Stimulis Bill Explained

[SAMBUSA]

Shortly after class, an economics student approaches his economics professor and says, "I don't understand this stimulus bill. Can you explain it to me?"

The professor replied, "I don't have any time to explain it at my office, but if you come over to my house on Saturday and help me with my weekend project, I'll be glad to explain it to you." The student agreed.

At the agreed-upon time, the student showed up at the professor's house. The professor stated that the weekend project involved his backyard pool.

They both went out back to the pool, and the professor handed the student a bucket. Demonstrating with his own bucket, the professor said, "First, go over to the deep end, and fill your bucket with as much water as you can." The student did as he was instructed. The professor then continued, "Follow me over to the shallow end, and then dump all the water from your bucket into it." The student was naturally confused, but did as he was told.

The professor then explained they were going to do this many more times, and began walking back to the deep end of the pool. The confused student asked, "Excuse me, but why are we doing this?" The professor matter-of-fact stated that he was trying to make the shallow end much deeper.

The student didn't think the economics professor was serious, but figured that he would find out the real story soon enough.

However, after the 6th trip between the shallow end and the deep end, the student began to become worried that his economics professor had gone mad.

The student finally replied, "All we're doing is wasting valuable time and effort on unproductive pursuits. Even worse, when this process is all over, everything will be at the same level it was before, so all you'll really have accomplished is the destruction of what could have been truly productive action!"

The professor put down his bucket and replied with a smile, "Congratulations! You now understand the stimulus bill."

[Artmageddon]

Perfect explanation. We're all screwed.

[Casper]

[Disclaimer]

Oh no, not another one of these... simplified analogies.

[SAMBUSA]

Oh no, not another one of these... simplified analogies.

Democrats. Always hatin:thefinger:

[Disclaimer]

President, please! If I was hating, you'd have gotten neg rep.

I just get crap like this at work from a few people who think they're smart listening to Bill O'Reilly and Sean Hannity. I just grin and bear it because they're not worth arguing with, but I actually like you guys on here and have to read this garbage here too.

I guess I don't have to, but you need a liberal progressive pansy like me to keep it 'fair and balanced'...

[Todd#43]

Oh no, not another one of these... simplified analogies.

Please, enlightened one, explain it to we the unwashed masses....how IS the stimulus plan going to work?

Edited March 1, 2009 by Todd#43

[fusion]

You mean that explains Bush's Economic Stimulus Act that did nothing right?

[SAMBUSA]

You mean that explains Bush's Economic Stimulus Act that did nothing right?

yeah, his didn't do shit either. If it had, Obama wouldn't be pushing another one at us.

[SAMBUSA]

President, please! If I was hating, you'd have gotten neg rep.

I just get crap like this at work from a few people who think they're smart listening to Bill O'Reilly and Sean Hannity. I just grin and bear it because they're not worth arguing with, but I actually like you guys on here and have to read this garbage here too.

I guess I don't have to, but you need a liberal progressive pansy like me to keep it 'fair and balanced'...

I dont listen to either. I read/watch the news and form my own opinion. I will listen to Glenn Beck if his program happens to be on though.

[Disclaimer]

and? <--- that's all the neg rep person gave me to go off of....

and, what? Sign your rep, por favor?

[SAMBUSA]

and? <--- that's all the neg rep person gave me to go off of....

and, what? Sign your rep, por favor?

Beatin the dead horse J. They do it to me alot, suprisingly I am unaffected.

[Disclaimer]

Beatin the dead horse J. They do it to me alot, suprisingly I am unaffected.

Big Brother knows who they is.... I was going to cry myself to sleep over it, but now I don't feel so bad that I'm not the only one it happens to.

Thanks sheepfucker, thanks.

[Disclaimer]

Interesting article, but if you look at the chart at the end... it's cheaper to bail them out than to force Chapter 11.

Not to mention:

GM would need financing not only so it could weather the storm, but also to help its suppliers and dealers survive.

Regardless of whether you support or don't support the auto bailout - what are everyones' thoughts on the end-game strategy to maintain any manufacturing inside the US, which is rapidly becoming predominantly a service oriented country?

[Todd#43]

http://online.wsj.com/article/SB123535613910745405.html

Hmmm.... Can we have our billions back' date=' please?!?! Fucking Cock Suckers!!![/quote']

I found this passage quite interesting:

"The initial discussions call for private banks to provide the financing -- known as a debtor-in-possession, or DIP, loan -- with the government guaranteeing or backstopping the loan. In this scenario, some of the financing would be used to pay back the $17.4 billion the government lent GM and Chrysler late last year."

