There is something that I have been wondering about tax cuts for the wealthy supposedly driving an economic recovery. Somebody explain to me if I have this wrong.

The idea behind giving tax cuts to the rich is that they would then invest that money into new businesses, thus generating jobs, which in turn create tax revenue and spending to spur the economy.

However, it seems to me that if the economy is stalled and sales of goods and services is slow, then the last thing you would want to do is give money to rich people.

Here’s how I see it: if most people–lower- and middle-class Americans, in this case–do not have much money to spend and are not going out and buying stuff, then no amount of money given to the wealthy will lead to new jobs. Why not? Because it does not matter if you give a rich person a billion dollars, they are never going to invest in a new business to make stuff if they think no one is going to be able to buy their product. If inventories are sitting on shelves and new products would never sell, it simply wouldn’t make sense. They would find some other way to make that money work for them, but it wouldn’t involve creating jobs, either directly or indirectly.

Now, turn that around. Let’s say that you don’t give wealthy people any money–in fact, let’s say that you raise their taxes and cause them to have less money. But the lower- and middle-class Americans have money to spend and are buying products faster than they can be made. Demand is high. Will businesses say, “Gee whiz, I’d like to invest, but darn it if my taxes are too high”? Of course not. they will use what capital they have, or they will get others to invest in their business, or they will borrow the money somehow–but if there is demand, there will be investment.

So, explain to me exactly why giving money to wealthy people ever makes a stalled economy take off?

That’s the headline:

GOP: No more help for jobless, but rich must keep tax cuts

WASHINGTON — Republicans almost unanimously oppose spending $33.9 billion for extended unemployment benefits for some 2.5 million people who’ve lost them, because they say it would increase federal budget deficits.

At the same time, they’re pushing a permanent extension of Bush administration tax cuts, especially for the wealthy, which could increase federal budget deficits by trillions of dollars over the next 10 years.

How do they justify this?

Good question. The answer: Darwinian philosophy thinly disguising a well-known bias for rich people. Poor people vote Democratic; you don’t want to give money to those people. Besides, they lost their jobs, and conservative economic philosophy says that losers don’t deserve pity or help–that’s socialist entitlement bullcrap. Rich people, on the other hand, deserve to keep the money they’ve earned–because they’re so good at investing it in stuff like making businesses that employ those jobless people (and, um, they make sizable campaign contributions, ahem).

Forget that the economic engine is driven primarily from money spent by people just like the ones who are jobless, while more money for the rich is what causes the economy to stall. Rich people can be as rich as you can make them, but none will invest in new businesses if the common folk don’t have any money to spend.

And that thing about paying for stuff and how deficits will destroy us? That just applies to Democrats, you silly. Haven’t you been paying attention?

So, what does this look like to you? Apple comes out with two hit devices within a few months. Apple posts record profits and sales. Throngs line up to buy new Apple products. Analysts–again–hike up Apple’s stock price target, this time to $375, a full $100 above current value. Apple has never been stronger, and is just getting stronger and stronger still.

So what have we seen the past few days? Apple’s stock taking steep, sudden, unexplained dives. Most notably right this moment, having fallen about $7 or nearly 2.5% in less than half an hour.

Can anyone say “stock price manipulation”? Nothing but criminally dishonest traders beating down the price of an undervalued stock, knowing that it will inevitably get back up again and gain them tons of profits by betting against it and then for it.

Where the hell is the SEC when crap like this is going on? Or is this completely legal and/or just overlooked?

290,000 jobs added in April. With adjusted numbers for February, the fourth straight month of job growth. The best jobs report in 4 years. Even the uptick in the unemployment rate–from 9.7% to 9.9%–was good news in disguise, as it reflected people who had given up the search for work rejoining the ranks of applicants. And the job numbers for February and March were both adjusted upwards. The new chart:

Republican attempts to (a) credit Bush and/or themselves, (b) deny that Obama had anything to do with it, and/or (c) blow this off as insignificant, in three, two, one…

What is encouraging is how the trendline is holding steady. It may be unrealistic, but the current trendline has us gaining roughly 750,000 jobs per month by the midterm elections. That trend will, of course, max out at some point, likely before 500,000, but still, the regularity of the trend so far is very encouraging.

I believe that the technical economic term for what you see below is a “roller coaster ride.” You know, where you first get cranked up almost vertically, and then your stomach falls out as you drop, several times.

After Apple’s spectacular earnings report late last week, the stock shot up. Early Monday morning, Philip Elmer-DeWitt quoted a stock analyst predicting a “major sell-off,” and though he thought Apple stock would go up, he also called for it to plummet to $200 soon, taken down with the rest of the market. A few hours later, AAPL dropped by about $3 in a matter of minutes. The next day, there was an even steeper drop of about $5. The next day, in pre-market trading, it plummeted by about $8, erasing all of its gains after the earnings announcement. But then it came back up, then immediately plummeted $8 again in regular trading.

Believe me, after having lived with this stock through the Bush collapses in early and late 2008, when drops like the ones we saw this week led to $80 free-falls and worse, it is not in any way describable “easy” or “comfortable” to sit back and watch this happen, and not do something about it. Fortunately, since Wednesday afternoon, the stock has climbed back up and is just $4 off it’s peak. Hopefully it will start climbing again.

