Rush Limbaugh, Sean Hannity, Ann Coulter, and most right wing Republicans continue to insist that the mainstream media is liberal. President Clinton may beg to differ, as every “liberal” network systematically allowed itself to be used as the right wing’s mouthpiece to pass blatantly false and/or misleading information. The fact is that the “liberal media” has allowed the right wing to castrate it. Had that not been the case, President Bush could never have been elected. Anyone listening to the President babbling next to foreign leaders, whether from the “third world” or other countries, must cringe in embarrassment that the United States, the sole standing superpower, is led with such ineptitude.
The genesis of this country’s malaise was the election of President George Bush. President Bush had been knowingly lying on most issues of consequence he campaigned on. The “liberal media” never took him to task in any substantial manner.
- Why did the “liberal media” not expose the president’s military record while he implied his prowess as a military supporter?
- Why did the “liberal media” not expose his dealings in the many failed companies in Texas that were simply fronts using his name for influence-peddling?
- Why did the “liberal media” not contrast his and his family’s “moral shortcomings” to his opponents’, given his moralizing on their values?
- Why did the “liberal media” not constantly report the irresponsibility of the large tax cuts while fighting a war?
- Why did the “liberal media” not hammer the administration on all the information available to discount the rationale for going to war?
- Why did the “liberal media” not explain to the public at large the fascist inklings of the Patriot Act?
- Why did the “liberal media” not expose the no-bid contracts going to the President’s and Vice-President’s cronies?
The fact is the mainstream media is not liberal at all. It has been made impotent by its corporate masters, who would rather not engage an administration that is willing to use a corrupt religious movement to intimidate them with unenforceable threats. A free media is imperative to prevent the government and/or the ruling party from exercising complete dominion over the population at large. It should be the free voice protecting the population against government propaganda that allows uninformed support for bad and corrupt policies.
Ultimately the media is very much responsible for our malaise, given its willful inaction. One can only hope that the teeth it has shown in the last few weeks will continue and grow to atone for the past five years.
Visit Political Truths, a place for views to move our country forward.
Ed/pub:NB
Article comments
— go to most recent comments1 - Silas Kain
Blame the media. Blame the politicians. Blame the system. One thing is missing. We only have ourselves to blame. We have allowed ourselves to fall into the trap of listening to sound bytes, getting the quick fix and not taking responsibility. We're not a stupid people. We're lazy and spoiled. What's it going to take to get us off our collective arses and set things right?
2 - Dave Nalle
The media is called 'liberal' because it is corrupt, and the word 'liberal' has become erroneously associated with the failed policies of the corrupt left in this country. In fact the media is merely self-serving, and reports what it thinks will advance its interests by attracting the most viewers.
As to your specific and somewhat naive points:
>>• Why did the “liberal media” not expose the president’s military record while he implied his prowess as a military supporter?<<
Because the president didn't campaign as a 'military supporter' or on his military record. He was in the Texas Air National Guard - basically a rich boy flying club. Once you accept that basic fact, what he actually did there is pretty irrelevant. He's already a non-combat pansy.
>>• Why did the “liberal media” not expose his dealings in the many failed companies in Texas that were simply fronts using his name for influence-peddling?<<
They were exposed exhaustively in the media. You have a short, short memory. The fact is that his various business ventures were pointless and harmless and after being exposed the media discovered that no one cared and that talking about them more didn't interest anyone.
>>• Why did the “liberal media” not contrast his and his family’s “moral shortcomings” to his opponents’, given his moralizing on their values?<<
Because his opponents moral shortcomings were as bad or worse, and the moral shortcomings were the only thing about him which the left-leaning reporters found endearing.
>>• Why did the “liberal media” not constantly report the irresponsibility of the large tax cuts while fighting a war?<<
Because they don't like to explain complex issues to the public, and to do this they would have to both explain how tax cuts and the federal budget work, and also deal with the fact that tax cuts benefit the economy enough to more than offset any short term loss of revenue, and that's not something you can do in a 15 second news soundbyte.
