The Ambrosini Critique

The Klingster claims that the Bush tax cuts were effective fiscal stimulus and that claims of their inefficiency are wrong. The real problem isn’t that consumers aren’t spending enough its that jobs aren’t being created. He goes on to say that the tax cuts are unrelated to the jobs gap problem.

The tax cuts are not boosting consumer spending because they couldn’t (you can only squeeze so much blood out of a turnip). On the other hand, we’re seeing growth. The only other destination for the extra cash is investment. If you’re not spending your additional money on even more big screen TVs and refrigerators, then you must be putting it in the bank (American or foreign).

It doesn’t appear that folks are investing abroad… quite the contrary:

The effect is a higher domestic investment, which means more machines and equipment for workers to man… More ovens in the proverbial kitchen.

But we’re not seeing the job growth that we’d expecting based on our experience in past business cycles:

What if past recoveries involved investment in more of the same machines, thus requiring more workers to man those new machines. What if, in this recovery, the extra money from the tax cuts is going towards machines and tools (e.g. computers) that are making current workers more efficient rather than more of the same tools for more workers (i.e. better ovens, not more)? That, in combination with the fact that consumers can’t spend anymore than they were already spending, would lead to a so-called jobless recovery… more investment, higher output, but no or few new jobs.

For those politicians that want to speak for me and for the rest of the American People, I offer my priorities for this next presidential election*:

- Existence (This includes my own life but also my culture and its institutions)

- Freedom (That’s right Ashcroft, I’m watching you. I have my ACLU membership card to prove it…)

- Economics (If I have the above two, then, what the hell, I want to be rich… very rich.)

* BTW, I’m relatively new to this Presidential politics stuff… are elections always 8 months long?

The most important issue facing America that will/can be addressed by the next president is America’s response to extreme Islamist terrorism. This issue constitutes a short-term threat to our existence.

(There are some other long-term problems, for example Krugman insolvency, but existence has priority over standard of living. Besides Argentina isn’t that bad of a place to live… Key word is live. You have to be alive to live.)

I know how Bush sees the problem. War. His rhetoric has been all war and he’s waged two military engagements. I tend to agree with this approach, but I have concerns that more subtle aspects of the problem are being missed or overlooked. For example, how do we know that waging war in the middle east isn’t creating more terrorists than its destroying? To what extent are our policies in that region fomenting anti-Americanism and to what extent does anti-Americanism embolden terrorists? On the other hand, will a successfully waged War force the terrorist’s hand, causing them to engage in a series desperate and deadly last-stands?

I don’t know Kerry’s position. That concerns me much more.

Going against my previous promises of a protest vote, I’ll commit to vote for the mainstream candidate (Kerry or Bush) that best answers the questions raised by the grand SOD in his “leaked” letter to his staff.