Krugman to Obama: You’re gonna lose unless you demand a huge stimulus package

posted at 11:21 am on May 2, 2012 by Ed Morrissey

Paul Krugman continues his Chicken Little tour in service to his new book, End This Depression Now!, by giving the Obama campaign a little free advice.  Did I say “free”?  Actually, it comes at a steep, steep price:

In his book, which hit shelves May 1, Krugman laments the “shadow of economic catastrophe” we live in, and the opportunity cost of huge stockpiles of underutilized human and physical capital. The government should put that to work, Krugman says, first by reversing the state layoffs of teachers, firefighters and other employees, and then ideally with a New Deal-style public works push to rebuild American infrastructure by putting the unemployed to work. But even though GOP opposition makes that all but impossible, Krugman believes it’s a mistake for Obama not to go the extra mile and at least tell voters what more he would do if only he could.

“There is a political danger to Obama, which is that [Mitt] Romney can go around saying, ‘The economy is still lousy,’ which is true,” Krugman said. “And the fact that Obama has never made a really clear case for his own economic leadership hurts. Now, I still think Obama will probably win, because there are other issues, but they have created a trap for themselves on the economic policy front by allowing themselves to own a weak economy in a way that they shouldn’t, because a lot of the problem has been tortured opposition from the Republicans.”

The White House’s narrative developed amid strong political headwinds. Pressure not only from Republicans but many Democrats and even administration officials, along with a broad establishment consensus, compelled Obama to pivot to deficit-reduction, after the Democrats’ 2010 congressional losses and in the face of an exploding national debt.

I’m pretty sure that a proposal to spend another $2 trillion in stimulus spending would just about put a bow on the election for Mitt Romney, not Barack Obama.  That became very clear after 2010, when Republicans won a landslide in House elections that hadn’t been seen in a midterm since 1938.  However, the notion that Obama pivoted to deficit reduction is rather ludicrous.  His proposed FY2013 budgets reduced the deficit to $900 billion, which is better than the four straight trillion-dollar-plus deficit budgets Obama signed — remember, he signed the FY2009 budget after the Democratic Congress played keep-away with George W. Bush — but it’s hardly a reduction to pre-Obama levels.

On the other hand, Krugman does correctly identify the inherent contradiction in Team Obama’s campaign:

“They’ve tied themselves up in knots because they’ve bought into this notion that it would sound wrong to admit that they haven’t been able to do everything that they really should have done,” Krugman told TPM in an interview following the release of his new book, “End This Depression Now!” “It’s incredible — they can’t quite make up their minds on whether the theme is that Republicans are standing in the way of doing what has to be done, or things are really good and America’s back on track. The problem is that you can’t perceive both of those lines at the same time.”

No, they have to argue that the 2009 stimulus worked, when it obviously didn’t.  They can’t blame GOP recalcitrance for that, either; Democrats locked Republicans out of the drafting of that stimulus package, and then passed it themselves without any GOP votes in the House and only three in the Senate, including one who later switched parties (Arlen Specter).  They own the 2009 stimulus package, and they own the results.

Speaking of results, the Romney campaign released another campaign ad today, attacking Obama on his promises of economic resurgence:

How do you define “progress”?  Probably not with these economic statistics.  No matter what Krugman claims now, the Obama administration proposed the $800 billion stimulus and predicted it would stop joblessness from rising above 8%, and it hasn’t been below 8% since.  That’s failure no matter how one wants to spin it.

Update: Liz Peek slams Krugman’s “left-wing bullying” of Ben Bernanke:

Paul Krugman vaulted over the line recently, issuing an ad hominem attack on Fed Chair Ben Bernanke  for not doing enough to boost the economy. Krugman’s anxiety that the stuttering recovery will bounce President Obama from the White House seems to have loosened his already-fragile grip on reality. His conclusion – that “right-wing bullying” is holding Bernanke back – seems especially nonsensical, even for the truculent Mr. Krugman. …

Krugman’s frustration is understandable. Many Americans are still without jobs, and income growth is tepid. However, driving the nation full tilt towards the next financial cliff is not the answer. Leadership and pro-business measures such as those adopted in Canada and Germany in recent years – an approach consistently undervalued by the Obama White House – would better help us get back on the speedway.

Fortunately, the Fed is in the hands of a sober driver, who appears immune to right-wing bullying. Let us hope he will resist Krugman’s left-wing bullying as well.

I think that’s a safe bet.  Is anyone taking Krugman’s advice these days?  Anyone?  Bueller?  Bueller?


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I know, it’s unbelievable the way this administration is holding back Joe the Plumber and his like. Totally the government’s fault.

bayam on May 2, 2012 at 1:07 PM

How many private sector jobs has O’bama created?

Del Dolemonte on May 2, 2012 at 1:10 PM

Cool, it get to use my Chicken Little ‘shop. It could use some text though. Any ideas?

BKeyser on May 2, 2012 at 1:12 PM

I would argue you are the stupid one.

Uppereastside on May 2, 2012 at 12:32 PM
So argue it.

NotCoach on May 2, 2012 at 12:43 PM

Simple! The only way we fully exit this recession is when the MIDDLE & UNDER PRIVILEDGE CLASS starts spending money again.

The only way they will start spending money is if they feel secure at their current jobs or if the unemployed start finding work again.

