Thread: Reagan/Bush and National Insanity

One of the reasons I think Obama has a good chance of winning this year is that all of us can see the mess the Bush administration has made with our economy. Of course the Republicans will never take responsibility for the bank failures, unemployment, foreclosures, record deficts and sky high prices we're seeing, they'll never take responsibility for anything.

Instead they'll spin and lie and blame the other guy.

This is an article written by Robert Freeman in 2003. Seems the Republicans have been playing this same game since Reagan. Except back then it was called the trickle down theory, and it is they who have bankrupted our treasury and ruined our economy.

REAGAN REVOLUTION Bush's Tax Cuts
A Form of National Insanity
By ROBERT FREEMAN
Insanity, said Albert Einstein, is doing the same thing over and over again but expecting different
results. By this measure, the latest Bush tax cuts qualify as certifiably insane.
Where have we seen this deranged fiscal strategy before? Remember Ronald Reagan and Supply
Side Economics? In the early 1980s, Reagan promised the nation that if we lowered tax rates on
the wealthy, the economy would grow so much the federal budget would be balanced "within
three years, maybe even two."
Sober people were skeptical-and rightly so. Reagan's Republican opponent for the 1980
presidential election, George H.W. Bush called it "voodoo economics." His own Budget Director,
David Stockman, called it a "Trojan horse," a scam intended really to funnel more money to the
already rich. Stockman was quickly dismissed.

The results, we now know, were a disaster. In 1982, the first full year after the tax cuts were
enacted, the economy actually shrank 2.2%, the worst performance since the Great Depression.
And the effect on the federal budget was catastrophic.
Jimmy Carter's last budget deficit was $77 billion. Reagan's first deficit was $128 billion. His
second deficit exploded to $208 billion. By the time the "Reagan Revolution" was over, George
H.W. Bush was running an annual deficit of $290 billion per year.
Yearly deficits, of course, add up to national debt. When Reagan took office, the national debt
stood at $994 billion. When Bush left office, it had reached $4.3 trillion. In other words, the
national debt had taken 200 years to reach $1 trillion. Reagan's Supply Side experiment
quadrupled it in the next 12 years.
Is there anything to compare this to? When Bill Clinton took office he intentionally reversed the
Supply Side formula, raising taxes on the wealthy and reducing them on the lowest wage earners.
Supply Side true believers predicted the arrival of the Apocalypse. Bob Dole said the stock
market would collapse. Newt Gingrich said the world would fall into another Great Depression.
What actually happened?
Between 1992 and 2000, the U.S. economy produced the longest sustained economic expansion
in U.S. history. It created more than 18 million new jobs, the highest level of job creation ever
recorded. Inflation fell to 2.5% per year compared to the 4.7% average over the prior 12 years.
Real interest rates fell by over 40% producing the greatest housing boom ever. Overall economic
growth averaged 4.0% per year compared to 2.8% average growth over the 12 years of the
Reagan/Bush administrations. Most impressively, Clinton reversed the mammoth deficits of the
Supply Side years, turning them into surpluses. He used these surpluses to begin paying down
the national debt.
By virtually every meaningful measure-employment, growth, inflation, interest rates, investment,
deficits and debt-the economy performed better once the Supply Side experiment was terminated
and replaced with a more honest economic policy where we actually pay our bills as we go.

Continued at:
Robert Freeman: Bush's Tax Cuts: a Form of National Insanity

It's been awhile since I've been on, so I haven't had the chance to greet you yet.

So . . . Welcome to PH!:waving:

Originally Posted by alexg

One of the reasons I think Obama has a good chance of winning this year is that all of us can see the mess the Bush administration has made with our economy. Of course the Republicans will never take responsibility for the bank failures, unemployment, foreclosures, record deficts and sky high prices we're seeing, they'll never take responsibility for anything.

You are aware that we are in fact, a free market economy in theory, correct? Which would mean that government, and especially Bush would have a very limited impact on the economy. So, if Bush and the GOP were responsible for all of this nation's economic woes, then I would say that our capitalist system is seriously flawed if not already. So, let's go down the list.

