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Buttigieg 2020

Hugo Stiglitz

By Hugo Stiglitz
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bad_teammate

bad_teammate 13188

Posted
Posted
Just now, henrygandorf said:

guess you saw the kkk-related stories filed by the "independent" (white) reporter.

Sure. He's very critical of Pete Buttigieg. You know... journalism.

Quote

once they saw him, they said "you're not supposed to have credentials", as was described as some sort of "bolo" on the reporter (not the cameraman).  no idea what credentials they took from jordan, but it seemed clear they did not want him there. 

Did they say that to him once they saw him or are you making that up?

Because they signed in at the press desk and received their credentials. They didn't lie about who they were. They applied for press credentials and got them at the venue from the Pete campaign. Then they went outside and did interviews with people in line.

If the Pete campaign doesn't want them there...

1) Don't approve their press credentials.
2) Go up to them and ask them to leave.
3) Go up to them and ask them to remove their press credentials.
4) Have security or police handle them if they are breaking rules.
5) Make sure everyone knows to never approve their credentials again.

You know what you don't do? Touch journalists.

Quote

also "physically ripped the sticker" - how do you rip stickers off people?  telekinesis?

You don't rip stickers off people. That's the point here, henry, you don't do that.

You ask them to leave. You call security or police to get them to leave.

But why didn't they do that to the journalist they didn't like? Why did they only feel free to physically assault the black guy (who isn't responsible for the material they are mad about) but leave the white guy (who IS responsible) untouched?

Make sure you do some yoga or at least some solid stretching before coming up with an answer that's not the obvious one. I don't want you hurting yourself.

Quote

and it seems very clear from the repeated tweets, retweeting himself, and the sheer volume of tweets, that jordan is hope-hope-hoping that this turns into a "thing".

So? Should he not be doing that? 

Should journalists just shrug and laugh it off when a campaign has its staffers physically assault them or their crew?

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Hank Kingsley
Hank Kingsley

and English.   

henrygandorf
henrygandorf

look dude, i understand that the political forum is "the wild west", but in a sea of bad takes and unnecessary obnoxiousness for the sake of theater likely stemming from some sort of irrational fear,

Chuckie Finster
Chuckie Finster

Now that it’s over... Pete wasn’t ready to be President, but a giant fuck you to the Bernie crew for how personal and intense the attacks got against him.  

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henrygandorf

henrygandorf 29189

Posted
Posted
2 minutes ago, bad_teammate said:

Did they say that to him once they saw him or are you making that up?

i was just reading the story.  which part would i have made up?

3 minutes ago, bad_teammate said:

If the Pete campaign doesn't want them there...

1) Don't approve their press credentials.
2) Go up to them and ask them to leave.
3) Go up to them and ask them to remove their press credentials.
4) Have security or police handle them if they are breaking rules.
5) Make sure everyone knows to never approve their credentials again.

agreed.

4 minutes ago, bad_teammate said:

You don't rip stickers off people. That's the point here, henry, you don't do that.

You ask them to leave. You call security or police to get them to leave.

agreed.

5 minutes ago, bad_teammate said:

But why didn't they do that to the journalist they didn't like? Why did they only feel free to physically assault the black guy (who isn't responsible for the material they are mad about) but leave the white guy (who IS responsible) untouched?

because they don't like the journalist or what he's saying, and they obviously don't want footage of it.  he's holding the camera.  you're trying way too hard to make this racial and you're actually missing the opportunity to make this a "freedom of the press" moment.  that's the point here, bad.  i don't like any part of their behavior, but making it racist is a stretch.

8 minutes ago, bad_teammate said:

So? Should he not be doing that? 

he can do whatever he wants.  this is the twitter age, and clicks are everything.  but when you have such a dynamite story, you can post it, update it, and have the company you work for retweet it, without just spamming your own twitter page with repeat tweets and reposts and retweets and everything he's doing, like a little kid that just caught his first fish.  it's hard to wade through it all to actually see what happened.

10 minutes ago, bad_teammate said:

Should journalists just shrug and laugh it off when a campaign has its staffers physically assault them or their crew?

absolutely not.  once the staff-member is released from the hospital, they should definitely file a police report.  hate-crimes are no joke.