The only way business will provide that kind of security is when customers start buying their products and services.

Redistribution of wealth (via cutting vital public services and giving excessive a tax cuts to the well to do ALONE) to the upper 1% with hopes it will magically flow back to everyone else is just farce

Uppereastside on May 2, 2012 at 1:13 PM

The auto industry remains at the center of the country’s industrial base

Pauline Krugman on May 2, 2012 at 11:55 AM

This is for you, Sweetheart:

The Obama camp can’t stop clucking about how he saved GM and the car industry. But if the GM bailout is such a success story, why can’t it pay back its debt to taxpayers?

The president’s new campaign video narrated by actor Tom Hanks claims GM has “repaid” its loans. But in a revelation by the special inspector general monitoring the TARP bailout program, GM and GMAC together still owe the biggest share of the remaining $119 billion TARP debt.

Of the top bailout recipients, GM is the biggest laggard, the TARP watchdog says in his latest quarterly report to Congress. Bank of America, Citigroup, Chrysler and Chrysler Financial all have paid off their debt and left the TARP program. Even AIG has paid back more than 75% of what it owes taxpayers.

GM, on the other hand, still owes more than half the $50 billion in federal funds it received when the combination of the recession and its costly union contracts drove it into bankruptcy. And its lending arm, GMAC (now Ally Financial), still owes $14.5 billion.

What’s worse, it’s not clear that GM actually repaid what it’s gotten credit for repaying. Check out this note buried in the inspector’s report: “As part of a credit agreement with Treasury, $16.4 billion in TARP funds were placed in an escrow account that GM could access only with Treasury’s permission.”

As it turns out, GM got Treasury’s OK to “repay” more than $6.7 billion “using a portion of the escrow account that had been funded with TARP funds.” So GM is merely paying the government back with government money, not money GM is earning selling cars, as the administration has claimed.

-snip-

Ford, which didn’t take TARP funds, grabbed market share from GM and is now more profitable. Ironically, Ford for the first time in years has outsold GM in the number of cars bought by the federal government — although Washington still owns a huge stake in GM. Not exactly a vote of confidence.

In North America, Ford just recorded its highest quarterly profit since 2000. GM missed profit estimates in the fourth quarter. And analysts are not sanguine about its first-quarter results due Thursday.

The GM story is hardly what we’re looking for in terms of a recovery. That Obama is touting it as a top economic achievement speaks volumes about his policies.

You need to go back to school.

Del Dolemonte on May 2, 2012 at 1:14 PM

How many private sector jobs has O’bama created?

Del Dolemonte on May 2, 2012 at 1:10 PM

ADP: Hiring slowed significantly in April

Difficultas_Est_Imperium on May 2, 2012 at 1:15 PM

Oh please, Mr. Obama. Listen to Krugs. He is SO in touch with what most Americans are thinking.

mdavt on May 2, 2012 at 1:17 PM

I know, it’s unbelievable the way this administration is holding back Joe the Plumber and his like. Totally the government’s fault.

bayam on May 2, 2012 at 1:07 PM

Yep. It is just like the truism that government cannot grant liberties, only take them away. The same is true in economics. Government cannot create wealth, only destroy it.

NotCoach on May 2, 2012 at 1:18 PM

Redistribution of wealth (via cutting vital public services and giving excessive a tax cuts to the well to do ALONE) to the upper 1% with hopes it will magically flow back to everyone else is just farce

Uppereastside on May 2, 2012 at 1:13 PM

Do you speak of the vital public services funded to the tune of up to $1 Million per job “saved” from the stimulus?

That king of efficiency is the true farce, and a complete waste, and hardly vital. To anyone. It is “magic” for unions though.

Difficultas_Est_Imperium on May 2, 2012 at 1:19 PM

Simple! The only way we fully exit this recession is when the MIDDLE & UNDER PRIVILEDGE CLASS starts spending money again.

The only way they will start spending money is if they feel secure at their current jobs or if the unemployed start finding work again.

Dick Cheney Is A War Criminal on May 2, 2012 at 1:13 PM

You left out the biggest part of the puzzle.

Companies stopped hiring when O’bama got elected. Because they were deathly afraid of an increase in government meddling in their businesses via added regulations, etc. I am a small business owner myself, and since Dear Leader took office my profession has seen increased layers of new regulations (and the increased costs of complying with same) we now must follow. And they have been coming out Fast and Furious; each of the past 3 years has seen increased governmental regulations for my profession.

If you had ever actually owned and run a business yourself, you would know that. Happy to enlighten you!

Del Dolemonte on May 2, 2012 at 1:22 PM

The auto industry remains at the center of the country’s industrial base…
This is for you, Sweetheart.

But Dell, I thought GM was Obama’s willing tool and immediately responded to his every whim and command… I guess you’ve reversed your mind on that point, kind of like a reed blown awry by the wind?
I notice the article fails to mention the billions in corporate and employee income taxes anticipated over this decade, which will result in a huge profit for US taxpayers. But good idea to quote from a right-wing and unbiased source.

F-

bayam on May 2, 2012 at 1:22 PM

with hopes it will magically flow back to everyone else

Uppereastside on May 2, 2012 at 1:13 PM

It’s not magic if you actually understand how people get hired, and by whom.