>>• Why did the “liberal media” not hammer the administration on all the information available to discount the rationale for going to war?<<
Because that information wasn't available until well after the course of war had already been set, plus wars make good news stories - way better than non wars.
>>• Why did the “liberal media” not explain to the public at large the fascist inklings of the Patriot Act?<<
It's 500 pages long. Do you think they're going to read it on the air?
>>• Why did the “liberal media” not expose the no-bid contracts going to the President’s and Vice-President’s cronies?<<
Because even the media isn't stupid enough to believe that hoary bit of conspiracy crapola.
Dave
3 - PoliticalTruths
Dave Nalle,
Your answers prove in fact that the points are not naive given that indirectly you have simply bought into the same points I assert.
1. Tax cuts have never generated a boon to counteract its effect. It failed under Reagan as well as under Bush II. In fact Bush referred to this as Voodoo economics and in his administration broke his promise to the Right and began the trend to fiscal responsibility that was further handled under the Clinton’s administration. In fact fiscal responsibility gave the longest and most robust economy ever. These are not my words, simply review the government statistics. Read my piece on the economy at http://www.politicaltruths.info/web/Economy-Budget.htm. It is rather general but absolutely correct. General tax cut stimulating growth is a non-sense idea. It is the general tax cuts accompanied by deficit spending created by said tax cuts that stimulate the economy (Economics 101). If tax cuts are offset by the exact amount in spending cuts, then the net effect is zero. After all, whether individuals spend the money or the government, it gets spent. Actually, to be more specific, if the monies are given to poor people as opposed to the rich, chances are there would be a bigger bang to the economy given that they are likely to spend immediately while the rich may invest abroad, save it, etc. These are known facts but the media does little to attempt to educate the populace from the propaganda provided by the party politics.
2. Your other statements are filtered through your belief in what the Right Wing media has programmed into your head. Liberalism being equated with corruption. In fact liberalism is what allowed for the creation of our republic. Even though our founder suffered from some of the prejudices of their time, they were generally liberal. I wrote an article that addressed this somewhat at http://www.politicaltruths.info/2004/10/inner-strength-role-of-faith-in-public.html.
4 - David Flanagan
I'm the one to blame... Sorry! My bad!
David
5 - Eric Berlin
I think it's simply false to assert that the "mainstream media" is "liberal" these days.
One of the problems the media in general has is the decline of real investigative journalism. Other problems: focus on bottom lines force a leaning toward infotainment and celebrity journalism, and corporate ownership's chilling effect on certain kinds of coverage.
6 - Dr. Kurt
We, the People are to blame; we are getting what we ask for and pay for. That's what really scares me - not some boogyman from either end of the political spectrum.
"We have met the enemy, and he is us." - Pogo
7 - volt
Republican members of congress. they repeatedly towed party line, changed rules, prevented investigations into serious matters and uniformly failed to do their job of checking and balancing.
Next, all those democrats and republicans are to blame who contributed to the deterioration of the fourth estate by allowing media consolidation, the disappearance of the fairness doctrine and for kowtowing to corporate interests over that of their constituents.
Certainly David Flanagan deserves his fair share of blame, but props to him for admitmitting his mistakes.
And lets not forget that all of the above pale in comparison to the bush administration.
8 - Dave Nalle
>>1. Tax cuts have never generated a boon to counteract its effect. It failed under Reagan as well as under Bush II.<<
I assume you mean Bush I who didn't cut taxes - which is why he was a one-termer and Reagan did not cut taxes as significantly as Bush II has done and still got us out of the devastating Carter-era recession. And it has clearly worked for Bush II whose tax cuts were more substantial. It also worked when Kennedy did it. The truth is that it's worked every time it's been done.
