 PM

LOL. Newt is sleeping on the couch alone tonight.

shick on October 7, 2010 at 2:23 PM

Nancy lives in her own private world – one that bears no relation to the one the rest of us are in.

GarandFan on October 7, 2010 at 2:24 PM

Pelosi and her caucus want an electorate dependent on government handouts.

It’s true. They’re all about control. They are perpetual children who want to rule perpetual children. It’s very, very sick.

And creepy.

Cody1991 on October 7, 2010 at 2:24 PM

“This kind of rhetoric and labeling is unnecessary in civil discourse.” -Brooks/Frum/Parker/Voorhees III/Krauthammer

portlandon on October 7, 2010 at 2:25 PM

The extra 79 cents comes from the unicorns & rainbows

tommer74 on October 7, 2010 at 2:26 PM

I’m no big Newt fan, but this is 3 minutes that should be viewed and repeated by every candidate in the country.

Marcus on October 7, 2010 at 2:28 PM

What’s not to like, the Democrats, party of food stamps, Besides you get $1.79 of economic growth for every $1 spent on government food stamps.

Recover your responsibilities or you will not have any individual rights.

tarpon on October 7, 2010 at 2:29 PM

If Pelosi’s correct, why doesn’t she advocate putting everyone on food stamps and unemployment? Then we’d have the best economy evah!

LASue on October 7, 2010 at 2:31 PM

Every Dem spending program is an “investment”. Pelosi’s claim that food stamps give us “more bang for the buck” citing that the economy gets a buck seventy something for every $2 in food stamps spent is…? With “investments” like that our national 401k is minus how many $trillion?

cartooner on October 7, 2010 at 2:31 PM

Pelosi and her caucus want an electorate dependent on government handouts.

And comfortable in their poverty, while voting Democratic.

iurockhead on October 7, 2010 at 2:32 PM

every dollar spent in food stamps returns $1.79 to the economy

Then why not force everyone to go on food stamps? We’d never have to borrow money again, we’d become rich beyond anyone’s wildest dreams.

29Victor on October 7, 2010 at 2:32 PM

Democrats create noting but addicts… addicts to a system of entitlements bled from the productive in society. Do not misunderstand me. We must always be there to help those who can’t help themselves but we can not allow those who can to bleed a society dry

theblacksheepwasright on October 7, 2010 at 2:34 PM

[Pelosi] claims that every dollar spent in food stamps returns $1.79 to the economy.

If that were really true, we would just have the government issue unlimited food stamps to the entire population and we would all grow insanely rich overnight. Next thing she’ll be telling me that a pyramid scheme is a great wealth creator. But I think we all knew that economic insight and analysis were not her strong point.

jwolf on October 7, 2010 at 2:34 PM

Not only does Newt deride “liberal math”…

I call it ‘Marxist Math’.

Buy Danish on October 7, 2010 at 2:35 PM

Hey, Newt, keep sitting on the couch with her.

SouthernGent on October 7, 2010 at 2:35 PM

Ok, my bad, I could’ve sworn Pelosi said $2. If she said $1 then its even worse. She thinks negative numbers are equal to positive numbers.(que “Twilight Zone” music)

cartooner on October 7, 2010 at 2:38 PM

We’ll all be drinkin’ that free Bubble-up
And eatin’ that Rainbow stew…

cartooner on October 7, 2010 at 2:39 PM

Newt=loser. Go away.

I hate to go to the grocery store stese days bcs it burns me up to watch a huge fat person buy soda pop & junk food with their EBT card & then ring up a cash sale for a carton of ciggies.

Badger40 on October 7, 2010 at 2:41 PM

I call it ‘Marxist Math’.

Buy Danish on October 7, 2010 at 2:35 PM

Marxist Math?! Excellent. This needs a trademark!

/ I suddenly feel an urgent need to speak with my socialist relatives in the UK. lol They’re idiots.

Cody1991 on October 7, 2010 at 2:41 PM

Pelosi, for her part, continues to insist that food stamps and unemployment stimulate the economy, and claims that every dollar spent in food stamps returns $1.79 to the economy.

If she truly believes this, and is not just making a sound bite, that woman should not be in any position where she can make or influence the laws in this country.