I don’t think the Clinton tax rates would kill the economy, personally, but at the same time I don’t think Obama cares about deficit reduction at all, so I don’t trust him with those tax rates.

DrSteve on May 2, 2012 at 1:24 PM

He’s going to lose anyway Krugman, 62% beliebe we are still in recession. Wow what useful idiots

Conservative4ev on May 2, 2012 at 1:26 PM

Simple! The only way we fully exit this recession is when the MIDDLE & UNDER PRIVILEDGE CLASS starts spending money again.

Uppereastside on May 2, 2012 at 1:13 PM

And you don’t understand why they aren’t?

Redistribution of wealth (via cutting vital public services and giving excessive a tax cuts to the well to do ALONE) to the upper 1% with hopes it will magically flow back to everyone else is just farce

Cutting taxes is redistribution of wealth? Seriously?

I see some sort of populist tripe that any OWS halfwit can spout, but nothing resembling any sort of intelligence. When uncertainty prevails because of government interference in the economy recession and stagnation are the norm. We saw it during the Great Depression and we see it repeating itself today. Yet the fault somehow lies with wealthy individuals and corporations because they don’t pay enough taxes. Forget the fact that the top 5% pay over 50% of all the taxes the government collects. Forget the fact that almost 50% pay no taxes at all. The only “truth” is that we need to squeeze the producers who are propping the entire system up even more. And it is a mystery to you that they refuse to invest in growth with the threat of higher taxes and more regulations always hanging over their heads?

You need to refine your argument.

NotCoach on May 2, 2012 at 1:28 PM

I am a small business owner myself, and since Dear Leader took office my profession has seen increased layers of new regulations (and the increased costs of complying with same) we now must follow. And they have been coming out Fast and Furious; each of the past 3 years has seen increased governmental regulations for my profession.

If you had ever actually owned and run a business yourself, you would know that. Happy to enlighten you!

Layers of new regulations? Give us a break. Name 4 or 5 specifically and maybe you’ll have some credibility. It’s amazing how people like you love to hide behind generalities.

bayam on May 2, 2012 at 1:29 PM

Look, we know the point; buy voters by giving them public-sector jobs.

It’s how Barry has a shot in OH and VA.

Enough people are dependent on the public sector, either directly or by proxy.

It takes people off the unemployment roles, which makes it appear as if they’re not being covered by federal dollars.

In reality, they’re being paid for short-term work, which will become long-term payroll thanks to all the jobs created being unions gigs.

That’s all Kruggy’s after; Euro-Socialism because, inside, he knows “stimulus” doesn’t work, so Barry might as well make them a permanent voting class.

budfox on May 2, 2012 at 1:30 PM

How do you define “progress”? Probably not with these economic statistics. No matter what Krugman claims now, the Obama administration proposed the $800 billion stimulus and predicted it would stop joblessness from rising above 8%, and it hasn’t been below 8% since. That’s failure no matter how one wants to spin it.

Bullseye.

H

e’s going to lose anyway Krugman, 62% beliebe we are still in recession. Wow what useful idiots

Conservative4ev on May 2, 2012 at 1:26 PM

They know the BEA and the BLS are faking their data. The real GDP for Q1 2012 is 0.08% not 2.2%. While 0.08% is still a positive value, it’s very very poor.

And it’s been that way for a while. People, voters believe what they see with their own eyes and their wallets. The millions the BLS dropped from the labor force VOTE.

dogsoldier on May 2, 2012 at 1:35 PM

How many private sector jobs has O’bama created?

Del Dolemonte on May 2, 2012 at 1:10 PM

Not an exact answer, but may be of interest….

I ran the numbers comparing January, 2009, to March, 2012:

Jan. 2009:

Civilian labour force: 153,716m
Employed: 142,099m
Unemployed: 11,616m
Not in labour force: 81,023m
Not in the labour force, but who want a job now: 5,682m
Participation Rate: 65.5%
Average Weeks Unemployed: 19.8
Unemployment rate: 7.6%

March 2012

Civilian labour force: 154,707m
Employed: 142,034m
Unemployed: 12,673m
Not in labour force: 87,897m
Not in the labour force, but who want a job now: 6,299m
Participation rate: 63.8%
Average Weeks Unemployed: 39.4
Unemployment rate: 8.2%

Change:

Civilian labour force: + .64%
Employed: – 4.58%
Unemployed: + 8.34%
Not in labour force: + 7.82%
Not in the labour force, but who want a job now: +10.86%
Participation rate: – 2.67%
Average Weeks Unemployed: + 98.99%
Unemployment rate: + 7.31%

Hope. Change. Chronic unemployment. Plus, $5 trillion in new debt, $4 gas, and two historic downgrades.

Resist We Much on May 2, 2012 at 1:37 PM

Layers of new regulations? Give us a break. Name 4 or 5 specifically and maybe you’ll have some credibility. It’s amazing how people like you love to hide behind generalities.

bayam on May 2, 2012 at 1:29 PM

How many do you want, from either the EPA or HHS? Wow you walked out into high speed traffic with that one. ROFL!

dogsoldier on May 2, 2012 at 1:37 PM

If you had ever actually owned and run a business yourself, you would know that. Happy to enlighten you!

