Biden Acknowledges Administration 'Misread' The Economy

Vice President Biden acknowledged today that the administration underestimated the depth of the economic recession months ago as it prepared a recovery package that is only now beginning to take effect.

"We misread how bad the economy was, but we are now only about 120 days into the recovery package," Biden said on ABC's "This Week." "The truth of the matter was, no one anticipated, no one expected that that recovery package would in fact be in a position at this point of having distributed the bulk of the money."

Figures released last week showed that the national unemployment rate has reached 9.5 percent, and that the economy is still shedding nearly half a million jobs a month. In reality if you factor in all the people who have dropped off the unemployment roles but haven’t found work, the unemployment figure is actually at 16% and then their are two 4 other groups to factor in… people who have lost their jobs but got severance package so either haven’t hit the unemployment rolls yet or won’t qualify, people who lost their jobs over the past 3 to 4 years who gave up looking to replace their employment as the economy started its march downward, students who graduated this past year who have never found employment other than the part-time jobs they had in school, and the group which includes seniors and people who were previously out of the job market that have to go back to work because they’ve lost their investments that they counted on to supplement their incomes.

President Obama pushed through a $787 billion stimulus package within his first month in office to slow the economic slide by replacing retreating private-sector demand, in part, with government spending.

But criticism has been mounting from the left and right, albeit for different reasons, that the plan was misconceived.

Administration officials have argued for weeks that the economic projections made before Obama took office presented an overly optimistic view of the economy, a case Biden reiterated in blunt terms today.

Conservative critics have used the mounting job losses to argue that the stimulus package - a mix of government spending and tax cuts - should have been titled more toward the latter than it was.

Meanwhile, liberal economists such as Paul Krugman have argued for more public spending, just as the stimulus money begins trickling into the economy.

After acknowledging the economic "misreading," Biden said "the second question becomes, did the economic package we put in place, including the Recovery Act, is it the right package given the circumstances we're in?"

"And we believe it is the right package given the circumstances we're in," he said.

Asked if a second stimulus package is needed, Biden said it is "premature to make that judgment."

Instead, he said, the administration will monitor the effect of the government spending in the coming months, as the public-works projects financed by federal funds move from the planning stage to the hiring and construction phase.

"And so this is just starting," Biden said. "The pace of the ball is now going to increase."

By Scott Wilson

Wow… Is anyone surprised. Everyone I know could have told them this and come up with better and less intrusive solutions without all their experts, czars and Ivy League educations. The unemployment situation is much worse the administration’s figures show, the bank bailouts and stimulus plan is a failure with virtually no funds ever trickling down under Joe’s watch, nobody can get a loan and the next crisis is, created by this administrations and their unbridled spending in all areas is the next crisis. Ask Marion~

Yanina Manolova / AP

National Debt Clock... Tick Tock

Posted: Daily Thought Pad

Related Resources:

• President Trump? What If?
• Economists Point to Rising Debt as Next Crisis
• Catastrophe or Catastrophe CD
• Glenn Beck's Common Sense

California, Here We Come!

By Patrick J. Buchanan

PALM SPRINGS, Calif. -- In just a few weeks time, California hits the wall. And Americans should take a good, long look at the fiscal and social wreck of the Golden Land, because California is at a place to which all of America is heading.

In May, when five fund-raising proposals were put on the ballot, Gov. Schwarzenegger pleaded with the overtaxed Californians not to make their state "the poster child for dysfunction."

As The Economist writes, "On May 18th, they did exactly that."

Arnold went to the White House for U.S. loan guarantees for new state bonds. But with the president's approval rating wilting because of a belief he is spending too much, the Obama-ites slammed the door.

In Sacramento, a Republican blocking force is resisting any new tax revenue. And with the state under a constitutional mandate to balance its budget, yet facing a $24 billion deficit this July, a chainsaw is about to be taken to state government.

Some 38,000 of 168,000 state prisoners may be released. As Barack Obama is pushing universal health insurance, California will cut Medi-Cal for the poor. Education will be slashed, resulting in a shortened school year, thousands of laid-off teachers, school closings and an end to summer programs in a system that has plummeted from the nation's best to one of its worst, as measured by dropout rates and academic achievement.

The 10 campuses of the University of California face cuts that may result in 50,000 fewer students and 5,000 fewer teachers.

What makes her fiscal crisis relevant to us all is not only that California is our most populous state, with one in eight Americans living there, but California has a gross domestic product larger than Canada's.

Moreover, the demography of California today is the demography of America tomorrow, just as the social and fiscal policies of California in the last decade mirror those of the U.S. government today.

One-third of all U.S. wage-earners today have been amnestied from paying U.S. income taxes, as the top 1 percent haul fully 40 percent of that huge load. So, too, in California, the well-to-do and the wealthy are hammered, which is why many have quietly closed their businesses, packed and gone back over the mountains whence their fathers came.

Under George W. Bush and Obama, the U.S. government has undertaken huge new responsibilities: No Child Left Behind, Medicare prescription drug benefits, wars in Iraq and Afghanistan, the takeovers of banks and auto companies, bailouts without end and national health insurance.

California, too, spent lavishly in the fat years and issued bonds when state revenues did not cover the costs, bringing its once-sterling credit rating down to the nation's lowest. So, too, U.S. Treasury bonds, T-bills and the American dollar are now increasingly suspect.

Demographically, California is where America will be in 2040.

White folks, who are leaving California as they did in the millions in the 1990s, are below half the population. Hispanics, their numbers surging due to legal and illegal immigration, are well over a third of the population. The African-American share of California's population is also falling, as the Asian share is rising, again from immigration.

Los Angeles, which is what most large American cities will look like, is the most diverse city on earth. Has diversity been a strength?

In the prisons and jails, and among the scores of thousands in street gangs and the underclass, a black-brown civil war is underway.

In October 2006, the Financial Times reported the findings of the famed author of "Bowling Alone" on what diversity has wrought:

"A bleak picture of the corrosive effects of ethnic diversity has been revealed in research by Harvard University's Robert Putnam, one of the world's most influential political scientists. His research shows that the more diverse a community is, the less likely its inhabitants are to trust anyone -- from their next-door neighbor to the mayor."

"In the presence of diversity, we hunker down," said Putnam. "We act like turtles. The effect of diversity is worse than had been imagined. And it's not just that we don't trust people who are not like us. In diverse communities, we don't trust people who do look like us."

"Professor Putnam," said the Financial Times, "found trust was lowest in Los Angeles, 'the most diverse human habitation in human history.'"

Richard Nixon and Ronald Reagan carried California nine times. But the state is now a fiefdom of liberalism. John McCain's share of the vote was smaller than Barry Goldwater's. California today believes in Big Government, open borders, diversity, multiculturalism and the politics of compassion. But what liberalism has wrought in California, its native-born are fleeing.

Still, where California is at, America is headed.

Californians who are running away from the communities and towns in which they were raised have Arizona, Idaho, Colorado, Utah and Nevada to head to. But when all of America arrives at where California is at today, where do the Americans run to?

---

Mr. Buchanan is a nationally syndicated columnist and author of Churchill, Hitler, and "The Unnecessary War": How Britain Lost Its Empire and the West Lost the World, "The Death of the West,", "The Great Betrayal," "A Republic, Not an Empire"and "Where the Right Went Wrong."

Related Resources:

• California Mess A Microcosim of What's In Store For the Rest of Us
  
• California is Liberalism's "Canary in the Coal Mine"

Posted: Daily Thought Pad