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washparkhorn

washparkhorn 9939

Posted
Posted

Pete has some edgy tea partyish energy along for the ride. They are railing hard against Biden's Blue Checks and the Blue Checks are fighting back. 

Is Pete raising up the original tea party magic spell, or have they just hitched a ride with him. Getting nasty between Biden and Buttigieg. They are competing for the same lane, so not unexpected.

The center/right lane does not have a defining narrative.

The candidates competing for that lane - Biden, Buttigieg, Warren, and Klobuchar - have failed to differentiate themselves from each other. 

Look for more differentiation - and conflict - among the center/right lane candidates. 

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Mrs Whiggins

Mrs Whiggins 13050

Posted
Posted
3 minutes ago, washparkhorn said:

Where? 

Trump's billionaire buddies and associates.

Huh. I read the tweet and was like wut? Who believes this stuff? I mean the guy may have been tongue in cheek, serious, who knows? But then I realized in a QAnon kind of way, I could see how his followers might suddenly go, "Hey! And Bill Clinton was a Rhodes scholar and he flew on Epstein's plane and" yada yada yada. There's some real head scratchers out there, but this fellow probably tweets stuff and sits back to see if it picks up steam.

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bad_teammate

bad_teammate 13188

Posted
Posted
6 minutes ago, henrygandorf said:

because they don't like the journalist or what he's saying, and they obviously don't want footage of it.  he's holding the camera.  you're trying way too hard to make this racial and you're actually missing the opportunity to make this a "freedom of the press" moment.  that's the point here, bad.  i don't like any part of their behavior, but making it racist is a stretch.

Why is it a stretch?

Quote

absolutely not.  once the staff-member is released from the hospital, they should definitely file a police report.  hate-crimes are no joke.

Literally how Trump fans reacted to Michelle Fields complaining about Lewandowski grabbing her.

2 minutes ago, Hank Kingsley said:

He's basically getting Scenario 2 right now from the left. I'm guessing you're not on Twitter haha

When Joe Biden's to your left, that's a pretty huge problem.

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washparkhorn

washparkhorn 9939

Posted
Posted
19 minutes ago, Mrs Whiggins said:

Huh. I read the tweet and was like wut? Who believes this stuff? I mean the guy may have been tongue in cheek, serious, who knows? But then I realized in a QAnon kind of way, I could see how his followers might suddenly go, "Hey! And Bill Clinton was a Rhodes scholar and he flew on Epstein's plane and" yada yada yada. There's some real head scratchers out there, but this fellow probably tweets stuff and sits back to see if it picks up steam.

Trump denizens have all sorts of theories on everything. I always wanted to know what the big reveal would be with Q'Anons. Most of them burn out in some old European Royalty conspiracy.

If it's not a Trump theory, it is an ugly Clinton-Creature type smear - like what they did against Obama when he began to beat Hillary. 

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BradInATX

BradInATX 9208

Posted
Posted
21 minutes ago, longhornmatt said:

The criticism he’s getting from other Democrats is a lot different than what he would get from Trump, though.  He would need to show some fire against Trump or else he will just look like a pussy like Cruz and a litany of others who swallow Trump’s outrageous bullshit without hitting back.

Scenario One:

Other Democrats:  Pete doesn’t have much experience beyond small town mayoring.

Pete:  What makes us most American is our shared values of Americanism, and nowhere is that exemplified better than the small towns of the heartland.  We would all be better off if Washington were more like South Bend.

Other Democrats:  Hmm, fair enough.  Well played, Pete.
 

Scenario 2:  

Trump:  Lil Petey Booty-Judge isn’t fit to be elected dog catcher.  He was a terrible mayor, absolutely terrible, ask anyone in South Bend.  He was racist, he has no idea what he’s doing.  He’s a George Soros sock puppet, that’s all he is.  How this guy, with no experience, never done anything in his life, 35 years old looks like he should be on a paper route, how the big money deep state people chose him, what he must have done for those guys ... well I’ll let you be the judge.

Pete: Mr. President, what makes us most American is our shared values of Americanism, and nowhere is that exemplified better than the small towns of the heartland.  We would all be better off if Washington were more like South Bend.

