Monday, February 2, 2009

Wrong Again

I am wondering if Republicans ever tire of being wrong, seriously mind-numbingly wrong??

In 1993, President Bill Clinton inherited record Budget Deficits and a faltering economy. He pushed through an Economic Plan that included raising taxes. It got not a single vote in the House. Republicans predicted economic doom and disaster. What we got was the 8 years of strong economic growth, 21 million new jobs, and a Budget Surplus.

In 2001, President Bush inherits a Budget Surplus and a faltering economy. He pushed through massive tax cuts, only by limiting them to 10 years because of their huge cost, promising strong economic growth. Instead what we got was 8 years of anemic job growth, growing income disparities, a sputtering Stock Market and obscene deficits. By the time President Bush and the Republicans were through, we had an economic collapse to rival the Great Depression, Trillion Dollar Deficits, more than doubling of the National Debt, a banking system that won't lend, a diminished prestige in the world and two wars, one of which should never have been fought, the other should never have been ignored. Oh, and a ruined city.

Now its 2009, President Obama has inherited more challenges than perhaps any President in history with the possible exception of Abraham Lincoln. And now, a badly needed stimulus package has passed the House without a single Republican vote. Sound familiar.

Do they ever get tired of being wrong

About the Economy
About regulation
About Global Warming
About Invading Iraq
About the importance of Competence
About Torture

I almost looks like they like being wrong.


The Coach said...

Walt -

I recognize vitriol when I see it. The only thing mind-numbing to me about the post is your ability to lay the blame for all of our country's ills on the most recent President.

You note that President Clinton inherited a faltering economy but passed on a similarly faltering economy to President Bush, yet you blame only President Bush. Could it be that the economic crisis is a result of long-term American (bi-partisan and non-partisan) greed? To suggest that the economic recession is a function of only the last 8 years of economic policy (imperfect though it may be) is disingenuous at best.

Robert Madolf? Warnings about his scheme and the lax regulations that allowed it have been aired since before W took office.

Over-lending to marginal applicants, leading to unprecedented foreclosures? Not due to new Bush policies - in fact, everyone-deserves-to-own-his-own-home idealism that led to the Feds' push of Fannie Mae/Freddie Mac's subprime lending began in the late 70's (President at the Time: Jimmy Carter), was bolstered in the early 90's (President at the Time: Bill Clinton), and went largely unchecked because of huge (and artificial) economic growth that resulted on paper but never materialized.

The auto industry's collapse? Yes, Republicans (and specifically one George Walker Bush) are to blame for a union-driven organization's ability to produce substandard products at inflated prices, at a rate greater than consumption, with the dead-weight of sky-high executive salaries (now government-subsidized), and the anchor of union-mandated production quotas making sure the inferior product continues to be pushed to Americans who already can't afford to borrow more money for a car they don't need.

Corporate greed aside - how about personal responsibility and American hedonism? Our culture of indulgence says "you deserve" that fill-in-the-blank (new Hummer, new home, new cell phone, fast internet speed at home). Don't worry, you can just charge it.

Banks that won't lend are a result of banks that lent too much before and are now in a pinch; this is NOT a partisan, George Bush-caused problem.

Your contention that the Republicans alone are to blame is short-sighted.

Oh, and President Bush caused Hurricane Katrina. I'm sure the White House special-ordered a natural disaster in order to ruin a coastal city that was built below sea level, has suffered great floods before, has had levees in need of repair for more than thirty years, and whose proposed repairs would still not have prevented the damage done by this cataclysmic event.

The Coach said...

Second comment because I forgot to check the "email follow up comments" box.

Uncle Walt said...


I actually wasn't trying to blame everything on President Bush, though he deserves a lot of blame for much of what President Obama is facing.

I was trying to focus, not on President Bush, but on the Republicans in Congress who are trotting out the same nostrums that they have used since Reagan. The answer to any problem is to cut taxes and reduce government regulation.