Johnnyreb on October 7, 2010 at 2:41 PM

Ok, my bad, I could’ve sworn Pelosi said $2. If she said $1 then its even worse. She thinks negative numbers are equal to positive numbers.(que “Twilight Zone” music)

cartooner on October 7, 2010 at 2:38 PM

Well of course they are.
Don’t you remember that when you combine 2 negative #s you get a +?

Badger40 on October 7, 2010 at 2:42 PM

Good ol Newt, always throwing bombs. And they say Palin is polarizing.

Don’t get me wrong, I agree with him, but sometimes I think he just likes the attention.

davek70 on October 7, 2010 at 2:43 PM

Why don’t the tax dollars and regulatory compliance costs we spend not have a Magic Multiplier like Government Money has?

The Monster on October 7, 2010 at 2:43 PM

The extra 79 cents comes from the unicorns & rainbows

tommer74 on October 7, 2010 at 2:26 PM

Yeah , there had to be a perfectly rational explanation.

the_nile on October 7, 2010 at 2:43 PM

http://www.youtube.com/watch?v=qi6n_-wB154

They may not agree on much, but they DO agree that “our country must take action to address climate change.”

Greek Fire on October 7, 2010 at 2:44 PM

This is what Newt does best.

booter on October 7, 2010 at 2:46 PM

Any one here read the Matt Taibi article in Rolling Stone where he went to a Tea Party rally and talked to Tea Party supporters rolling around in Medicare-funded scooters and wheelchairs?

cornfedbubba on October 7, 2010 at 2:47 PM

If she truly believes this, and is not just making a sound bite, that woman should not be in any position where she can make or influence the laws in this country.

Johnnyreb on October 7, 2010 at 2:41 PM

Pelosi is despicable. If you do a little research on her, you will understand that she has always been an elitist. She’s stupid compared to Hillary, but they are both power hungry to the point of insanity. Neither of them should have any position of authority.

Cody1991 on October 7, 2010 at 2:49 PM

Remember folks, this is the dingbat that said 500 million Americans are losing their jobs every month. Even her staff will admit off the record that she’s not the sharpest tool in the shed.

slickwillie2001 on October 7, 2010 at 2:51 PM

CNN reports this:

For every dollar a person receives in food stamps, Pelosi said that $1.79 is put back into the economy. The U.S. Department of Agriculture cites an even higher figure of $1.84

Someone needs to hunt down this U.S. Department of Agriculture statement where they say one dollar turns into $1.84.

ButterflyDragon on October 7, 2010 at 2:53 PM

For those who don’t understand Pelosi math of ‘every dollar spent in food stamps returns $1.79 to the economy’ -

Just think of the CHILDREN, it is all FOR the children….

And they will use children as props every chance they can get.

Sir Napsalot on October 7, 2010 at 2:54 PM

For all his flaws and faults, his genius shines through once again and his timing is simply genius.

The Democrats and this administration LOVE sound bites. Obama would not be President if not for one of the most recognizable sound bites in our history: “Hope & Change”.

Newt nails the coffin shut on the midterms by simply labeling them what they are: The Party of Food Stamps.

Beautiful

Opposite Day on October 7, 2010 at 2:55 PM

What’s really sad is…there are ardent dipsh!ts at kos, huffpo, and other liberal sites, totally lapping the Pelosi poo poo up. Not only believing it, but praising her as thee best speaker, and smartest forward thinking person.

OT here, but is anyone else having problems accessing certain sites thru explorer? I’ve made several attempts at Foxnews, and it says explorer cannot access the site? What gives? Temporary problems, or insideous machinations going on? lol

capejasmine on October 7, 2010 at 2:58 PM

Pelosi’s claim that food stamps give us “more bang for the buck” citing that the economy gets a buck seventy something for every $2 in food stamps spent is…? With “investments” like that our national 401k is minus how many $trillion?

cartooner on October 7, 2010 at 2:31 PM

I’m selling some December food stamp puts at $1.60

Vashta.Nerada on October 7, 2010 at 3:00 PM

One dollar returns $1.79? Wow, what is this “food stamp” investment instrument, and on what exchange is it traded? I’m guessing the trading symbol is FU, but I’m having trouble finding a data feed from the Washington Beltway Exchange (WBE?).

Help, please…

karl9000 on October 7, 2010 at 3:02 PM

Someone needs to hunt down this U.S. Department of Agriculture statement where they say one dollar turns into $1.84.