Now, I have been planning for some time to sell off about half my stock this year and hang on to the other half for at least another year or more. I will feel a lot more comfortable having done that, without the whole market tumbling first. And it was not DeWitt’s column or the analyst’s prediction that caused this (though many commenters in the column roundly blamed both for exactly that), but market activity in general, including the thing in Greece. Although, one does smell the malodorous presence of people playing the market for a quick buck–one almost hopes, as it would suggest a better overall stability. Still, it makes you think.

In a development one can be assured Republicans will try to find a way to attribute to the Bush administration, the U.S. economy added 162,000 jobs in March, the biggest job gain in three years, since the Bush recession began. Analysts expected 190,000 jobs gained, but that figure is likely to be realized with adjustments over the next two months. Unemployment remains at 9.7%, but is below double-digits; while the job market remains tough, we are still in an upward trend and are now in positive territory. Compare this to January 2009, when Bush left office and 741,000 other Americans lost their jobs at the same time.

Obama’s stimulus was put into play, and immediately Bush’s plummet was reversed. Aside from Obama’s election in general, no other major factors aside from the stimulus seem to be able to explain the upswing in job creation. This month’s job report puts us comfortably on the plus side, and hopefully that trend will continue along the lines it has over the past year.

Compare this to when Bush was handed a shaky yet overall positive job market in 2001; he passed his massive tax-cuts-for-the-rich and immediately send jobs down the toilet–and did not see this kind of recovery until October in his third year in office. Bush, on the other hand, handed Obama the worst recession in recent history, the worst since the great depression, and we were hemorrhaging jobs–and Obama is back in positive jobs territory after just 14 months.

Any way the conservatives want to spin this, even despite the still-distressed economy, it cannot be denied that the Obama recovery is remarkable, perhaps even startling. If the current trend continues, we could be seeing aggressive job gains by summer (in the 400,000 ~ 500,000 range), in time to impress voters before the midterms. That would allow Obama and the Democrats to tout their two major victories–the Stimulus and Health Care Reform–in a light that makes clear the long-term benefits of both. And they can point to undeniable massive Republican obstructionism, and state truthfully that the Republicans tried to stop the recovery. Remember, they said it aloud: they wanted Obama to fail. Just run on the record: Republicans were driving us into a recession, and then tried hard as hell to stop the legislation that we can now see is bolstering the economy.

Republicans will no doubt bring up the deficit in criticism of this, but Obama and the Dems can correctly point out–aside from the fact that most of the debt is Republican-generated–that in order to drive down the debt, you must first have a strong economy. We had to spend before we could do anything else; failing to do so would have been courting economic collapse. Had Republicans gained power and there had been no stimulus–or worse, more massive tax cuts for the rich like Bush used in 2001 to drive job losses further–we would have been in a hell of a mess by now, maybe even in a depression.

The Dems just have to show the Bush trend and where it was leading, and contrast it with the Obama trend. This is the magic chart that could win the midterms:

Look at that red trend line and imagine where we would have gone had McCain won, or worse, the Republicans had also controlled Congress. One shudders at the thought.

The difference could not be more stark. Republicans were driving us straight into the toilet; a depression was imminent. Obama and the Dems intercepted that long-bomb pass Bush threw straight to the depths of hell, and are now rocketing out of the chasm Bush was dragging us into, a recovery clearly foreseeable. (It won’t be so easy to recover from the staggering debt Bush drove us into, but aside from that….) Back this up with strong job gains into the summer, with people feeling the recovery in their guts, and the point will be driven home.

This is not one of those bogus charts where a regular trend line to the present is “predicted” to take ridiculous turns in the future, with “our” party’s line going straight up and “their” party’s line going way down. These are actual figures showing definite trend lines based on hard fact.

That chart should be made into a theme for the next seven months, it should be iconic for these elections. Show it every chance you get. Put it up on walls, show it on broadcasts, make it into backdrops for rallies and speeches. Convert it into a simpler graphic:

This part of Obama’s response to Republican accusations bears repeating often:

Jeb, with all due respect, I’ve just got to take this last question as an example of how it’s very hard to have the kind of bipartisan work that we’re going to do, because the whole question was structured as a talking point for running a campaign.

Now, look, let’s talk about the budget once again, because I’ll go through it with you line by line. The fact of the matter is, is that when we came into office, the deficit was $1.3 trillion. — $1.3 [trillion.] So when you say that suddenly I’ve got a monthly budget that is higher than the — a monthly deficit that’s higher than the annual deficit left by the Republicans, that’s factually just not true, and you know it’s not true.

And what is true is that we came in already with a $1.3 trillion deficit before I had passed any law. What is true is we came in with $8 trillion worth of debt over the next decade — had nothing to do with anything that we had done. It had to do with the fact that in 2000 when there was a budget surplus of $200 billion, you had a Republican administration and a Republican Congress, and we had two tax cuts that weren’t paid for.

You had a prescription drug plan — the biggest entitlement plan, by the way, in several decades — that was passed without it being paid for. You had two wars that were done through supplementals. And then you had $3 trillion projected because of the lost revenue of this recession. That’s $8 trillion.

Now, we increased it by a trillion dollars because of the spending that we had to make on the stimulus. I am happy to have any independent fact-checker out there take a look at your presentation versus mine in terms of the accuracy of what I just said.

