LETTER TO THE EDITOR:

GOP policies are far from fiscally responsible

Rebekah Hamby, Henderson

Fri, Sep 5, 2008 (2:07 a.m.)

I am so tired of Republicans’ labeling the Democrats as tax-and-spend liberals. Republicans apparently think all forms of taxation are evil and must be avoided at all costs. However, it seems they have forgotten that without some form of taxation, the functions of government would either run poorly or cease to exist.

I am also tired of hearing the Republicans label their party as the one of fiscal responsibility when its economic policy consists of tax cuts followed by extreme spending and borrowing.

Since when is borrowing money sound fiscal policy? It is not a sound principle for people to use credit and run up massive debts. So when is it sound for a country to do the same thing?

Which is more detrimental, to tax and spend or to run up massive debts through excessive borrowing?

Any political candidate who encourages the economic policies that President Bush has followed these past eight years needs to have his head examined. I no longer consider the Republican Party the true party of fiscal responsibility.

Discussion: 28 comments so far…

By Future2012

9/5/08 at 8:59 a.m.

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Obama and Biden going back to Clinton for a redistribution economic model is a failure.

Here is what I know:

My 401K value dropped by 50% under Clinton and has never recovered.

From March 24, 2000 to October 9, 2002 S&P 500 Index drop of 49.1%

This was Clinton's 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 March 24, 2000 to October 9, 2002 S&P 500 Index drop of 49.1% was caused in part by a need by people to sell stock to pay increased taxes.
• 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; and corporate tax shelter trickery (Enron, Global Crossing, and Tyco) took off.
• Real GDP was just 0.5% in 2001.
By PatriciaLV

9/5/08 at 9:09 a.m.

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Any chance at all that you'd have some point of reference for your stats? You know, an actual source.
By jfnance32

9/5/08 at 9:48 a.m.

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Under Bill Clinton with a Republican controlled House and Senate, we got a balance budget.

Outside of that time period, both parties have done a poor job.

Obama is promising not to do anything about the budget deficit. Many say his large spending promises are not paid for. Some say that he will generate the first trillion dollar deficit.

McCain is promising to cut spending and not increase it.
By thebs

9/5/08 at 10:01 a.m.

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Looks like you aren't so hot at picking investments, Future.

Let's take a historical snapshot of the Dow, shall we?

January 20, 1993
Clinton Took Office: 3241

January 20, 2001
Bush Took Office: 10587

Today's Dow: 11184

Those numbers are indisputable proof of the expansion of the economy under Clinton. The DOW more than tripled in value.

Under Bush, it's growth has been stagnant.

Your historical numbers also seem to mirror the addition of more Republicans to the House and Senate after the 1998, 2000, and 2002 elections.

It's just hilarious that you blame the S&P drop from March of 2000 to October of 2002 on taxes. Maybe you forget what happened in 2001. I'll give you a hint: the Republicans showed the worst attack on U.S. soil on their glorious jumbotron last night. You may want to rewind your TiVo and take a gander.

Yes, corporate debt increased and corporations hid money in tax shelters. You may want to call Newt Gingrich and ask him why he didn't do more about that... seeing as he was leading the charge for corporate tax loopholes during his tenure in the House.

The economic policies that McCain championed last night MIRROR those of George W. Bush. In opposition, the Obama tax plan sets forth very similar tax burdens to those of the Clinton era, which had unprecedented growth of the U.S. economy.

Again, you may need to review your investments, because the obvious seems to escape your view.
By KDR81

9/5/08 at 10:39 a.m.

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Borrow and spend is just as bad as tax and spend.

Low taxes and low spending is better than high taxes and high spending.

Unfortunately Republicans have proved that once elected and control 3 branches they're big spenders just like Democrats.

Hopefully they'll remember that lesson 20 years from now when they retake the government back.
By jfnance32

9/5/08 at 10:59 a.m.

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Clinton ruled mostly with a Republican House and Senate to generate that economy.

This Democratic Senate and House...just spends and spends and spends and spends....They are no shining example of fiscal respondibility.

Yes Obama wants to raise taxes on capital job creation investments.

The DOW started to take off during Reagen.

