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Originally Posted by shakran
Well. . I'll tell ya where I'm confused. I'm really confused based on present and past statements of Republican "economists."
See, back when Reagan got elected he started this "cut taxes and increase spending and we'll all get rich" idea. It's a concept, by the way, that his vice president called "voodoo economics" until he was picked as Reagan's running mate, at which point suddenly Bush the Elder was rabidly behind it.
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Bush I was correct based on what you stated above. The original premise of Supply Side Economics was to cut excessive tax rates and reduce spending. Reagan cut excessive tax rates and increased spending. I think this had something to do with the cold war.
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So anyway, 8 years of Reagan and 4 more years of Bush 1 to try out voodoo economics and the voodoo just wasn't doin' it. We were mired in a recession, which has a lot to do with why Bill Clinton got elected.
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Bush I did not stay the course. He raised taxes. I did not vote for him. As I recall Clinton's economic policies were middle of the road, with a hostile republican congress. This combination worked, I don't and have never disputed that.
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In 8 years Clinton seemed to have turned it around. We were on track to paying off the debt, people were prosperous, and everything seemed to be working well.
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Everything worked well until people invested in technology lost 80 to 90% of their portfolio.
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Here's where it gets entertaining. The Republicans came out and said "Hold on wait a minute, that's not Clinton! It takes 8 to 12 years for a president's economic policies to have an effect! It was Reagan all along that's why everyone's doing so well!"
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Here we go again. Example: Clinton signed welfare reform legislation. What was the impact of that legislation the year it was signed, the year after, 5 years after, on the federal budget?
Example: Reagan reduced long-term capital gains rates - what was the impact of that in year 1, year 5, year 10?
Example: bush II Perscription Drug Plan for seniors? I am scared to think about the long-term costs. But when the costs peak - Bush will be a distant memory. I pity the President 15 years from now.
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The logic already began to break down, btw, because by that logic we shouldn't have been in a recession at all in 1992 after 12 years of Voodoo. And yet, strangely enough, we were!
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Business cycles are greater than the President in the fact that noone has ever figured out how to prevent economic slow downs after periods of above normal growth.
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But it gets better! Bush 2 got elected and promptly set out to undo all the damage Clinton had supposedly done to the economy. Within a few months, we're back in the ol' recession again, and that was all Clinton's fault.
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Not all Clinton, but not all Bush either.
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Now, by the logic of the Republicans' earlier statements, we should continue to stay in financial difficulties for at least another 2 years - possibly 6, in order to fill out the "8 to 12 year" deadline for a president's economic policies to have an effect.
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Begining to loose me here.
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And yet miraculously enough after only 6 short years, Bush 2 and his cronies are taking credit for the supposed good news that this year's deficit is lower than last year's (frankly I don't think spending $248 billion more than you earned is good news, especially when you calculate that by subtracting $300 billion coming in from social security which we're not supposed to count as a liquid asset).
How can this be? Can Bush possibly have done what his fellow Republicans declared impossible? The man's either a certified genius (and one minute of any one of his speeches will tell you that ain't it) or a letterman in the varsity bullshit league.
Aceventura3 says the current numbers are good because they (on paper, after financial trickery) look better than last year's. I'd say the comparison would be akin to saying "well last year my 3 year old was eaten by a crocodile. This year it only chewed off my leg."
Pretending that running a 1/4 TRILLION dollar deficit in a single year is "positive" is absurd to the point of laughability.
Currently if we wanted to pay off the national debt we'd have to invest between $25,000 and $30,000 PER PERSON, including children. That's bad enough but when you add a million dollars to that number every 45 seconds, that's just plain irresponsible.
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I just pointed to the trend. The trend is your friend. When the trend is up - join the fun. When the trend is down - get out while you can.
If Bush's policies where harmful why would the trend reverse on his watch?