Huge State Economic Backlash Due to Stimulus Funds?

[OKCTalker]

Are federal stimulus funds going to destroy Oklahoma's economy?

1. Begin with the fact that our state's budget gap (as a percentage of the annual state budget) leads the nation at 18.5%, ahead of California, Michigan and New York. Source: Today's Wall Street Journal.

2. Then consider that most of the federal stimulus funds come with significant strings attached to the states what accept them, mostly by requiring the state to provide matching funds and/or increase state spending. It's a short-term benefit with killer long-term effects that are only in the fine print. Two governors - Mitch Daniels of Indians and Rick Perry of Texas - saw the potential for disaster and turned down the funds. Link: The States and the Stimulus - WSJ.com)

So when today's Daily Oklahoman reported that the state is about to receive $2.6 billion in federal stimulus funds, I wonder: "Can we afford to accept them?" Is anybody at 23rd & Lincoln reading the fine print?

[soonerguru]

Give me a break. Most of my friends would have been fired last year if the state hadn't accepted the funds, which made up for a shortfall of $700 million in the state's budget. I'm thankful there are actually more available, or the shortfall we have would be almost insurmountable.

A lot of state workers are already taking furlough days and facing layoffs. Without the prospect of the stimulus money, they would most certainly be facing unemployment.

Also, Rick Perry accepted about 80 percent of the stimulus funds for Texas, and "turned down" a small percentage of them. Same with Bobby Jindal. Ever heard of politics?

Your source is an editorial by the way, not a news report. If you actually look up the facts of the matter you will see that Texas and Louisiana accepted billions in stimulus funding.

Also, this is NOT the political board. Take the politics there, please.

[rcjunkie]

States that are using "stimulus" money to supplement their budgets are just prolonging the inevitable, we should have refused the stimulus money and dealt with the problem head on. Gov. Henry will escape the brunt of the financial problem/heartaches, but is leaving a huge mess for the next Governor.

[Kerry]

Step one in breaking the spending addiction - take away the money. This is the very reason we are nowhere near the bottom. The entire country is now built on a funding bubble that will disappear soon. So now not only will Soonerguru's friends still lose their jobs, but the rest of us will be stuck with a large bill owed to China.

[Bunty]

Well, surely, Republicans at the State Capitol will be promoting state tax cuts as a way to improve the state economy. And why shouldn't they? Doing that can lead to further cuts in government and so doing precisely what Republicans want to see happen, according to their conservative philosophy.

[mugofbeer]

Well, surely, Republicans at the State Capitol will be promoting state tax cuts as a way to improve the state economy. And why shouldn't they? Doing that can lead to further cuts in government and so doing precisely what Republicans want to see happen, according to their conservative philosophy.

In most cases, this IS the correct action. But if the state;s budget decificit is to be as large as advertised, they can't take this action. Bunty, basic economics and historical cases have proven that tax cuts spur an economy. We came out of the Carter-bred recession because Reagan cut taxes. Put more money in people's pockets and they will spend it, the money they spend rolls through the economy multiple times boosting the economy. The difference is that this time, people have no extra money and they seem to be saving money rather than spending any they may have. This is a different recession.

Cutting government? Generally, its a positive thing.

[Spartan]

Oh boy, here we go again...

[OKCTalker]

Guru - You misinterpreted this to be a political post, which it isn't; I'm soliciting information and facts about a monumental budget shortfall, and how it might be exacerbated by accepting federal stimulus funds. This is the first I've read about that.

Your friends wouldn't be the first bureaucrats who did something stupid and contrary to the public interest in order to protect their jobs. And dismissing a story because it's on the Wall Street Journal's editorial page won't get you very far - they may lean to the right, but their facts are usually spot-on. Instead of challenging me to "actually look up the facts," why don't you present the facts to support your inferences?

So taking it AWAY from a political discussion and back to one of economics, my question stands: With Oklahoma's huge fiscal shortfall looming, will accepting $2.6 billion in stimulus funds ultimately require us to dig out of an even deeper hole?

[soonerguru]

OK, here are the facts:

Gov. Perry of Texas attempted to turn down $500 million in stimulus funds. But he ACCEPTED $17 BILLION!

Here's an article about it from the Dallas Morning News.

http://www.dallasnews.com/sharedcont...1.4ad958f.html

Most of this stuff amounts to political grandstanding against the President. When push comes to shove, states won't turn down this money and they shouldn't.

We are in the worst economic conditions since the Great Depression.

Some of you folks have no problem with our government paying more than $1 trillion to rebuild Iraq and Afghanistan but have a problem when our government invests even less less than that in America during its worst financial meltdown in several generations?

And RCJunkie continues to peddle the fantasy that Reagan's tax cuts (which he by the way also raised while in office) were a benefit to the economy. They led to a massive build-up in government debt, you know, the debt you GOPers keep going on and on about now that Obama is in office.

It is true that President Kennedy's tax cuts stimulated economic growth, but Reagan's did not. Remember, his own budget director resigned because of the fiscal insanity of his administration.

We will need the stimulus money this year or there will be drastic cuts to public services, and it won't just affect my friends.

[soonerguru]

And by the way, I believe the original poster should explain precisely how accepting this money is going to hurt Oklahoma. Please give concrete examples.

Will continuing to pay teachers be a problem for Oklahoma? More money for highways and bridges? Please explain how this federal largesse is going to hurt Oklahoma, and keep the right-wing Reagan-loving rhetoric out of it. Facts only please.