It shows up the stunning hypocrisy of the GOP: to take a budget surplus and a promise to start paying off the debt, and immediately turn that into massive deficits and $8 trillion in debt–but the moment Obama takes office, pretend that he created it all and was fully responsible for it being there. Garrison Keillor expressed the Republicans’ mendacity best:

The bums have tiptoed out the back door and circled around to the front and started yelling, “Throw the bums out!”

Let’s make it clear: this is not Obama acting like Bush and trying to blame his current failures on the previous administration. Obama owned up to what he added to the debt. But he also pointed out that you could not blame him for losses incurred before he had the chance to act, nor could you fault him for having to start working deep down in a hole created by someone else. Republicans may be desperate to do so, but Obama’s having none of it, and rightly so.

Remember, Clinton left office with a jobs report that had only 16,000 jobs lost in one month, after several months of sporadic gains and losses (the gains were greater), with only a possibility of downturn; it took Bush 16 months before he broke even with that level of job creation, and it took him two and a half years before he had regular job growth again.

Obama, on the other hand, was handed job losses which for 3 months straight had exceeded 680,000. In just one year he has almost brought us back to jobs being gained again, and by relative terms, is about 600,000 jobs per month in the black from what Bush left him. In fact, the news may be better than that: job numbers for November were revised up to show the first job gain in two years, and although December job numbers came back down to 85,000 losses, that number could also be revised upwards, if things go well.

Unemployment rates are high mostly because of the massive losses that Bush generated, and Obama had to make huge strides upward and go into positive job gains again before the number could come down–and Obama is nearly there after only one year.

Take a look at the differences; below are two charts, showing job gains and losses for one year before the transition, to 11 months after the transition (the latest numbers we have for Obama), keeping in mind that the December ‘09 job numbers are preliminary:

Jobs gained/lost: Clinton to Bush

Jobs gained/lost: Bush to Obama (Dec. 09 may be revised)

See the difference?

Add to that the surprisingly high Q4 2009 GDP numbers, even after mitigating factors are removed, and you have very strong promise for the economy right now. Hopefully, the jobs report due out in a week will show the first growth since December 2007.

Make no mistake: Obama’s economic performance so far has been astonishingly good, extraordinarily better than Bush’s at this point–despite the fact that Bush had already committed the country to far more debt at that point with his tax cuts than Obama has at the same point with his stimulus.

The idea that Obama is not doing a good job with the economy is purely an illusion created by the deep pit Bush had dug for him, an illusion that the Republicans are attempting to reinforce and amplify. And Obama was 100% correct for swatting them down.

Great. My Apple stock was doing great–at $215 a share, and set to go way up. Everyone rates it as strong, and there’s general concurrence that it will go up to at least $260, with many speculating that over the next few years, it can go up to $500 or even $1000–and for very good reason. Apple is set to release the tablet, computer sales are up, it is conquering the smartphone market worldwide, and its computer market share is growing, with lots of potential.

But over the past three days it has slid from $215 to $197, $10 of that just in the last day. WTF?

And then I see the reasons:

The game was “on” big time this week. Petulant “let’s teach Obama a lesson” Street players did their thing on Thursday and Friday (today). The market’s big move down was partly the Street’s retribution against the Obama Administration for daring to regulate proprietary trading by banks.

The news on China and Bernanke didn’t help, but they weren’t the only causes here:

Apple (AAPL), being a large part of the QQQQs, was caught up in today’s down draft and was sold and shorted mercilessly, finishing the day down $10.58 (5.04%). Helping to accelerate the selling was a false report today about Apple (AAPL) being downgraded by Deutsche Bank. This “Apple (AAPL) downgrade” story was pumped widely by the Street echo-chamber (i.e. hedge funds, institutional trading desks and other denizens of Wall Street). It is my opinion that the majority of trading desks understood precisely what happened at Deutsche Bank, but held tight to the truth and may have intentionally misled the financial press (by omission).

Don’t you just love it when your personal fortunes are in the hands of these pricks playing their little games? As for Obama regulating trading, the Street’s reaction proves exactly why there should be a lot more regulation.

Right-wingers have been bashing Obama for “losing” millions of jobs–and have even found ways to bash him further still for the fact that only 11,000 jobs were lost in November. As if there was no such thing as “last year,” or even sometimes “last month.”

A quick study of the chart above (Bush months in red, Obama’s in blue) tells the story in undeniable detail: Bush drove us into one of the worst recessions in memory, with unimaginable levels of job losses totaling more than 700,000 per month by the time he left office. Obama came in, quickly instituted a stimulus package and–purely by coincidence, of course–the trend immediately reversed itself. November job loss numbers were only barely negative, promising possible job growth for December or early 2010. I would not be at all surprised if the new growth turns out to be steady.

There is no way to look at that chart and blame Obama for anything except reversing a horrific hemorrhage of jobs that Bush saddled the nation with. At best, if you want to insist that the turnaround, timed exactly upon Obama’s entrance and his promised deployment of a stimulus package, was nothing more than an incredible coincidence, then you still can’t blame him for anything–unless you want to contend that Obama has damaged job growth but that has only been overcome by a delayed economic miracle that Bush somehow quietly enacted when no one was paying attention. But realistically, this kind of result just doesn’t happen by chance. Obama clearly had a strikingly positive effect on employment. He hasn’t fully repaired the damage done by Bush, but he has clearly turned it back onto the right course, and was correct to claim ownership of that early this year (when it was far from certain that the numbers would improve as much as they have).

