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The Big Scamulus Con

In my column at Townhall this week (read it all here) I look at some of the reasons behind President Obama's strategy for talking the economy down prior to passage of the "stimulus" bill and then back up last week.

"Spendulus," "Porkulus," and "the Generational Theft Act of 2009" are all nicknames some have given to the "American Recovery and Reinvestment Act of 2009" signed into law by President Obama last month. In light of Obama's most recent statements about the economy an even more accurate moniker might be "Scamulus" considering how obvious it now is that everything leading up to passage of the bill was a master con perpetrated on American taxpayers. The con is not over either. We have simply entered the next phase.

"Scamulus" had to be passed in a big hurry. The rush was such that not only did Democrats and Obama break their pledge to allow for a 48 hour review period prior to the vote, but not even 24 hours were provided to read the 1400-plus page bill. The urgency of the bill, according to President Obama, was because America was facing an "economic crisis as deep and as dire as the Great Depression" and we could not afford to wait even 48 hours because it might turn into a "crisis that at some point we may be unable to reverse."
...
Obama has also talked the economy down to the point that just about any future improvement will look like significant recovery by comparison and be hailed as the product of the miraculous Obamessiah's policies. The media that downplayed, and sometimes just completely ignored, good economic news during the Bush years, will highlight each and every example of it over the next few years. It has already begun.

Over the weekend I heard the following statement from Lawrence Summers reported as an indication that the President's policies are working and that his new found optimism is valid: "It is surely too early to gauge the broader economic impact of the President's program. But it is modestly encouraging that since it began to take shape, consumer spending in the US, which was collapsing during the holiday season, appears, according to a number of indicators, to have stabilized." As I cited earlier, at least one economic indicator, retail sales, was up in January for the first time in seven months indicating the collapse of consumer spending during the holiday season was already recovering in January, not only before passage of the major component of "the President's program" in mid February, but for the most part before Obama was even sworn into office. The news report on the Summers statement I heard made no mention of the January retail sales numbers. Expect each and every positive bit of economic news to be attributed to the President's plan, regardless of whether or not it is even possible for it to be related.

Today in the news there is another reason the scam stimulus bill had to be rushed -- I can't find a link yet, but it was just reported on Fox News that today the Commerce Department reports an unexpected jump in new housing projects for the month of February. Construction of new homes and apartments jumped more than 22 percent since January. Consider how much more difficult it might have been to sell his 800 billion dollar bill if he had waited until this news was out. It would have been a little bit harder to sell the doom and gloom scare pitch with good news out there to report. It might have occurred to people that the economy would recover even without a big government takeover of more of the nation's economy.

Update: Here is a link to the new home numbers (courtesy of Hugh).

Update II: Obama followers are desperate to downplay any signs of progress prior to passage of The One's spendulus plan. Here are winners for the most desperate comments so far:

There is already a surplus of 6 million new, empty homes for sale or rent in the U.S. That is in addition to 13 million more that have already been started. And add to that all the older homes that people are trying to sell.

Yet more new homes would further depress housing prices.

New home starts isn't a good sign.

Posted by Adrian Browne | March 17, 2009 9:20 AM


My response was ask Adrian to tell that to the construction workers who would not otherwise have been employed and to the sellers of lumber and other construction materials who would have otherwise not had the business. I also told Adrian I want to hear how new home starts are not a good sign when President Obama starts citing them in a few months as proof that his spendulus plan is working. Here's the second winning comment:
From the housing starts article:

But despite February's gain, housing starts are down 47% from a year ago, and are down 74% from the peak in early 2006. Permits are down 44% in the past year.

Is it too much to ask that you read the article before you link to it?

A 47% decrease is really really really bad. The article goes on to say, in many different ways, how epically horrible the building market is right now. If Republicans & Conservatives don't possess the ability to read and understand a simple article about housing starts why should anyone listen to their complaints about the stimulus bill?

Posted by Blue Neponset | March 17, 2009 9:46 AM

Here is some additional info from the same news article Blue decided to leave out in order to talk about how "really, really, really" bad the news was:

Boosted by an 82% increase in construction of apartment buildings, U.S. housing starts surged 22% in February to a seasonally adjusted annual rate of 583,000, the Commerce Department estimated Tuesday.

It was the largest percentage gain in 19 years and was the first increase in eight months in the sector that was at ground zero in the global economic recession. The housing data in winter months are especially volatile because of the weather.
Building permits, which are less volatile than the starts data, rose 3% in February to a 547,000 annual rate. Permits for single-family units rose 11% to a 373,000 rate, the largest percentage gain in 18 years.

"We're inclined to write this off as a weather-related fluke for now," wrote economists for Wrightson ICAP. "If the permits series can hold onto its gains in next month's March report, though, we'll take it as a sign that new construction has finally found a floor (albeit a very low one)."

