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October 06, 2008

A Funny Joke

It would be excellent if—when Arnold Schwarzenegger arrives at the White House to ask for a $7 billion loan for California—George Bush put on an Austrian accent and told him "Don't be an economic girlie-man!"

I bet Schwarzenegger would really get a kick out of it.

SCHWARZENEGGER: There is another way you can tell you're a Republican. You have faith in free enterprise, faith in the resourcefulness of the American people, and faith in the U.S. economy. To those critics who are so pessimistic about our economy, I say: Don't be economic girlie men!

—Jonathan Schwarz

Posted at October 6, 2008 03:19 PM

Awesome vid. BTW, can someone help me, not sure where to ask this, figured i would try here...can someone please articulate in a very simple way why trickle down economics are bad. thanks in advance

Posted by: josh at October 6, 2008 04:06 PM

It isn't a "bad" thing. It just doesn't exist. It's a con game. See David Stockman's famous 1982 article in, I recall, "The Atlantic," on how the Reaganites sold this snake oil to America and made the wealthy and corporations happy.
The more things change...

Posted by: donescobar at October 6, 2008 04:31 PM

yeah, i had read that, and now, they cant even find someone to take credit for it, or something like that...just got a bunch of bloody repugs in the office i work in and they all think im a crazy liberal because i dont think the bail out will work..just once i would love to shut them up! by the way, long time reader, first time poster...escobar, always appreciate your thoughts.

Posted by: josh at October 6, 2008 06:46 PM

We wasted our recall on Grey Davis?

Posted by: Christopher Wing at October 6, 2008 07:11 PM

I've long thought a strange symmetry was at work in California.

The amount by which Ahnold's state is in debt is not too far removed from the amount Grey's state (by coincidence, the very same state) was in debt, which was the whole reason Ahnold gave for recalling him.

And the major reason for that original debt was the shenanigans Exxon and friends played on California. And Ahnold was invited to a special little party Exxon and friends held before he started running to replace Grey!

Ha ha! Such a funny joke! Such odd coincidences!

Posted by: steve at October 6, 2008 07:56 PM

Arthur Laffer and the Laffer Curve===Trickle down.
I would try to explain it but there is no explaination.

Posted by: Mike Meyer at October 6, 2008 08:16 PM

yeah, these guys are the ultimate revisionists huh, just make up numbers as we go along

Posted by: josh at October 6, 2008 08:21 PM

Laffer actually drew his curve on a cocktail napkin in the presence of Dick Cheney and Donald Rumsfeld...sign of things to come?

Posted by: En Ming Hee at October 6, 2008 09:52 PM

note to self: go to the store,get a cocktail napkin, come up with suspect-yet-deceptively simple scheme to save the world, make lots of money.

don't forget, you also need toilet paper and orange juice(leave this mundane note off napkin, might inspire doubts...)

Posted by: Jonathan Versen at October 7, 2008 12:47 AM

If you want a basic reason why "trickle down economics" doesn't function (and there are many) without getting too technical, here's one reason:

The basic premise of "trickle down economics" is that if you free up money for the rich bastards at the top, they'll have so much money they won't know what to do with it. They'll be "forced" to "invest" it back into the economy. This "investment" could be in the form of direct investment (putting it into the market, putting it back into their own corporations, putting it into savings in a bank so the bank can make loans, etc.) or more indirect "investment" like buying things (more toys, more houses, electronic doo-dads, etc.). The premise is that the trickle comes down to the folks in the middle and at the bottom because the rich bastards are putting more money into circulation to create jobs - either through direct investment or through increasing the sales of expensive widgets.

The glaring, gaping, easily understood hole in this mess is that there's nothing that forces the rich bastards to invest their money in the US economy. And in fact simultaneous to enacting "trickle-on" economic policies, the same folks pushing those policies also pushed for more globalization and lower barriers for imports, as well as lower barriers for investing capital in overseas markets. So the whole premise of the faux "social contract" that trickle down was based on is destroyed - rich bastards get their money and see better returns on investment by putting it into overseas banks and overseas companies. They get better toys from overseas manufacturers as well. Since we collect relatively little in the way of taxes from them, trickle-down economics hurts us far more than it helps us.

There are many other flaws involved in trickle-down economic theory, but that's the gut-level one that I find easy to explain to people and trickle-down advocates have a hard time explaining why my outline above isn't right. The only reason it's taken so long to hurt us as much as it has recently is because early on in the process our economy was a lot stronger than the rest of the worlds' nations. Plus in the 90s the government twiddled with things to make technological research in the US something that was very attractive for investors (creating a tech bubble that burst at the end of the 90s). Bush could have done something similar to keep the whole mess afloat, but his advisers seem to actually not understand that trickle-down was a scam designed to fleece the people and cripple the unions and the Democratic party, so he didn't. And so we got a giant real estate bubble and a major financial crisis instead.

Posted by: NonyNony at October 7, 2008 09:49 AM