Del Dolemonte on May 2, 2012 at 1:22 PM

lol. Why don’t you share not two but ONE of these so called “regulations” with us?

Perhaps the main reason why your “small business” isn’t doing too well is because you are selling goods and services people aren’t interested in. Ever thought about that?

Uppereastside on May 2, 2012 at 1:41 PM

I notice the article fails to mention the billions in corporate and employee income taxes anticipated over this decade, which will result in a huge profit for US taxpayers. But good idea to quote from a right-wing and unbiased source.

F-

bayam on May 2, 2012 at 1:22 PM

Um, the article addresses the loans and the fact that even the government has admitted that it is highly unlikely that they will ever be repaid in full.

It would be like you defaulting on your student loan from the government, but still paying your income and payroll taxes. The government is still out the money that it is owed.

Double F-

Resist We Much on May 2, 2012 at 1:43 PM

Layers of new regulations? Give us a break. Name 4 or 5 specifically and maybe you’ll have some credibility. It’s amazing how people like you love to hide behind generalities.

bayam on May 2, 2012 at 1:29 PM

You are not being generous. I asked him to name one. Not two but one.

Uppereastside on May 2, 2012 at 1:44 PM

How many do you want, from either the EPA or HHS? Wow you walked out into high speed traffic with that one. ROFL!

dogsoldier on May 2, 2012 at 1:37 PM

Go ahead, enlighten us.

I’m still waiting for an answer that explains how a small business owner faces layers of new regulations. When Obama returned the EPA to the level of real enforcement found under Clinton, clearly that killed the economy. After all, the economy was just so terrible during the Clinton era.

bayam on May 2, 2012 at 1:44 PM

Forget the fact that almost 50% pay no taxes at all. The only “truth” is that we need to squeeze the producers who are propping the entire system up even more. And it is a mystery to you that they refuse to invest in growth with the threat of higher taxes and more regulations always hanging over their heads?

You need to refine your argument.

NotCoach on May 2, 2012 at 1:28 PM

By your estimate, half of the folks here don’t pay any taxes. So what is the beef? Why the constant whinning that your taxes are too high?

Uppereastside on May 2, 2012 at 1:47 PM

Simple! The only way we fully exit this recession is when the MIDDLE & UNDER PRIVILEDGE CLASS starts spending money again.

Uppereastside on May 2, 2012 at 1:13 PM

One of my biggest pet peeves: IT IS P-R-I-V-I-L-E-G-E.

I swear. As class conscious as Progs are, they can’t spell “privilege” to save their lives.

Resist We Much on May 2, 2012 at 1:49 PM

bayam on May 2, 2012 at 1:44 PM

You won’t get one from him.

I do have a liberal friend who once complained to me (during the Bush years) about what he felt were excessive regulations around the home constructions. All the steps he had to go through to get a permit to improve basements etc.
Spoke to him a few months ago and he said a large chunk of those rules have been relaxed.

Uppereastside on May 2, 2012 at 1:52 PM

bayam on May 2, 2012 at 1:29 PM

I’m going to encourage him to answer you directly, but please do keep in mind that the SBA Office of Advocacy published a study during the present administration that estimated compliance burdens for Federal regulations alone at 14% of GDP, or $1.75 trillion. Comparable to health care expenditures. So no pooh-poohing the overall picture, please. Regulatory compliance burdens are real, and have been for a long time.

As to changes under the current President, you probably don’t want to read it because of the source, but here’s something on point. No ad hominems or genetic fallacy please, just restrict yourself to the data or the methodology if you want to complain.

DrSteve on May 2, 2012 at 1:52 PM

Washington Nearsider on May 2, 2012 at 11:58 AM

Ahhh, the beauty of the electoral college.

schlagerman on May 2, 2012 at 1:54 PM

I swear. As class conscious as Progs are, they can’t spell “privilege” to save their lives.

Resist We Much on May 2, 2012 at 1:49 PM

My bad! Privilege

Uppereastside on May 2, 2012 at 1:54 PM

Layers of new regulations? Give us a break. Name 4 or 5 specifically and maybe you’ll have some credibility. It’s amazing how people like you love to hide behind generalities.

bayam on May 2, 2012 at 1:29 PM

I am associated with the mortgage sector. Does that answer your question?

Del Dolemonte on May 2, 2012 at 1:54 PM

By your estimate, half of the folks here don’t pay any taxes. So what is the beef? Why the constant whinning that your taxes are too high?

Uppereastside on May 2, 2012 at 1:47 PM

I think you could play the parts of Lloyd and Harry by yourself in Dumb and Dumber.

What does this have to do with anything we’ve been discussing?

NotCoach on May 2, 2012 at 1:56 PM

So Krugman says we’re in a depression? I don’t think he’ll be getting too many calls from the Obama campaign.

Ward Cleaver on May 2, 2012 at 1:57 PM

But good idea to quote from a right-wing and unbiased source.

F-

Pauline Krugman on May 2, 2012 at 1:22 PM

Translated: “I can’t credibly refute the Facts stated in Del’s link, so I will attack the messenger by claiming it’s right wing”. Saul Alinsky taught you well.

BTW, IBD includes as their columnists B.J. Dionne and Richard Cohen of the WaPo. I wasn’t aware they were Reich Wing.

