Wednesday, January 28, 2009

REPUBLICANS CONTINUING TO MISLEAD THE PUBLIC ABOUT THE CBO, JAPANESE STIMULUS PLAN AND TAX CUTS

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First let me give a Kudos "shout out" to "Morning Joe"'s frequent guest, Dylan Ratigan and to CNBC's Maria Bartiromo for their insightful and enlightening remarks this morning. We need more people getting angry with what's going on in the financial world, in corporations, and in the Congress and the Senate. You guys keep up the good work; and I urge citizens/consumers to keep a "watchful eye" on these entities and hold them accountable.
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"Rolling Stone" writer claims no one came forward to address corruption regarding Blagojevich. Not true ... Jesse Jackson Jr. did speak to certain federal investigators when the Governor asked for a donation of $25,000 from Jesse in exchange for hiring his wife. Kudos to Jesse.
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Yesterday, I sent quite a few emails to the House and the Senate dealing with myths, lies and half-truths.
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1. Republicans state study by CBO shows vast majority of money in stimulus package won't be spent until after 2010.
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The facts:
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"Reports of a recent study by the Congressional Budget Office, showing that the vast majority of the money in the stimulus package won't be spent until after 2010, have Democrats on the defensive and the GOP calling for a pullback in wasteful spending.
Funny thing is, there is no such report.
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"We did not issue any report, any analysis or any study," a CBO aide told the Huffington Post.
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Rather, the nonpartisan CBO ran a small portion of an earlier version of the stimulus plan through a computer program that uses a standard formula to determine a score -- how quickly money will be spent. The score only dealt with the part of the stimulus headed for the Appropriations Committee and left out the parts bound for the Ways and Means or Energy and Commerce Committee.
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Because it dealt with just a part of the stimulus, it estimated the spending rate for only about $300 billion of the $825 billion plan. Significant changes have been made to the part of the bill the CBO looked at. ..."

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See entire 1/23/08 post at:
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2. Republicans claim that stimulus didn't work with the Japanese therefore it won't work now.
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The facts:
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The Journal [conservative "Wall Street Journal"] editorial listed stimulus policies enacted by Japan between 1992 and 1999 and concluded that "Japan's economy grow [sic] anemically over that decade, but as the nearby chart shows, its national debt exploded ... Now we're told that a similar spending program -- a new New Deal -- will revive the U.S. economy. How do you say 'good luck' in Japanese?"
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Contrary to the Journal's suggestion that stimulus spending was ineffective in Japan, Adam Posen, deputy director of the Peterson Institute for International Economics, wrote in his September 1998 book, Restoring Japan's Economic Growth, that "the 1995 stimulus package ... did result in solid growth in 1996, demonstrating that fiscal policy does work when it is tried. As on earlier occasions in the 1990s, however, the positive response to fiscal stimulus was undercut by fiscal contraction in 1996 and 1997."
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He concluded:
Similar contractions undertaken both openly and by hidden means in 1994, 1996, and 1997, with reference to announced but unimplemented spending, had destructive effects. Future government packages must recognize that when the Japanese government paid for fiscal stimulus in 1995, it got economic growth, and that when it mistakenly pursued fiscal austerity in most of the remainder of the 1992-97 period, it got economic contraction.
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A 1999 budget brief from the Japanese Ministry of Finance demonstrates that the consumption tax was indeed increased from 3 to 5 percent in 1997. Other economists and media figures agree with Posen that the positive effects of the mid-decade stimulus packages were curtailed by these attempts to scale back spending and increase sales taxes.
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For the entire December 22, 2008 article:
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3. John McCain says broadband spending will not stimulate the economy.
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The facts:
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Rachel Maddow caught John McCain stating (during the campaign) that spending on broadband would stimulate the economy. She even played the video with those words flowing out of his mouth.
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4. Republicans claim that (supply side, etc.) tax cuts help stimulate the economy more than spending. They have even front loaded up the Internet search engines directing you to blog posts and articles (that were non existent a few days ago) that repeat distorted/misleading assumptions, trying to sway you to their side.
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The Facts:
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Go to:



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video
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Tune into GRITtv with Laura Flanders
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