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Biden Previews Dems’ New Economic Plan: More Failed Stimulus

August 29, 2011

Despite Poor Economy and Already Racking Up $4 Trillion in Debt, Democrats Want to Spend Even More

  • Vice President Joe Biden may have accidentally previewed the Democrats’ new plan for the economy: more failed stimulus. Unfortunately, this doubling-down on failed policies is no surprise.
  • What is shocking is that Democrats are still calling for more spending despite their record-breaking increase in the national debt by $4 trillion in just two and a half years.  
  • New economic data continues to prove the old stimulus was a bust, with the odds of a second recession as high as they’ve ever been and unemployment continuing to remain high. Yet Democrats refuse to abandon their failed policies.

BACKGROUND 

Vice President Joe Biden may have accidentally previewed the Democrats’ new plan for the economy: more failed stimulus. Unfortunately, this doubling-down on failed policies is no surprise: 

BIDEN: WE NEED MORE STIMULUS, FIRST ONE DIDN’T SPEND ENOUGH MONEY. “Vice President Joe Biden said on Friday the U.S. economy needed more stimulus to get it moving, putting in a plug for government intervention shortly before the White House unveils new proposals to boost job growth. … ‘I think the economy does need more stimulus,’ Biden said, adding that it was difficult to get the 2009 package of some $830 billion in spending and tax cuts through Congress even when Democrats had majorities in the House of Representatives and the Senate. ‘Everybody says we should’ve (had)…a bigger stimulus package. Yeah, we should’ve. I was pushing (for) it,’ he said.” (Jeff Mason, “Biden Says U.S. Needs More Stimulus, Businesses Mad at S&P,” Reuters, 8/26/2011)

OBAMA’S “NEW PLAN” FOR THE ECONOMY IS THE SAME AS THE OLD PLAN: MORE FAILED STIMULUS SPENDING: “President Obama has decided to press Congress for a new round of stimulus spending…” (Zachary A. Goldfarb and Peter Wallsten, “Obama to Issue New Proposals on Job Creation, Deficit Reduction,” The Washington Post, 8/17/2011)

What is shocking is that Democrats are still calling for more spending despite their record-breaking increase in the national debt by $4 trillion in just two and a half years:

“NATIONAL DEBT HAS NOW INCREASED $4 TRILLION ON PRESIDENT OBAMA’S WATCH.” “The latest posting by the Treasury Department shows the national debt has now increased $4 trillion on President Obama’s watch. The debt was $10.626 trillion on the day Mr. Obama took office. The latest calculation from Treasury shows the debt has now hit $14.639 trillion.” (Mark Knoller, “National Debt Has Increased $4 Trillion Under Obama,” CBS News, 8/22/2011)

OBAMA DEBT BURDEN “THE MOST RAPID INCREASE IN THE DEBT UNDER ANY U.S. PRESIDENT.” (Mark Knoller, “National Debt Has Increased $4 Trillion Under Obama,” CBS News, 8/22/2011)

OBAMA, JULY 2008: BUSH “ADDED $4 TRILLION BY HIS LONESOME… IT’S UNPATRIOTIC”: “The problem is, is that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents –#43 added $4 trillion by his lonesome, so that we now have over $9 trillion of debt that we are going to have to pay back — $30,000 for every man, woman and child. That’s irresponsible. It’s unpatriotic.” (“Flashback: Obama: Adding $4 Trillion to Debt is Unpatriotic,” Real Clear Politics, 8/24/2011)

BIDEN BLAMES S&P, REFUSES TO TAKE RESPONSIBILITY FOR DEMOCRAT SPENDING POLICIES THAT CAUSED CREDIT DOWNGRADE. “Reacting to a leadership switch at the top of S&P after the downgrade, Biden said his ‘instinct’ was that pressure from disgruntled businesses may have influenced the change, though he made clear that he did not know the agency’s internal workings. … ‘My instinct is they got a lot of pressure from a lot of places, not the government. I think there were probably an awful lot of businesses out there going, what the hell did you guys do? You know, I mean, because it rebounded back to impacting on Wall Street and impacting on American business.'” (Jeff Mason, “Biden Says U.S. Needs More Stimulus, Businesses Mad at S&P,” Reuters, 8/26/2011)

 

New economic data continues to prove the old stimulus was a bust, with the odds of a second recession as high as they’ve ever been and unemployment continuing to remain high. Relief remains out of sight:

Q2 ECONOMIC GROWTH DOWNGRADED TO 1%. “The U.S. economy grew a meager 1% and corporate profits moderated in the April-July period amid weak consumer spending, stalled exports and a smaller buildup in inventories, highlighting the weakness of the recovery. The Commerce Department reported gross domestic product rose at a 1% annualized seasonally adjusted rate in the second quarter. This figure met Wall Street’s expectations but represented a decline from an earlier estimate of a 1.3% growth rate, a change due to recent disappointing economic data.” (Tom Barkley, “Economic Growth Revised Down,” The Wall Street Journal, 8/26/2011)