Especially Cohen, who calls Israel “a mistake”.

F-

Del Dolemonte on May 2, 2012 at 1:58 PM

I am associated with the mortgage sector. Does that answer your question?

Del Dolemonte on May 2, 2012 at 1:54 PM

No it doesn’t. You are yet to name ONE.

Typical right wing con. At least google one, cut and paste to rid yourself from shame.

Uppereastside on May 2, 2012 at 2:00 PM

DrSteve on May 2, 2012 at 1:52 PM

The SBA study measures are for 2008, so consider it a baseline. But it wasn’t peanuts during Bush’s last term either.

DrSteve on May 2, 2012 at 2:01 PM

Uppereastside on May 2, 2012 at 1:52 PM

Those rules have been relaxed or unenforced?

Home construction regulation is just about entirely enforced at the state level. Your friend was not suffering from federal regulation overload. Where does your friend live?

NotCoach on May 2, 2012 at 2:01 PM

As to changes under the current President, you probably don’t want to read it because of the source, but here’s something on point. No ad hominems or genetic fallacy please, just restrict yourself to the data or the methodology if you want to complain.

DrSteve on May 2, 2012 at 1:52 PM

That’ a very legitimate and well-stated point. I respect your opinion.

Layers of new regulations? Give us a break. Name 4 or 5 specifically and maybe you’ll have some credibility. It’s amazing how people like you love to hide behind generalities.

bayam on May 2, 2012 at 1:29 PM

I am associated with the mortgage sector. Does that answer your question?

Del Dolemonte on May 2, 2012 at 1:54 PM

True, hard to imagine an industry so victimized by unnecessary regulation and oversight. How terrible!

http://www.ritholtz.com/blog/2011/12/fbi-estimates-80-of-mortgage-fraud-involved-industry-insiders/

http://www.ritholtz.com/blog/2011/12/unprecedented-fraud-toothless-watchdogs/

bayam on May 2, 2012 at 2:01 PM

Go ahead, enlighten us.

bayam on May 2, 2012 at 1:44 PM

http://news.yahoo.com/obama-halts-controversial-epa-regulation-143731156.html
Oops!

Then there are the new CAFE standards for trucking, the cost of which to the economy have yet to be calculated.

Then there’s this:

Regulating Small Businesses Out of Business

By Blanche Lincoln

“Small businesses bear a disproportional share of government regulation. A study by the Small Business Administration found that firms with fewer than 20 workers incur an average cost of $2,830 more to comply with regulations than companies with 500 or more employees, which is about one-third more per worker.”

http://energy.nationaljournal.com/2011/11/whats-the-sum-effect-of-epa-ru.php#2114271

Search google. There are quite a few examples including the ALEC site. They have a cool video…

dogsoldier on May 2, 2012 at 2:02 PM

Del Dolemonte on May 2, 2012 at 1:22 PM

lol. Why don’t you share not two but ONE of these so called “regulations” with us?

Perhaps the main reason why your “small business” isn’t doing too well is because you are selling goods and services people aren’t interested in. Ever thought about that?

Uppereastside on May 2, 2012 at 1:41 PM

lol. Where did I say anywhere that my business is not doing well? I never said that, you assumed it. I’m not sitting here jobless posting to Hot Gas on a Wednesday because business is poor, it’s because I work both weekend days.

In fact my business is doing OK despite the added government regulations, because I offer a service that is needed. I’m in the mortgage sector (but not a mortgage broker or anything like that; many of those folks helped create the real estate crash, after all).

But thanks so much for admitting that you’ve never owned or run a business. Even though we all knew that already.

Del Dolemonte on May 2, 2012 at 2:03 PM

dogsoldier on May 2, 2012 at 2:02 PM

Stop with the links to your right wing sites. Why don’t you give us a specific scenario of how the recent EPA rules impacted your small business or anyone you know of.

Uppereastside on May 2, 2012 at 2:05 PM

Desperate liberal trolls make me smile.

Roy Rogers on May 2, 2012 at 2:05 PM

My bad! Privilege

Uppereastside on May 2, 2012 at 1:54 PM

Just be careful. I don’t want you to get too bad a case of Alliduncism.

Resist We Much on May 2, 2012 at 2:06 PM

I am associated with the mortgage sector. Does that answer your question?

Del Dolemonte on May 2, 2012 at 1:54 PM

You have first hand knowledge. One cannot enlighten trolls. They aren’t really interested in facts. They are merely attention seekers, nothing more.

dogsoldier on May 2, 2012 at 2:06 PM

Del Dolemonte on May 2, 2012 at 2:03 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

Stop with the links to your right wing sites. Why don’t you give us a specific scenario of how the recent EPA rules impacted your small business or anyone you know of.

Uppereastside on May 2, 2012 at 2:05 PM

Blanche Lincoln is a right winger? ROFLMAO! Okay Okay that’s an admission you’ve been pwnd. That’s OMG funny…

dogsoldier on May 2, 2012 at 2:10 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

All the new forms and process consume time. Time is money. Is that expressed simply enough for you? I know Del is correct because I re-fi’d my home recently and the stack of new forms is stupid.

dogsoldier on May 2, 2012 at 2:14 PM

dogsoldier on May 2, 2012 at 2:10 PM

lol. Oh yea. How did that “liberal” thing work out for her.