>> In fact Bush referred to this as Voodoo economics and in his administration broke his promise to the Right and began the trend to fiscal responsibility that was further handled under the Clinton’s administration.<<
And led to an economic downturn which was only reversed by the tech boom and the growth of the internet, which also led to the Clinton era economy, which his high taxes managed to destroy by the end of his term which ended in recession.
>> In fact fiscal responsibility gave the longest and most robust economy ever. <<
Except that there's no connection whatsoever.
>>These are not my words, simply review the government statistics.<<
Yes, if you misread the statistics an ignorant person could come to this conclusion.
>> Read my piece on the economy at http://www.politicaltruths.info/web/Economy-Budget.htm. It is rather general but absolutely correct. <<
I've read it. It's a mixture of ignorance and wishful thinking based on the premise that the economy responds instantaneously to government policy which is absolute crap.
>>General tax cut stimulating growth is a non-sense idea. It is the general tax cuts accompanied by deficit spending created by said tax cuts that stimulate the economy (Economics 101). If tax cuts are offset by the exact amount in spending cuts, then the net effect is zero.<<
How you can even utter nonsense like this is incomprehensible. You seem mired in the fallacy that only government spending can stimulate the economy,, when the truth is that the additional money in the hands of consumers because of tax cuts is far more significant in stimulating the economy through spending and investment.
I find it particularly amusing that in one sentence you say that balanced budgets stimulated the Clinton economy and that deficit spending stimulated the economy under Bush II. You can't have it both ways.
>> After all, whether individuals spend the money or the government, it gets spent. Actually, to be more specific, if the monies are given to poor people as opposed to the rich, chances are there would be a bigger bang to the economy given that they are likely to spend immediately while the rich may invest abroad, save it, etc.<<
Investing and saving stimulate the economy as much or more than consumer spending. And yes, your second point is correct. Government deficits also stimulate the economy. But your earlier claim that balanced budgets stimulate the economy is patently untrue. This is a fact we've known since the time of Alexander Hamilton, in fact.
>> These are known facts but the media does little to attempt to educate the populace from the propaganda provided by the party politics.<<
Like I said before the media isn't competent to explain these things. Look how confused you are, and you don't appear to actually be stupid. Imagine how difficult it would be for the media to boil the economy down enough for the average citizen.
>>2. Your other statements are filtered through your belief in what the Right Wing media has programmed into your head. Liberalism being equated with corruption.<<
You don't read very well, do you. Did I ever use the term liberalism? Liberalism is incompatible with corruption. What we have in the media culture is corporate-socialism which is nothing at all like liberalism.
>> In fact liberalism is what allowed for the creation of our republic. Even though our founder suffered from some of the prejudices of their time, they were generally liberal.<<
Yes, being a liberal I understand all of this. The point is that our media, their partners on the political left, and most of our politicians in both parties are not liberals, but statist socialists.
Dave
9 - PoliticalTruths
One of the reasons why we require progressive liberal thinkers to set public and private policies is that many people with limited desire to think or limited tolerance to facts can really lead us astray. It is evident you have no desire to understand based on factual information.
1. You state the article at http://www.politicaltruths.info/web/Economy-Budget.htm is a mixture of ignorance and wishful thinking yet it is simply impossible for you to provide anything incorrect about any statement in the article.
2. You are unable to refute my stance on the zero net effect of tax cuts accompanied by equal spending cuts given that neither Reagan nor Bush I accomplished this. Under Clinton we had fiscal responsibility and a growing economy. The Internet Economy flourished under Clinton because the base was laid fiscally. I paraphrase what Lloyd Bentsen said many years ago. If I give you a checkbook without any funds, you could temporarily have the semblance of prosperity till the checks start bouncing.
3. Try learning to differentiate between different events. By saying that Reagan’s economic activity can be attributed to deficit spending does not say deficit spending is the only way to economic activity. Please, it is that kind of thinking that has us in the condition we are in today. Clinton’s fiscal responsibility was a rock to build on. You can live prosperous with a lot of credit card debt but you can live prosperous and sleep well if you are fiscally responsible.