So if I read this right, the yet to be received government backed load would be used to payback the original government loan?

Hmmmm...I'm gonna see if Nissan will loan me money to pay back the money Nissan loaned me two years ago to buy my car.

[Todd#43]

Regardless of whether you support or don't support the auto bailout - what are everyones' thoughts on the end-game strategy to maintain any manufacturing inside the US, which is rapidly becoming predominantly a service oriented country?

Unions and environmental regulations have already killed manufacturing in this country. The lack of these issues in former third world countries - primarily India and China - mean that they will be eating our lunch for many years to come.

Doesn't do any good to close the barn door after the cows are already gone.

[Disclaimer]

You can still manufacture things and have regard for the environment... check the list of all the companies that are ISO 140001 certified. Please don't tell me that's the excuse you're leaning on.

http://www.qualitydigest.com/nov00/html/iso14000.html and that article is from 2000. In some instances it's more cost effective.

That wasn't my question though... again, what's the end-game strategy to maintain manufacturing in the US, or is it not worth it?

[Todd#43]

You can still manufacture things and have regard for the environment... check the list of all the companies that are ISO 140001 certified. Please don't tell me that's the excuse you're leaning on.

http://www.qualitydigest.com/nov00/html/iso14000.html and that article is from 2000. In some instances it's more cost effective.

That wasn't my question though... again, what's the end-game strategy to maintain manufacturing in the US, or is it not worth it?

Sure, you can maintain manufacturing, but you can't do it as inexpensively as China, Korea, India, Turkey, etc. So, if you can't offer a comparable item for the same or lower cost, why would you do it? That's why we don't manufacture much here any more. Sure, we put a lot of stuff together, but that's not the same.

Take for instance, extrusion dies. A die made here used to cost an extruder $20,000-$40,000 depending on complexity. The same die can be sourced in China or Korea for 1/10th of that. Why? Labor is cheaper (no unions). Government subsidies for raw materials, no EPA, no "OSHA", no "social security", and the list goes on. The savings to a company that runs 30 or 40 lines is astronomical.

I was in the Machine Tool Industry 20 odd years ago and saw Japan eat our lunch for a number of years before Taiwan, China and Korea took that over. We've seen the US auto industry have their collective asses handed to them by Japan for almost the same amount of time. Korea is making great strides in that industry now, as is India. Its only a matter of time. I'm sure if I thought about it long enough I could come up with several other "US industries" that have gotten fat dumb and happy only to have someone show them how to do it.

The writing has been on the wall for decades. Everything that's going on now is far too little and wayyyyyy too late.

[Disclaimer]

Labor is cheaper, but brain power isn't. You'll still see the US as a leader in ADVANCED manufacturing techniques. Extrusion dies are hardly advanced - and yes, the labor rate is offset in the low cost countries in that instance. I'm talking prog dies, deep draws, robotic welding and assembly. That's all US, or at least originated from here.

Not to mention that with the energy inflation, JIT manufacturing, and inventory costs - it's no longer economical to pay to ship stuff from China and India because of 6+ week lead times and container costs. So again, China and India don't always "eat our lunch".

You still haven't gotten to the crux of the question, if it's not economical to manufacture in the US, you're OK with letting it fall by the wayside and offshore all traditional manufacturing, stampings, die making, etc.?

[Todd#43]

Labor is cheaper, but brain power isn't. You'll still see the US as a leader in ADVANCED manufacturing techniques. Extrusion dies are hardly advanced - and yes, the labor rate is offset in the low cost countries in that instance. I'm talking prog dies, deep draws, robotic welding and assembly. That's all US, or at least originated from here.

Not to mention that with the energy inflation, JIT manufacturing, and inventory costs - it's no longer economical to pay to ship stuff from China and India because of 6+ week lead times and container costs. So again, China and India don't always "eat our lunch".

You still haven't gotten to the crux of the question, if it's not economical to manufacture in the US, you're OK with letting it fall by the wayside and offshore all traditional manufacturing, stampings, die making, etc.?

Show me where the US leads in "brain power". Been to a college campus lately? Since when is brain power manufacturing???