It was 780 in start of 1980.

By the end of 1993 it was at 3240.

It increased by factor of 4.1x's during Bush Sr and Reagen years

During Clinton's years it increased by a factor of 3.3x's

Both are good.

Under Carter the DOW went from 1005 to 780 which is a 1.3x's factor decrease.

At least Bush, who received Clinton's recession which start in Clinton's last quarter, had the DOW increase not decrease like Carter.

Obama has proposed a ton of new spending that many say are not paid for.

Obama has promise not to reduce the deficts by one cent.

McCain is going to cut spending not increase spending.
By PatriciaLV

9/5/08 at 11:09 a.m.

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You know they're in trouble when they start dredging up "Carter". LOL.

Want to go back to Nixon?
By thebs

9/5/08 at 11:57 a.m.

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Reeks of desperation, doesn't it, Patricia?

They love to acknowledge progress when their party is in charge...

But when it's the Dems? They trot out excuse after pathetic excuse.

Clinton presided over one of the largest economic expansions in American history.

You can't deny that, even with your right-wing blinders on, Nance.
By thebs

9/5/08 at 12:01 p.m.

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Nance can't see the cognitive dissonance here:

"Clinton ruled mostly with a Republican House and Senate to generate that economy."

"At least Bush, who received Clinton's recession which start in Clinton's last quarter, had the DOW increase not decrease like Carter."

He seeks to give the credit for Clinton's economy to the Republicans in Congress...

And then blame Clinton's economy for giving Bush a recession?

Ergo, Nance, the Republicans are responsible for giving Bush a recession.

I couldn't have argued it better!
By jfnance32

9/5/08 at 1:43 p.m.

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The Clinton years are a result of combination of a moderate Democratic President and a Republican Senate and House. I did not say that Clinton did not share for credit. They both get credit.

According to the offical agency that determines which time periods are in recession, they stated in an offical report that the recession started in Clinton's last quarter and continue into the Bush's first two quarters.

The last time there was a filibuster proof Democratic Senate and a Democratic controlled House and a Democratic President was during the Jimmy Carter years.

They had full control of government. They get full credit for interest rates near 15%, gas lines, high employment and a DOW that fell by a factor of 1.3x's.

Wooooooowweeeee.......Jimmy Carter and the Democrats were very successful managers of the economy...............lets go back to those days!!!!!!! Carter = Obama
By ksand99

9/5/08 at 2:19 p.m.

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You do not seem to have very high hopes for yuor side, jfnance32.

A filibusterproof Senate? That is very unlikely, even for the Democrats when the Republicans are so damaged like they are now.

And look at where we are now, with 6 uninterrrupted years of Republican rule of the House, Senate and Presidency? We're struggling to stop the freight train of the economy from derailing.

We're bailing out banks, mortgage companies, homeowners. The republican congress didn't do their job and prevent abuses in the capital markets.

Unemployment went up today, again.

It will take at least another 2 years for the economy to recover from the disasterous policies of the Bush administration.
By jfnance32

9/5/08 at 3:53 p.m.

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Every since the Democrats got into power 2 years ago in the House and the Senate the economy has been going downhill.

Are they going to take credit for that?
By thebs

9/5/08 at 4:19 p.m.

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Let's see, since today's economic climate was caused by the mortgage crisis.

And the mortgage crisis was precipitated by deregulation of the lending industry.

And deregulation of the lending industry was championed by Phil Gramm, McCain's "economic brain."

And deregulation of the lending industry was signed into law by George W. Bush.

I don't really see any way to assign the blame to Dems, Nance.

Let's see... taxes haven't been raised. Spending is steady... certainly isn't significantly higher than 2005.

No, I can't see a reason to assign blame to the Dems for the McCain-Gramm mortgage meltdown.
By jfnance32

9/5/08 at 4:53 p.m.

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Oh....we are changing the rules?

I guess the last two years do not count.

I see.....
By jfnance32

9/5/08 at 4:56 p.m.

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So if Bush gets a recession that started in Bill Clinton's last quarter then that is Bush's fault...

But....the Democrats are not respondible for any thing that happens in the economy now.......