Please take a class in basic macro economics. Stop towing your party’s lying lines. You will be surprised how quickly you learn to despise their policies.
10 - volt
there is no doubt that cutting taxes can work in the short run to stimulate the economy. with american atipathy towards saving, a few extra hundred or thousand dollars from tax cuts can filter straight into the economy with can help boost gdp.
but the effectiveness of this practice is neglible when the brunt of the tax cuts go to the richest people. since they can, in large part, already buy everything they desire, the money does not immediately make its way into the economy. further, when you take into account inflation, higher energy costs, higher health insurance costs and less employers picking it up, deteriorating job security, etc. middle class americans are in a far more precarious situation than five years ago.
All of these factors have made our economic recovery far less than was expected from the enormous stimulus package of the bush administration. more importantly, it begs the question of why bush and the republicans are continuing to push for further tax cuts for the very rich as they will do little to help the economy.
that is really a rhetorical question as the answer is obvious.
11 - PoliticalTruths
Volt,
I agree with you with you 100% with one stipulation. The tax cut must not be offset by spending cuts by the government else you are simply moving spending from the government to people thus not necessarily increasing spending in the aggregate which is what is desired to increase economic activity.
12 - Reich Winger
Hey Eric Berlin,
I agree with your post. Except, I would change only one thing, one word actually: "infotainment" to "infantotainment."
Reich Winger
13 - Dave Nalle
There's not much point in even discussing this topic the PoliticalDelusions, but I'll at least address a few of his misconceptions.
>>One of the reasons why we require progressive liberal thinkers to set public and private policies is that many people with limited desire to think or limited tolerance to facts can really lead us astray. It is evident you have no desire to understand based on factual information.<<
Where is your factual information? You've certainly provided no evidence in this article or your comments that follow it. You have made unsupported assertions about the behavior of the economy that a first year economics student knows are based on simple fallacies.
>>1. You state the article at http://www.politicaltruths.info/web/Economy-Budget.htm is a mixture of ignorance and wishful thinking yet it is simply impossible for you to provide anything incorrect about any statement in the article.<<
Like hell. I can point to multiple factual errors in the article. Here are just three.
You state that "one hears that budget deficits do not matter". Give me a source on that one other than yourself or someone you met in a bar. Even the administration is acutely conscious of the importance of the budget deficit, both for positive bolstering of the economy and the danger which it poses. This statement is patently ridiculous.
You single out unemployment as one of the dangers we face. Yet the truth is that unemployment is at a historically low level. Not just in comparison to the historical scale, where it is enormously lower than the average for the previous century, but even in the short term - putting aside a few better years under Clinton - unemployment is extremely low. Our current unemployment rate is within 1% of the lowest rates the nation has ever enjoyed, and arguably close to a rate so low that it cannot be lowered without forcibly conscripting the unemployed.
Your social security fearmongering is outrageous and, of course, fraudulent. You suggest that someone has proposed taking all of social security and putting it into volatile investments so that those nearing retirement would be at risk of losing everything. No one, not even the most radical supporters of privatization, has suggested a plan like this. The extremely moderate Bush plan would have left the funds of those near retirement completely untouched, and even the more comprehensive plans focused almost exclusively on providing a limited selection of alternative options to those under the age of 45.
Basically, your entire article is a vague pile of repeated political arguments which are based on demonstrably false premises, misrepresentations and the left's distorted version of what some of these economic proposals or situations are. Almost nothing you address is based on hard, factual economic data.
>>2. You are unable to refute my stance on the zero net effect of tax cuts accompanied by equal spending cuts given that neither Reagan nor Bush I accomplished this.<<
I didn't attempt to refute this argument. I think it's almost viable. The best solution for the economy in the long run is stable or declining taxes with fixed or declining spending from the government. This changes if there is a recession. A recession needs to be addressed with tax cuts and increased government spending, but deficit spending should not outstrip the ability of the government to recover revenue from economic growth generated by spending and tax cuts. It's pretty simple, really.