1. The Federal Reserve has taken enormous strides in making sure that there are no major bank failures. Remember Bear Sterns? Indybank was one that got hit hard, but only because Schumer scared the living daylights out of Indybank account holders by suggesting that it could crash. There was no "collosal collaspe" of the banking system, and the government is prepared to "lend" Fannie and Fredie money to prevent their collaspe, which is unlikely at this point. There is no denying that banks have been hit hard, but we ask ourselves, is the bank responsible for their own collaspe, or Bush who in no way controls or operates the bank?

2. Unemployment is dependent on corporations, as layoffs come not from the government, but the employers. A lot of the unemployment rate hike has to do with an incredibly pathetic automotive industry in Michigan, that has to cut back on the payroll because they're getting slammed by foreign car makers such as Honda, Nissan, and primarily Toyota. What can Bush do about an automotive industry that can't compete with foreigners? (Braces for "protectionism" response.) Besides, if it's jobs you're concerned about, then why not a tax break for the corporations? If the employers get to keep more of their money, then that reduces the necessity to fire workers in order to get their company back on track. The best way to combat unemployment is not to give MORE unemployment benefits, as the democrats have, but to decrease them, saving taxpayer dollars while effectively encouraging the unemployed to get jobs.

3. Foreclosures, the most exaggerated economic problem in the nation. Hopefully you know this, but 97% of homeowners pay their mortgage on time. That obviously leaves 3% of homeowners that don't pay their mortgage, but only a very small percentage of those homeowners have their house foreclosed on. The simple reason is that banks DO NOT want to foreclose on a house. A bank would much rather have a borrower paying them SOME mortgage payments than having an empty house that won't sell in a flat housing market. As for those "families",(mostly real estate "flippers") they assume responsibility for getting into an agreement that can't afford. Used to, a bank would make you put 20% down on a house before they would let you make a loan, but not anymore. Therefore, the banks must make their own adjustment in accepting loans by imposing stricter lending policies. This is a change that must happen INDEPENDENT of the government, with borrowers and lenders alike. Why? Because if the government bails everyone out, then who learns from this? NO ONE.

4. Record deficits are without a doubt, a RESPONSIBILITY of the federal government, including Bush. A record $3 trillion budget is unexcusable, as there is no reason why we should be spending that much of the taxpayers' money. However, Karl Rove has made the point over and over that had the unforseeable circumstances of 9/11 and the resulting war not happened, then the budget would be perfectly balanced, with a SURPLUS. That is why the tax cuts were implemented, to BALANCE the budget and increase revenues over the long term. We did see the benefits of the tax cuts, with a booming economy over much of Bush's presidency despite a national crisis, (9/11) two wars, some of the worst natural disasters in US history, rising gas prices, and a democratic Congress for the past two years.

5. Sky high prices? LOL. You haven't seen anything. Go do some research on Carter and get back to me. Besides, Bernacke says that inflation is topping off, and will revert to moderation as the year goes on. Also, the dollar is strengthening, the markets are rallying, oil is falling in price, and the economy is still growing. Record Congressional spending has a lot to do with inflation, as the Treasury Department prints off more money to keep up with the budget shortfalls. The rule of thumb is that the more currency you have in circulation, the lower the value of the currency. And when the value of the currency falls, more of it is needed to purchase goods and services, which is brilliantly dubbed inflation.

Instead they'll spin and lie and blame the other guy.

Might want to reread your post and reconsider this point.

This is an article written by Robert Freeman in 2003. Seems the Republicans have been playing this same game since Reagan. Except back then it was called the trickle down theory, and it is they who have bankrupted our treasury and ruined our economy.

:laughing:

Two things, your author fails to make the connection between tax cuts and growth, and completely ignores the fact that spending BALLONED BIG TIME during Reagan-Bush 41 era. Pinning tax cuts on budget shortfalls, when spending is far outpacing tax revenue is ridiculous.