In fact, this same challenge should apply to every bomb-throwing tea partier weighing in on this thread. Please explicitly show how Oklahoma accepting money from the federal government is going to create a "hole to dig out of" for Oklahoma.

Kerry seems to think Oklahoma is going to have to write checks to the Chinese.

Facts only, righties.

[Urbanized]

Now, now... ..."right-wing" and "Reagan-loving" are NOT synonymous. Or even especially connected, depending upon who you talk to.

Thus concludes my participation in message board political discussions for calendar year 2010.

[soonerguru]

States that are using "stimulus" money to supplement their budgets are just prolonging the inevitable, we should have refused the stimulus money and dealt with the problem head on. Gov. Henry will escape the brunt of the financial problem/heartaches, but is leaving a huge mess for the next Governor.

How is Henry "leaving a mess?"

Please explain using facts.

Are you suggesting that by accepting federal stimulus funds Henry is creating a "mess." How's that work, Einstein?

[soonerguru]

And I was wrong on my initial post. Governor Blow Dry Perry accepted 99 percent of stimulus funds.

But his game worked well enough to convince the original poster that he "turned down" the stimulus funds. Politicians can be tricky like that.

[mugofbeer]

Now, now... ..."right-wing" and "Reagan-loving" are NOT synonymous. Or even especially connected, depending upon who you talk to.

Thus concludes my participation in message board political discussions for calendar year 2010.

chicken! (LOL)

[Bunty]

In most cases, this IS the correct action. But if the state;s budget decificit is to be as large as advertised, they can't take this action. Bunty, basic economics and historical cases have proven that tax cuts spur an economy. We came out of the Carter-bred recession because Reagan cut taxes. Put more money in people's pockets and they will spend it, the money they spend rolls through the economy multiple times boosting the economy. The difference is that this time, people have no extra money and they seem to be saving money rather than spending any they may have. This is a different recession.

Cutting government? Generally, its a positive thing.

So what? After all these tax cuts eventually comes a recession. I suspect cheap oil and cheap borrowing rates have more to do with a strong economy.

[mugofbeer]

I'm not following you. You can stand on your head and sing in the rain and eventually a recession will come.

Cheap oil and cheap borrowing rates will certainly help an economy grow but people have to have money in their pockets to spend in order to drive the economic machine. Thats not just something that will help, that is essential. Its also the reason recovery from this recession will be extraordinarily slow, because we are tapped out and we will have even less to spend as inflation kicks in and the government takes away more of our money by raising taxes.

[soonerguru]

I'm not following you. You can stand on your head and sing in the rain and eventually a recession will come.

Cheap oil and cheap borrowing rates will certainly help an economy grow but people have to have money in their pockets to spend in order to drive the economic machine. Thats not just something that will help, that is essential. Its also the reason recovery from this recession will be extraordinarily slow, because we are tapped out and we will have even less to spend as inflation kicks in and the government takes away more of our money by raising taxes.

I don't disagree with what you're saying here but I don't envision a tax increase in the near term.

To combat inflation, they are going to gradually raise interest rates as long as the recovery can sustain itself.

[Bunty]

I'm not following you. You can stand on your head and sing in the rain and eventually a recession will come.

Cheap oil and cheap borrowing rates will certainly help an economy grow but people have to have money in their pockets to spend in order to drive the economic machine. Thats not just something that will help, that is essential. Its also the reason recovery from this recession will be extraordinarily slow, because we are tapped out and we will have even less to spend as inflation kicks in and the government takes away more of our money by raising taxes.

A major reason the recovery with new jobs will be slow is because companies are adopting new ways of doing things. This can either mean obtaining the latest in advanced technology for more efficient operations with fewer worker needed or moving labor overseas. That's also why the recovery from the Bush recession was so slow.

[Larry OKC]

How is Henry "leaving a mess?"

Please explain using facts.

Are you suggesting that by accepting federal stimulus funds Henry is creating a "mess." How's that work, Einstein?

Think this goes back to the post that started the thread

2. Then consider that most of the federal stimulus funds come with significant strings attached to the states what accept them, mostly by requiring the state to provide matching funds and/or increase state spending. It's a short-term benefit with killer long-term effects that are only in the fine print. ...

[rcjunkie]

How is Henry "leaving a mess?"

Please explain using facts.

Are you suggesting that by accepting federal stimulus funds Henry is creating a "mess." How's that work, Einstein?

Are you trying to impress someone with the name calling.
I only respond to mature, intelligent posters.

[jeffery581]

Ditto that for me. People are just stupid. They can't reason. It's either way over here or way over there....

[Kerry]

I don't disagree with what you're saying here but I don't envision a tax increase in the near term.

How do you think they are going to pay for Obamacare? Not only that but Obama said 2010 was going to be the year where he focuses on deficit reduction. What do you think Obama means by that?

[jeffery581]

Probably the same thing when Cheney said deficits do not matter...

[Urbanized]

chicken! (LOL)

Nah. I just figured out long ago how futile (and poisonous) it is to argue politics on Internet message boards. Those who drink a beer with me from time to time find out I'm pretty willing to be and interested and interested in talking politics.

[Kerry]

Nah. I just figured out long ago how futile (and poisonous) it is to argue politics on Internet message boards. Those who drink a beer with me from time to time find out I'm pretty willing to be and interested and interested in talking politics.

Do yourself a favor and stay out of on-line politics. I resisted for many years on the this site but finally caved. Now I can't get out.