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Stories tagged with “John Shadegg

Yglesias

Job Creators Don’t Need Money to Create Jobs, They Need Customers

To add a little bit to what Jon Chait has to say about Rep John Shadegg the whole notion that you drive the economy forward by directing more money into the hands of “job creators” (i.e., rich people) makes basically no sense. A job creator is basically a businessman with an idea. If it’s a good idea, a business based around his idea will attract customers. And if it attracts customers, he’ll hire employees to serve those customers’ needs. This is where growth comes from.

But a businessman with a good idea who needs capital doesn’t need a tax cut to get that capital, he needs a loan or an equity investment. This is what we have a financial system for. Sergey Brin doesn’t need to first get rich, then finance Google out of his own pocket. He just needs to start Google and that’s how he gets rich.

The thing of it is, though, that your idea really only works if you have some customers. If everyone in Yuma, Arizona is unemployed then even a very competent proprietor of a dry cleaning establishment is going to have a hard time expanding his business. He won’t take out a loan to expand, he won’t get an equity investment to expand, and he won’t invest his own money in an expansion. You can give the guy all the money you want, and he won’t invest in expanding his business. That’s because unemployed people don’t need much dry cleaning and also don’t have much money to spend on dry cleaning. A guy with $0 and a good idea and a lot of potential customers will find a way to start his business. A guy with $1 billion and a good idea and no potential customers is just a guy sitting on a huge stockpile of cash. Things like the availability of credit matter, but credit is currently available. What’s not available is customers with money and an inclination to spend it. More government spending and more money-creation will lead to more purchases, more customers, more business expansion, and more hiring. Then people with good ideas will make a lot of money and complain about their high taxes.

Economy

Rep. Shadegg Scoffs At The Fact That Jobless Benefits Are A Benefit To The Economy: ‘No, They’re Not!’

Unless Congress acts today, unemployment benefits will expire for 2.5 million Americans, with unemployment above nine percent and five unemployed workers competing for every available job opening. If Congress, as expected, does nothing, this will be first time in the last forty years that benefits have expired with unemployment so high.

According to calculations by the Congressional Budget Office, Moody’s Economy, and myriad other economists, unemployment benefits are the single best way to pump money into the economy and generate economic activity, as the unemployed are very likely to spend all of the benefits they receive (thus moving money into local businesses). But during an interview with MSNBC’s Mike Barnicle today, Rep. John Shadegg (R-AZ) scoffed at the notion that unemployment benefits help the economy. “Unemployed people hire people? Really? I didn’t know that,” Shadegg jeered:

BARNICLE: What about the fact that unemployment benefits pumped into the economy are an immediate benefit to the economy? Immediate…

SHADEGG: No, they’re not! Unemployed people hire people? Really? I didn’t know that.

BARNICLE: Unemployed people spend money Congressman, ’cause they have no money.

SHADEGG: Aha! So your answer is it’s the spending of money that drives the economy and I don’t think that’s right. It’s the creation of jobs that drives the economy…Actually, the truth is the unemployed will spend as little of that money as they possibly can. Job creators create jobs.

BARNICLE: Have you ever been unemployed? Have you ever been unemployed?

SHADEGG: Yes, I have.

BARNICLE: What did you do with the money? Save it?

Watch it:

At the same time that he was dumping on the unemployed, Shadegg called for extending all of the Bush tax cuts without paying for them, joining a slew of Republican lawmakers who care more about tax cuts for the very wealthy than unemployed Americans about to lose the last strand of safety net that they have available.

Shadegg never managed to explain why all of the job creators he cites would create any jobs if households aren’t spending money. In that vein, MarketPlace noted today that “when unemployment checks stop, it’s felt right away by businesses like gas stations, apartment operators, and grocery stores.” And as the Center for American Progress’ Heather Boushey and Jordan Eizenga found, “the workers losing benefits have an average weekly benefit of a little over $290 per week, which translates into a total loss of about $2.5 billion dollars in benefits over December. This is equal to about one in seven dollars of the gain in retail sales seen between December 2008 and December 2009.”