Trump:  Go back to manage the Dairy Queen where you belong, Booty-Judge.

 

I agree with this. He'd have to get firey and savage at Trump without coming off like a pissy little nerd. He might struggle with that. I think Warren has the same style mismatch. 

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washparkhorn

washparkhorn 9939

Posted
Posted
6 minutes ago, Hank Kingsley said:

He's basically getting Scenario 2 right now from the left. I'm guessing you're not on Twitter haha

Biden's Clinton-Creature are hitting Buttigieg right now. Not close to scenario 2 - because it is Biden, but some of those Clinton types go low - like what they did to Obama in 2008. Their choice of attack lines remain a large part of the Trump denigration of President Obama.

Biden's newest ad was hard hitting, but not unfair. 

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Hank Kingsley

Hank Kingsley 20904

Posted
Posted
Just now, washparkhorn said:

Biden's Clinton-Creature are hitting Buttigieg right now. Not close to scenario 2 - because it is Biden, but some of those Clinton types go low - like what they did to Obama in 2008. Their choice of attack lines remain a large part of the Trump denigration of President Obama.

Biden's newest ad was hard hitting, but not unfair. 

I'm not talking about Biden's ad. I'm talking about the Bernie people on Twitter. 

 

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Hank Kingsley

Hank Kingsley 20904

Posted
Posted
2 minutes ago, longhornmatt said:

There’s a huge difference between Bernie Bro online trolls talking a bunch of bullshit and actually having that bullshit come from the candidate himself front and center on national television.   Nobody cares if Pete doesn’t call out bad teammate.  They will care if Trump walks all over him in front of the world and he doesn’t hit back in a way that seems real.

Point taken, but when I say Bernie people I'm not talking about worthless reply trolls.  A lot of venom is coming from leftist journalists and media. 

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washparkhorn

washparkhorn 9939

Posted
Posted
9 minutes ago, Hank Kingsley said:

Point taken, but when I say Bernie people I'm not talking about worthless reply trolls.  A lot of venom is coming from leftist journalists and media. 

Policy differences are not hate.

https://twitter.com/johniadarola/status/1226413972171055104

$600B in savings seems like a lot . . ., no?

Now try to reply without a Republican talking point. 

 

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Fozzz

Fozzz 152

Posted
Posted

He hasn’t even been nominated and this rat is already talking about how we need to get serious about the deficit. He would be America’s Macron if he somehow got elected, and what would follow would make all the shitlibs on this board pine for Trump. 

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gmr548

gmr548 16576

Posted
Posted
1 hour ago, longhornmatt said:

The criticism he’s getting from other Democrats is a lot different than what he would get from Trump, though.  He would need to show some fire against Trump or else he will just look like a pussy like Cruz and a litany of others who swallow Trump’s outrageous bullshit without hitting back.

Scenario One:

Other Democrats:  Pete doesn’t have much experience beyond small town mayoring.

Pete:  What makes us most American is our shared values of Americanism, and nowhere is that exemplified better than the small towns of the heartland.  We would all be better off if Washington were more like South Bend.

Other Democrats:  Hmm, fair enough.  Well played, Pete.
 

Scenario 2:  

Trump:  Lil Petey Booty-Judge isn’t fit to be elected dog catcher.  He was a terrible mayor, absolutely terrible, ask anyone in South Bend.  He was racist, he has no idea what he’s doing.  He’s a George Soros sock puppet, that’s all he is.  How this guy, with no experience, never done anything in his life, 35 years old looks like he should be on a paper route, how the big money deep state people chose him, what he must have done for those guys ... well I’ll let you be the judge.

Pete: Mr. President, what makes us most American is our shared values of Americanism, and nowhere is that exemplified better than the small towns of the heartland.  We would all be better off if Washington were more like South Bend.

Trump:  Go back to manage the Dairy Queen where you belong, Booty-Judge.

Pos rep for Booty-Judge

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bad_teammate

bad_teammate 13188

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Posted

A million years ago guys were arguing in this thread that Pete wouldn't just gain ground on Trump in the active/vet military vote, but outright beat him.



What a fucking joke.

Literally the same program Joe Biden got Hunter into so Hunter could clean himself up.