In contrast, look at the chart of job gains and losses starting at the same point near the end of Clinton’s second term (in blue), and then where Bush took it afterwards (in red):

Not quite as clear-cut as the previous chart, but one can see a pattern: Clinton handed over a bad economy, but it was only middling-bad. Keep in mind that Bush signed his huge tax boondoggle for the wealthy in early June 2001 (after it passed through Congress in May)–exactly at the time when job losses became steady and notably increasing. It took until late 2003 before sustained job growth returned. Now it looks like Obama will achieve the same thing in just over one year–not two and a half–despite being handed a death spiral which made the economy Clinton handed Bush seem positively robust.

Contrast the Clinton-Bush chart with the stark shape of the job losses under Bush and then Obama, and it’s inescapable: had Obama not come in and turned things around, we could have been looking at ten million more jobs lost. He turned that trend around, but fast.

And for this, right-wingers attack Obama for “losing” all of those jobs. It’s as if Bush put the national aircraft into a deep, steep dive, then Obama took control and immediately started to pull us up, and we’re now leveling out, much safer now–and right-wingers are thrashing Obama for being at a low altitude.

I shudder to think what would have happened had McCain won and vetoed anything except yet another tax cut for the rich. Yeah, that would have worked.

Yayy!! Some new terrible-looking thing we can blame Obama for! Yayy!!!

Of course, the truth is, it was Bush. Remember when unemployment went double-digit last time, and it was Jimmy Carter’s fault? Oh, wait, no–unemployment fell under Carter, and didn’t hit 10% (almost 11%) until two years into Reagan’s term. Of course, Republicans hold him responsible for all those jobs lost, right? Um, well…. And of course, they recognize that unemployment spiked the last four times under Ford, Reagan, Bush 41, and Bush 43, yes? Um, maybe not….

Of course, I have long since abandoned any pretext of expecting right-wingers to use actual facts instead of claiming whatever bizarre, hypocritical fantasy that suits their purposes for the moment.

The facts are, the current unemployment rate is solidly a Bush artifact. Take a look at the figures–first, job losses:

See how those jobless figures were dropping under Bush, and then they suddenly shot up under Obama? Oh, wait–the chart’s data reflects the opposite. Well, that can’t be! Jobless figures plummeting right after Obama passed the stimulus bill? Impossible!

Maybe the Unemployment numbers tell the tale better:

There, you see? Unemployment has risen under Obama! Just never mind the fact that it started to rise a year earlier under Bush! Pay no attention to that! Nor to the fact that though job losses have dropped steadily under Obama, he had to work from a massive 700,000+ job less per month that Bush saddled him with, and still hasn’t reached job growth yet.

You can bet that Republicans will crow about this wonderf–er, horrible news for the next week, month, whatever, blaming Obama for it 100%. America failed again! Yayy!!!

Until, of course, the unemployment rate drops under 10% again and steadily goes down, at which time it will be the distant hand of George W. Bush doing all the work!

I know that this is old hat, but it bears pointing out.

Conservatives claim that Obama is “bankrupting America” because, in response to an economic crisis, he put forward a stimulus bill in his first month in office which will eventually cost the United States a total of $787 billion.

On the other hand, conservatives to this day say that George W. Bush saved the American economy almost exactly eight years ago because, in response to an economic crisis, he put forward a tax cut plan (primarily benefitting rich people) in his first month of office which was projected to cost the United States a total of $1.6 trillion.

I’m pretty sure that $1.6 trillion is something like double $787, but I didn’t use a calculator to check. Of course, since 2001, inflation has made that $1.6 trillion into $1.9 trillion, but who’s counting? Well, these guys are (PDF), actually, and they say that Bush’s overall tax cuts wound up costing the United States $2.5 trillion. Again, no calculator, but I think that’s triple what Obama spent.

So: Bush spends $2.5 trillion in tax cuts mostly for rich people, and he saved the economy, while Obama spends $787 billion on a stimulus to create jobs, and he’s bankrupting us.

Did I miss the part where conservatives offered a cogent explanation of how these two opinions are reconcilable?

A big talking point of the Republicans is that Obama’s stimulus package has failed because the economy has failed to rebound, despite the fact that it’s only been a few months since the stimulus has been in effect. Even though preliminary signs were good–job losses turned around and started decreasing instead of increasing right after the stimulus passed–conservatives held that it had come and gone and, what, no effect. This despite giving Bush a far longer time to claim that his initiatives were successful, taking more than two years for most indicators, and even as late as 2004 Bush was still claiming that a job recovery was “just around the corner.” For Obama, right-wingers claimed that after three or four months, the game was over.

Now, many economists are saying that an economic rebound is in fact coming; indicators like the housing market and consumer spending are looking good.

