||David Sirota's new book, The Uprising, is
available in bookstores everywhere.
||President elect, Barack Obama, is warning of dire
||and how much worse it could get if there is not
bipartisan support, and quickly,
||for his stimulus plan.
But will his proposals work?
||Joining me now from Denver is nationally
syndicated columnist, David Sirota.
||He is also the author of the book, The Uprising.
||David, you wrote a column yesterday,
||In the immediate aftermath
of the Obama speech called,
||"The Good, The Bad and The Ugly of the Plan".
Let's walk through it.
||What the good first?
||The good is that Obama seems to understand, at
least the size and scope of the problem,
||and is proposing a robust package of
||And we know that public spending is probably the
most efficient way to stimulate the economy.
||Some people, though, are saying that there isn't
enough public spending in this.
||Well, it gets to the bad. The bad part of this is
that he is also including a lot of tax cuts
||and he seems to be paying for those tax cuts
with that public spending.
||In other words, he's taking the money that could
be going to public spending,
||and proposing putting it into a lot of tax cuts
that a lot of people don't think are gonna work.
||So why do you say the tax cuts are bad? Because if
you look at the other side of the political fence,
||or on the Republican side, they believe that the
tax cuts are good
||and there probably needs to be more of them.
||Well, because the data tells us that the best way,
the quickest way, the most efficient way,
||to stimulate the economy,
is through public spending.
||Mark Zandi of economy.com,
one of John McCain's advisors,
||had said that you get about $1.58 GDP benefit
with public spending.
||You only get $1.23 or $1.24 when you put
that money into tax cuts.
||So, if we want to stimulate the economy in a short
term, quick kinda way,
||the best way that we know how to do that is
through public infrastructure spending,
||unemployment insurance, food stamps.
||We'll get to the ugly in just a second David, but
do you have enough information
||about what's in this plan to be able to say
whether or not it would work?
||Not yet, and that's a good point. We don't know
what the final size of the package is gonna be.
||We don't know what percentage is gonna spending,
what precise percentage is gonna be tax cuts.
||It's still a negotiation in process,
that's absolutely true.
||Alright, so give us the ugly of all of this.
||Well, the ugly was that Obama seemed to mention
that he wants to connect deficit reduction
||to entitlement, "entitlement reform."
||Now, entitlement reform refers to
social security and Medicare.
||Now when you tie deficit reduction to entitlement
"reform", it usually has meant in the past
||efforts to try to cut those programs. That's a
bad idea in a bad economy.
||Medicare and social security are very, very
stimulative to the economy.
||You do not want cut those programs.
||There was one other aspect to all of this that
John Dickerson from Slate Magazine
||picked up, he noticed how this was
being sold. He writes,
||"For a president who has repeatedly promised an
entirely new way of doing business in Washington,
||Obama's address had a deep familiarity: Doom was
its central and recurring message.
||Unless the federal government acts quickly and
boldly (and expensively),
||the roof is going to cave in."
||It's almost like he's using the tactics
of the Bush administration.
||As it sold security, to try to sell us economic
||I think there is something to that but I don't
necessarily think that's a bad thing.
||Every crisis is an opportunity and I think that
this economic crisis is an opportunity
||to reassert the role of the government as a force
for good in the economy
||on behalf of the middle class.
||We haven't had that in the last 30-35 years.
And I do think that that's a paradigm shift,
||at least from the past couple of decades.
||David Sirota in Denver this morning.
It's good to see you David, thanks for coming in.
||Thanks for having me John.