The Democrats all have to swallow it on stage and pretend this ventriloquist dummy is a war hero, but the Republicans are going to eat this Fortunate Son bullshit alive.

These people laughed at John McCain.

Fine, do your bit and get your check and uniform, but this push to bend and scrape for this is laughable.

Libs warming up the "HOW DARE YOU, SIR?" cannons but are going to get wiped.
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staboner

staboner 4969

Posted
Posted (edited)
On 2/10/2020 at 2:01 PM, Fozzz said:

He hasn’t even been nominated and this rat is already talking about how we need to get serious about the deficit. He would be America’s Macron if he somehow got elected, and what would follow would make all the shitlibs on this board pine for Trump. 

a grazing blow of flapping hyperbole. your compound word work use is good though

does anyone know how to pronounce Buttplug's name? no homo, asking for myself

yeah all the healthcare plans suck because we are trying to make a large underclass pay up linearly to maintain the current, bloated corporatist mob plan. such is mango. 

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washparkhorn

washparkhorn 9939

Posted
Posted
On 2/9/2020 at 7:01 PM, Fozzz said:

He hasn’t even been nominated and this rat is already talking about how we need to get serious about the deficit. He would be America’s Macron if he somehow got elected, and what would follow would make all the shitlibs on this board pine for Trump. 

Dean Baker (CEPR/Economist) believes Pete's debt scaremongering should be treated like climate change deniers. Debt fear mongers like Pete and the followers of Pete Peterson should know we have lost $1.4 Trillion in demand each year since 2008. We have secular stagnation. Lower interest rates did not cure that problem. Deficit spending is not the problem; the debt is not the problem. Pete is preaching voodoo economics that further aggravates secular stagnation that is dragging this economy down once again.

https://www.patreon.com/posts/34006602

 
 
 
 
Spoiler

What if Buttigieg Said That he Doesn’t Accept the “Fashionable” View that Climate Change is a Problem? | Dean Baker on Patreon. 

. . . But whatever may be in Buttigieg’s head, we can certainly look at his words. He didn’t just indicate he disagreed with a view on deficits that has been largely embraced by the mainstream of the economics profession, he implied that this view was frivolous – a fashion that could change at any time.

This is more than a little annoying for those of us who have spent a lot of time in budget debates, especially in the dozen years since the collapse of the housing bubble gave us the Great Recession. The view that large deficits, like the one the country is now running, are not a problem came about as a result of an analysis of the evidence. 

Ever since the collapse of the housing bubble, the economy has suffered from a persistent shortfall in demand. The loss of demand from the collapse of the bubble was enormous. At its peak in 2005, housing investment was 6.7 percent of GDP. In the most recent quarter it was just 3.8 percent of GDP. The difference of 2.9 percentage points of GDP translates into more than $600 billion in lost annual demand.

In addition, there was a falloff in consumption demand associated with the collapse of the housing bubble. The ephemeral wealth created by the housing bubble led to a surge in consumption spending, as people spent based on the newly generated wealth in their homes. At the peak in 2005, households consumed 97.5 percent of their disposable income. When the bubble burst and the housing wealth disappeared, so did the bubble driven consumption. In the most recent quarter, households were consuming just 92.3 percent of their disposable income. The difference in consumption shares translates into more than $800 billion annually of lost demand in today’s economy.

If we add the loss in annual demand from the falloff in housing investment and reduced consumption, it comes to more than $1,400 billion. As we have painfully learned since the Great Recession, there is no easy mechanism to replace this lost demand. The view formerly held by many economists, that the Fed could just lower interest rates and bring the economy back to full employment, has been shown to be clearly wrong. Even with the Fed’s interest rate at zero for seven years, the economy still did not rebound to anything like full employment.

This is the context in which much of the mainstream of the economics profession came to embrace the view that large budget deficits could be sustained for long periods of time. Given a persistent shortfall in demand in the economy (a.k.a. “secular stagnation”), there is no other sector that could provide the boost to growth necessary to bring the economy to full employment. 