So, how long until those very same conservatives who said no rebound meant Obama failed will now start claiming that the rebound has absolutely nothing to do with anything Obama has done? Three, two, one…

Don’t be surprised if many of them actually try to credit Bush for the rebound, claiming that Obama just wasted money on a stimulus that was not necessary after all. Now, the stimulus may not in fact turn out to have been the major reason for the rebound, in that there is usually not too much presidents can do to affect the economy positively (negatively is easy). But politically, presidents tend to get blamed for bad economies just by being there when it happens–look at how the right-wingers eagerly started calling it the “Obama Recession” just days after he got elected, months before he even took office–and, conversely, they get credit when economies are good. That’s simply how it works.

Whatever the case, if the economy does in fact rebound and things start clearing up, Obama will step up and take credit, and the Republicans will try to claim that somehow they were responsible (“we stopped him from making things worse with a bigger stimulus package!”). But since presidents historically get credit, and because Obama’s been the consistent one (conservatives not only have claimed that he is trying to destroy the country, but often claim that he has already destroyed it) in saying that things will get better. He has more cachet here.

Mike Huckabee on how Bush never blamed the recession on anyone else:

HUCKABEE: There’s one thing though that Biden and President Obama have got to get under control. And that is quit blaming George Bush. George Bush inherited an economy when he became president back in 2001 that was already beginning to show real signs of the stress from the breaking of the technology bubble. George Bush didn’t go out whining and complaining every day, he stood up like the president of the United States and he worked on trying to get it fixed.

Then 2001, 9/11 came, things really went tough, but he worked on the economy and it was in much better shape for most of his presidency. Then the recession started, wasn’t totally his fault for sure and all you hear from Joe Biden and President Obama is how, how terrible it was, what they inherited, how it wasn’t their fault. No, look, you own it now. You got elected, you wanted the job. Stand up and take it and get this thing rolling. But quit spending money.

Not only did Bush whine and complain, he did it every chance he got. When he mentioned the economy, he constantly threw in some mention of how it was already in motion when he took office, making sure people knew that he was not to blame. Not only this, but he did it throughout his entire eight years in office, right up to his last press conference.

In fact, Bush used the economic slowdown in the exact same way Obama is using the current one–which is to say, using it as a reason to push his financial package. Every time the slowdown or recession was mentioned, Bush used it to push his massive tax cut agenda. And as you can see from the quotes below, it was accompanied by repeated comments about when it started, pinning it on the last guy.

So I went and got most of these from Bush’s White House archives site, a few from other places–and by the time I got to 2004, I just got tired and jumped to 2008. Trust me, there’s lots more. You can go check yourself. Below I list only Bush’s direct quotes, though I found endless quotes by Cheney (a few: “To begin with some recent history, President Bush and I came to office facing a recession that had already begun.”, “We inherited a recession. The recession began the first quarter of ‘01, when we first arrived.”, “We inherited a recession, a recession that began either shortly before or about the same time that we got into office.”) as well as several Bush administration Press Secretaries and cabinet officials. But Huckabee said “Bush,” so here is a small sample of Bush’s modesty and non-whining:

“Our economy is sputtering. Economic growth has stalled. Consumer confidence is falling. We can’t just stand by and hope for the best. We must act, and act now, to get ahead of this problem, and blunt or reverse this slowdown.”

–George W. Bush, March 10, 2001

“For several months, economic indicators have pointed toward a slowdown, and now many Americans are beginning to feel its impact in your lives.”

–George W. Bush, March 17, 2001

“And one of the problems we inherited was an economy that was sputtering along and slowing down.”

–George W. Bush, August 16, 2001

“I tell you what the numbers are showing. They’re showing that we’ve inherited an economic slowdown and the country is in an economic slowdown.”

–George W. Bush, August 23, 2001

“Many economists warned me when I took office that a recession was beginning.”

–George W. Bush, December 1, 2001

“You know, when I came into office, we were beginning a recession. I remember the Vice President saying that clearly.”

–George W. Bush, August 7, 2002

“You see, you’ve got to remember something about our economy. When we came in there, the economy was just beginning to get into a recession.”

–George W. Bush, August 29, 2002

“When we got up to Washington, D.C., the country was headed into a recession. Markets started correcting in March of 2000, that’s when it peaked. And then the summer the economic growth started to slow. And so by the time the Vice President and I showed up in Washington, D.C., we were in three-quarters of recession.”

–George W. Bush, September 23, 2002

“So with the combination of the loss of revenue as a result of the recession — which was official in January of 2001…”

–George W. Bush, May 2, 2003

“Let me tell you something, the deficit was caused by a recession which we inherited…”

–George W. Bush, August 13, 2003

“First, the stock market began a steady decline in March, 2000, as investors realized that the economy was not healthy. Businesses faced over-capacity during that period of time and cut their budgets for new investment in technology or equipment. And by early 2001, this economy was in recession.”

–George W. Bush, September 4, 2003

“We’ve been through a recession — and, by the way, the stock market started to decline six months before I became President. And then we had a recession.”

–George W. Bush, October 9, 2004

“When I took office, we inherited a recession…”

–George W. Bush, February 8, 2008

“We inherited a recession.”

–George W. Bush, March 14, 2008

“In terms of the economy, look, I inherited a recession, I am ending on a recession.”

–George W. Bush, January 12, 2009

Yep, Good ol’ George. Never willing to pass the buck.

While the Republicans may have done a lousy job of convincing the American people that Obama is to blame for the deficit, their long-term efforts to blame Democrats in general seem to have been successful. Witness the results of an NBC/WSJ poll (PDF):

Which ONE of the following groups do you feel is most responsible for the federal budget deficit?

