More economics questions

[Bob The Mercenary]

I figured instead of going around taking other threads off the rails with my questions, I could pool them all here instead. There are also a couple articles I would like to link, so this will avoid some unorganization.

This first article is kind of creepy, if not a complete hyperbole.

June 8 (Bloomberg) -- I’ve finally figured out the Obama economic strategy. President Barack Obama and his team have been having so much fun wielding dictatorial power while rescuing “failed” firms, that they have developed a scheme to gain the same power over every business. The plan is to enact policies that are so anticompetitive that every firm needs a bailout.

Once that happens, their new pay czar Kenneth Feinberg can set the wage for everybody and Rahm Emanuel can stack the boards of all of our companies with his political cronies.

I know, it sounds like an exaggeration. But look at it this way. If there were a power ranking of U.S. companies, like the ones compiled by football writers for National Football League teams, Microsoft would surely be first or second to Google. But last week, Microsoft Chief Executive Officer Steve Ballmer came to Washington to announce what Microsoft would do if Obama’s multinational tax policy is enacted.

Over the top, and I'm not one of those who huddles in his fallout shelter with a gun worrying when Obama Vader will come to take over his stuff, but it's been making too much sense to me lately. The same can be said about nationalizing healthcare. If that ever becomes a reality doesn't that pretty much give the government the opportunity to regulate every aspect of your life under the guise of cutting costs? Example, not allowing your kids to play in the pool for fear they might accidentally hurt themselves or drown (a little extreme I know, just trying to illustrate).

U.S. firms have nonetheless prospered because our tax code allows a business to set up a subsidiary in a low-tax country. When that subsidiary earns profits, they are taxed at the rate of that country, and don’t face U.S. tax until the money is mailed home.

Whenever I've brought this up I've been shot down by people saying that lowering taxes on businesses would destroy the country. Then, on the flip side I've been told raising taxes on businesses would destroy the country. That's too much pressure! Anyone care to clear this up? I have been rooting through my local B&N for books on economic history and philosophy so I can be more prepared in the future for debates such as this.

The second thing I wanted to ask about is a little more...sketchy. And I apologize for bringing this blight upon the hallowed grounds of the boards, but today I committed the mortal sin of listening to a half hour of Rush Limbaugh. The thing was, it was a very convincing half hour where he talked about the press conference from yesterday, talking about the new unemployment rate. I'll save you from reading the entire transcript by posting snippets here, but I'll link the transcript as well. The reason I'm linking it is because he made it seem like a complete clusterfuck, and reading back on the actual press conference, that's how their answers did sound.

RUSH: Yesterday at the White House, Vice President Biden's chief economic advisor, Jared Bernstein, held a press conference to talk about the new unemployment rate and the economic stimulus package. And during the Q&A, Jake Tapper of ABC says, "In January you and Dr. Romer issued your recommendation for the stimulus. It turned out to be rather optimistic. I think it's fair to say you said without the stimulus the unemployment rate will be just over 8%. Obviously it's 9.4% with your stimulus. How do you explain that?"

BERNSTEIN: That was before we had fourth quarter results on GDP, which we later found out was contracting at an annual rate of 6%, far worse than we expected at that time. Were this plan not to be implemented as I've described and as Dr. Romer and I articulated back then, in the absence of the plan, job losses would have been deeper from whatever level they started, job looses would have been deeper, the unemployment rate would have been, by our estimates by the end of next year, would have been between one-and-a-half and two points higher than it otherwise will be. So those estimates that we are touting today and the estimates that you hear us talk about, that's the difference between what would have happened to the job market, the unemployment rate were this plan not in effect and the actual outcomes of jobs. Now, looking back, it was clearly too optimistic.

RUSH: This is flat-out pap. This is rigmarole. This is BS, plain and simple BS. You just heard Biden's economic guru explain that their estimates on unemployment were wrong because it was Bush's fault, the fourth quarter of 2008 was worse than they thought, and, by the way, it would be worse than ever if we hadn't done what we did, that they were too optimistic. They are not optimistic at all. They talk optimism. They implement plans that are based upon pessimism. They implement plan and plan after plan that is destroying the US economy. It is destroying the opportunity for the American dream for millions of Americans who don't yet realize that their pursuit of the American dream is in the process of being destroyed. They will learn this, sadly, soon enough. This is how it's done. "Hey, we didn't know how bad Bush left it." I knew they were going to do that with Iraq, they were going to do it with Club Gitmo, "Well, we didn't know how bad it was, Bush didn't really tell us. The economy was so bad, we had no clue. Our plan, why, if we hadn't done our plan, it would be even worse."

One more Jared Bernstein, this time the question came from Bloomberg News' Hans Nichols: "Those summer jobs, that 125,000, are you counting that toward the 600,000 jobs you're going to be saving or creating?"

BERNSTEIN: Yes.

NICHOLS: Are you also going to be counting that towards the 3.5 total goal?

BERNSTEIN: That is -- yeah, that -- the 3.5 is the, uh, the 3.5 is an estimate of jobs created or saved by the end of, uh, of next year.

NICHOLS: What you're obviously acknowledging are temporary jobs over the summer which won't last three months --

BERNSTEIN: Oh, that's a good question, right.

NICHOLS: How that's being counted in the 3.5?

BERNSTEIN: Thank you. Now, that's a good question. The 3.5 million jobs are what economists call full-time equivalent jobs. So those 125 would not count as a full 125. Two part-time jobs count as one full-time equivalent job.

I want to stress that I didn't create this thread to argue any points, only to get answers. I know approximately dick about economics. Is there something about this I'm missing or does none of this actually make any sense? I have a mean habit of missing the big picture.

With so many objections I have to the President's policies, it would be nice to know if I'm basing my opinions off of faulty "facts".