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twitterLETTER TO THE EDITOR:
U.S. economic recovery will take time
Saturday, Nov. 7, 2009 | 2:03 a.m.
Regarding Richard McCord’s Oct. 29 letter to the editor, headlined “Incurring deficits no way to spur growth,” in which he called for the private sector to be “unleashed to do what only it can do — create jobs”:
I am reminded of two periods in recent and not-so-recent history.
First, Herbert Hoover’s policies amid the crash in the late ’20s and early ’30s allowed the economy to go into the Great Depression, which was so deep it took 10 years and a world war to get us out of it completely. Franklin Roosevelt’s policies were best at alleviating the suffering caused by Hoover’s folly, they kept the economy from worsening and sowed the seeds for the prosperity of the ’40s and ’50s.
Second, I am reminded of the policies of Bill Clinton in the early ’90s, when taxes were raised on the wealthy over the violent objections of the “trickle-down,” “supply-side” Hoover party’s members in Congress who predicted economic disaster because of the tax increase.
Clinton went on to produce not only economic prosperity, but also a balanced budget that had been put out of balance mainly by the supply-side policies and tax cuts of Ronald Reagan and George H.W. Bush. (Bush was forced to eventually raise taxes to stop a budget free fall caused by Reagan’s tax cuts.)
Then along came Bush’s son with more supply-side nonsense and tax cuts for the wealthy, which brings us to the deplorable situation inherited by Barack Obama, who is using the FDR and Clinton models to stop an economic free fall caused by supply-side economics. Give him time!
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"Clinton went on to produce not only economic prosperity"
The expectation that Clinton was leaving a long term surplus is fiction. It was based on the same types of budget ruses that we saw recently in Congress. Under Clinton the GDP was negative in the 2nd quarter of 2000 and the 1st quarter of 2001.
When Bill Clinton came into office he inherited swiftly rising economy from the Bush 1.
In 1994 before the Clinton tax rate increase, total revenue was $1.258 trillion and a short six years later it was up 84% to $2.025 trillion. In fact it increased an astounding $198 billion (10.8%) in the year between 1999 and 2000, due to the back loading the tax rate increase law. This occurred while the GDP growth averaged 3.6% per quarter during the 1999-2000 periods.
Have you forgotten the 2000 DOT.com recession
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
The January COB 2001 Fiscal outlook was for a FY-2001 Federal total revenue of $2135 billion and a $286 million surplus. However, Clinton's last budget for FY-2001 showed a Federal total revenue decrease from $2.025 trillion (FY-2000) to $1.991 trillion (FY-2001), and actual decline in surplus from $236 billion (FY-2000) to $127 billion (FY-2001). Clinton's economic surplus projections for just nine months later were off by -$144 million (-7%).
Sadly, Daniel Olivier, is exhibit A on why our educational system sucks and also he demostrates of the side-effects of drinking koolaid --- he is clueless about history.
The first president to greatly increase the deficit was.........Hoover. FDR used that fact against Hoover during FDR's first election.
Who was the first president to go a binge public works program? It was.......Hoover (that is why it is called Hoover Dam and not FDR Dam).
Hoover ........greatly increase taxes....too.
Hoover ........introduced harsh protectionism against foreign trade.
I think Obama sounds like a Hoover.
Here are few other FYI's.
The balance budgets were not passed until a Republican congress forced spending cuts onto Clinton.
Also, you are confusing your arugments. Are you talking about deficits or you talking about economic recoveries?
Reagen took a much worse economy than Clinton and turned it into a boom time. Clinton took an economy that was coming out of recession, took it into a boom period and at the very end of his turn the economy slipped back down into a recession.
The US economy did get out of depression mode until after FDR was dead.
As for Obama it is too early to predict but so far it has not been good.
His prediction of effect his "stimulus" plan on the economy and the unemployement rate was way----way----way----off. He said that the unemployement would be at 8% at this time because of the "stimulus" but it is at 10%.
FDR and Hoover introduced great public works programs. Obama has given us $20 a week tax cuts, Cash for Clunkers and Cash for Corporations.
All his proposals have and will greatly increase the deficit and so far have had very little effect on the economy.
Soon the large deficts will start interest rates to claim and for inflation to climb. The value of dollar keeps dropping and that makes the purchase of foreign goods, like oil to go up.
Soon we will be paying much higher prices at the pump and for everything else.
We are screwed.
Obama has three years before he is out of office. How much damage can he do in three years???