>> Under Clinton we had fiscal responsibility and a growing economy. The Internet Economy flourished under Clinton because the base was laid fiscally. I paraphrase what Lloyd Bentsen said many years ago. <<
Are you familiar with the concept of coincidence? Clinton didn't cause the tech boom. He reaped the benefits from it. Saying that his raised taxes and surpluses were in any way beneficial to the nation is just insane. They're part of what caused the recession after the tech boom crashed. The government sitting on money is worse than the government borrowing money.
>>If I give you a checkbook without any funds, you could temporarily have the semblance of prosperity till the checks start bouncing. <<
A totally inept comparison. The proper comparison is to a loan being used to finance investments. If the investments you borrow to finance return more than the interest rate on the loan, then you come out ahead. You may be using borrowed money, but if it turns a profit for you then you pay it back and keep the difference.
Money borrowed by the government is effectively an investment in the economy. If the economy grows as a rate greater than the rate at which the debt increases, then the deficit financing paid off.
>>3. Try learning to differentiate between different events. By saying that Reagan’s economic activity can be attributed to deficit spending does not say deficit spending is the only way to economic activity.<<
Reagan built up a deficit, but also lowered taxes. The result was a booming economy which Clinton inherited and which you mistakenly give him credit for, apparently.
>> Please, it is that kind of thinking that has us in the condition we are in today. Clinton’s fiscal responsibility was a rock to build on. You can live prosperous with a lot of credit card debt but you can live prosperous and sleep well if you are fiscally responsible.<<
You have absolutely no idea how the economy works or you are repeating someone else's fallacious argument. Clinton's 'fiscal responsibility' - more like fiscal neglect - led to economic stagnation and encouraged a bubble which burst and which we are only just recovering from.
>>Please take a class in basic macro economics. <<
Do graduate classes count?
>>Stop towing your party’s lying lines. You will be surprised how quickly you learn to despise their policies<<
I have no idea what my 'party' believes. I just go with what is obvious to anyone with a basic understanding of the economy.
Dave
14 - PoliticalTruths
Dave,
Given your answers I would be ashamed to note having taken graduate courses in economics; well maybe from Karl Roves University of Propaganda. I do not repeat propaganda neither from the left or the right. As a successful business owner, engineer, and an independent study of real economics and its impacts, I have drawn conclusions that have all come to pass. There is no genius to this as anybody who simply looks at the truth from the facts generally can come to conclusions analytically. Where outcomes are based on random events, an entropic cloud of accuracy can be drawn.
I will no longer address your ramblings as discussing with you is pointless.
15 - Dave Nalle
Pol,
Given your answers I am not surprised to hear you have no background in economics. I do not repeat propaganda neither from the left or the right. As a successful business owner, professional historian, and someone who has studied economics both in theory and in practice, I have pointed out the fallacies in your presentation and you have proven unable to respond. There is no genius to this as anybody who simply looks at the truth from the facts generally can see how our economy works and where the big lies of the left which you're repeating fail the test of truth.
As I said before you're not interested in discussion based on facts or non-emotional analysis, so I guess we'll just leave it at that.
Dave
16 - Lono
to Silas' point. I can't possibly blame myself.
1. I didn't vote for the Bush crime family
2. I did everything I possibly could to warn as many people as a could that these guys would fuck us.
Impeach the President
17 - practical joe
There are too many variables in the economy to either predict what will happen in the future or to ascertain what caused past events.
However, one event during the past 40 years has caused our economy to tank visibly and catastrophically.
Our economy lives on energy.
