Obama's big speech
Here's what's going to happen tomorrow, when Obama is going to give his jobs speech.
According to tentative leaks today, Obama will call for about $300 billion in "stimulus" spending, much or all of it to be paid for by cuts outlined soon. Many of these measures, particularly FAST (Fix America's Schools Today) make sense. And the dollar amount, if all of his proposals were enacted in full (snowball's chance in hell of that!) are enough to matter.
So I'm happy, right? Not at all. America has HUGE problems, and HUGE unmet infrastructure needs, as Paul Krugman and others have been saying for years. America has a HUGE problem with a lack of consumer demand. These two HUGE problems (coupled with other big problems I don't have time to post about right now) call for huge solutions. Big stimulus now, reduction of health care spending, and some trims in other spending years from now. But the current massive budget deficit we are running is not a problem. In fact, its a godsend. If the GOP had its way, we'd slide closer to a Great Depression.
Anyway, here's what I expect will happen after the speech. The markets will not react much because much of his program will not pass, and because any effect is priced in. The mainstream media will be very impressed with his "bold" plan. The GOP will deem some of it dead on arrival, but promise a careful consideration of the rest. And the Paul Krugman wing of the democratic party (the left, which is yearning for far bolder action) will be mostly disappointed. Krugman himself will probably spin it as a glass half full speech, but I expect much of the rest of the liberal blogosphere will be disappointed. Again. If anyone cares.
I'll post my reactions in the days after the speech.