Obama: 6%
Bush: 46%
Republicans in Congress: 7%
Democrats in Congress: 21%
Everybody: 13%

It’s fairly encouraging that only 6% truly believed that Obama could cause “most” of the damage seen in the federal deficit in just a few months in office than Bush could in eight full years; one can discount the 6% as the lunatic conservative fringe. “Everybody” is not a bad answer, either.

But look at the congressional numbers: Republicans 7%, Democrats 21%? When the Democrats have been in charge of the House for just over two years, barely in charge in the Senate for most of that time, the Republicans filibustering everything in sight, and Bush dominating things until just recently? That wins them 21%, while Republicans in Congress–who are in fact just as responsible as Bush, oversaw the majority of the deficit-building, and were guilty of extravagant pork and deregulation, only got 7%?

That has to be a result of either (a) Democratic respondents blaming Bush while Republican respondents blame Democrats, or (b) the successful job conservatives have done of making people believe the fiction that Democrats are to blame for spending no matter what, and that Republicans are fiscally responsible. It’s a given that Democrats in Congress have not distinguished themselves as fantastic budget-cutters, but to assign three times more responsibility for the current deficit to them than to Republicans in Congress is rather ludicrous.

A chart from the New York Times showing where the current deficit comes from. I have altered the colors so that Bush’s deficit is shown in red, Obama’s in blue. It is worthy to note two things: first, that most of what we see here has taken place over a relatively short period of time, over the last year or so. Second, that the lion’s share of Obama’s deficit consists of actions needed to fight off Bush’s recession. When you subtract continuing costs incurred by Bush policies (like the recession and the Middle East wars), Obama’s contribution is limited to that tiny arrow at the bottom right.

In any case, if you ever encounter a tea-bagging wingnut screaming that he wants to secede from the union because Obama is creating a deficit that’ll cripple us, show him this chart. He’ll ignore it, of course, or otherwise claim it’s irrelevant (or Clinton’s fault), but others in the room will see him for the idjit he is.

Once we get out of the current recession, expect to see us do something that Bush could not do: rise up out of this deficit.

A lot happening, a lot to talk about… but various things to take care of have made it a bit difficult to post over the past several days. Sorry about that.

One interesting point: in an encouraging sign, 345,000 people lost their jobs in May.

It is, of course, encouraging only in the context of 345,000 being way below estimates (the prediction was for 520,000 jobs lost), and May’s numbers showing the lowest job loss numbers in more than six months. As you can see from the chart on the right, there seems to be a trend from January that suggests we are quickly heading out of this recession. If you follow the trend line, we could actually be seeing job growth in three or four months–if the trend line holds or improves.

Is Obama responsible? Well, Obama passes a stimulus bill, and within a month or so job losses slow dramatically and the stock market gains 2000-plus points. Not proof positive, but it’s pretty hard to dismiss.

However, ever since Obama got elected, Republicans have been trying to blame him for anything and everything that smacks of bad news. Seriously, even after he was nominated as the Democratic candidate, Republicans have tried to pin stock market drops on him, as if the traders were going into wild panics at even the thought of Obama maybe becoming president.

And when Obama took office, Republicans took no time at all to go into full-blast blame-Obama mode, despite forgiving Bush for years of bad economic news because it was Clinton’s fault. A few weeks after Obama took office, the market dropped, and that was immediately jumped on. For example, in February, Malkin reached back to a November high to contrast the February low, blaming Obama for the stock market tumble. Even counting from January, when Obama took office, there was an apparent plummet that right-wingers wasted no time in laying at Obama’s doorstep.

Naturally, when the stock market then immediately regained and actually rose above the level it was when Obama took office (just a few weeks after the “ineffective” stimulus bill passed), the same bloggers’ thundering silence was hard to miss.

By the right-wingers’ own standards, Obama should be responsible for the first encouraging upswing since mid-2007. We’re still waiting for their congratulatory praise, their admission that the stimulus bill indeed stimulated the economy. After all, if Bush had gotten such immediate, positive results, the same people would be shouting this from the rooftops–but when Obama pulls off a relative economic miracle, they claim he is an abject failure.

Instead, Bush was supposedly not responsible for the downturn in the market at all–a lie easily proven false when one tracks back to stock market activity before the election. It’s kind of hard to miss the fact that the biggest losses came well into the remains of the Bush administration:

Malkin’s blaming of Obama for a 4-month, 2000-point drop kind of loses significance when one sees Bush suffering a 2,400-point drop in just ten days in October. In fact, the very temporary one-month drop looks insignificant when compared to the market’s activity in the last six or nine months of Bush. And I don’t think that Malkin has yet congratulated Obama for the 800-point rise relative to when he took office.

And let’s not forget that the change in payroll job loss numbers is kind of hard to miss–that the moment Obama took office, the numbers immediately switched from accelerating downward to slowing considerably, pointing to a possible end of the recession with such rapidity that Bush’s faux “recovery” will look ridiculously slow in comparison.

At which point, I have no doubt that the right-wing bloggers would yet again do a 180-degree double-flip-flop and again assert that the previous president’s influence is what should be credited with the economic performance a year or two after the next president takes office–completely ignoring their previous claims that anything after November 2008 was completely Obama’s fault.