The Democrats are already trying to set the stage for an Obama second term. And Clinton didn't "produce prosperity", simply by being the sitting president in the DOT.com boom era of the 90's he takes and gets credit for it. Of course you get to see the liberals hypocrisy here, the economy wasn't to bad under Reagan and that was chided as the "decade of greed" by them. Yet, when a Democrat is in the White House and the economy is good it's "prosperity" and when it's bad, well it's "Bush's fault".
GDP for 2001 was $10,075,900,000,000,000. The Clinton administration had a budget surplus for two years and used that surplus to pay down on the National Debt. Go TO: www.lafn.org/Natl_Debt_Chart.html and read the graph.
The fiscal year for the government runs from September 30 of one year to the next. From Sept. 30 to Jan 20-2001 the cheney/puppet bush mis-administration added $600,000,000,000 to the National Debt which Obama inherited.
"The US economic recovery will take time" to proove it is not a recovery at all. The life support is simply prolonging the inevitable, and adding more fuel to the flames. It is, though, ensuring some can retire VERY well. Our 2 party system is the biggest sham in history, far more entertaining than WWF prime time, which far more "Americans" partake in these days. The few smart ones left (that pay any attention) are are blinded by small views, on issues that are spoon fed to the public. They cannot see the real picture clearly. Our politicians are not working for us. Its time to stop looking at what presidents are doing and have done, and time to start looking at who is lobbying and giving out contributions when any thing is being touched by government.
The U.S. economic recovery will gain steam in January 2011 when the new Congressmen take office and should be pretty well back on track in January 2013 after Obama is out of office...
The health care boondoggle will make the economic duldrums last even longer. Big spender, big taxer Obama will drain any life left in the economy. It's going to be a long, long mess made longer by big and getting bigger government.
The bottom line is this:
THE REPUBLICANS RUINED THE ECONOMY.
It will take President Obama 8 years to fix.
Obama is too stupid to change a flat tire. In two more years we will be lucky if there is an economy left.
jlb101 said....
"Obama is too stupid to change a flat tire. In two more years we will be lucky if there is an economy left."
That's funny. Especially when one stops to consider who was walking the halls of the White House prior to Obama's election......maybe I need to refresh your memory my little friend?
Does the name George W. Bush ring a bell?
I'm sure you remember George, don't you? He's the guy largely respnsible for our present mess..
Yep, good ole clueless George! He took us to two wars in the Middle East; took a Clinton balanced budget and replaced it with eight years of unbalanced budgets. He borrowed money from anyone and everyone, and watched millions of good paying jobs be shipped off-shore.
He over saw the decline of the American dollar (it lost almost 50% of its value against the Euro under George) and he gleefully watched our trade deficit become the larger in our history.
Oh, I almost forgot, George did take care of his rich buddies....he gave them a huge tax cut and said that "supply-side economics" would create millions of new jobs...
What a guy George was.... Yep! He gave us 8 years of wonderful leadership!
PvtRock.....
You're a very funny guy! Your statement that Daniel Olivier "is clueless about history" is beyond funny. After reading your rant about Hoover and FDR, it appears to me that Mr. Olivier may not be the one who's clueless when it comes to understanding our history. That honor should go to you...
Herbert Hoover was convinced that the Great Depression, that he actually inherited from his two predecessors, (Harding and Coolidge) would simply go away if he and the federal government did nothing.
There's a lot of people out there who presently believe that about our current situation... Maybe you're one of those....?
Doing nothing or next to nothing was Hoover's belief based on his political philosophy which he called "rugged individualism." Maybe you should go to your local library and check out Hoover's book by that very name. Once you read the book, you will clearly understand why all attempts by Hoover to deal with the Great Depression failed.....
Yes, Hoover did get the federal government involved in the economy more than any previous president, but when it was all said and done, compared to FDR's New Deal, the Hoover approach was based on doing next to nothing...
It should be pointed out that the attempts made by Hoover to intervene in the nation's economy proved to be a complete failure mainly because the man from Iowa didn't have his heart in what he was attempting to do...
In other words, he didn't believe in what he was doing and he feared that was he was doing might do more harm than good.
Hoover's attempt to bring about a "bank holiday" and his attempt to "prime the pump" by creating new jobs failed big time. FDR picked up both programs and ran successfully with them.
