To be fair I haven’t heard many Republicans calling for a tax cut recently, except those facing a teabagger challenge or those who are out of their minds.

We need to let ALL the Bush tax cuts (including the estate tax elimination that cost the government $25 billion this year) expire as scheduled.

Hmm, I wonder what William Vickrey would have said about this…

Vickrey’s four urgent tax reform proposals are taxation of accrued capital gains, elimination of tax-exempt interest, taxation of life insurance buildup, and taxation of undistributed corporate profits…
http://www.stanford.edu/~boskin/Publications/Vickrey.pdf

Dave, I’m assuming David Dayen will be back tomorrow, or at least soon. I just want you to know that you’ve left a most impressive record here in only a few days. Please, once again, direct us to your blog so we can continue to benefit from your exceptionally sound work. Many, many thanks for all you’ve done and I hope you’ll continue to be a contributor here, too.

A small number of Democratic congresspersons (and a Repub, I believe) led by Defazio, proposed direct federal lending to small business and consumers instead of the TARP. They were ignored.

They claimed that shoveling money at the banks would do nothing to ease the credit crunch on all us lesser beings and that the banks would just use all that cash to shore up their bottom line against impending defaults. I wrote several Dkos diaries on the subject myself.

So it’s not like nobody saw this coming.

Bank of America stated it have 500,000 troubled home loans. On half those loans there hasn’t been a payment in over a year. Any lender would be crazy to loan money in that kind of an environment. Loaning more money to deadbeats just doesn’t cut it. I used to loan myself but no more.
Hiring new employees makes even less sense than loaning money. Just the hiring process is loaded with legal pitfalls. The person you hire will sue you if you look at them crossed eyed and the people you do not hire will sue you because they are certain they should have gotten the job.
I work with a couple engineering firms that can produce machines that can do just about anything a human can. Better yet these machines can replace four or five workers at a crack. That’s awesome. The only thing the engineers can’t do is build a machine that waste time surfing the web on company time, goofing off and dealing with personal problems on company time.
For any job that can not be performed by a machine there’s always Asia.

tinman 1967 must be a republican. How else can one explain this level of (fill in the blank).

For any job that can not be performed by a machine there’s always Asia.

Why do you hate Americans? And Asians?

Better yet these machines can replace four or five workers at a crack.

Who’s going to buy the stuff the machines make?

Lucky me! I don’t have a job, so I get to come on line while I’m at home. Ha!
Speaking of not buying things made by machines, I’m making stuffed zucchini squash. Big ass guy from my garden.
PS, I thought we weren’t supposed to Feed.

The problem is reduced demand. Continuing unemployment means that the economy is not producing demand, so businesses are not willing to risk investing in meeting demand, which means they are not hiring, which means unemployment continues. Also employed workers are working longer hours, usually for no extra pay, reducing any need to add employees. Individual companies have every incentive to reduce workers, while the economy-at-large then suffers from the resulting loss of aggregate demand.

This seems appropriate here: Reevaluating Unemployment: Is Progress Destabilizing our Economy?

I think we’re still fundamentally facing this problem with how we configure our social, political, and economic institutions. We’re grappling with rapid and massive human-labor obsolescence, at the same time as being unwilling to allow everyone to take part in the efficiencies and products available through automation and abundance.

I miss the ongoing conversations here.
Kelly, this is the part where you ask me how I’m making it. And, I say, ground beef, rice, green onions, bell peppers, tomatoes and the inside chunks of the squash. Cook. Add shredded cheese on top.
PS, home grown always tastes better.
:)

You forgot cilantro and mint. Heh.

um…don’t they want high unemployment and desperate people. I’m not sure why they would do anything to benefit the american people as they have worked hard to screw them these last years.

Really? Well, darn. I did salt, pepper and garlic. But, it’s gonna be goo-ood. I think. I made too much rice and beef, so I saved half for something else tomorry.

Just the hiring process is loaded with legal pitfalls. The person you hire will sue you if you look at them crossed eyed and the people you do not hire will sue you because they are certain they should have gotten the job.

Maybe you are doing it wrong.

I see a lot of people who are employed.
So, some companies must have figured it out.

Exactly. Taxes on retained earnings and the like are important tools. Think of them like taxing carbon or soft drinks – it reduces the demand for those things. If business doesn’t want to invest, there are ways to force them to. I would prefer to stimulate demand from consumers, but I’ll take what I can get.

And tinman needs to get more up to date talking points.

George Carlin (RIP). Stuff. Hoarders. Human overpopulation. Economic collapse. Massive unemployment. It’s not funny anymore.