Rather than being a liability, large deficits are needed to lower the unemployment rate. And, low unemployment rates are especially important to African Americans, Hispanics and other disadvantaged groups in the labor market, since they disproportionately are the job gainers as the labor market tightens. In a tight labor market, employers have no choice but to employ people who would otherwise be the victims of discrimination. With the unemployment rate now well under 4.0 percent, there are accounts of employers even reaching out to people with criminal records who they might otherwise never consider employing.

Tight labor markets also give workers at the middle and bottom of the wage distribution the bargaining power needed to achieve wage gains. After seeing declines in real wages in the years immediately following the Great Recession, workers at the middle and bottom of the wage distribution have been seeing real gains of more than 1.0 percent annually over the last five years. 

If we had smaller budget deficits, we would have seen less demand in the economy and less growth. This would have meant fewer jobs, higher unemployment, and less bargaining power for workers. That is the Pete Buttigieg world. He may not know this or he may not care, but we should be clear, this is what his call for lower budget deficits means. 

The Story of Evil Deficits I

The conventional story of the evils of budget deficits is that they lead to higher interest rates, which then crowd out investment. Less investment (both public and private) is bad news because it means that productivity growth will be slower, leaving us poorer in the future than we would otherwise be. 

This story clearly does not fit the current situation. The interest rate on 10-year Treasury bonds is just 1.6 percent. That compares to interest rates of 4.0-5.0 percent back in the late 1990s when we were running budget surpluses. With interest rates at historically low levels for the last decade, it is pretty hard to make the case that the deficit has been crowding out investment.

The conventional story would also hold that large deficits could lead to inflation, if the Fed failed to act by pushing up interest rates. This story also does not fit with the data. The inflation rate, as measured by the Consumer Price Index was 2.5 percent over the last year, but this reflects jumps in energy prices last fall. The inflation rate in the core personal consumption expenditure deflator, the rate targeted by the Federal Reserve Board, has been just 1.6 percent over the last year. 

This is well below the Fed’s 2.0 percent target, which is meant to be an average. That means that the Fed would like to see the inflation rate occasionally be somewhat above 2.0 percent in order to balance out the periods of below 2.0 percent inflation. From the Fed’s standpoint, the problem has been that the inflation rate has been too low, not too high.

In short, we are not seeing either of the short-term problems usually attributed to large budget deficits. Interest rates are at historically low levels, so we can’t tell a story about deficits crowding out investment, and inflation has been consistently below its targeted rate, so there is no basis for complaints about the deficits causing inflation. So, if Buttigieg has a story about deficits doing harm to the economy, it is not one of the conventional stories economists tell.

The Story of Evil Deficits II

The other story often told about the budget deficit is that it will be a burden on our children, since they will have to pay interest on the debt. The story goes that our current publicly held debt of $16.9 trillion (79.2 percent of GDP) will impose an enormous burden as future generations struggle to pay it off. There are three points to be made on this.

First, these interest payments are an intragenerational issue, not an inter-generational issue. The debt is overwhelmingly held domestically. This means that the interest payments will be made by some of our children to the children of other people. In twenty or thirty years, ordinary workers may be paying taxes to pay the interest on the bonds held by the children of Bill Gates and Jeff Bezos. That could be a problem, but it is one that is easily solved by taxing the children of Bill Gates and Jeff Bezos. This is just saying that inequality can be a problem, which is obviously true, and if Bill Gates and Jeff Bezos’ kids hold lots of government bonds, the interest they get on those bonds could be part of the problem.

The second point is, that in spite of the large debt, the interest burden is relatively low, due to the extraordinarily low interest rates we have seen in recent years. The latest projections from the Congressional Budget Office show that interest payments, net of remittances from the Federal Reserve Board, will be just 1.4 percent of GDP in 2020. This compares to payments of more than 3.0 percent of GDP in the early and mid-1990s. It is pretty hard to get too upset about a burden that is less than half as large as what we faced three decades ago. And, that burden did not prevent the 1990s from being a relatively prosperous decade.

The final reason the debt interest burden argument richly deserves our ridicule is that it is very selective in choosing what burdens to consider and what burdens to ignore. Direct spending is only one mechanism the government uses to pay for things it wants done. It also gives out patent and copyright monopolies. These government-granted monopolies can be thought of as private taxes that the government allows companies to collect from the public in exchange for innovation and creative work. 