Some economists estimate that allowing benefits to expire could cause economic growth to “fall by one half to nearly 1 percentage point,” as well as throw hundreds of thousands of people into poverty. “Look for homelessness to rise and food lines to get longer as we approach Christmas if the situation can’t be resolved,” says Diane Swonk, chief economist at Mesirow Financial.

While Shadegg joked that he will be unemployed come January since he is retiring from Congress, next year he will be eligible for a federal pension (if he opted for one), as he is turning 62 and served on Capitol Hill for more than five years.

Politics

Deficit Fraud Shadegg Can’t Name A Single Program He Would Cut To Reduce The Deficit

Monday night, Rep. Paul Ryan (R-WI) was pressed by MSNBC’s Chris Matthews to identify what programs he would eliminate in order to address the deficit. All Ryan could come up with was repealing the remaining stimulus and TARP funds. By advocating for the elimination of the stimulus, Ryan was endorsing a tax increase on the middle class. However, at least Ryan was able to positively identify something that he would cut.

Today, Rep. John Shadegg (R-AZ) went on MSNBC and put on an even less impressive performance. Mike Barnacle begged Shadegg to identify just one specific program that he would axe, but Shadegg fell back on the conservative tactic of calling for an across the board cut on all programs:

BARNACLE: We have had an endless stream of members of Congress and the United States Senate on here over the past two or three years and whenever they are asked the question, ‘specifically, what would you cut to trim spending in the federal government,’ everybody agrees it’s a huge problem, we have to soak our faces in cement here on the set to prevent ourselves from laughing out loud at the non-answers we get. So my question to you, long-winded question here, is, can you please, I’m begging you, give me just one program you’d cut? We’ll start with just one program you’d cut.

SHADEGG: Well, there are lots of programs I would cut. I would begin by an across the board cut on all spending because I think we need to spread this…I’d say five percent across the board tomorrow on every single program, including defense, then you’d begin the process in the right direction.

Watch it:

But an across the board cut makes no attempt to prioritize between vital, necessary programs that people depend upon and unnecessary, wasteful spending. It simply takes the same chunk out of everything. Is Shadegg willing to cut veteran’s health care or Social Security benefits by five percent tomorrow? How about border enforcement, food stamps, homeland security, the FBI, or national park funding? By not providing one single idea, instead opting for a tired talking point, Shadegg shows that he isn’t interested in grappling with any of the realities of the budget.

The Wonk Room has ideas on programs that could be cut.

Economy

MSNBC Begs Deficit Fraud Shadegg To Name One Program He Would Cut, But He Can’t Deliver

Monday night, Rep. Paul Ryan (R-WI) was pressed by Chris Matthews to identify what programs he would eliminate in order to address the deficit, and all Ryan could come up with was repealing the remaining stimulus and TARP funds. Ryan was unable to name a program that affects the long-term deficit, and by advocating for the elimination of the stimulus he was endorsing a tax increase on the middle class.

However, at least Ryan was able to positively identify something that he would cut. Today, Rep. John Shadegg (R-AZ) went on MSNBC and put on an even less impressive performance. Mike Barnacle begged Shadegg to identify just one specific program that he would axe, but Shadegg fell back on the conservative tactic of calling for an across the board cut on all programs:

BARNACLE: We have had an endless stream of members of Congress and the United States Senate on here over the past two or three years and whenever they are asked the question, ‘specifically, what would you cut to trim spending in the federal government,’ everybody agrees it’s a huge problem, we have to soak our faces in cement here on the set to prevent ourselves from laughing out loud at the non-answers we get. So my question to you, long-winded question here, is, can you please, I’m begging you, give me just one program you’d cut? We’ll start with just one program you’d cut.

SHADEGG: Well, there are lots of programs I would cut. I would begin by an across the board cut on all spending because I think we need to spread this…I’d say five percent across the board tomorrow on every single program, including defense, then you’d begin the process in the right direction.

Watch it:

This is extremely lazy of Shadegg, and shows that he’s fundamentally disinterested in actually addressing the deficit. An across the board cut makes no attempt to prioritize between vital, necessary programs that people depend upon and unnecessary, wasteful spending. It simply takes the same chunk out of everything. Is Shadegg willing to cut veteran’s health care or Social Security benefits by five percent tomorrow? How about border enforcement, food stamps, homeland security, the FBI, or national park funding? The list goes on and on.