But that isn't the right answer.

Cutting taxes, according to the studies I have seen, does not provide the same short term stimulus to teh economy as spending the same amount of money on things like extended unemployement insurance and infrastructure projects like road bridges and mass transit.

Tax Cuts do not pay for them selves. As the economy expands, tax revenues eventually reach the same level they were before the tax cuts, but not all of the economic expansion is a result of the tax cuts, so much of the increase in government revenues was going to happen without the stimulus of the tax cuts. And since the tax cuts inevitably increase the deficit, long term they actually slow the economy because of the impact they have on interest rates.

I wasn't really addressing President Bush. I was talking to those in Congress who predicted disaster when Bill Clinton raised taxes. They were wrong. I was talking to those in congress who supported Bush's tax cuts claiming that they would grwo the economy and eliminate the deficits. They were wrong and we got stuck with pathetic economic growth, anemic job growth, and a rising disparity in wealth as the rich prospered and the rest of us just hung on. They were wrong.

And now some of the same members are making the same arguments

They were wrong then, they are wrong now.

They must like it.

Uncle Walt said...


You claimed I was blaming President Bush for everything. That wasn't my intention.

But there is plenty that he can be blamed for.

Both President Clinton and President Bush inherited faltering economies.

Ecomonies have cycles. The economy never actually went into recession in 1993, in 2001 it went into a very mild recession in the second quarter and was out of recession by the third quarter.

But what did each President do with their weak economies.

President Clinton put out a stimulus package that included significant tax increases. Got it through the House without a single Republican vote. Republican's uniformly predicted that the tax increases would be disasterous for the economy. They were wrong.

President Bush went with Tax Cuts. He proposed tax cuts that would cost about 1.5Trillion dollars over 10 years after which they would expire and Clinton's rates would return.
What happened as a result.
Anemic Job Growth
The recovery was weaker than any recover since the end of the Great Depression. Income disparity was up, but virtually nothing else was. In 8 years, the US economy added only 3 million net jobs. Not nearly enough to keep up with population growth.

If you want to talk blame, then I find it easy to blame President Bush's policies for 8 years of a pitiful economy.

You mentioned Madoff. I find it interesting that President Clinton proposed strengthening the role of the SEC in 1998. The Republican congress blocked those changes. President Bush's first Commissioner of the SEC promised a Kinder Gentler SEC. Republicans got some of the Depression era barriers between Commercial and Investment banks lowered, letting largely unregulated investment banks into the mortgage business.

I can find ways to blame President Bush for that.

You point out that Sub-prime lending dates back to the 70's, which is true as far as it goes. But the creation and trading of mortgage based securities is a creature of this century and happened while regulators were claiming that the financial industries could regulate themselves. That self-regulation, supported by the Bush Administration, worked out really well didn't it.

I don't understand your comment about the "artifical" growth "that resulted on paper but never materialized." The American economy created 21 million new jobs during the Clinton Administration. I am not sure what is artifical about that. President Clinto balanced the budget. What is artifical about that? We had both very low unemployment and very low inflation for most of his presidency. What is artifical about that?

I don't blame President Bush for the Auto Industries woes. Everybody screwed that one up.

I never even claimed that President Bush caused Hurricane Katrina. God did that. But President Bush put a political hack in charge of FEMA, shoved it into the new Homeland Security department where it was an orphan step child in that new monstrosity. And then praised the Director of FEMA while FEMA was completely screwing up the federal response to Katrina. Tehre is plenty of blame to go round here. Mayor Nagin is an idiot and probably a coward. Governor Blanco was largely useless. But if I wanted to blame President Bush, there is plenty here to blame him for.

I never claimed that Republicans ALONE were to blame for anything.

I said that Republicans were wrong about Clinton's fiscal polices, they were wrong about Bush's fiscal policies and yet again, they are wrong about Obama's fiscal policies.