ButterflyDragon on October 7, 2010 at 2:53 PM

Hate to quote myself, but I found the report with this $1.84 figure in it. (PDF document)
In their report they suggest that the money people would have spent on food, they would now spend on non-food items, thus the $1.84 figure.

It’s all based on a 2002 study by Kenneth Hanson and Elise Golan. Effects of Changes in Food Stamp Expenditures Across the U.S. Economy (PDF document)

Though, they have a very interesting point in their paper that the liberals seem to overlook:

If the same recession-driven increase in FSP benefits is financed through increased taxes or other budget-neutral means, the stimulus effect of the increase in expenditures is dampened or even reversed. If program growth is financed through an increase in taxes, it redistributes
income primarily from high- and mid-income households,
in the form of taxes, to low-income households, in the
form of food stamps. In this case, the stimulus effect of
increased spending by food stamp recipient households is
muted by reduced spending by taxpaying households. The net result of the shift in spending from mid- and high income households to low-income households is an increase in demand in some sectors and a decrease in demand in other sectors.

Overall, the study is still flawed in my opinion because it assumes people have money to buy food with in the first place.

ButterflyDragon on October 7, 2010 at 3:11 PM

The only reason Pelosi’s math works is that the value of the dollar is declining so rapidly. What cost a buck yesterday costs a buck seventy-nine today.

It’s the only thing I can figure.

Duncan Khuver on October 7, 2010 at 3:14 PM

The only reason Pelosi’s math works is that the value of the dollar is declining so rapidly. What cost a buck yesterday costs a buck seventy-nine today.

It’s the only thing I can figure.

Duncan Khuver on October 7, 2010 at 3:14 PM

No, I put a link to the study that started all of this crazy math, but I guess it got moderated. Some kind of buzz word must be in there and I’ll be darned if I know what it is to change to post it.

Hopefully Ed or Allah will moderate it soon and post it.

But essentially the study says the money people would have spent on food, is now spent on non-food items, while they purchase food with the food stamps. That’s how you get a bigger number than the original dollar. They’re also counting the dollars the recipient had in their pocket.

A huge assumption that people actually had money to spend on food in the first place.

ButterflyDragon on October 7, 2010 at 3:18 PM

Ed, you’d get more comments on your posts if you wouldn’t keep analyzing the topics so thoroughly & thoughtfully! There’s not much else to be said. Well done.

itsnotaboutme on October 7, 2010 at 3:19 PM

Cody1991 on October 7, 2010 at 2:41 PM

Glad you like it. I’ve been using it for a long time but you’re the first person to notice. There’s also this game my older brother taught me years ago: 1 for me, 1 for you, 1 for me…1 for me, 1 for you, 1 for me… which pretty well describes how Democrats divide their spoils.

Buy Danish on October 7, 2010 at 3:23 PM

ButterflyDragon on October 7, 2010 at 3:18 PM

Isn’t the only way to “figure” this is if the people receiving the food stamps already have the money they need to buy food? They’re essentially “giving” food stamps to people who don’t need them, and then assuming that the “real” money will be spent on other items.

There are some serious mental disconnects there…

karl9000 on October 7, 2010 at 3:25 PM

ButterflyDragon on October 7, 2010 at 3:18 PM

OK thanks for the clarification. But how do they account for the negative effect of taking money away from people who pay the taxes that goes into food stamps? Seems to me they missed part of the equation. Great, food stamp recipient has 79 cents. They get a food stamp for a buck. They now have a buck 79, but I’m out a buck. It seems kind of like the “broken window” idea of the economy. (Kid breaks your window, forces you to spend money on broken window so kid breaking window is good)

I wasn’t entirely serious about the dropping dollar theory. Just mystified at Pelosi “math”.

Duncan Khuver on October 7, 2010 at 3:27 PM

Swamp not drained…rather sludge intensified

Most voters think Congress’s ethics have gotten worse in the past two years, according to a new poll in key battleground districts.