It took us only a day or so to go from low energy prices to instantaneous quadrupled prices. The price of energy quadrupled on October 17, 1973, the day Richard Nixon sold out the American economy and the American people for his own political benefit. Nixon caved in to political pressure from AIPAC, the Jewish lobby in Washington, in defiance of a clear admonition from Saudi Arabia to stay out of Middle East politics and the 1973 war. Nixon should be remembered for this debacle but he isn’t. Nixon’s perfidy was reported in the October 23, 1973 issue of Time Magazine but hasn’t had much exposure since. Our news media has suppressed this perfidy of Nixon for over three decades. It was content to be distacted by Watergate, a significant event but not one that impacted our entire economy. The connivance of Nixon in Watergate is a drop in the bucket compared to what he did to the economy of this country.
The effects of quadrupling oil prices, reverberated throughout our economy and that of the world. Inflation and interest rates soared and the stock market tanked. It took a decade for the Dow to go from 700 to 1,000 and interest rates went as high as 21%. The new car that could be bought in 1972 for $2,000 now costs $30,000. The house that could be bought in 1972 for $30,000 now costs $500,000.
During the decade following 1973, government programs became indexed and now our budget deficits are due mainly to Social Security and Medicare indexing.
Our economic problems are not caused by liberals OR conservatives -- they are the result of both political parties being in the tank with lobbyists.
During the past several decades the number of lobbyists has grown exponentially and now is around 35,000 -- that’s approaching 100 for each member of Congress.
Like Willie Sutton, the lobbyists rob us in Washington because that is where the money is.
Right out of our pockets.
18 - G. Oren
Interesting discussion PT, Eric, and Dave. No one has pointed out the real reason why the economy began rebounding in '83'. That was due to the monetary policy that Fed chairman Volker began following in the fall of '79', the end to an inflationary easy money system - which successfully, if painfully, wrung inflation out of the system. Remember those 21% prime rates in the spring of '81'. Fiscal stimulus from the ERTA tax cuts in '81' did not really hit the economy until '83' - when the full impact of those cuts took effect. Whether the Reagan years were a success of Supply-Side economics and increased productivity or, as most traditional Keynesians argued, stimulation of aggregate demand through deficit spending, will be debated from now on. That the Reagan and Bush I years gave us large deficits cannot be argued. Do deficits matter? They matter in comparison to overall GDP and to the extent that an overall increasing Federal debt and unfunded liabilities of future payments mean that a larger amount of dollars must be absorbed by the government from credit markets. The Japanese and the petro-dollars from the Arabs helped finance our deficits in the 80's and early 90's. The Chinese are financing our deficits now with excess dollars from our trade deficit with them. As one Chinese official pointed out on NPR's afternoon show last Wed., they can make other choices with their excess dollars, that may be an arbitrage game between euros and dollars, but someone will wind up with those dollars to invest.
The two questions that should be asked are: 1. Should tax rates be increased to fund current deficits - basically reversing the Bush plan of 2001 and taxing current domestic growth? 2. Should government spending be cut (or the rate of increase in spending be cut) to help reduce those defcits?
Before trying to answer those questions, I think it is important to note that the Fed, under chairman Greenspan, has continued to alternately loosen and tighten monetary policy via the Fed funds rate. Fed policy and monetary policy in general, in my opinion, is more important than fiscal policy in determining the overall groundwork for recovery and expansion. And monetary policy - however skillfully managed - cannot fully abrogate the business cycle. That is credit expansion and business decisions will always grow with rosy scenarios of future returns (as occurred in the late 90's) leading to eventual contraction as reality catches up with those decisions. A period of retrenchment and reshuffling will again lead to opportunities for credit expansion. That the Fed tries to temper the waves of expansion - when inflationary pressures appear - and provide monetary stimulus - when recessions occur - is exactly what the overall economy needs. Whether or not Greenspan and the Fed have always made the right decision can be debated.