We make a lot of stuff, and we make more things with fewer people or more people who’ll take less money for making our stuff, so that a very few people make a lot of money. For a while, debt and false economies enable more people to buy tons more stuff than anybody needs. We make more and more people every day. We need fewer and fewer of them every day to make all our stuff. Then, we lose our jobs to the machines and the people who take less money for making our stuff, and we can’t pay anybody for anything and we lose all our stuff.

Yep. :-) That’s pretty much it in a nutshell. Like I stated in my linked diary, at some point we’re going to have to come to terms with the fact that our visions of microeconomic success and macroeconomic success are in direct competition with one another. Considering that we’re inevitably going to act individually to improve our microeconomic successes, this inevitably leads to a massive failure on the macroeconomic scale.

I struggle with what to call this. I’ve previously called it a Liesure Glut, but considering it’s more of a paradox I’ve more recently been calling it the Progress Paradox.

What we need is another FDR. During the Great Depression he warned corporations against hoarding money. He threatened to take the hoard away by taxing it.

“Who’s going to buy the stuff the machines make?”

This is the problem. Right now companies have every incentive to get rid of YOUR job. Someone makes more money if they can get rid of you.

tinman1967 is expressing this view, which is widespread.

BUT, as I wrote, across the economy this has the opposite effect.

The problem is obviously the structure of the economy, which is now structured to screw the average person and pass everything to a few at the top. This can’t work, just makes a few at the top rich before the whole thing breaks down.

This is one of the reasons things functioned so well when we had 90% tax rates after someone made a certain amount… Incentives to mess up the whole economy were removed. And that money built infrastructure, which made all of us competitive.

If you click on Dave’s name it takes you to his author page. There you can find his blog is called at seeing the forest.

Ah, at last, a clear example of the non-existant drain down which trickle trickles.

Put that in your Laffer Curve and smoke it.

Wait a minute, don’t we want corporations to keep cash on hand in order to weather financial meltdowns like the current one? Don’t we want corporations to behave conservatively right now? To me, a company keeping a boatload of liquid assets is actually protecting its current employees’ jobs.

I’m not sure why they would do anything to benefit the american people as they have worked hard to screw them these last years.

Henry Ford, a noted capitalist, thought benefitting the workers would be a good idea:

Henry Ford had reasoned that since it was now possible to build inexpensive cars in volume, more of them could be sold if employees could afford to buy them. The $5 day helped better the lot of all American workers and contributed to the emergence of the American middle class. In the process, Henry Ford had changed manufacturing forever.

In my opinion, modern capitalists, at least in the US, have too much focus on near term profits. They refuse to bear any cost which won’t raise earnings and stock prices by the next quarter. I think we have to reeducate them.

The problem is obviously the structure of the economy, which is now structured to screw the average person and pass everything to a few at the top. This can’t work, just makes a few at the top rich before the whole thing breaks down.

I remember from school days, an instructor saying the American economy had three distinct stages. At first we focused on producing goods and services. Then we focused on marketing. Finally, finance was all that mattered. Everything business does has to be analyzed with a focus on profits. If it doesn’t meet the target return, business isn’t intrested.

I think that’s the problem we face today. Business is sitting on piles of cash because it can’t be invested profitably. We have to encourage them to do it. I’d uses taxes to supply the encouragement. Business would have to use it or lose it.

Wait a minute, don’t we want corporations to keep cash on hand in order to weather financial meltdowns like the current one? Don’t we want corporations to behave conservatively right now? To me, a company keeping a boatload of liquid assets is actually protecting its current employees’ jobs.

Business exists to serve the American People. Those that can’t do that have to be encouraged to change their ways.

Taxpayers gave corps enough money to enable them to wait us out, foreclose on us, and rent back to us by collecting Section 8 money. NAFTA ruined Mexico so the displaced HAVE to come here. We hire them as slaves. If we would just get over it and work for a dollar an hour, the corps would abandon India, China, and Mexico, come here, and the economic crisis would be over. Americans are just too greedy, but we’ll get hungry enough and work for less. Then we can do what we do best. Compete.

You just turn the machines off. No unemployment benefits required.

Nope, never voted for a Republican in my life (at least for president).

Your right about near term profits.

The last thing we need is another FDR. Actually we didn’t need the first one.

You just turn the machines off. No unemployment benefits required.

That’s pretty much what would happen when the industrialists realized they weren’t selling anything because no one had any money to buy anything.

It’s almost like the situation we face today. Businesses are shutting-down and dissolving because they can’t make money making products no one can buy. That’s why government has to step-in. Private enterprise can’t restore the economy.