Schadenfreude on October 7, 2010 at 3:29 PM

OK thanks for the clarification. But how do they account for the negative effect of taking money away from people who pay the taxes that goes into food stamps? Seems to me they missed part of the equation. Great, food stamp recipient has 79 cents. They get a food stamp for a buck. They now have a buck 79, but I’m out a buck. It seems kind of like the “broken window” idea of the economy. (Kid breaks your window, forces you to spend money on broken window so kid breaking window is good)

I wasn’t entirely serious about the dropping dollar theory. Just mystified at Pelosi “math”.

Duncan Khuver on October 7, 2010 at 3:27 PM

They actually do mention how raising taxes to pay for it will offset any perceived growth.

This is the study (PDF document) that all of it is based on. I hope it posts it, I still don’t see any bad words that would have required moderation. LOL

If the same recession-driven increase in FSP benefits is financed through increased taxes or other budget-neutral means, the stimulus effect of the increase in expenditures is dampened or even reversed. If program growth is financed through an increase in taxes, it redistributes
income primarily from high- and mid-income households,
in the form of taxes, to low-income households, in the
form of food stamps. In this case, the stimulus effect of
increased spending by food stamp recipient households is
muted by reduced spending by taxpaying households. The
net result of the shift in spending from mid- and highincome
households to low-income households is an increase in demand in some sectors and a decrease in demand in other sectors.

ButterflyDragon on October 7, 2010 at 3:36 PM

Overall, the conclusion of the study with a budget neutral scenario shows loss of wealth and jobs when food stamp usages is increased.

As usual, the liberals cherry pick a tidbit out of a report and offer it out of context and distort the conclusions. In this case, they’re saying the exact opposite of what this report concludes. Food stamp increase will cause a loss of jobs. Period.

ButterflyDragon on October 7, 2010 at 3:42 PM

ButterflyDragon on October 7, 2010 at 3:36 PM

Thanks again ButterflyDragon. It still seems that whoever wrote this belongs to the “Broken Window” theory of Economics. That had not an expenditure been forced, money would have sat idle producing no benefit to anyone. In the case of the store owner whose window was broken, they assume the store owner would not have spent the money on themselves, bought additional products, hired someone etc.

This reasoning seems very similar, that if spending is not forced, spending and investment will not happen. Very flawed logic.

Anyway back on topic, I have a very liberal cousin who would be proud to wear the label “Party of Food Stamps” because she would think it would show how compassionate she is.

Duncan Khuver on October 7, 2010 at 3:47 PM

Huh?

I must have slept through that lesson in economics class.

UltimateBob on October 7, 2010 at 2:23 PM

It’s actually a misconception commonly taught in college level macroeconomics. It works on the premise that money produces goods.

Count to 10 on October 7, 2010 at 3:49 PM

To understand any idea fully you explore the extremes, so if everyone was on food stamps (an extreme and perhaps desired end, at least by Pelosi) the economy would be generating $1.79 for every dollar of food stamps, we would all be rich somehow, right? And there would be a unicorn in every garage? This goes right along with the idea of spending yourself out of debt. Why isn’t there a basic IQ test for politicians, some basic competency test of some kind?

odannyboy on October 7, 2010 at 3:52 PM

Overall, the study is still flawed in my opinion because it assumes people have money to buy food with in the first place.

ButterflyDragon on October 7, 2010 at 3:11 PM

They are also making a mistake if they assume that borrowing the money has any less of an economically dampening effect.

Count to 10 on October 7, 2010 at 3:53 PM

ButterflyDragon on October 7, 2010 at 3:11 PM

This is actually true. People use food stamps then have cash for other things like beer, cigarettes, fast food etc….

Let’s not forget the black market for them.

It’s just like with the free school meals program. Kids get free food and then roll up to school in their parents new late model car wearing $100.00 tennis shoes and such.

There are many who need the help, but as with all government programs, it’s become just another way to scam the system and have others pay the way.

Jvette on October 7, 2010 at 4:00 PM

From Barry Ritholtz’ site, The Big Picture: Explosive Growth in Food Stamp Usage (but written by Invictus):

I came across a piece of research today that referenced the growing number of households (currently a whopping 19.4 million) participating in the nation’s food stamps program (the official name changed two years ago from food stamps to Supplemental Nutrition Assistance Program (SNAP)), and was a bit taken aback by what I read, so I went to check out the numbers for myself. The year-over-year (YoY) percent gains in the number of households participating in this program are staggering and, like the recent report on poverty in our country, saddening. Here’s a table sorted in descending order of YoY percent change in number of households participating.