As for now, the right-wing blogs are mostly ignoring the encouraging job news altogether. The few wingnut blogs that are talking about May’s job numbers are pretending like the payroll numbers don’t exist or don’t matter, and instead focus on the unemployment numbers, which rose more than expected. From Hot Air:

The unemployment numbers for May hit earlier this morning, and it looks like Barack Obama didn’t save many jobs at all. Despite claims from both Obama and VP Joe Biden that the Porkulus package had saved 150,000 jobs, unemployment went up another half-percent to 9.4%, setting a new record for the past quarter century. … Why is this important? It demonstrates that the President and his economic advisers have gotten pretty much everything about this economic collapse wrong.

Outside the Beltway does mention the job numbers, but only at the end of their post about the unemployment numbers, and only to make the claim that they don’t matter:

Going by the Household Survey the number of unemployed increased by 787,000. This makes this recession as bad as 1957 and not quite as bad as 1948 in terms of unemployment. So despite the very mild good news yesterday about new jobless claims this data more than offsets it.

Even this grasp at painting the worst possible picture is hollow and false. As the NYT Economix blog patiently explains, the reasons for the unemployment numbers rising are not so dire–and may even be encouraging. While some of the number hike is due to the fact that 345,000 lost their jobs–still a loss, despite the great improvement in numbers–another part of the rise in unemployment is due to the fact that a much larger number of people than usual are trying to re-enter the job market. These are people who lost their jobs under Bush and had stayed unemployed for so long, they had dropped off the charts altogether–but now have reappeared because they apparently have new hope that jobs can be found. As for jobs Obama has saved, if you use Bush’s last numbers–700,000-plus jobs lost in January–as a baseline, Obama has saved about three-quarters of a million jobs already. Not that I take that claim seriously, but it conservatively follows the logical pretexts that right-wingers laid down.

So, the May payroll job numbers are about 175,000 jobs better than forecast and show a greatly encouraging trend toward rapid exit from recession, and even the higher unemployment numbers signal widespread confidence that jobs can be found, and people are out there looking for them–but all the right-wingers claim to see is bleak prospects–or nothing at all.

Not surprising.

As I recall, back when Bush was in charge and anyone tried to claim things weren’t going so well, they were accused by the right-wingers of trying to talk down the economy, of trying to make things worse so they could criticize Bush.

And now?

Jonathan Chait of the New Republic:

Quite possibly, four years from now we could still be mired in a worldwide depression and Obama could be facing dismal — who knows, even Bush-like — popularity ratings. The world is unpredictable. But isn’t there a pretty decent chance that the economy will have recovered, and Obama’s policies will look fairly wise in retrospect? Do Republicans want to make any political plans for this contingency?

Sure they have a contingency plan: lie. That’s how they claimed Clinton was not responsible for the booming economy he oversaw. If the economy gets better, claim it was because of actions taken by Republicans in the Bush years which came to fruition later, because of economic conditions completely divorced from Obama, and because of pressures Republicans exerted to shape policies during the Obama administration. Meanwhile, they will blame Obama for every piece of negative news during that time (there is always something bad happening), and will claim he’s the most liberal and worst president ever.

Is Chait new here or something?

The incessant, frenzied, paranoid, schizophrenic, and often downright vile right-wing campaign to make Obama fail and turn the nation against those nasty, communist liberals is not doing so well. According to the latest NY Times poll, Americans think we’re doing better and are headed in the right direction–and they think that the Republican Party has hit the bottom of the barrel:

…the number of people who said they thought the country was headed in the right direction jumped from 15 percent in mid-January, just before Mr. Obama took office, to 39 percent today, while the number who said it was headed in the wrong direction dropped to 53 percent from 79 percent. That is the highest percentage of Americans who said the country was headed in the right direction since 42 percent said so in February 2005, the second month of President George W. Bush’s second term.

The percentage of people who said the economy was getting worse has declined from 54 percent just before Mr. Obama took office to 34 percent today. And 20 percent now think the economy is getting better, compared with 7 percent in mid-January. …

By contrast, just 31 percent of respondents said they had a favorable view of the Republican Party, the lowest in the 25 years the question has been asked in New York Times/CBS News polls.

Of course, this is perception–but the nation’s economy is largely fueled by perception, as are election results. How this will translate into actual economic improvement over the next year is a different matter, as many elements of the economy are out of the control of mere perception, and could scuttle confidence.

Still, what we see is a measure of faith and trust: Obama and the Democrats are instilling more confidence and approval in the people, while Republicans are driving them away.

So, keep at it, Rush. You’re doing just fine.

You know that when Republicans start talking about class warfare, it’s because they plan on waging it even more than before.

You know that Republicans in D.C. have lost their moral compass, that happened quite a while back. You know they they will lie and obfuscate to ridiculous extremes, depending on the the media to back them up, enough to sound credible and get it presented raw to the American people and be believed by many.

But this is pretty amazing. I mean, there is lying, and there is lying. I know I keep on acting surprised at the lengths they go to, but they keep on getting more and more outrageous. Representative Paul Ryan, the ranking Republican Budget Committee member, said this when presenting the Republican budget that actually had some numbers, however ridiculous, in it:

“You’re gonna hear a lot of echoes of class warfare. You’re gonna hear allegations of draconian spending cuts. You’re gonna be told that there is no viable choice for America other than to embrace the president’s radical fiscal agenda. Let me respond to that right now.

