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Conservatives dead wrong on the economy
Wednesday, Oct. 15, 2008 | 2:06 a.m.
Regarding Malcolm Telloian’s Monday letter to the editor, headlined “Democrats want socialism again”:
Is the public aware that socialism is bailing out capitalism to the tune of $700 billion? The near collapse of the economy is the final verdict on the Republicans’ theory of trickle-down economics. We Democrats don’t want a socialist government; we just want one that works for all the people and not just for those who can afford it.
The record of Republican economics speaks for itself. Under the presidencies of Ronald Reagan, George H.W. Bush and George W. Bush, spending increased, the economy stalled, deficits soared and the size of government increased. Each of these administrations doubled the national debt during its time in office.
On the other hand, under Bill Clinton, who led the only Democratic administration in the past 28 years, we saw eight years of economic growth, the first balanced budget in a generation and the size of government actually shrink. We had record budget surpluses that were projected to last years. It sounds to me as if “insure domestic tranquility” and “promote the general welfare” are good ideas that work and that maybe it’s conservatism that needs to be defeated.
Vote wisely, my friends. If you don’t learn from the past you will be doomed to repeat it.
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The current economic disaster is really the final word on the give it all away theories of Barney Frank, Chris Dodd and Barrack Obama. The democrats now scream for regulation but actively fought any attempts from McCain and others to stop the idiotic loans to people with no income and no down payment. It's not hard to understand, it just isn't what the media wants us to think it is.
neiman1,
Quit trying to blame this mess on the Community Reinvestment Act and telling us that the act created the current mess we're in by forcing banks to lend to people in poor areas who were bad credit risks. According to the NY Times:
"The charges do not hold up...the fact (is)that the regulatory guidance issued under the reinvestment act and other banking laws actually impose restraints on the riskiest kinds of subprime lending.
"In addition, subprime lending was not driven by banks, which are covered by the act. Rather, most subprime lending was driven by independent mortgage lending companies, which the act does not cover, and, to a lesser extent, by bank affiliates and subsidiaries that are not fully covered by the act. By some estimates, nonbank lenders and bank affiliates and subsidiaries may have originated 75 percent or more of the riskiest subprime loans.
"A study released this week by the Center for Community Capital at the University of North Carolina in Chapel Hill shows that people of similar financial profiles were three to five times more likely to default when they received high-priced subprime mortgages than when they got bank loans made under the Community Reinvestment Act."
Don't ever tell the truth when a lie proves your point so much better. Right, Mr. Neiman?
"Neocons really need to do a little research and turn off Fox News and the AM radio. Watch Fox News for a day than read the neocon posts on here, these people regurgitate whatever their idols say, even if it goes against all logic and proven facts."
I love your freudian bleats of senseless blather. Your posts here exhibit little-to-none NONE of the research and fact you throw around as cover. You just regurgitate whatever your idols say, even if it goes against all logic and proven facts.
xxxxx
"Mention the financial crisis and immediately they blame democrats. Never mind the President is a republican in his 8th year. Never mind congress was controlled by Republicans for the majority of those 8 years. Never mind the overwhelming evidence pointing to deregulation and lack of oversight."
We now know what caused this economic mess = liberal legislators and their connected friends cooking books, legislating / forcing the FMs to solicit bad mortgages and in the name of "Party before America"(mq); announce their subversion just before an election. These facts are undeniable, except to those in self-denial. Laws were gutted for the last 10-13 years BY liberals. Thee is no doubt of this.
Liberals will effort losing a war (they failed) and tanking an economy (tried hard, but will lose again) in order to win an election.
Obamunists are really corrosive.
John:
"Creditworthiness and due diligence no longer mattered. As a 1999 New York Times editorial observed: "Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Bill Clinton administration to expand mortgage loans among low- and moderate-income people and felt pressure to maintain its phenomenal growth in profits."
"On Frank's and Clinton's watch, the Community Reinvestment Act was changed to force the issuance of bad loans. Banks would be RATED ON THE NUMBER OF LOANS, NOT THEIR SOUNDNESS (my caps). Fannie Mae and Freddie Mac were then encouraged to buy them up. It was all about affordable housing, even if the housing was unaffordable."
http://www.ibdeditorials.com/IBDArticles...
I guess the liberally laughable and shrinking NYT provides cover for you - until the facts come along. The "Act" was the initial legislative platform which liberals have been subverting American real estate and economy ever since. FORCING bad re-payable debts on to the books of lending institutions by Clinton, Frank, Waters, Dodd et all - ALL for phony quotas and more mortgages to be unpaid = IS the issue and it's not the (R) which caused this, but the liberal!
Joe Creed talks about the "projected surpluses".
What he fails to acknowledge is that the Clinton DOT.com recession and 9/11 blew those projection up.
This Clinton recession (that nobody will talk about) which was due to Clinton's tax increase.
This amount of money taken out of the consuming and investing public resulted in a precipitate decline in sales by and investments in the manufacturing sector. This is evident by:
-The long 17-month contraction in the ISM manufacturing index starting in July of 2000, causing the lost of millions of manufacturing jobs, which helped drive the country into recession.
-The unemployment rate increased 53%. It went from 3.9% (Dec 2000) up to 6.0% (Dec 2002).
-The March 24, 2000 to October 9, 2002 S&P 500 Index drop of 49.1%. More than the current drop.
-Median Household income crest at $42,000 in 1999, and dropped in 2000 and 2001.
-Corporate debt increased by 125% between 1995 and 1999 to $2.6 trillion;
-Real GDP was just 0.5% in 2001.
In 2007 the deficit as a percentage of GDP was 1.7% and in 2008, because of the simulate package, is projected at 2.7%. Both historically low in spite of the war on terrorism and the housing recession.