"We hold to the view that the level of housing construction is becoming so low in absolute terms that starts will bottom out in the months ahead," wrote John Ryding and Conrad DeQuadros of RDQ Economics.

Construction of new housing units had plunged 38% in the previous three months before February's unexpected jump. Economists surveyed by MarketWatch had forecast a further drop to 456,000, despite an expected surge in multifamily construction.

Hmmm...."largest percentage gain in 19 years and was the first increase in eight months"? Yeah Blue and Adrian, that can certainly be seen as nothing short of "really, really, really" bad news.

To paraphrase Blue... If Democrats & Liberals don't possess the ability to read and understand a simple article about housing starts why should anyone listen to their complaints about anything? These guys won. Why are they still so incredibly desperate to ignore any sign of progress?


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Comments (20)

There is already a surplus ... (Below threshold)
Adrian Browne:

There is already a surplus of 6 million new, empty homes for sale or rent in the U.S. That is in addition to 13 million more that have already been started. And add to that all the older homes that people are trying to sell.

Yet more new homes would further depress housing prices.

New home starts isn't a good sign.

<a href="http://www.marketw... (Below threshold)

Here is a link on the construction and housing starts.

"New home starts isn't a go... (Below threshold)

"New home starts isn't a good sign."

What are you smoking? Tell that to the construction workers who would not otherwise have been employed and to the sellers of lumber and other construction materials who would have otherwise not had the business. I know a man who worked for a company that provides materials (lumber, doors, windows, etc.) to builders and he was just laid off in December after working there 20 years.

I want to hear you say new home starts is not a good sign when President Obama starts citing them in a few months as proof that his spendulus plan is working.

Thanks Hugh! I'll update n... (Below threshold)

Thanks Hugh! I'll update now.

From the housing starts art... (Below threshold)

From the housing starts article:

But despite February's gain, housing starts are down 47% from a year ago, and are down 74% from the peak in early 2006. Permits are down 44% in the past year.

Is it too much to ask that you read the article before you link to it?

A 47% decrease is really really really bad. The article goes on to say, in many different ways, how epically horrible the building market is right now. If Republicans & Conservatives don't possess the ability to read and understand a simple article about housing starts why should anyone listen to their complaints about the stimulus bill?

"Is it too much to ask that... (Below threshold)

"Is it too much to ask that you read the article before you link to it? "

Is it too much to ask that you not be an ass?

I guess it really, really, really is.

I saw the down 47 percent from last year figure on the tv report and also read it in the news report I linked. That is down from last year, but up from the previous months and it is being reported by the Commerce Dept. as good news.

I'll remember in a few months when you want to report this kind of news as proof that Obama's plan is working. If numbers (for construction, spending, employment, etc.) are 22 percent up one month I will be sure to remind you that they are still really, really, really worse than the previous year or the previous decade and thus should be seen as really, really, really bad news for the Obama spendulus plan.

Oh, and Blue Neponset,<br /... (Below threshold)

Oh, and Blue Neponset,
Here is some additional info from the same news article that you decided to leave out so that you could talk about how really, really, really bad the news was:

"Boosted by an 82% increase in construction of apartment buildings, U.S. housing starts surged 22% in February to a seasonally adjusted annual rate of 583,000, the Commerce Department estimated Tuesday.

It was the largest percentage gain in 19 years and was the first increase in eight months in the sector that was at ground zero in the global economic recession. The housing data in winter months are especially volatile because of the weather.
Building permits, which are less volatile than the starts data, rose 3% in February to a 547,000 annual rate. Permits for single-family units rose 11% to a 373,000 rate, the largest percentage gain in 18 years.

"We're inclined to write this off as a weather-related fluke for now," wrote economists for Wrightson ICAP. "If the permits series can hold onto its gains in next month's March report, though, we'll take it as a sign that new construction has finally found a floor (albeit a very low one)."

"We hold to the view that the level of housing construction is becoming so low in absolute terms that starts will bottom out in the months ahead," wrote John Ryding and Conrad DeQuadros of RDQ Economics.

Construction of new housing units had plunged 38% in the previous three months before February's unexpected jump. Economists surveyed by MarketWatch had forecast a further drop to 456,000, despite an expected surge in multifamily construction.

Hmmm...."largest percentage gain in 19 years and was the first increase in eight months"? Yeah Blue and Adriane, that can certainly be seen as nothing short of really, really, really bad news.

To paraphrase Blue... If Democrats & Liberals don't possess the ability to read and understand a simple article about housing starts why should anyone listen to their complaints about anything?

You guys won. Why are you still so incredibly desperate to ignore any sign of progress?

Is it too much to ask th... (Below threshold)

Is it too much to ask that you not be an ass?

I'm not the one lying about the articles I link to.

The basic premise of the article is that the housing market may have hit bottom.

If you want to be a polemicist at least be a good one. The only thing you have to do to refute your arguments is read the articles you link to.

