First off, what gives? I thought Oregon was $2B in the hole.

Second, swallowing that, the article says $100M to help 5,000 people. That's $20,000/person. That seems rather high for just making payments when the owner can't. I guess that is the govt overhead to administer the program.

Non-sequitir - I just heard that because OH and WI don't want to take $1B for high-speed trains that it then gets divvied up amongst the remainder. What about not giving that money out and reducing the deficit?

I thought Oregon was $2B in the hole.

I think that's the next budget cycle, and state revenues/expenditures, rather than federal money.

$100M to help 5,000 people. That's $20,000/person.

Or, more precisely, $20k per household. $2k monthly mortgage payments are not unusual around these parts.

help 5,000 people.

You might say that it's the noteholders who are primarily being helped by this, rather than "people". Incidentally, people unable to make their mortgage payments because of unemployment may also be unavoidably convenienced.

What about not giving that money out and reducing the deficit?

What about it? The point of the stimulus was to borrow money and spend it to help the private sector. "Prime the pump", as we used to say. Conservatives say this didn't work; liberals say it wasn't tried. Take your pick, but reducing the deficit in the midst of a recession is not a conventional fiscal policy.

"but reducing the deficit in the midst of a recession is not a conventional fiscal policy."

Then why all the stink about the tax breaks being continued?

Indeed.

So the receiving end of all this largesse is.....wait for it.....the banks. I'm sure that JPMorgan Chase, Wells Fargo and Bank of America appreciate this outside the box handout.

These poor homeowners will get their $20,000 welfare check over the course of a year and immediately sign it over to the BIG BANKS!

This will do so, so very little in the big scheme of it all. It's just throwing more cash away and kicking the problem can down the road.

And an even bigger punch line is that it will be administered by the bastion of efficiency, the state.

On second thought, your question deserves more than a one-word response. The Bush tax cuts were offensive to many, including me, because they exacerbate the growing disparity in income, and because their ten-year sunset was so patently fraudulent as a way of bringing them within reasonable bounds in terms of their impact on the economy. I was even more outraged because they hole that they blew in the federal budget was being plugged by FICA taxes — in effect, taking from the working people to give to the rich. Obama promised to do away with this injustice, and many of us applauded that.

So, what happened? The economy is in the tank; unemployment is up. state and local revenues are down, and the rocks exposed by the receding tide are ugly. Basic macro-economic theory requires large deficits to plug the gap in GDP and get people back to work. There is a philosophical difference between R's and D's about how to do that. R's say, give money to the rich and let them invest it. D's say, give money to the masses and let them spend it, and spend money in the public sector (not, mind you, on dinner meetings for the HR department of the city, but on contracts for road improvements, rail, runways, bridges, electric power distribution, and other infrastructure stuff) to put people to work and money in their pockets. R's have effectively prevented D's from really implementing their philosophy, and have succeeded, politically, in implementing their own. It's a win-win for them; if the economy doesn't pick up, they have a big addition to the federal debt that they can use as a hammer to reduce federal spending, and if it does, they can say it was because of private sector investment, continuing their narrative that government is worthless and can't do anything useful. And here we are, with the R's calling the shots. The only way we can get deficit spending is by cutting, or not raising, taxes.

D's hate this because of the income disparity thing, and Obama's promise to do something about it. This has all produced a great deal of resentment in the democrats — more, I'm guessing, than Obama would have imagined possible. In resisting the Obama tax compromise and the other goodies that go along with it, the D's are saying that the principle of addressing the country's wealth disparity is more important than putting people back to work. I have a hard time with this. I'm as eager as the next person to raise taxes on the rich, but not if the result is increased unemployment.

D's say, give money to the masses and let them spend it, and spend money in the public sector (not, mind you, on dinner meetings for the HR department of the city, but on contracts for road improvements, rail, runways, bridges, electric power distribution, and other infrastructure stuff)"

Fine - If it happened. Oregon got something like $1.8B in stimulus, $700M in tobacco money and a annus mirablis in 2007 whne revenues jumped 20%.