Hmmmm...weird logic....seems like you what it both ways....
By alexant

9/5/08 at 5:13 p.m.

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This is not a Democrat/Republican issue. Both parties share essentially the same basic neo-Keynesian economic beliefs. It's remarkable that in a thread on economic policy there have been 21 mentions of Clinton, 12 mentions of Bush, and 0 mentions of Alan Greenspan. There has never really been a time that the Fed has not had both parties' equal blessing. I think this speaks to the amazing degree to which the corporate MSM has dumbed down the breadth of public knowledge.

The truth is that both parties are essentially clueless on economic matters. They try to goose the economy by stimulating demand (rebate checks, reduced taxes, deficit spending, public job programs, negative real interest rates to spawn asset bubbles that pop followed by taxpayer money thrown at the problem to "stimulate" the already dead patient...) - whatever will get them re-elected. They are happy to cook the books to turn their turds into sunshine, as the latest hilarious GDP figures prove. The clueless party sheep flock behind them and bleat back whatever they hear, without really parsing it through the "thought center" of the brain.

Prior to its current pants-crapping, the economy had still not recovered from the dotcom fiasco. All of the highest levels of government are at Defcon 1, trying like hell to avert a deflationary collapse that either party would have brought on, and both did. Consistent with this, SEC/DOJ are turning a blind eye to even blatant criminal fraud (see Morgan Stanley MBS, Lehman's Enron-style debt spinoff plans, delayed FASB rules, level 3 "hide the sausage" assets, etc.) in a desperate attempt to keep the doomed ship from sinking. And Obama and McCain are falling all over themselves to "stimulate" this turd.

I say we let this corrupt, outsourcing, strip mall building, house flipping, hard worker penalizing, credit-addicted, leased Beamer driving, Ivy League circle-jerking piece of garbage economy go to hell and start over. Who's with me?
By alexant

9/5/08 at 5:24 p.m.

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thebs, who signed the Gramm-Leach-Bliley Act into law? Economically, Clinton and Bush are basically the same guy, with slightly different ideas of where the tax brackets should be set.
By alexant

9/5/08 at 5:26 p.m.

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Nance, does correlation imply causation?
By thebs

9/5/08 at 7:57 p.m.

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Alexant, I make no claim that Clinton is innocent in this, only complicit.

But let's go back to, say, March of 2001.

Why March of 2001? Because a freshly installed Republican president was breaking in his chair while Alan Greenspan delivered a speech to the National Community Reinvestment Coalition.

Greenspan said, "Of concern are abusive lending practices that target specific neighborhoods or vulnerable segments of the population and can result in unaffordable payments, equity stripping and foreclosure,"

Well I'll be darned! Abusive practices? Check! Vulnerable segments? Check! Unaffordable payments? Check! Foreclosure? Check!

It's like Greenspan was looking into the future.

That was the foundation for the credit woes, the lack of equity and foreclosures, the resulting dip in the economy, etc.

Hmmm. And what did Bush do? What did the Republicans in the Congress do?

They sat back, and listened as more and more financial 'gurus' like Cramer and Bernake told them they had nothing to worry about. Contrary to mounting evidence and pronouncements of Greenspan in 2001, they did nothing but make it MORE difficult for consumers to seek refuge in bankruptcy.

And now we've reaped the consequences.

Nance, you're either clueless or naive to believe that the economy TODAY is a direct result of the Congress of today. It takes years to get laws and acts written, through committee, into law and to see the effect.

But, to be honest neither clueless Nance nor naive Nance would surprise me.
By thebs

9/5/08 at 8:08 p.m.

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Now that's settled, let's go back to the subject at hand, John McCain's fiscally irresponsible economic policies.

Most economists have taken a look at Obama and McCain's economic plans, how they plan to stimulate the economy, how they choose to lower/raise taxes, and their plans for spending, and figured out a rough financial picture of where we will be in 2012.

They looked at Obama's economic plan, added up the spending, added in the taxes for those making over $250k a year, subtracted the tax relief for the middle class, added in the spending for his health plan and figured, in 2012, he will have a national debt of $3.6 trillion.