Going back to my two questions above, in light of the preceding discussion about the business cycle and monetary policy. In my opinion, the Bush tax cuts were not necessary as a fiscal stimulus, that is, we are no longer talking about the punitive tax rates that existed prior to '81' (top rates in excess of 50% etc..)and the Feds monetary policy along with the natural action of the business cycle would have prevailed anyway. Some of those proposals - especially regarding capital gains taxes, estate taxes, the marriage penalty, child credits - were good (assuming we don't revert to pre-2001 law after 2010). Therefore, a rollback of most of the bracket cuts would be in order. The most damaging side of Bush II's policies, in view of the deficit, has been the dramatic increase in Federal spending at all levels. Not even counting the cost of the War in Iraq, the GOP Congress has rolled out as much pork as any Dems ever did. The notion that the Dems are now deficit hawks and the GOP the party of fiscal irresponsibility is hard to swallow for conservatives. Something needs to be done to cut the rate of increase in Federal spending - which will balloon again if the current medicare drug plan is not overhauled. The demographic problem of Social Security pales in comparison to the demographic problem of medicare. Keynes is often quoted for that acerbic statement "In the long run we're all dead". "We" may all be dead, but our children and our grandchildren will still be here to face the consequences of our decisions - good and bad.
19 - Justin Berry
Cant we just blame FEMA? Its so much easier. Plus with the Presidents latest poll numbers everyone would believe it.
On a serious note what happens to this post when you replace the word media as in "Liberal media" with leaders in Wash.? as in "liberal leaders in Wash." Last I checked the media doesnt legislate.
20 - Eric Berlin
G Oren -- Very solid analysis. Of course, supply side people will refute you to your last breath re: Reagan's '80s but I'm with you in large part. That said, I do think that Clinton's sensible policy of actually balancing the Federal budget helped to fuel the roaring '90s economy.
Bush II has ushered in the era of Big Spending Conservatism, or Don't Tax and Spend. They'll get away with it until the voters call them on it.
21 - Eric Berlin
Reich -- "infantotainment"
Great word!
22 - Dave Nalle
>>Interesting discussion PT, Eric, and Dave. No one has pointed out the real reason why the economy began rebounding in '83'. That was due to the monetary policy that Fed chairman Volker began following in the fall of '79', the end to an inflationary easy money system - which successfully, if painfully, wrung inflation out of the system. Remember those 21% prime rates in the spring of '81'.<<
I sure do. I also remember saving up and buying my car with cash in '81.
>> Fiscal stimulus from the ERTA tax cuts in '81' did not really hit the economy until '83' - when the full impact of those cuts took effect. <<
That's the delay I've been talking about which Pol doesn't seem to get.
>>Whether the Reagan years were a success of Supply-Side economics and increased productivity or, as most traditional Keynesians argued, stimulation of aggregate demand through deficit spending, will be debated from now on. That the Reagan and Bush I years gave us large deficits cannot be argued. Do deficits matter? They matter in comparison to overall GDP and to the extent that an overall increasing Federal debt and unfunded liabilities of future payments mean that a larger amount of dollars must be absorbed by the government from credit markets. <<
The deficit only matters at the point where it becomes impossible to manage. As was demonstrated in the aftermath of the Reagan/Bush period the seemingly huge deficits were clearly easily dealt with once the economy was on a roll, despite all the cries of doom and gloom at the time.
>>The Japanese and the petro-dollars from the Arabs helped finance our deficits in the 80's and early 90's. The Chinese are financing our deficits now with excess dollars from our trade deficit with them. As one Chinese official pointed out on NPR's afternoon show last Wed., they can make other choices with their excess dollars, that may be an arbitrage game between euros and dollars, but someone will wind up with those dollars to invest.<<
As I've mentioned elsewhere, it doesn't actually matter who buys the debt as long as someone does, and there's no sign that the attractiveness of US debt is going away anytime soon.
>>The two questions that should be asked are: 1. Should tax rates be increased to fund current deficits - basically reversing the Bush plan of 2001 and taxing current domestic growth? 2.<<
IMO this would be disastrous. Unless wages start to rise dramatically there's no justification for increasing taxes on anyone. Working people just can't afford it. The tax cuts are the only think keeping them ahead of inflation right now.