I am not noticing any great improvement in the economy. Then I see other disparities like we only need a TriMet board to vote to spend $720M on a train and noo car bridge. Yet the Sellwood bridge languishes because no one anywhere can find many money to fix it.

Anecdotal, sure, but still representative. You can just look at how PDC spends money on the short list of developers, yet the average Joe prop tax payer who doesn't live downtown gets to drive thru potholes past gang shootings to go to crappy schools that we can't find $500M to repair.

I'm sure I am getting boring, but if you tell me giving $1 to govt is going to do better than leaving that same $1 with a business owner to invest, I am going to be hard-pressed to believe you. There seems to be this fiction that business-owners are flush with profits that they never invest and never pay taxes on yet they are the job creaors, not some make-work wet dream over-priced building that the planner pod wants to build that will never rent at a price that pays for it.

You have a point, Steve, which is why the debate about this subject never ends. There is some history that's instructive: in the thirties, it was government spending that got us out of the hole. That also aligns with Keynes' basic theories as I understand them. Whereas money given to people in the private sector with assets to invest does seem to pile up without getting used. Why? Because with high unemployment, consumer demand (which makes up 70% of the economy) is down, and there is already unused capacity in the private sector. Your point about the bridge and the train is instructive, because it shows not that spending doesn't work, but that people don't like public spending on priorities that they don't buy into. Governments go off the rails (so to speak) when they misspend, even if misspent funds juice the economy. Dems don't know how to make the government work for the people, and Republicans don't want to.

You say the money we got didn't help noticeably in Oregon. There wasn't enough of it, and what there was was probably misspent (like this mortgage assistance caper), at least in part. It's enough to make a person weep. We need teachers, not bigger retirements and more school administrators. We don't get what we need. Business owners get tax breaks and bailouts, and they then pay themselves big rewards. They maximize profits by sending jobs overseas. And why not? It's what market forces tell them to do. Why should they hire people and reduce their profits if they already have idle capacity?

There are some studies about how stimulus works, in terms of the "multiplier effect" of dollars handed out to people (through unemployment insurance and the like), or handed out to states to fill budget gaps, or used to reduce taxes. To me, there's nothing definitive, but it seems likely that tax reductions are the least effective way to stimulate the economy of all the alternatives. Note that the economy gets a shot in the arm from pretty much any kind of spending, public or private, whether it's wise spending or not.

I'd like to see us spend public funds on stuff that will make us stronger economically in the future: infrastructure and education, and energy research. But I'm not in charge, and no one who is listens to me.

— in effect, taking from the working people to give to the rich

Taking what? Giving what? Using "in effect" does not rescue this from being pure demagoguery. That's not helpful - that's the problem.

I agree with most of your other observations save one:

I'm as eager as the next person to raise taxes on the rich, but not if the result is increased unemployment.

You're being too modest. You're much more eager than the next person (excepting Jack) to raise taxes on the rich.

But, hey, you've got the last part of that quote just right.

Who's with me? http://www.cic.gc.ca/english/immigrate/index.asp

"I'd like to see us spend public funds on stuff that will make us stronger economically in the future: infrastructure and education, and energy research."

Then why give them any more money?

It kills me that we don't have money for schools, water/sewer rates go thru the roof and potholes abound.

Yet if we want a trolley or some handout for Gerding-Edlen, there's always a honeypot for Earl or Sam or PDC to reach into.

Besides, I am not even convinced if we gave a bazillion for stimulus that any would reach the working man. I mena that's Krugman's solution, its not working because we haven't spent enough. It'd just get skimmed off at each level of govt for benefits and then end up as a bonus for some Goldman Sachs employee.

I understand why people think the tea party types are nuts and love to mock them, but I also understand the anger at both Ds and Rs or any level of govt.

20,000 per household, eh? OK I paid my house off the hard way -- make the payments and add a little more each month. Sometimes only $10. I could use $20K in a flash. Redo the bath, new roof, foundation repair. Or better yet, give me a $20K moratorium on my property taxes.