$3.6 trillion with tax cuts for the middle class and small businesses and a health care plan that will move us toward full coverage. That's nothing to sneeze at, it's a huge debt.

Then they looked at McCain's economic plan. They subtracted taxes for the rich, subtracted the taxes for the middle class and added in the new spending he's proposed in his energy plan and figured that, in 2012, the McCain administration will have a national debt of $5 trillion.

So huge tax cuts to the rich, token cuts to the middle class (you'll save $19 a YEAR with McCain if you're a single woman making minimum wage, ladies! Hop on board!) and you'll have the United States with the largest national debt in the history of the nation.

Sorry, Republicans. There's no way you can spin that. There is no sane person who can deny that, on balance, the Democratic economic plan, even with additional spending, results in LESS DEBT for the United States.

Is it ideal? NO.

Is it 33% LESS debt than the Republican plan? Yes.

Some around here try to spin a $5 trillion national debt as "pro-growth." They are, again, either clueless or naive.

We can't afford 4 more years of a borrow and squander Republican as the President.
By avatar

9/5/08 at 10:20 p.m.

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As they say - spot on thebs.

Republicans pride themselves on being "fiscally responsible"! What a crock!

Last month the US budget deficit (not the trade deficit), was calculated at over 100 billion dollars. This is one month!

How can anyone see that this is not a hidden tax!!! Someone has to pay for this money that has been spent. Repubs never tell the truth about taxes. Bush and McSpend are the same! Cut taxes and increase the deficit. People don't notice the debt because it is hidden from the current taxpayers and forced onto future generations. This wreckless approach can't go on forever! The interest on that debt will eat up the entire federal budget.
By avatar

9/5/08 at 10:44 p.m.

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Palin made it sound like the plane was sold on E-bay, but again not true! What else isn't true? She lost 700,000 dollars in the process. Same accountants as Halliburton.

But it turns out the twin-engine Westwind II was a tough sell on the Web — and the state eventually pulled it offline and sold it through an ordinary brick-and-mortar brokerage, for a loss, a spokeswoman said Friday.

"Governor Palin has been correct in saying that she put the plane on eBay," McCain campaign spokeswoman Maria Comella told CNN. "They did end up selling it for $2.1 million. but not on eBay."
By alexant

9/5/08 at 10:52 p.m.

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thebs, this is in response to your first post. First of all, Alan Greenspan was God until 2001 and every Democrat and Republican was standing in line to blow him. Many Democrats had been arguing for years about mortgage credit being difficult to access for minorities, low income households, etc. No Democrat on earth had anything but glowing praise for the real estate market until it started wetting itself. Indeed many would have argued that NOT ENOUGH hotel maids were able to buy $400k houses, and oh the injustice to the poor and minorities! Please don't be so selective in your allegations when you know full well that both parties baked this cake in full cooperation.

The "foundation for the credit woes" was certainly NOT March 2001. Rather it was the series of Fed rate cuts, from 8.25% in 1990 to 3% in 1992 (a major overreaction to the mild early 1990s recession) that fueled the dotcom bubble, following which even sharper rate cuts were seen as "required" to allow the economy to mend. The "foundation for the credit woes" is the system of serial bubble blowing behind which both Obama and McCain throw their full support.

Also, the Debt Slave, er Bankruptcy Reform Act passed overwhelmingly in both houses, i.e., many Democrats led the cheer squad.
By alexant

9/5/08 at 10:58 p.m.

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thebs, this is in response to your last post. You said, "Most economists have taken a look at Obama and McCain's economic plans..." etc. Are these the same economists who:

- In late 2006 predicted that subprime would not be an issue;
- In early 2007 said that subprime would perhaps be a minor issue;
- In mid 2007 acknowledged that subprime might be a more serious problem, but was contained;
- In late 2007 said that subprime was a serious problem but the economy would avoid a recession;
- In early 2008 said that although subprime contagion had spread to certain other sectors of the economy, we would still avoid a recession;
- In mid 2008 acknowledged that we were probably in recession but we would probably pull out of it by the end of the year;
- Later in mid 2008 said that the recession would probably go on longer and deeper than any of them had anticipated but that everything was under control;
- Just now are saying that a depression is unlikely...