”Using class-warfare to take advantage of peoples’ legitimate anger and anxiety, it may make good policy but it’s not leadership. Preying on people’s emotions of fear and envy, it doesn’t create jobs. It demoralizes the small businesspeople who are trying to become successful, and it demonizes the small businesses that are successful that create most of our jobs.“

Some things he got right: using class warfare is wrong and it’s not leadership. The error: he ignores the fact that class warfare is a two-sided battle, and conservatives have been waging that warfare more vociferously and have been winning it outright for quite some time now. Think not? Then when rich and poor both needed bailouts, who got no-strings-attached billions and who got short-changed? Who got handsome bonuses and who got told to take a wage cut?

Republicans have been playing at class warfare for a long time now, and what Ryan said is, in a way, nothing new–when Republicans want to open up a whole new front in the class warfare battle, they always start by accusing the other side of it first. But who’s waging war here? Obama, who wants to take the best tax environment for the wealthy in a long time and scale it back just a smidge in the direction it had been for decades?

Or is it the GOP, which launches massive tax cut after massive tax cut for the wealthy, then turns around for some more union busting, followed by slashing of services and benefits for the middle and lower class? Almost their whole agenda is class warfare. When the poor needed cheaper drugs and the taxpayer needed a break with Medicare spending, who instead gave all the power, leverage, and profit to big pharma? When the people in dire straits were pitted against the loan industry, who pushed through legislation to put all the advantages in the hands of the big banks? And in this latest crisis, when regular people overstepped their means but banks lured them to do so for predatory reasons, who got the bailout and who got their homes taken away?

The Republicans want to dish out more of the same all over again–even more tax cuts for the rich. Because the economy will collapse if Paris Hilton doesn’t get all the billions her daddy’s gonna leave her. Because the wealthy need their inheritances more than the people need their homes. Because if we don’t give millionaires and billionaires those Bush tax cuts permanently, who’ll have enough money to save us all?

Note, of course, that Ryan dragged out the perpetual poster boy for the right wing and their rich patrons: the small businessperson. Obama’s budget, Ryan claims, both demoralizes and demonizes the small businessman. Um… how? When? What small businessman–the CEOs of the big banks? Those small businessmen?

Oh no, Ryan must be talking about people like Joe the Plumber. Small businessmen like him who own… um, who want to own, uh… well… who brazenly lied about being a small businessman so he could score a political ”gotcha.“ That’s pretty much all they have–because the small businesspeople they are talking about don’t exist, at least not in any form that will get wiped out by Obama’s plans. Despite Obama’s goal of raising the tax bracket on income over $250,000 a year, that’s not gonna take down a single small businessperson. You’d have to make well over that before you started paying significantly more in taxes, and let’s face it, that ain’t being poor, nor is it going to ruin any business. It might sting a little, but then taxes sting people making less than that a lot more.

I mean, really, is someone gonna say, ”I’m only making $300,000 a year in profit off my small business, but the new few thousand bucks in taxes I gotta pay makes it all totally not worth it–I’m shutting my shop down and going back to being a shop clerk at some other sucker’s store!“ Yeah, that happens all the time, I betcha.

The Republicans, on the other hand, want to make permanent tax cuts for the wealthy and even add some more, and they they want to slash Medicare, Medicaid and Social Security. They want to stop the stimulus cold, choking civilian job growth, and then heavily expand military spending, benefitting defense firms but also forcing poorer Americans to instead sign up for military service because there would be no other jobs out there. That’s not class warfare, right?

But the real whopper comes with their projections. Though tax cuts and more tax cuts for the rich have drowned us in deficits and a stagnant economy, despite the fact that Democrats have historically achieved better job growth and lower deficits, this is what the Republicans are claiming will happen if we follow Democratic or Republican budgets:

This is so out of proportion, so ridiculously, ludicrously fictional, it’s actually hilarious. And this economy is a tough room. Republicans might as well say that Democrats will lead us all to the gates of hell while Republicans will have rainbows and magic ponies for all! Just give up the rest of your social programs and translate it into a few more billions in tax cuts for billionaires, and we’ll be there!

And we can trust the Republicans when they tell us this, right? Because they have been so trustworthy and effective in regards to economics up until now, right?

I have heard this idea tossed around for some time in Japan–to increase the national sales tax from 5% to 20% and so do away with some other taxes. To me, this sounds like a foolish idea–it is essentially a way to tax the poor and give the rich a relative break, and could be a huge brake on spending in general. As I recall, the last times they raised the sales tax–from nothing to 3%, and then up to 5%–the economy did very poorly. Of course, other things happened at those times that make it uncertain as to how much of a bad effect the sales tax increases alone had, but it seems almost intuitive.

I do recall that before Japan had the sales tax, there were other taxes, like luxury taxes, that were aimed at the rich–and these taxes disappeared, the sales tax taking their place. To me, the sales tax in Japan has always seemed a way to make taxes in Japan less progressive. And it helps to remember that there are no exceptions for the sales tax–you pay the tax for food, for example, unlike in the United States.

However, my understanding of this issue and how it works is spotty at best. So could somebody explain to me how a 20% national sales tax is not a bad idea?