MERRILL LYNCH FORECAST: DOUBLE-DIP RECESSION ODDS COULD BE AS HIGH AS 80%: “A plunge in recent economic data puts the probability of a double-diprecession above 80 percent, according to modeling by Bank of America Merrill Lynch released Wednesday, reflecting the toll the U.S. debt downgrade, Europe’s woes and stock market volatility has taken on economic activity.” (John Melloy, “Chance of Recession Is as High as 80%: Study,” CNBC, 8/25/2011) 

CONSUMER CONFIDENCE AT LOWEST LEVEL SINCE NOV. 2008: “Thomson Reuters/University of Michigan final index of consumer sentiment dropped to 55.7 in August from 63.7 in July, the lowest level since November 2008, according to Thursday’s report.” (Vicki Needham, “Consumer Confidence Sinks Amid Economic Uncertainty,” The Hill, 8/26/2011) 

CBO: “SLOW GROWTH AND HIGH UNEMPLOYMENT FOR YEARS TO COME”:“”The Congressional Budget Office projects slow growth and high unemployment for years to come as a result of the financial crisis and recession, a new report shows.” (Richard Wolf, “Budget Agency: Jobless Rate Above 8% For Years,” USA Today, 8/24/2011)

JOBLESS RATE AT 8.9% BY END OF 2011, ABOVE 8% THROUGH 2014. “In its semi-annual update of budget and economic data, the agency — which serves as the official scorekeeper for President Obama and Congress — projects the jobless rate will fall to 8.9% by the end of this but remain above 8% until 2014.” (Richard Wolf, “Budget Agency: Jobless Rate Above 8% For Years,” USA Today, 8/24/2011) 

U.S. ECONOMY TO CONTINUE LAGGING UNTIL 2017?! “The U.S. economy won’t be operating at potential – meaning that labor and capital are fully employed – until 2017, CBO projects.” (Daniel Wessel, “CBO: No Recession, But Growth So Slow Jobless Rate To Top 8% Until 2014,” The Wall Street Journal, 8/24/2011) 

“BANKS LOWER U.S. ECONOMIC GROWTH FORECASTS”: “Gross domestic product will grow 1 percent in the fourth quarter rather than the 2.5 percent previously forecast and 0.5 percent in the first quarter of 2012 instead of 1.5 percent, JPMorgan said in a note e-mailed to clients today. Citigroup cut its 2011 growth forecast to 1.6 percent from 1.7 percent and lowered its projection for next year to 2.1 percent from 2.7 percent, according to a note to clients dated yesterday.” (Scott Hamilton, “Banks Lower U.S. Economic Growth Forecasts,” Bloomberg, 8/19/2011) 

ECONOMISTS: “RECOVERY COULD BE ONE OF THE LONGEST, MOST DIFFICULT IN U.S. HISTORY.” (Peter Whoriskey, “Recovery Could Be One of the Longest, Most Difficult in U.S. History, Economists Say,” The Washington Post, 8/19/2011)

“FED ECONOMISTS PREDICT A 15 YEAR BEAR MARKET FOR STOCKS.” (Bruce Krasting, “Fed Economists Predict A 15 Year Bear Market for Stocks,” Business Insider, 8/23/2011) 

 

Yet Democrats refuse to abandon their failed policies:

PELOSI TO LIBERAL BLOGGERS: DEMOCRATS WILL “REFUSE TO AGREE TO FURTHER SPENDING CUTS” EVEN IF IT MEANS A SHUTDOWN. “At a meeting this morning with online writers, House Minority Leader Nancy Pelosi tried to persuade progressives that the Democratic caucus won’t get rolled in future hostage standoffs. … The clear implication, however, is that she does in fact expect Democrats to refuse to agree to further spending cuts even if refusal results in a shutdown.” (Matthew Yglesias, “Pelosi Vows Dems Won’t Get Rolled Again,”ThinkProgress, 8/4/42011)

EVEN THOUGH A RECENT SURVEY SHOWED “MORE ECONOMISTS PREFER CUTS OVER TAXES”: “The majority of economists surveyed by the National Association for Business Economics believe that the federal deficit should be reduced only or primarily through spending cuts.

“The survey out Monday found that 56 percent of the NABE members surveyed felt that way, while 37 percent said they favor equal parts spending cuts and tax increases. The remaining 7 percent believe it should be done only or mostly through tax increases.” (“Survey: More Economists Prefer Cuts Over Taxes,” Associated Press, 8/22/2011)