Uppereastside on May 2, 2012 at 2:15 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

Obamacare’s 1099 reg on goods and services over $600. It may have finally be repealed because even some Democrats realised that it was a disaster, but I’m not sure. I know that many of the Progs wanted the money from it.

Resist We Much on May 2, 2012 at 2:21 PM

Redistribution of wealth (via cutting vital public services and giving excessive a tax cuts to the well to do ALONE) to the upper 1% with hopes it will magically flow back to everyone else is just farce

Uppereastside on May 2, 2012 at 1:13 PM

1% of the country pays 40% of the taxes. Those greedy bastards!! They should pay 99% of the taxes, right?

angryed on May 2, 2012 at 2:22 PM

I know Dodd-Frank has made it nearly impossible to originate loans for manufactured housing purchases. These loans are for lower amounts, but typically much shorter durations, and their servicing costs are harder to recover. Unfortunately they’re not treated any differently from mortgage loans now, which puts them in the “high cost loan” category under the regulation (and the rulemaking is not nearly done on D-F by any stretch of the imagination). This means no points or closing costs in many cases, and significant restrictions on late fees.

Now, some of this is the government effectively saying to folks (both sides of the transaction): Just rent, please. A little more of that attitude might have helped a few million people from 2005-2008, but I doubt seriously in the case of manufactured housing it was by design. I think they didn’t realize what they were doing.

DrSteve on May 2, 2012 at 2:22 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

Any business that accepts credit cards or check cards as payments has been impacted by Frank-Dodd. Any other questions Mr. Investment Genius who predicted SBUX would hit $70 by end of April?

angryed on May 2, 2012 at 2:25 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

Any mortgage broker has had numerous additional forms added to a loan origination process by Dodd-Frank. But hey, filling out all those forms doesn’t impact business, right? Time is limitless and spending an extra hour per mortgage filing out those forms doesn’t impact any business whatsoever.

angryed on May 2, 2012 at 2:27 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

Obamacare has drastically changed the rules for what constitutes an allowable medical expense under an HSA or FSA plans. But that didn’t impact any employers, right? Nobody had to get the new regulations, study the regulations, inform employees, right? All of that happened magically and there was no cost involved with the process whatsoever.

angryed on May 2, 2012 at 2:28 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

Thanks for Obama, CAFE standards will add on average $3000 to the cost of a new car in the next 3-4 years. But that won’t impact business, right? After all no small business uses a car/truck in any capacity. That’s so 2008. Now everyone just blinks their eyes and transports their goods to the destination without a truck/car involved. So that won’t impact businesses.

angryed on May 2, 2012 at 2:30 PM

Del Dolemonte on May 2, 2012 at 1:54 PM

True, hard to imagine an industry so victimized by unnecessary regulation and oversight. How terrible!

http://www.ritholtz.com/blog/2011/12/fbi-estimates-80-of-mortgage-fraud-involved-industry-insiders/

http://www.ritholtz.com/blog/2011/12/unprecedented-fraud-toothless-watchdogs/

Pauline Krugman on May 2, 2012 at 2:01 PM

lol. I am in no way a “mortgage industry insider” and never was. As I told your pal Eric Alterman earlier in this thread, I work in one of many of the associated mortgage service industries, and never was a mortgage broker or a mortgage originator.

Ever heard of the Dodd-Frank Wall Street Reform and Consumer Protection Act? That Act, which you Democrats own, has added several additional layers of Federal Regulation to everything from mortgage origination to real estate appraisals. Ironically Dodd and Frank themselves created most of the problems that their Act has tried to solve.

From last year:

President Barack Obama is expanding his use of federal regulations by prodding the financial sector to sell low-interest mortgages to millions of cash-strapped homeowners “independent of how deeply underwater they are,” said Shaun Donovan, Secretary of the Department of Housing and Urban Development, Monday morning.

White House officials worked with real-estate and financial-sector groups to shift the financial risks that have kept high-risk borrowers from getting mortgages. Under Obama’s plan, low-interest mortgages will even be offered to homeowners who need to borrow 125 percent of a house’s value, Donovan added.

-snip-

This risk-adjustment strategy, however, can be risky for taxpayers.

In part, the current recession was caused by federal efforts on the part of Presidents Bill Clinton and George W. Bush to have the federal government shoulder finance companies’ mortgage risks by granting mortgages to lower-income Americans.

The risk were lowered by having government-backed agencies, Fannie Mae and Freddie Mac, guarantee risky mortgages prior to them being sold to Wall Street investors. Subsequently, the investors — and the banks’ shareholders — lost billions of dollars in stock value when too many loans were unpaid.

This risk-shifting strategy allowed Bush and many legislators to spur the post-9/11 economy without appropriating more funds via Congress.

Del Dolemonte on May 2, 2012 at 2:31 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

There is a new set of federal regulations on the use of pesticides by commercial operators. But hey, that won’t impact any of the small businesses that use pesticides, right? They’ll just magically change their business process and pricing to conform to the new regulations.

angryed on May 2, 2012 at 2:32 PM

Obamacare has drastically changed the rules for what constitutes an allowable medical expense under an HSA or FSA plans.