The amount of money at stake in the rents from patent and copyright monopolies swamps payments of interest on the debt. In the case of prescription drugs alone the rents are going to be in the neighborhood of $400 billion in 2020 (1.8 percent of GDP). If we add in the rents from these monopolies in medical equipment, computer software, recorded music, movies, and video games, we are almost certainly over $1 trillion, or close 5.0 percent of GDP. 

It doesn’t make any sense to hyperventilate about an interest burden of 1.3 percent of GDP, while ignoring rents from patent and copyright monopolies that are more than three times as large. If Buttigieg wants to make a big deal about the interest burden from the debt, then it is clearly not due to any objective reality. He is either appealing to prejudices or simply reflecting his own ignorance of budget and economic realities. 

Yes, People Who Care About Economic Policy Should be Offended by Buttigieg’s Budget Comments

Only Buttigieg knows his actual motives for dismissing the lack of concern about budget deficits as a “fashion.” However, this lack of concern is based on hard data and clear theoretical thinking. Whatever reason Buttigieg has for saying that we should be concerned about budget deficits, those of us who have done our homework have every reason to be angry at Buttigieg, just as serious climate scientists are justified in their anger at the climate denialists. 

Too long - didn't read?  

"Only Buttigieg knows his actual motives for dismissing the lack of concern about budget deficits as a “fashion.” However, this lack of concern is based on hard data and clear theoretical thinking. Whatever reason Buttigieg has for saying that we should be concerned about budget deficits, those of us who have done our homework have every reason to be angry at Buttigieg, just as serious climate scientists are justified in their anger at the climate denialists. "

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Fozzz

Fozzz 152

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Posted
5 hours ago, washparkhorn said:

Dean Baker (CEPR/Economist) believes Pete's debt scaremongering should be treated like climate change deniers. Debt fear mongers like Pete and the followers of Pete Peterson should know we have lost $1.4 Trillion in demand each year since 2008. We have secular stagnation. Lower interest rates did not cure that problem. Deficit spending is not the problem; the debt is not the problem. Pete is preaching voodoo economics that further aggravates secular stagnation that is dragging this economy down once again.

https://www.patreon.com/posts/34006602

Spoiler
 
 
 
 
  Reveal hidden contents

What if Buttigieg Said That he Doesn’t Accept the “Fashionable” View that Climate Change is a Problem? | Dean Baker on Patreon. 

. . . But whatever may be in Buttigieg’s head, we can certainly look at his words. He didn’t just indicate he disagreed with a view on deficits that has been largely embraced by the mainstream of the economics profession, he implied that this view was frivolous – a fashion that could change at any time.

This is more than a little annoying for those of us who have spent a lot of time in budget debates, especially in the dozen years since the collapse of the housing bubble gave us the Great Recession. The view that large deficits, like the one the country is now running, are not a problem came about as a result of an analysis of the evidence. 

Ever since the collapse of the housing bubble, the economy has suffered from a persistent shortfall in demand. The loss of demand from the collapse of the bubble was enormous. At its peak in 2005, housing investment was 6.7 percent of GDP. In the most recent quarter it was just 3.8 percent of GDP. The difference of 2.9 percentage points of GDP translates into more than $600 billion in lost annual demand.

In addition, there was a falloff in consumption demand associated with the collapse of the housing bubble. The ephemeral wealth created by the housing bubble led to a surge in consumption spending, as people spent based on the newly generated wealth in their homes. At the peak in 2005, households consumed 97.5 percent of their disposable income. When the bubble burst and the housing wealth disappeared, so did the bubble driven consumption. In the most recent quarter, households were consuming just 92.3 percent of their disposable income. The difference in consumption shares translates into more than $800 billion annually of lost demand in today’s economy.

If we add the loss in annual demand from the falloff in housing investment and reduced consumption, it comes to more than $1,400 billion. As we have painfully learned since the Great Recession, there is no easy mechanism to replace this lost demand. The view formerly held by many economists, that the Fed could just lower interest rates and bring the economy back to full employment, has been shown to be clearly wrong. Even with the Fed’s interest rate at zero for seven years, the economy still did not rebound to anything like full employment.