>> Should government spending be cut (or the rate of increase in spending be cut) to help reduce those defcits? <<
The rate of spending has to be stabilized. I'm not sure that it needs to be cut, but we cannot continue to increase spending levels with the looming threat of out of control entitlements.
As for Greenspan and the Fed, they seem to have done a pretty good job overall. So long as they keep their increases in the rate gradual and stop at a reasonable level, I can't fault them. A little deflation right now is probably desirable to help stabilize things.
>>Going back to my two questions above, in light of the preceding discussion about the business cycle and monetary policy. In my opinion, the Bush tax cuts were not necessary as a fiscal stimulus, <<
They're hardly large enough to be a major fiscal stimulus. But I do think that they are enormously important for keeping middle-income consumers from losing ground in the economy.
>>that is, we are no longer talking about the punitive tax rates that existed prior to '81' (top rates in excess of 50% etc..)and the Feds monetary policy along with the natural action of the business cycle would have prevailed anyway. Some of those proposals - especially regarding capital gains taxes, estate taxes, the marriage penalty, child credits - were good (assuming we don't revert to pre-2001 law after 2010).<<
I fear these very desirable tax cuts may be a dead issue. Hard to believe that after 5 administrations promising to get rid of the marriage penalty it's still there.
>> Therefore, a rollback of most of the bracket cuts would be in order.<<
I don't see any justification in the current economic environment. It would do little to help with the deficit and would harm consumers gratuitously.
>> The most damaging side of Bush II's policies, in view of the deficit, has been the dramatic increase in Federal spending at all levels. Not even counting the cost of the War in Iraq, the GOP Congress has rolled out as much pork as any Dems ever did. The notion that the Dems are now deficit hawks and the GOP the party of fiscal irresponsibility is hard to swallow for conservatives.<<
Virtually incomprehensible. The only comfort is the thought that we might be in ever worse shape for overspending if the Dems were in power.
>> Something needs to be done to cut the rate of increase in Federal spending - which will balloon again if the current medicare drug plan is not overhauled. The demographic problem of Social Security pales in comparison to the demographic problem of medicare. Keynes is often quoted for that acerbic statement "In the long run we're all dead". "We" may all be dead, but our children and our grandchildren will still be here to face the consequences of our decisions - good and bad.<<
Which is exactly why we need a leader with the balls to actually tear these antiquated and ultimately disastrous systems down and start over again. Balls Bush demonstrated he doesn't really have despite his promises.
Dave
23 - practical joe
Dave says:
“it doesn't actually matter who buys the debt as long as someone does, and there's no sign that the attractiveness of US debt is going away anytime soon”
Wake up and smell the deficits and the coming pervasive oil inflation.
It’s like the decade of the 1970’s -- it’s like déjà vu all over again.
It was called “stagflation” then -- what will we call it now?
Those buying our deficits have an aging population, just as we do.
When their pension systems, whose funds are being loaned to us start to dry up, which of course will coincide with our pension disbursements, is the time our foreign creditors will want to cash in their chips.
Unless of course, the Euro gets to look much better than the dollar.
We will then have both large tax increases and an unacceptable reduced standard of living for retirees, and if we default, a world-wide depression.
The depression is likely in any event when we become unable to buy foreign goods.
And while we fiddle and argue about economic band-aids, the grim reaper is grinning at us.
We should start by killing all the lobbyists (most of which are lawyers), whose efforts have driven our economy into the ground.
Not that this will save us -- it is probably too late for that -- but we might feel a little better knowing that they got their just punishment.
24 - Eric Berlin
Throw in high health care costs, rising interest rates, a housing market that might be primed for an implosion...
25 - Dave Nalle
Practical Joe Says:
"Doom and gloom, boogety boogety boogety, depression, smell coffee, Bush is Satan, doom, raining frogs, bibbety bobbety boo, UPC codes on our foreheads, grim reaper, lobbyists, tinfoil hats!"
Ok then.
Dave