I’m still pissed about that one. I always considered my FSA part of my health care plan — and I liked my plan, so I believed I would be able to keep it (ahem). My annual election was waaay above the current threshold (2 family members with autoimmune disorders), so that was a definite tax increase for me directly associated with PPACA. I have no doubt it made the FSA less attractive to employers, and woe betide those companies that administer FSA plans as their primary line of business. Ouch.

DrSteve on May 2, 2012 at 2:38 PM

Resist We Much on May 2, 2012 at 2:21 PM

It was repealed. Even Democrats realized just how idiotic that rule was. The only thing repealed in ObamaCare to date I think.

NotCoach on May 2, 2012 at 2:38 PM

Question: Are the liberals purposely destroying America or are they just clueless?

Answer: Stimulus failed, Stimulus 2 failed, they want another stimulus and more failure… This is intentional, it is not about differing beliefs, it is not about being an idiot. It is evil, plain and simple.

jeffn21 on May 2, 2012 at 12:44 PM

Isn’t that the DEFINITION of liberalism: doing the same thing over and over again, and expecting different results each time?

If 100 million murders don’t make them question their theology; it’s safe to say a few trillion dollars of other people’s money are less than irrelevant to them.

logis on May 2, 2012 at 2:48 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

My sector of the mortgage industry depends on real estate appraisers to provide us with accurate valuations. Since the Democrats took over Congress in 2007, those folks have seen countless increases in Federal regulation, much of it taking place in the year 2007 itself before the Recession began but continuing each and every year. To give you one example of a new Federal Regulation impacting my business, last year the Feds started requiring those Appraisers to use a totally new format for their reports, called UAD.

To improve the quality and consistency of appraisal data on loans delivered to the GSEs, Fannie Mae and Freddie Mac, at the direction of the Federal Housing Finance Agency (FHFA), have developed the Uniform Appraisal Dataset (UAD), which defines all fields required for an appraisal submission for specific appraisal forms and standardizes definitions and responses for a key subset of fields.

For appraisals with an effective date (date of inspection) on or after September 1, 2011, the appraisal report must be completed in compliance with the UAD for conventional mortgage loans sold to Fannie Mae or Freddie Mac.

The UAD is a component of the Uniform Mortgage Data ProgramSM, jointly established by Fannie Mae and Freddie Mac under the direction of our regulator, the Federal Housing Finance Agency, to provide common requirements for appraisal and loan delivery data.

This SINGLE new layer of Federal Regulation immediately impacted not only the appraisers themselves, but us folks in the mortgage sector who use their services. The appraisers had to immediately spend extra money to take classes to acquire knowledge on how to fill out the new, much more complex forms, but also had to spend extra money to acquire the required new software updates for the new forms, which are required for single family homes and condos.

On my end of the mortgage sector, we had to spend extra funds to upgrade our computer systems to handle this new appraisal format, and also extra funds to train people how to read and understand the new format.

In the long run, the appraisers themselves have adjusted quite well, but the folks in my end are worried because one of the major goals of UAD was to eliminate layers of mortgage processors to streamline the mortgage process. In other words, Dodd and Frank wanted to put more people out of work.

Once again, thanks for admitting you’ve never owned or run a business.

Del Dolemonte on May 2, 2012 at 2:49 PM

http://www.zerohedge.com/news/zuckerman-cnbc-recession-never-ended

FTA:”Everyone’s favorite perma-bullish stand-in for Cramer, Fast Money’s Scott Wapner, seemed lost for words when Boston Properties CEO Mort Zuckerman laid down some basic truthiness on the state of the US economy “We have the most stimulative fiscal and monetary policy in the history of this country and here we are three years into the recession and it’s not ended. I think we may be heading for an even weaker economy this year than people expect.”

There is a reason a large majority know the recession/depression never ended. It didn’t.

Thanks for Obama, CAFE standards will add on average $3000 to the cost of a new car in the next 3-4 years.
angryed on May 2, 2012 at 2:30 PM

I mentioned that upthread. Did you see the new regs on aircraft de-icers?

dogsoldier on May 2, 2012 at 2:59 PM

Once again, thanks for admitting you’ve never owned or run a business.

Del Dolemonte on May 2, 2012 at 2:49 PM

Well written.

dogsoldier on May 2, 2012 at 3:02 PM

angryed on May 2, 2012 at 2:32 PM

I wasn’t referring to the imaginery regulations you hear Rush Bimbo and Sanity spew every day. I want you to state ACTUAL regulations that have negatively impacted you as a small business owner or someone you personally know. I gave an example of a friend who is in construction and told me how he felt some of the local rules around asbestos were too burdensome. Rules were since relaxed since 2008.

Del Dolemonte on May 2, 2012 at 2:49 PM

I have friends in the mortgage industry as well. A bulk of them complain about the housing sector not picking up. I am yet to hear any of them complain how your BS UAD law is why they aren’t making money.

Uppereastside on May 2, 2012 at 3:25 PM

Uppereastside on May 2, 2012 at 3:25 PM

You asked for him to list ONE regulation and several were cited. You then proceed on a tangent about your friends not crying over regs but the market not picking up. I believe you have just had your arse handed to you. Now you and your cohort will probably try and excuse the extra regs away as not all that cumbersome.