This is the context in which much of the mainstream of the economics profession came to embrace the view that large budget deficits could be sustained for long periods of time. Given a persistent shortfall in demand in the economy (a.k.a. “secular stagnation”), there is no other sector that could provide the boost to growth necessary to bring the economy to full employment. 

Rather than being a liability, large deficits are needed to lower the unemployment rate. And, low unemployment rates are especially important to African Americans, Hispanics and other disadvantaged groups in the labor market, since they disproportionately are the job gainers as the labor market tightens. In a tight labor market, employers have no choice but to employ people who would otherwise be the victims of discrimination. With the unemployment rate now well under 4.0 percent, there are accounts of employers even reaching out to people with criminal records who they might otherwise never consider employing.

Tight labor markets also give workers at the middle and bottom of the wage distribution the bargaining power needed to achieve wage gains. After seeing declines in real wages in the years immediately following the Great Recession, workers at the middle and bottom of the wage distribution have been seeing real gains of more than 1.0 percent annually over the last five years. 

If we had smaller budget deficits, we would have seen less demand in the economy and less growth. This would have meant fewer jobs, higher unemployment, and less bargaining power for workers. That is the Pete Buttigieg world. He may not know this or he may not care, but we should be clear, this is what his call for lower budget deficits means. 

The Story of Evil Deficits I

The conventional story of the evils of budget deficits is that they lead to higher interest rates, which then crowd out investment. Less investment (both public and private) is bad news because it means that productivity growth will be slower, leaving us poorer in the future than we would otherwise be. 

This story clearly does not fit the current situation. The interest rate on 10-year Treasury bonds is just 1.6 percent. That compares to interest rates of 4.0-5.0 percent back in the late 1990s when we were running budget surpluses. With interest rates at historically low levels for the last decade, it is pretty hard to make the case that the deficit has been crowding out investment.

The conventional story would also hold that large deficits could lead to inflation, if the Fed failed to act by pushing up interest rates. This story also does not fit with the data. The inflation rate, as measured by the Consumer Price Index was 2.5 percent over the last year, but this reflects jumps in energy prices last fall. The inflation rate in the core personal consumption expenditure deflator, the rate targeted by the Federal Reserve Board, has been just 1.6 percent over the last year. 

This is well below the Fed’s 2.0 percent target, which is meant to be an average. That means that the Fed would like to see the inflation rate occasionally be somewhat above 2.0 percent in order to balance out the periods of below 2.0 percent inflation. From the Fed’s standpoint, the problem has been that the inflation rate has been too low, not too high.

In short, we are not seeing either of the short-term problems usually attributed to large budget deficits. Interest rates are at historically low levels, so we can’t tell a story about deficits crowding out investment, and inflation has been consistently below its targeted rate, so there is no basis for complaints about the deficits causing inflation. So, if Buttigieg has a story about deficits doing harm to the economy, it is not one of the conventional stories economists tell.

The Story of Evil Deficits II

The other story often told about the budget deficit is that it will be a burden on our children, since they will have to pay interest on the debt. The story goes that our current publicly held debt of $16.9 trillion (79.2 percent of GDP) will impose an enormous burden as future generations struggle to pay it off. There are three points to be made on this.

First, these interest payments are an intragenerational issue, not an inter-generational issue. The debt is overwhelmingly held domestically. This means that the interest payments will be made by some of our children to the children of other people. In twenty or thirty years, ordinary workers may be paying taxes to pay the interest on the bonds held by the children of Bill Gates and Jeff Bezos. That could be a problem, but it is one that is easily solved by taxing the children of Bill Gates and Jeff Bezos. This is just saying that inequality can be a problem, which is obviously true, and if Bill Gates and Jeff Bezos’ kids hold lots of government bonds, the interest they get on those bonds could be part of the problem.

The second point is, that in spite of the large debt, the interest burden is relatively low, due to the extraordinarily low interest rates we have seen in recent years. The latest projections from the Congressional Budget Office show that interest payments, net of remittances from the Federal Reserve Board, will be just 1.4 percent of GDP in 2020. This compares to payments of more than 3.0 percent of GDP in the early and mid-1990s. It is pretty hard to get too upset about a burden that is less than half as large as what we faced three decades ago. And, that burden did not prevent the 1990s from being a relatively prosperous decade.