Progressive dies and deep draw dies are hardly more "advanced" than an extrusion die. I could show you some aluminum and PVC shapes that would blow your mind. I personally know SEVERAL owners of die shops (primarily progressive die experts) that can't even come close to competing with the price from off shore. Robotic welding started here? Gimme a break. The first robotic assembly machines were done by Fanuc. Last time I checked they're a Japanese company.

Shipping from those countries - especially by the full container load - is still more economical than manufacturing it here. And trust me, it doesnt take 6 weeks for it to get here. I can have a container (pacific or atlantic) here in three weeks. Customs time is another story, but you plan for that. Inventory can EASILY be maintained using offshore suppliers. If it couldn't be, you wouldn't see so many companies doing it.

I've been in Manufacturing for 99% of my adult life. I'd hate to see it go completely, and honestly I don't think it will. To grow manufacturing in the US you have to make it MORE attractive for companies to do it here as opposed to off shore. You don't do that by making it more expensive to do it in foreign countries (taxes and tariffs), you do it by making it more economical to do business here. Based on the current econimic and political climate, it won't happen.

[Disclaimer]

Ok, if you don't see it going completely... where do you see it going? The auto industry (and I use the term auto industry in the broad sense - anything with wheels or tracks) maintains jobs for a lot of skilled tradesmen, hell - my ol' man is/was a diemaker. Where will these people go if we cut manufacturing to 50% or less of what it currently is?

Not to mention that in times of national defense, many of the auto manufacturers had the capability to manufacture parts for war almost immediately. Loss of all these skilled trades means what for our national defense? These aren't skills you can build up overnight, nor can they be purchased from an "enemy".

Regarding your 3 week lead times, that's still piss poor. We deliver line set line sequence parts to our major OE the day of with less than 3 days notice. That's the kind of service they expect. The reason Japan eats our lunch is because they partner with their suppliers and build assembly "campuses" with all major suppliers on campus. The Japanese do it right though because many of their suppliers are also Japanese corps that go multinational and put facilities in the US for instance. Buy all the parts from "US suppliers" HQ'd in Japan, assemble it in the US using US labor to avoid import taxes - now that unions have paved the way for the wage scale, but without the legacy costs, then send all the profits back to Japan. That might be slightly exaggerated, but that's the vicious circle. They protect their own. Not to mention excellent marketing - "My Honda was built in Marysville, so I don't feel guilty about not buying a domestic."

I put most of the blame on US Auto Supply Base for our shiddy treatment of our own suppliers, but we're learning.

[Disclaimer]

Easier said than done.

Many of these people aren't college educated, late 40s to early 50s... too young to retire, but too old to waste four years at school with other obligations (family and otherwise) only to enter the workforce for another 7 or 8 years.

If you were an employer, would you hire a 53 yr old fresh out college student, or a 23 yr old one? Sure, 30 years of life experience does count for something, but obviously their prior skills were no longer useful, so it doesn't matter much in their new career. Not to mention, what's the incentive to hire someone that'll use your health care benefits much more than a 20+yr old? Or someone that's only going to be there for less than a decade versus a 20+ yr old who has potential to make a lifelong career at the employer?

So, how do they adapt?

[Disclaimer]

I don't think late 40s is too old for school. People do it all the time. Also' date=' if you are too old for school and are less than a decade from retirement shouldn't you have enough of a 'nest egg' to retire early and pick up a part time gig to supplement your income?[/quote']

Shouldn't people not spend money beyond their means? Yet, here we are - having this stimulous debate.

There's a lot of shoulda, coulda, woulda... and the "people do it all the time" argument doesn't sit well with me unless you've walked that road before. It's funny how many people say, "Just do x, or just do y" when they've never had to deal with that situation - I'm guilty of it too.

Early 50s isn't necessarily enough of a 'nest egg' to just up and leave, and have a drastic drop in income, even if you "supplement" it, which some people don't want to do. If you worked at a factory day in and day out because you're not a people person, why would you want to go be a Walmart greeter? That's just one example, but there are numerous reasons people don't get part-time jobs to supplement their income.

[Disclaimer]

How do you figure? It's got partial support from leading economists. What if we could magically 'delay the inevitable' for 60-100 years, or delay it indefinitely? Then would it be worth it?

[Disclaimer]

I was just talking the spending in general to stimulate the economy. Not the bill itself. The bill is full of compromises which make it much less effective. I said that before in another thread.