And in case you’re wondering why the year-over-year growth of foodstamps is so explosive, consider what the New York Times reported earlier this year:

The revival began a decade ago, after tough welfare laws chased millions of people from the cash rolls, many into low-wage jobs as fast-food workers, maids, and nursing aides. Newly sympathetic officials saw food stamps as a way to help them. For states, the program had another appeal: the benefits are federally paid.

[...]

States eased limits on people with cars and required fewer office visits from people with jobs. The federal government now gives bonuses to states that enroll the most eligible people.

The program then has become something of a cash cow for the states, who have strong incentives to put as many people on SNAP (aka “food stamps”) as possible. That makes today’s numbers very different from those seen in past recessions.

ironman on October 7, 2010 at 4:09 PM

We all need to be unemployed and on foodstamps — because that will put 79% more money back into the economy.

unclesmrgol on October 7, 2010 at 4:14 PM

claims that every dollar spent in food stamps returns $1.79 to the economy

If that’s the case, then all we need to do to fix the economy is get rid of all jobs and have everyone go on food stamps.

And here I thought the Dems just didn’t know what they were doing…

taznar on October 7, 2010 at 4:32 PM

I remember when this kind of thing was referred to as “Voodoo Economics” by that old movie star president……….

di butler on October 7, 2010 at 4:33 PM

I’m so ticked off today. The following rant is partly OT, but mostly on:

This morning I told a 4th grade class that we’re doing a patriotic concert using American flags. A student asked me if we would use the Mexican flag. I said, “No–it’s an American concert. We’ll use American flags.” His answer: “My parents are going to be mad. They don’t like the American flag. They like Mexico.”

How much you wanna bet the parents are on every gov’t program imaginable…all the time they hate on the producers?

Grace_is_sufficient on October 7, 2010 at 4:42 PM

Di Butler, It was George H.W. Bush who called Reagan’s “supply side” economics ‘voodoo economics.’

flataffect on October 7, 2010 at 5:13 PM

What Pelosi is touting is the “fiscal multiplier” idea from Keynesian economics:

In economics, the multiplier effect or spending multiplier is the idea that an initial amount of spending (usually by the government) leads to increased consumption spending and so results in an increase in national income greater than the initial amount of spending. In other words, an initial change in aggregate demand causes a change in aggregate output for the economy that is a multiple of the initial change. (See http://en.wikipedia.org/wiki/Multiplier_Effect )

It was called pump-priming under FDR, but it doesn’t really work, because the money comes from taxes or borrowing, i.e. deficit spending. There is no actual wealth involved. It’s more like check kiting than true economic activity.

flataffect on October 7, 2010 at 5:27 PM

It’s more like check kiting than true economic activity.

flataffect on October 7, 2010 at 5:27 PM

Carl C. Perkins insists he was stimulating the economy. /s

ButterflyDragon on October 7, 2010 at 5:39 PM

Sometimes I have to wonder if the kids on Pelosi’s staff play jokes on her, like -’let’s make this up and see if we can get Nan to say it, it’ll be so great.’

slickwillie2001 on October 7, 2010 at 5:56 PM

California has finally discovered that its welfare debit cards are frequently being used in Las Vegas and on cruise ships. Pelosi-nomics at work!

LASue on October 7, 2010 at 5:58 PM

Of course Gingrich is correct, but the cynic in me says he’s using this to try and distance himself from his too friendly time on the couch with Pelosi selling global warming and Cap & Trade.

RJL on October 7, 2010 at 7:41 PM

Don’t forget…Pelosi is using a maxed out credit card with high interest rates to pay for those food stamps. So basically that $1.00 she’s borrowing to buy food stamps with will never get paid back. Instead of putting an imaginary $1.79 into the economy, what she’s doing is forcing the Treasury to turn a $1.00 debt into a $10.00 or more debt.

OxyCon on October 7, 2010 at 7:50 PM

Not just crazy math, unless of course Pelosi is lying:

The extra 79 cents could be the cost of the food stamp programs in offices plus salaries and benefits paid to the government employees administering the food stamp programs.

alice on October 7, 2010 at 8:08 PM

Gingrich is a smart guy, no doubt, but he can go SCOZZAFAVA himself.

Dandapani on October 8, 2010 at 8:11 AM