But it’s not that hard to come up with something in the federal budget that actually can be cut. Here are some suggestions: the second engine for the F-35 and the C-17 transport plane, both of which the Pentagon doesn’t want. How about the $45 billion in subsidies we give to Big Oil companies? There’s a tax subsidy for NASCAR track owners that can certainly go. Agriculture subsidies and subsidies for ethanol, which both benefit huge corporations, need to be cut. There are also a handful of Army Corps of Engineers projects that are environmentally and economically disastrous that can certainly come to an end.

At the same time, revenue needs to be responsibly raised by allowing the Bush tax cuts to expire, ending the preferential tax treatment that hedge fund managers receive, reinstating the estate tax, cracking down on offshore tax havens, and closing the S-corp tax loophole. But Shadegg isn’t interested in grappling with any of the realities of the budget, instead opting for a talking point that proves nothing besides his own lack of credibility on the issue.

Health

Republican Congressman Makes Strong Case For Single Payer Health Care

Conservatives sometimes try to rally progressives to oppose the Senate health care bill by characterizing the legislation as a give away to private insurers. But this morning, retiring Congressman John Shadegg (R-AZ) took this manufactured outrage to new heights, telling MSNBC’s David Schuster that the bill would give insurers “exactly what they want”:

SHADEGG: The reality is this bill is going to reward for-profit companies that have done a disservice. This bill mandates, with the IRS executing the penalty if you don’t go along, that you and I buy health insurance plans from for-profit companies. That’s an outrage. It’s the same for profit health care companies that have done a lousy job of taking care of this. And yet this bill gives them exactly what they wanted. The insurance industry, the for-profit insurance industry wanted an individual mandate and that’s what they are getting out of this bill. The for-profit insurance industry did not want a public option because they don’t like competition. And guess what? They are getting that. This bill is giving to the for-profit insurance companies and I happen to believe that Dennis is making this point, it’s giving the for-profit insurance companies exactly what they want.

Watch it:

When Schuster pressed Shadegg on whether he would support a “government-run medicare expansion,” Shadegg described his personal health care proposal which, ironically, would go a lot further towards pleasing the insurance industry than the Senate bill. Shadegg’s plan would allow insurers to continue providing completely unregulated insurance policies to cheap-to-cover younger Americans and push older more expensive Americans into tax payer funded high risk pools. Shadegg takes some preliminary steps towards limiting premium growth, but it’s unlikely that these programs will offer affordable or even adequate coverage.

Nationwide, high-risk pools can afford to cover fewer than 200,000 people. States grapple with the high cost of insuring a large pool of very sick people by charging higher premiums, denying benefits for treatments related to their preexisting conditions and limiting eligibility. In fact, according to the Tax Policy Center, subsidizing sick people by grouping them together into a single risk pool could cost as much as $1 trillion over ten years.

Yglesias

Rep. Shadegg Warns of “Soviet-Style Gulag Health Care”

Not content with out of control Hitler analogies, Rep John Shadegg (R-AZ) took to the floor yesterday to demonstrate that he’s a fool. Lee Fang has the quotes:

SHADEGG: You know, it occurs to me, and I’ll go through these other scandals very quickly, but what we’re really getting here is we’re not just getting single-payer care. We’re getting full on Russian gulag, Soviet-style gulag health care [...] It appeared in last Friday’s Wall Street Journal. You can Google it. You can pick up the phone and call Kim Strassel. You can ask her about Soviet-style gulag health care in America, where powerful politicians protect their constituents.

Lee reminds us that “The Soviet gulags were a network of prisons and forced labor camps that held as many as 20 million people during Stalin’s reign of terror.” To compare a set of insurance regulations you happen not to favor to Stalin’s mass imprisonment and slaughter is ridiculous, and absurdly insensitive to the real victims.

Massive human rights violations aside, I would also note that health care was among the strong points of the Soviet economy, along with primary and secondary education, armaments, and mass transit.

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