The major difference between Hoover and FDR was that FDR believed in direct federal relief to the unemployed. Hoover did not! Hoover believed that the various states should do that type of thing, not the federal government. The only problem with that approach is that the states had no money to do that ......they were broke!
PvtRock....
More on the same topic...
Also, it must be pointed out that FDR was a great public speaker and clearly understood the power of the radio. His "fire-side chats" convinced Americans to back his New Deal program and he, like no other president before or since, was able to get the country to rally around him.
In all fairness, Hoover didn't cause the Great Depression all by himself, but he was not the man that was needed to deal with what was going on.....FDR was!
Without FDR, we would have had a revolution in this country. FDR's approach gave one thing to the American people that Hoover could not.....HOPE!
It took America's entry into World War II. however, for us to pull ourselves completely out of the Great Depression.
Keep in mind, that the Great Depression was a world-wide depression and Europe was actually in worse shape (if that was possible) than we were doing the 1920's & 1930's.
Hitler and National Socialism would never have been able to gain a foot-hold in Germany if the economy in Germany had been better...
Obama and National Socialism would never have been able to gain a foot-hold in the U.S. if the economy in the U.S. had been better...
LarryVegas said.....
"Obama and National Socialism would never have been able to gain a foot-hold in the U.S. if the economy in the U.S. had been better..."
Hmmmmm....I thought Obama and his policies were over on the left, not the right? I guess one can learn something everyday! Ha! Ha!
Are you also saying that the present recession has nothing to do with Obama....in other words, he inherited it from the previous president?
There is a good chance that Obama would not have been elected if he did not have the economy to use as another crisis. Don't matter anyway, because we have for another three years...
LarryVegas.....
Please answer my question.... I repeat:
"Are you also saying that the present recession has nothing to do with Obama....in other words, he inherited it from the previous president?"
No, I am saying that the present recession has everything to do with Obama. Obama inherited a downturn in the economy and turned into a full scale recession.
LarryVegas said....
"No, I am saying that the present recession has everything to do with Obama. Obama inherited a downturn in the economy and turned into a full scale recession."
Ha! Ha! Ha! Wow! That's funny! I haven't had a laugh like this one in a long, long time.
Obama "inherited a downturn in the economy and turned into a full scale recession." That's funny! No, that's hilarlous!
I think your reaching for straws! No, I know you're reaching for straws....
Of course, the proof will be in the pudding....we'll see what historians say about our present recession and what and who caused it....that's funny! Thank you for the humor!
What's responsible for the current mess is 70 years of government giveaways. Obama's plan is to create a "classless" society in which taggers, saggers, illegal aliens, crack addicts, welfare moms, etc are equal to those who go to work everyday.
Lobita: "your" is not a contraction of "you are." Learn it, live it, love it...fool.
mikegino.......
Thank you for your tip on grammer. I'm not sure how I've made it this long with out you....
Hmmmmm........"70 years of government giveaways..?" Are you saying that both parties are responsible? Surely not? Ronnie "Raygun" and George Bush sr.? Wow! Who would have guessed that?
Larry,
I will also thank you for that wonderfully humorous anecdote about our current fiscal affairs and your corresponding assignment of culpability. Of course, you being an "independent", you surely jest. Shirley.
Isn't it also wonderful to have the "slightly acerbic wit" of meekgino return to the Sun!
He's likely just back from some exotic locale and is eager to make up for lost time by sharing his Words of Wisdom with us, the unwashed masses.
Shirley? I don't think she lives here anymore...
But, I am glad to be of service to you guys who only smile when you kick a little dog. Someone has to inject a little humor into the lives of those who live in the cloud of doom, left of normal.
Oh, oh, oh, another one... Obama inherited an insurgency in Afghanistan and turned it in to a complete defeat for the U.S. and NATO forces.
Mr. Magnusson (sic): thank you for the compliment about my "slight" wit. Unfortunately, I no longer get to go to exotic or erotic locales. I was in two relatively boring places where the primary entertainment factor is over-eating: Shanghai and New York. I wouldn't choose to live in either city but at least Shanghai appears safe.
Lobo: grammer? Yes, in my humble estimation, they're all to blame except for Carter and Bush II because they were both clueless.
Larry,
I have NEVER kicked a dog... little or otherwise.
My overweight Beagle would probably kick me back.
"Cloud of Doom?"
THAT, my friend, is a peculiarly right-wing state of mind.
Michael, I would certainly consider Shanghai an exotic, if not erotic, locale. New York & Shanghai, my God you must have a thing for crowds.