You guys won. Why are yo... (Below threshold)

You guys won. Why are you still so incredibly desperate to ignore any sign of progress?

I'd rather have the truth that some political mud slinging wrapped up to look like something it isn't.

Great article. Th... (Below threshold)
TOhio:

Great article.

The more that information like this is shared, the greater chance that more people in America will wake up and see Obama for the manipulative liar that he is.

Blue,I didn't lie or... (Below threshold)

Blue,
I didn't lie or twist anything, but rather quoted at length from the article you claim I am not reading so your beef is with the part of the article I quoted, not with me.

Are you telling me you read that February's numbers showed "the largest percentage gain in 19 years and was the first increase in eight months in the sector that was at ground zero in the global economic recession" and you want to call that bad news? No, actually you want to call that really, really, really bad news. That is what you said, but I guess I just want to hear you say it one more time because that sounds really ridiculous to me and I have to wonder if you actually read it.

You are the one misrepresenting the article Blue. Yes, the article talks about how horrible the housing market has been. And how it is still way down from where it has been in the past, but for the first time in many months there are signs of progress. Do you really not see that when your read the article? Seriously. Just pretend it was not me who pointed it out to you.

Do you seriously not see that an increase is better than if there had been a further decrease as there has been for the past few months? Do you seriously believe that anything short of complete and immediate return to previous levels is really, really, really bad news? No wonder you guys didn't understand the news from Iraq and were so dumbfounded by the surge.

Consider how those of us on the right felt every time a positive economic report came out during the Bush years and the headline stuck on it was to take the one tiny piece of bad news out of ten pieces of good news and place the bad one in headline font at the top of the page. In this case though, this really is good news. It is not great news. And it may not last or be a trend, but it beats the heck out of what we have seen the previous few months which was a decline. Next month might suck and return to the pre-February trend, but for one month progress was seen. How you can call that really, really, really bad news is something I frankly can't understand.

Calling me a liar doesn't change that. Facts are stubborn things.

I will be away from the com... (Below threshold)

I will be away from the computer for a while, but will check back in later.

Lorie:"Calling me a ... (Below threshold)
GarandFan:

Lorie:
"Calling me a liar doesn't change that. Facts are stubborn things."

To paraphrase, just remember, "They Won".
Ergo, anything that does not support their program is "irrelevant", a "distraction", "distortion of the truth", "a vast right-wing conspiracy", "all George Bush's fault".

Hey guys, how's that "AIG moral indignation" thing working out for you? Kinda looks like that guy with all that 'executive experience' got punked.

Because the left can't attr... (Below threshold)
Sue:

Because the left can't attribute this small indication of the economy improving to Obama they have to deny it.

After all if they said that this was good news then when it keeps improving without any of the "stimulus" money or very little then they will have a harder time convincing people that it is all due to Obama's policies.

Hey guys, how's that "AI... (Below threshold)
Sue:

Hey guys, how's that "AIG moral indignation" thing working out for you? Kinda looks like that guy withall that 'executive experience' got punked.

Yea, he got punked all right-by the Democrat controlled congress and house. They are the ones that had the ultimate say and were in such a hurry to get their spending bills passed that they didn't care if the "bailouts" were really needed or if there were regulations about how it got spent.

President Bush went along with it and signed the bill and I don't like that, but it is more the responsibility of the Democrat controlled congress. They are the ones who pass the spending bills and as we have seen with the "stimulus" bill some of the Democrat members of congress wrote much of it themselves.

You can blame President Bush all you want but people are not buying your story. Obama is pushing way too many counterproductive plans/ideas/"we won so we'll do what we want" for the people not to know who is at fault.

OK, let's assume your disho... (Below threshold)

OK, let's assume your dishonest reading of the article is accurate for a second. How does a report issued yesterday prove that President Obama has been lying about how shitty the economy is for the last six months?

The next time a poster call... (Below threshold)
maggie:

The next time a poster calls an editor a liar,
you're gone.
Posting on Wizbang is a privilege, not a right.
Agreeing to disagree is one thing, repeatedly
accusing editors of lyiing is another.
This will brook no argument from any poster.

The next time a poster c... (Below threshold)

The next time a poster calls an editor a liar,
you're gone.
Posting on Wizbang is a privilege, not a right.
Agreeing to disagree is one thing, repeatedly
accusing editors of lyiing is another.
This will brook no argument from any poster.

What if the editor is lying? Is it ok then?

Blue,Go on over to W... (Below threshold)
SCSIwuzzy:

Blue,
Go on over to Wizbang Blue. You'll have plenty of examples...

The scam of the century is ... (Below threshold)
Nilakash:

The scam of the century is the redirection of Fed money to Goldman via AIG, with Tim Githner and Hank Paulson working as facilitators. Pres Obama should fire Geithner and try him jointly with Paulson.




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