BTW, the Republicans controlled Congress during Clinton's presidency from 95' on, so all Billy had to do was sign his name while the conservative Congress handled the budget for him. The Bush 41 tax hike led to the absolutely horrible recession in 1990 to late 1992, so don't kid yourself about the harmful effects of raising taxes. A more accurate representation of Clinton's tax policies versus Bush 43's tax policies would be 1993-94, as Clinton had a democrat Congress behind him then.

Overall, Bush and the present-day Congress assume SOME responsibility for economic problems, but these are limited to government specific roles such as curbing inflation and congressional spending. However, it is ridiculous to point at Bush economic policy as the cause for unemployment, foreclosures, bank failures, and high prices.

Originally Posted by alexg

One of the reasons I think Obama has a good chance of winning this year is that all of us can see the mess the Bush administration has made with our economy. Of course the Republicans will never take responsibility for the bank failures, unemployment, foreclosures, record deficts and sky high prices we're seeing, they'll never take responsibility for anything.

Instead they'll spin and lie and blame the other guy.

This is an article written by Robert Freeman in 2003. Seems the Republicans have been playing this same game since Reagan. Except back then it was called the trickle down theory, and it is they who have bankrupted our treasury and ruined our economy.

The real deal is the policies that allowed these things were signed into law Bill (Where'd I put that cigar?) Clinton. Makes you go Hmmm.
And yet another article by some loser that can't get a real job in the real media, again insulting our intelligence.

Originally Posted by alexg

One of the reasons I think Obama has a good chance of winning this year is that all of us can see the mess the Bush administration has made with our economy. Of course the Republicans will never take responsibility for the bank failures, unemployment, foreclosures, record deficts and sky high prices we're seeing, they'll never take responsibility for anything.

Time to grow up.

BOTH Republicans and Democrats are on the hook for letting this Nation
get off track.

"Bank failures" were tied to the sub-prime lending crash that was
significantly aided by "affirmative action" lending practices promoted by
the Left over the past decade or more.

"Unemployment" realities are tied to the economy, something neither party
can totally control.

"Foreclosures" are linked to the same sub-prime problem as the bank failures.

"Record deficits", thats Bush spending like a Liberal.

"Sky high prices", all tied to sub-prime failures, and the inflated cost of
oil. Iraqi and Venezuelan oil production has been impacted by conflict, but
basically supply is fine. Speculation, as well as a weak dollar, doubled oil prices.
.

Originally Posted by Tick

The real deal is the policies that allowed these things were signed into law Bill (Where'd I put that cigar?) Clinton. Makes you go Hmmm.

Sorry, you're not making any sense. Slow down and try to think about what you want to say. Then type it and then read it to make sure it says what you wanted it to say.

Otherwise it's just gibberish and people think you're retarded.

Originally Posted by bla bla

Time to grow up.

BOTH Republicans and Democrats are on the hook for letting this Nation
get off track.

"Bank failures" were tied to the sub-prime lending crash that was
significantly aided by "affirmative action" lending practices promoted by
the Left over the past decade or more.

"Unemployment" realities are tied to the economy, something neither party
can totally control.

"Foreclosures" are linked to the same sub-prime problem as the bank failures.

"Record deficits", thats Bush spending like a Liberal.

"Sky high prices", all tied to sub-prime failures, and the inflated cost of
oil. Iraqi and Venezuelan oil production has been impacted by conflict, but
basically supply is fine. Speculation, as well as a weak dollar, doubled oil prices.
.

And that's the way it is folks!! Good response!

Originally Posted by mjollnir

And that's the way it is folks!! Good response!

So it's not the Republicans fault that the economy is in the toilet. Gosh, it's a shame that we voters are going to blame them anyway. Here's an old article I thought you might enjoy.