JAGonzo on May 2, 2012 at 3:43 PM

Mr “Small Business”- Still waiting on ONE not TWO but ONE new regulation under the socialist’s regime that has impacted your business.

Uppereastside on May 2, 2012 at 2:07 PM

Among other specific federal regulations that are hurting the mortgage business are, the new rules on what loan originators can be paid and how they can be paid. I have to pay each loan officer a specific and pre-determined amount based on loan amount. If they make a mistake in locking/pricing or if they want to give some of their commission to a borrower for rate reduction or cost reduction(used to be a common practice), they cannot. Since I manage and I want to get paid on eeevil profitability, I cannot originate anything. This removes the ability for me to make a little extra money which I would use to put back into my business or use to hire more staff. Not really that big of deal for me personally but makes a dramatic effect on any smaller companies with “producing” managers. The appraisal thing is a big deal as was mentioned. First there was HVCC(home valuation code of conduct), that the feds and big banks used to force AMC’s(appraisal management companies) into the appraisal process. It basically added a huge additional link between the originator and the actual appraiser. And, if HVCC wasn’t bad enough, along came Dodd-Frank to take over and add more regulations on top of it. By federally requiring the use of AMC’s they created an entire level that did not need to be there. It added 2 to 400 bucks to each appraisal, took most of that from the appraisers and added about 200 to the cost of each loan that the consumer ends up paying in the end. Many of these things needed to be reformed, but instead of helping the industry police itself or taking a market based solutions approach, they ended up removing choices from business owners, borrowers and everyone involved. We can argue forever about what needed to be done and what was done but here are some specific examples. I can go all day with more specifics as well. Simply because you got an A in critical thinking class and you think it is fun to point out the hypocrisy that everyone engages in does not mean you have any real world knowlege of anything other than your personal perspective and opinion.

pistris on May 2, 2012 at 3:50 PM

Paul, Paul, Paul…

It’s “Big Stick”, buddy, not “Enormous Package”…

mojo on May 2, 2012 at 4:02 PM

angryed on May 2, 2012 at 2:32 PM
I wasn’t referring to the imaginery regulations you hear Rush Bimbo and Sanity spew every day. I want you to state ACTUAL regulations that have negatively impacted you as a small business owner or someone you personally know. I gave an example of a friend who is in construction and told me how he felt some of the local rules around asbestos were too burdensome. Rules were since relaxed since 2008.

Del Dolemonte on May 2, 2012 at 2:49 PM
I have friends in the mortgage industry as well. A bulk of them complain about the housing sector not picking up. I am yet to hear any of them complain how your BS UAD law is why they aren’t making money.

Uppereastside on May 2, 2012 at 3:25 PM

Many of these additional regulations especially for construction are state mandated and regulated. But you need to regognize the link between the feds, EPA, etc., and the states. Especially here in Kommiefornia there is virtually no difference between the state and the feds, they are working together and an states that don’t, the feds sue and who has the bigger war chest?

With regards to the housing sector,.. Do you think perhaps that the feds micro-managing the short sale and foreclosure process has anything to do with the lack of market recovery? I know it is different in other parts of the country but here in the CA central valley, the biggest problem is the massive lack of available inventory of homes on the market. Federal and state regulations has slowed the short sale and foreclosure process to a crawl and it we have never even seen signs of a recovery. This has been a problem since literally Jan of 09. Each one of my loan officers must have 25 fully qualified borrowers that can’t find homes due to lack of supply. Astonishing but true.

pistris on May 2, 2012 at 4:16 PM

pistris on May 2, 2012 at 4:16 PM

Like i said, i know folks in the same industry who aren’t complaining about all these “regulations” you are talking about.

That said, if these regulations are so cumbersome, why don’t you write your congressman and detail them to him the way you just did here. That way he just doesn’t go on CNBC or Fox News and scream regulations without being specific.

Might there be some regulations out there stifling growth? Of course. However republicans have been known to blame higher taxes and regulations on everything you can ever imagine. They have managed to politized legitimate concerns you and others may have about actual unnecessary regulation. That is why folks on the other side of the aisle call their BS when they scream regulations this regulations that.

Uppereastside on May 2, 2012 at 5:22 PM

Krugman is living proof that years spent at academic institutions does not equate to getting an education.

Machismo on May 2, 2012 at 6:02 PM

Hey, Krugman! I’ve got your huge stimulus package. Here’s your huge stimulus package. I’ve got your huge stimulus package right here. (Said with appropriate gestures).

Mason on May 2, 2012 at 8:50 PM

Obama should demand it I say!! Demand more of other people’s money to spend!! Obama should take his advice and demand another trillion in the middle of this election year. Please, please, please do it Obama!

Dollayo on May 2, 2012 at 9:48 PM

That said, if these regulations are so cumbersome, why don’t you write your congressman and detail them to him the way you just did here. That way he just doesn’t go on CNBC or Fox News and scream regulations without being specific.

What a fat load of crap. We live in an age where one party locks the other out of the legislating process (think 2009-2010) on certain bills. What makes you think they give a rip about constituents except maybe 2 to 3 months out from the next election?

Difficultas_Est_Imperium on May 3, 2012 at 12:01 AM

Does anybody STILL in their right mind even listen to Krugman anymore???

Colatteral Damage on May 4, 2012 at 3:48 PM

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