Stimulus leads to chicken fried steak: The Swamp
The Swamp
Chicago Tribune
Posted February 11, 2009 4:15 PM
The Swamp

chicken fried steak small.JPG
(Chicago Tribune photo by James F. Quinn)


by Frank James

The Center for American Progress, a liberal think tank with close ties to the Obama Administration, has an explainer on how the economic stimulus works to boost economic activity.

They have an animated illustration showing how spending on a bridge-construction project ripples through a community leading to dollars ping ponging through the hands of numerous providers of goods and services ending with a chicken-fried steak. Why weren't we told this sooner? It might've boosted public support for the stimulus package, especially during the dinner hour.

Here's a transcript of CAP's explanation:

How Recovery Works

Let's say President Obama signs a recovery plan that includes money to build a bridge...

Money goes to a bridge builder. He hires an accountant to handle the books, a company to handle payroll, and a lawyer to look over contracts. He buys concrete and tools from a local supplier. Finally, he hires dozens of construction workers to start the project.

Weeks later, a construction worker, back on the job, has a little extra cash. He starts grabbing breakfast from a local diner, brings his truck to a car wash, and takes his family to the movies.

Over time, with business growing again, the payroll company, the accounting firm, the law firm, the supplier, the diner, the car wash, and the movie theater all start hiring new employees. New jobs boost the economy, tax revenues grow, and the recovery continues.

Soon, the effects multiply. With more customers coming in, the cook at the diner feels ready to buy a new car; the car dealer, expecting a big month, hires painters to repaint the showroom, the painters go to the accountant to help with their growing income, and the accountant, now working late, winds up at the diner, eating the country fried steak made by the cook.

This one piece of the recovery plan started with a bridge project, but its effect rippled through the community and helped get the economy moving forward again.

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Comments

For got to mention the contractor gives some politician a political donation -PORKGREASE-


Don't forget how the chicken fried steak leads to clogged arteries and obesity which then improves business for doctors and pharmaceutical firms. That bridge goes far.


They do some leaps of time and logic, but overall that's the general idea. As long as corruption is controlled and oversight is ensured, this is indeed all possible.


Are these people so stupid.

All of you who argued "trickle down economics" doesn't work, what do you say to the Democrats, Pres. Obama and his Admin', that is using our money to do what "Private Industry" should be doing and saving our money?.

I just don't get it.


PG, I would not expect you to get it. Typically, bridges are public property that is bought and paid for by the government....not "private industry". It is people like you that got us into this mess, you know, the ones that don't get it.

As for the article, sometimes you have to explain something nice and s-l-o-w for some people to understand, and then they make a post and say they still do not get it. I was going to make an original comment that the think tank does not have to even go that far, as I believe the just getting the construction industry back to work is enough stimulus to flood the economy with some cash. For those not in the industry, you do not understand how large it is, and how much money gets exchanged. In WI, a bridgbuilding carpenter will make about $28/ hr. It is good money for hard work. It is money that will be spent once attained. Right now my union has about 1,000 carpenters laid off. If we were all back on jobsites building America, we would be putting at least $1.2M back into the local economy of southern WI each week, and that is just for the first tier of the cash cycle. Currently right now, we are drawing unemployment checks, which is costing the state money and nothing is being built.


PG,
You must be wet behind the ears.
Trickle Down was invented by Reagan and involved tax cuts for the rich. The theory being that they would invest it and the benefits would 'trickle down' on the rest of us.

Building a bridge is not TD econ. And it has the added bonus of not killing us down the road. (ha ha)

Now, pay attention; Tax cuts for us po folk are nice, but not stimulative. We will save it or pay down debt.
But that's good mid-term.

The big problem is the fact the total debt is getting so big that our economic competitors will no longer buy our bonds, necessitating the 'monetization' of our debt.

I await your thanks for making this clear.


PG,
You must be wet behind the ears.
Trickle Down was invented by Reagan and involved tax cuts for the rich. The theory being that they would invest it and the benefits would 'trickle down' on the rest of us.

Building a bridge is not TD econ. And it has the added bonus of not killing us down the road. (ha ha)

Now, pay attention; Tax cuts for us po folk are nice, but not stimulative. We will save it or pay down debt.
But that's good mid-term.

The big problem is the fact the total debt is getting so big that our economic competitors will no longer buy our bonds, necessitating the 'monetization' of our debt.

I await your thanks for making this clear.


At least the cornbread looks pretty good.


Xcellentform, maybe you should have the bill checked by your Union, for how much money is going to leave the Country and say employ illegals "THAT ARE TAKING YOUR JOB". Why wouldn't the Democrat's protect your job, with "What's been quietly stripped is a provision that would have required any businesses receiving federal stimulus cash to use an easy computer program called E-Verify to make sure that the jobs they generate go to American citizens or documented foreign workers, not illegal immigrants". Thats from the Trib'.

And you know what, The Government isn't a business. The Democrats are trying to turn it into one, and hopefully they fail. I want you (in Private Industry) to become a developer, employ lots of people and make lots of money. Next answer the post not create something I didn't say. The right has been trashed for years about "trickle down eco'". The article and my post was about "trickle down" except having 535 CEO's and a White House. Stick with the facts.


Wow PG, more words but even less insite. That is a trick that only a true pug can pull off. I was completely on topic....maybe you need to read the story for the first time.

I wish they would weed out the illegals here. They have no business being here. I can tell you this though; I have not seen a mexican in any of the trade unions since I have been there. I'm not sure why, but very few blacks too. I DO see MANY mexicans in the capitalist private sector where the game is how cheap you can build things and what corners you can cut to get your bid a little lower.

You really need to do some homework if you think the above article was about "trickle down eco". If anything, it is a river flowing up article, but once again, I would not expect you to understand any of that stuff. Go snort another rush ball.


But the proof is in the pudding.


But the proof is in the pudding.


The left-wing CAP leaves out a vital fact--the taxes that will have to pay for all this.

In fact, $13 in taxes to pay for each $10 in goodies. Which, by CAP's logic, will have a NEGATIVE "ripple effect."

Which will leave everyone poorer.

No chicken fried steak for you, buddy.


Hey genius, I'll explain it to you. I don't expect you to understand Trickle down. Lets forget where the money comes from but (ok taxes), but contracts are awarded to a contractor/developer/builder who then has to hire others who then have to hire others all the way DOWN to the apprentice. That's it. It called "trickle down economics", which in turn "creates a trickle up", jobs, money.

It did not start from the apprentice, maybe in your mind it did, but taking shots at me is not going to get to the trillion dollar truth.

My point is what you said and what was given as an example is called "trickle down" what the left has said for years doesn't work. Let's just take the first paragraph, "Money goes to a bridge builder. He hires an accountant to handle the books, a company to handle payroll, and a lawyer to look over contracts. He buys concrete and tools from a local supplier. Finally, he hires dozens of construction workers to start the project."


PG, your example is not "trickle down" at all. "Trickle down" would mean giving a tax cut to the rich guy living on an island, and hoping that he decides to use that money to build a bridge. The problem, of course, is that in a bad economy, the rich guy might not decide to spend the money building the bridge. The government is in the unique position where they can force spending to occur, and thus provide the economic stimulus needed.


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