Mark Shields: Let's look at the record

WASHINGTON (Creators Syndicate) -- In 2002, Rep.-elect Michael Michaud, D-Maine, was a genuine exception among Democratic House candidates: a blue-collar, dues-paying union member who had worked in the paper mill for 28 years, who is pro-life and who, in a district previously represented by moderate Republicans -- former U.S. Sen. Bill Cohen and current U.S. Sen. Olympia Snowe -- defeated Snowe's longtime chief of staff.
All this, mind you, after Michaud publicly embraced the Man Republicans Love to Hate, former president Bill Clinton.

Here, according to the estimable columnist E.J. Dionne, is what candidate Michaud had to say to Clinton in October before 2,500 Maine citizens in Augusta: "The country's economy was in the ditch, and you made the hard decisions and turned things around. But the Republicans in Washington could never give you any credit. Oh no. They said it was not Bill Clinton who brought prosperity, it was the House Republicans and Alan Greenspan. Guess what? We still have the House Republicans. We still have Alan Greenspan. And where's the economy? Back in the ditch." This Michaud fellow is clearly on to something.

For the past decade, it has been a conservative crusade to: a) deny Bill Clinton's policies any credit for the historic prosperity the nation enjoyed during his presidency, or b) deny that those good old Clinton days were really that good at all.

First, when Clinton won the White House, the federal budget deficit was at a historic high of $290 billion, 10 million Americans were out of work and the nation's economic growth rate under the outgoing Republican administration was the lowest in more than half a century. Clinton introduced his controversial economic plan that raised the income taxes of the richest 1.4 percent of Americans. We immediately heard from the Gloom and Doom congressional Republicans, every one of whom voted against the Clinton plan. Sen. Phil Gramm, R-Texas, announced, "This tax bill is a one-way ticket to a recession." House Republican Whip Newt Gingrich predicted, "This is the Democrat machine's recession, and each one of them will be held personally accountable."
What followed is unarguable: creation of more than 22 million new jobs; the nation's lowest unemployment rate in 30 years; the lowest unemployment rate among women in 40 years; and the lowest Hispanic and African-American unemployment rate in history. The nation went from the largest budget deficits in history to the largest budget surpluses in history, while the average family's income went up more than $5,000.
Faced with a recession that never appeared, Republicans went from assigning blame to denying the improving economic situation. In 1996, GOP presidential nominee saw the dark side: "(Clinton's) big-government policies slammed on the brakes, starting with the largest tax increase in the history of America.. .. His economic legacy is the Clinton crunch, slow growth, high taxes and stagnating wages."

continues at:
CNN.com - Mark Shields: Let's look at the record - Dec. 9, 2002

Originally Posted by bla bla

Time to grow up.

BOTH Republicans and Democrats are on the hook for letting this Nation
get off track.

"Bank failures" were tied to the sub-prime lending crash that was
significantly aided by "affirmative action" lending practices promoted by
the Left over the past decade or more.

"Unemployment" realities are tied to the economy, something neither party
can totally control.

"Foreclosures" are linked to the same sub-prime problem as the bank failures.

"Record deficits", thats Bush spending like a Liberal.

"Sky high prices", all tied to sub-prime failures, and the inflated cost of
oil. Iraqi and Venezuelan oil production has been impacted by conflict, but
basically supply is fine. Speculation, as well as a weak dollar, doubled oil prices.
.

How do you ever expect to have any friends if you go around being reasonable, calm and equitable?

Originally Posted by Tick

And yet another article by some loser that can't get a real job in the real media, again insulting our intelligence.

No tick. You're wrong. Again. How many articles have you written for the Wall Street Journal?

Robert Freeman writes on economics and education. His articles have appeared in The Wall Street Journal, Salon, CounterPunch, CommonDreams, ComputerWorld, and other publications. He can be reached at robertfreeman10@yahoo.com

How Will Bush Deal With the Deficits? Connecting the Dots to Iraq

Originally Posted by alexg

So it's not the Republicans fault that the economy is in the toilet. Gosh, it's a shame that we voters are going to blame them anyway. Here's an old article I thought you might enjoy.

Out of morbid curiosity, have you ever lived through a serious economic downturn? Let me assure you, that the current conditions do not qualify. They are not even close.