Imagine;
The big corporations falsify their finances and cook the books DURING THE CLINTON ADMINISTRATION - only to have the ROT all blow up after Bill leaves - losses to the tune of what (idk the total) 4-5-6 TRILLION.
Bush mopping up Clinton-era messes which shred "the People's" finances.
DURING THE CLINTON ADMINISTRATION, Legislators are forcing the FMs to MAINTAIN QUOTAS of low-income (child support / unemployment checks usable as POI?) mortgages which as the IBD correctly states = "rated on the number of loans, not their soundness". Raines et all cooking books, like under their watch in the 90s.
A LOT of rotten economics and finance (socialist style) happened DURING THE CLINTON ADMINISTRATION, only to falsely blow up on Bush.
Clintoniacs and Obamunists are corrosive to America.
"2012":
Well done.
NVMakz,
I'm sure Neiman thanks you for sticking up for him.
Funny how you deride the New York Times while using an editorial that quotes the Times to make your case. Sort of shot yourself in the foot on that one, eh?
Tax facts LV R-J 10-15-2008
Year Top 1% Income Top 1% Taxes Top 5% Income Top 5% Taxes
1990 14% 25% 27% 44%
2000 21% 37% 35% 56%
2005 21% 39% 36% 60%
What the above tax facts show is that under Clinton in the 90s, with increased tax rates for the rich, more income shifted to the rich. Under Bush with lower tax rates for all workers, there is almost no shift in income to the rich.
What the above tax facts show is that under Clinton in the 90s, with increased tax rates for the rich, the relative tax revenue from the rich is much less than under Bush's lower rates for all workers,
Socialism doesn't help the poor, never has never will.
When you grant government the power to take from A to give to B, who do you think B is going to be?
The poor? Or the person with the most influence, power and wealth?
"NVMakz,
I'm sure Neiman thanks you for sticking up for him.
Funny how you deride the New York Times while using an editorial that quotes the Times to make your case. Sort of shot yourself in the foot on that one, eh?"
Sure, score one, after all this time, for you. Fine! Whoohoo.....
xxxxx
The lazy-lawyering of your post (a tiny, off-the-subject pointoid doesn't negate the swamping you find your argument wallowing in), though, still doesn't negate the correctness of the information making MY point - about a time period which shows the CAUSES of this bad-debt / and what it had become. Sponsored, enforced and protected by LIBERAL Executives and Congressionals to the detriment of America.
The IBD quote was but a small sliver of liberalism to make the correct historical point of how we all came to be here, my point.
The NYT story referenced was ALL liberalism, ALL the time to cover for the criminals here, liberal legislators and their connected patrons forcing bad debt on the system - socialism's failure again, ALL effected or begun-in-earnest DURING THE CLINTON ADMINISTRATION.
Causes, liberal. Effects, "the People"!
Shame on liberals!
Gordon, they backed the loans.
Subprime loans between 2003 and 2006 are at higher default rates BECAUSE of drastically increasing prices.
Prices that increased thanks to subprime mortgages, bad fed policies, and the government wanting to get people into homes.
Face it Gordon, the government created this crisis. http://npri.org/blog/the-anatomy-of-a-cr...
Gordon,
THE CRA required loans be given to low-income high risk people.
Low government interest rates fueled massive amounts of credit which reduced the risk of banks making these loans.
Investment banks were allowed to increase capital ratios, meaning they could hold $1 and lend out $10-$40 in credit based on that $1 (say hello to inflation)
Followed by the correct belief that if everything went bad, the government would bail them out.
Bad government regulations, bad inflationary monetary policy, and government bailouts created the problem. The governments response, more bad regulations, more inflationary policy, and more freaking bailouts.
Who else can I source, media people who know nothing about economics and except the word of politicians? The boneheads at CNN or 60 minutes? Give me a break!
Other think tanks which study economics only to have you attack them as being partison too?
Unregulated mortgage backed securities are not the core of the problem. The core of the problem was inflationary fed policies, government regulations requiring subprimes, and a history of government bailouts.
The only thing unregulated securities did was find a creative way to crash. Absent them, there STILL WOULD HAVE BEEN A CRASH!
What was Bear Stearns Gordon?
The SEC allowed them to hold $1 in capital for ever 40 they lent out (I beleive it was increased to 1-40, or maybe that was just Freddie and Fannie).
Eitherway, Bad GOVERNMENT POLICY.
http://cato.org/special/financial_crisis...
http://mises.org/story/3128
By the way Gordon, by attacking NPRI for being "partisan" and having the support of Sheldon Adelson you've destroyed all your own counterpoints.
Warren Buffet donates a great deal of wealth to Democrats.
Don't make the logical fallacy of attacking sources or you screw yourself.
Down with postmodernism!
What Gordon recognizes, that KDR81 is unable to, is the difference between sources with no credibility such as the libertarian CATO institute or mises versus higher education or partisan sources with good information. In a word, because KDR81 is unemcumbered by the thought process it is unable to distinguish between idiotic sites and good sites and will never be able to.
MsSchaffer,
All he's done, and you have done, is self-select sources that you approve of and don't. Just like I won't accept 60 minutes and CNN.
Neither of you address the central issues.
For example. The crisis never would have happend if the housing market hadn't popped.
The housing market popped because housing prices got to high and people stopped buying, people stopped paying, and people got upside down. IE High prices started the forclosure process and cause prices to start to drop.
So what caused the rapid rise in prices between 2003-2006?
Gordon explination says NOTHING about this.
All my sources attempt to address this, ie look to find the core of the problem.
Next, msSchaffer, don't pretend to be smarter than me, especially when this is all you can muster.
By the way, Cato and VonMisses both predicted trouble with Fannie Mae and Freddie as far back as 1995 and also predicted the housing bubble starting back in 2002-2003.