Are these economists taking into account the recent phenomenon of sharply declining tax revenues that any fool can see are going to decline a lot more, or the utterly massive bailouts/nationalization of undeserving corporations on the horizon that both Obama and McCain strongly endorse?

Am I really supposed to feel comforted knowing that Professional Politician A will add ONLY $3.6 trillion to the national debt over the next three years, vs. B who will add $5 trillion? Gee, what paragons of financial prudence we have running for office, no?

To me both of these economic plans sound like more of the same Keynesian garbage that got us here: stimulate, delay, bail out, etc. If neither of these deep thinkers has noticed, the USA has a debt that it will not be able to service much longer. There is nothing that either of these fools does not want to throw huge wads of money at - you name it.

China and Russia are getting sick and tired of financing this BS and they hold the leash. Once they start selling our debt, say hello to total financial collapse. Stage 1 of the financial crisis alone has totally wiped out the banks' balance sheets, not even accounting for all the crap they've offloaded onto Fed drug (credit) dealing facilities and their own off-balance-sheet cesspools. The next stages will do them in for good. Neither of these eunuchs has any clue other than to tell you what you want to hear in a sweet voice. A vote for any president at all in November is a vote for the next Herbert Hoover.
By avatar

9/5/08 at 11:22 p.m.

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alexant-

Freddie and Fannie are now in "stewardship" by the Feds. Total financial collapse could be just around the corner! These two quasi-private stock firms are holding 5 Trillion in debt- that is with a "T".

Financial prudence - is that an oxymoron for all times or what?
By thebs

9/5/08 at 11:56 p.m.

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alexant, yes, I'm saying you have a binary choice.

Obama: $3.6 trillion national debt
McCain: $5 trillion national debt

McCain's entire line of argument on why he should be elected is that he's going to:

a) lower taxes
b) lower spending
c) balance the budget by 2012

He's making this argument in a strained attempt to distance himself from Bush's economic policies.

When you look at the final figure, though, of where our country will be in 2012, it just doesn't add up.

But I'll grant you the point: neither party has an ideal economic plan. I've made that statement here. But the severity of Obama's debt is 30% lower than McCain's debt. $1.4 trillion is far too much money to dismiss.

You argue you can't trust the economists. That's a futile game to play. You go off the best information you have and make the best decision. If you have any other information that can shed additional light, positive or negative on either candidate, I'd love to see it.

As it stands, without any kind of contradictory figures, it's all we have... and it's the information upon which we will make our decision.
By jfnance32

9/6/08 at 3:09 a.m.

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Many have said that Obama's plan just does not add up and that his spending is not paid for and his estimates of health care savings will never materialize and if they they did materialize then it would be many years.

Also, most studies of both plans say they have to take liberties in filling in details and they have to make many assumptions. For instance, I am sure that McCain is expecting larger economic growth from his pro-growth tax incentive plan. Do the people that do the study to give him that benefit and how much? Like wise for Obama, he has a plan to reduce health care cost. Do the people that do the study to give him that benefit and how much?

So the real cost and benefits of both plans are hugh guessing games.

Also, there is the reality of congress that will have a big say in economic policy, too. The corrupt crook Charles Rangel will have a big input in any tax plan. That corruption tends to favor corporate entities that send money to the crooks in shoe boxes or deposits in off-shore accounts.

There are basic elements to each plan.

Obama will give more tax cuts to the middle class. An average of $1.95 a day over McCain's plan.

Obama will tax the "rich" more. In some states, the "rich" marignal tax rate will go from 45% to 65%.

Obama will increase taxes on captial job creation investments.

McCain will increase tax incentives for capital job creation investments.

Obama has tons of new increases in spending and new spending programs and McCain does not.

Obama has a plan to increase taxes on income to help social security. There is no such thing as a social security lock box. That money will go into the general fund and will get spent.
By alexant

9/6/08 at 9:28 a.m.

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thebs, forgive me for finding it difficult to support Stinky Turd #1 over Stinky Turd #2. Even if I choose one or the other, I am going to find it hard not to feel ashamed of it, and I am going to want to have a lot of sanitary napkins handy, and perhaps a vomit bag nearby.