The final reason the debt interest burden argument richly deserves our ridicule is that it is very selective in choosing what burdens to consider and what burdens to ignore. Direct spending is only one mechanism the government uses to pay for things it wants done. It also gives out patent and copyright monopolies. These government-granted monopolies can be thought of as private taxes that the government allows companies to collect from the public in exchange for innovation and creative work. 

The amount of money at stake in the rents from patent and copyright monopolies swamps payments of interest on the debt. In the case of prescription drugs alone the rents are going to be in the neighborhood of $400 billion in 2020 (1.8 percent of GDP). If we add in the rents from these monopolies in medical equipment, computer software, recorded music, movies, and video games, we are almost certainly over $1 trillion, or close 5.0 percent of GDP. 

It doesn’t make any sense to hyperventilate about an interest burden of 1.3 percent of GDP, while ignoring rents from patent and copyright monopolies that are more than three times as large. If Buttigieg wants to make a big deal about the interest burden from the debt, then it is clearly not due to any objective reality. He is either appealing to prejudices or simply reflecting his own ignorance of budget and economic realities. 

Yes, People Who Care About Economic Policy Should be Offended by Buttigieg’s Budget Comments

Only Buttigieg knows his actual motives for dismissing the lack of concern about budget deficits as a “fashion.” However, this lack of concern is based on hard data and clear theoretical thinking. Whatever reason Buttigieg has for saying that we should be concerned about budget deficits, those of us who have done our homework have every reason to be angry at Buttigieg, just as serious climate scientists are justified in their anger at the climate denialists. 

Too long - didn't read?  

"Only Buttigieg knows his actual motives for dismissing the lack of concern about budget deficits as a “fashion.” However, this lack of concern is based on hard data and clear theoretical thinking. Whatever reason Buttigieg has for saying that we should be concerned about budget deficits, those of us who have done our homework have every reason to be angry at Buttigieg, just as serious climate scientists are justified in their anger at the climate denialists. "

Dean Baker is awesome and I would recommend to everyone on this board to follow the work he and others do at CEPR. 

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Guest Lobo

Guest Lobo

Posted
Posted

Pete seems like the kinda guy who would break up a threesome because he doesn't like odd numbers.  

Having said that, I made a donation to him and may make another one when he comes back to Austin.  

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Tuco

Tuco 5076

Posted
Posted
On 2/9/2020 at 6:43 PM, washparkhorn said:

Pete has some edgy tea partyish energy along for the ride. They are railing hard against Biden's Blue Checks and the Blue Checks are fighting back. 

Is Pete raising up the original tea party magic spell, or have they just hitched a ride with him. Getting nasty between Biden and Buttigieg. They are competing for the same lane, so not unexpected.

The center/right lane does not have a defining narrative.

The candidates competing for that lane - Biden, Buttigieg, Warren, and Klobuchar - have failed to differentiate themselves from each other. 

Look for more differentiation - and conflict - among the center/right lane candidates. 

Jesus Christ, a politician in a small town said DC could learn something from small towns?  That's newsworthy? That is something to be critical of?  

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bad_teammate

bad_teammate 13188

Posted
Posted (edited)

Lis Smith, Pete's #1 advisor and comms lady, accidentally Tweeted from a sock puppet account on Twitter.

 

Pretending to be a Nigerian Pete supporter.

This campaign is a riot.

Some more Tweets from Lis's Nigerian sock

She's trying to do damage control and didn't even bother to look up what time it would be in Nigeria.

 

Edited by bad_teammate
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Guest Lobo

Guest Lobo

Posted
Posted (edited)

Just embrace your whiteness Pete.  You're a Gay mayor living in the shadow of the most powerful piece of Catholic real estate this side of Rome.  You have an interesting narrative, just get back to it.  You've seem lost lately.  Your black support has not dwindled because of your connections to high price donors, it's dwindled because you seem like the kind of white nerd that would say shit like, "A lot of people organize their books by author or theme.  I sort mine by texture."  

Edited by Lobo
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