Reagan insider: 'GOP destroyed U.S. economy'

[Mursilis]

The middle is dead.

Because the middle is full of the brain-dead, the sort of people who insist the gov't can't tell a woman she can't have an abortion, because it's her body, but it can tell her she can't smoke pot, because it's not her body, apparently.

 

[child of wonder]

How long until we all don't give a rat's ass about "Democrat" and "Republican" and just fix our fucking country?

 

[BoberFett]

How long until we all don't give a rat's ass about "Democrat" and "Republican" and just fix our fucking country?

Not until it completely crashes. Americans love their reality TV, and what's more like reality TV than politics? You've got the good guys, the bad guys, the scheming to get people kicked off the island. Americans don't WANT a country that works properly.

 

[Jaskalas]

They wanted the economy, markets and the government to be under the absolute control of Wall Street's too-greedy-to-fail banks. They conned Congress and the Fed into bailing out an estimated $23.7 trillion debt. Worse, they have since destroyed meaningful financial reforms. So Wall Street is now back to business as usual blowing another bigger bubble/bust cycle that will culminate in the coming "American Apocalypse."

I have to admit, when the man warns of what I'm warning of... there's quite a bit of believability on who he blames.

 

[Jhhnn]

Yes, because the GOP definitely controlled Congress all those years since Reagan. 🙄 A Dem Congress would NEVER pass an unbalanced budget!

Oh, please. Bush used 9/11 as a bludgeon against all enemies, foreign and domestic, and repubs in general used tax cuts the way a pedophile gives out candy to the kiddies...

And Repubs held a majority in the senate from 1995 to 2007, with the exception of the 2001-2003 congress, when Jeffords switched sides...

And repubs held the HOR from 1995 to 2007, as well, but I'm sure you won't allow facts to interfere with the formulation of your opinion...

 

[Generator]

The middle seems to be the corporations. Obama the liberal? Well I'm still waiting for that guy to show up. He's completely in the pockets of big business which usually has its interest in between conservatives and liberals. The Republicans did sabotage this economy faster than expected, but they are only playing with the hand the Democrats gave them with Clinton.

It seems like a Republican use to have respect for making money outside of government. Now Republicans deliberately sabotage the government in any way they can to leach money out of it to big business. Without the government I don't know if a Republican could make money anymore. So insane are the Republicans that it leaves Democrats willing to sellout to corporations at any time receive any precious power possible.

At the end of the day a democrat is still a democrat. Losers with no principles. While they desperately seek to retain power just for the sake of having it they sell out this country again and again. Honestly what is the difference anymore between the two parties if you're big business? Fuck why don't we just call the CEO of big corps Senators instead? Are these people not the government?

 

[nick1985]

Oh, please. Bush used 9/11 as a bludgeon against all enemies, foreign and domestic, and repubs in general used tax cuts the way a pedophile gives out candy to the kiddies...

What did the Democrats do?

 

[ElFenix]

1. Those word were the sub-title to the article, printed in the print NY Times but omitted from the Online version of the editorial. They are apparently Stockman's words.

i don't know about editorials, but on the news side the editors often title the stories.

 

[Fern]

There's another difference. The dems have not hoodwinked voters into believing that they are the party of fiscal responsibility.

-snip-

At any rate, the dems have never claimed fiscal responsibility as a central party or campaign theme.

- wolf

Are you sure about that?

I seem to remember that being a big part of their campaign in the 2006 elections when they took over both the House and Senate. (That and ending the 2 wars, repealing the Patriot Act and closing GITMO etc.)

Fern

 

[PokerGuy]

Are you sure about that?

I seem to remember that being a big part of their campaign in the 2006 elections when they took over both the House and Senate. (That and ending the 2 wars, repealing the Patriot Act and closing GITMO etc.)

Fern

None of which were done of course. At least I'll give them that, they're consistent. Once they fail, they make sure they keep consistently failing at whatever they do. Too bad they drag the rest of us down with them.

 

[Jhhnn]

Let's try interjecting some sense into the discussion, shall we?

Maybe we can agree on a few points.

1. Federal expenditures far exceed revenue.

2. Cutting Federal expenditures to match current revenues would devastate the economy even further, given the number of people laid off in the process and the spending on various projects never realized.

3. Private enterprise is either unwilling or unable to pick up the slack in unemployment we have today, let alone the much larger numbers that 2. would create.

4. Propose an honest solution taking all 3 factors into account.

I contend that the answer to 4. is to raise taxes, particularly on those whose income is greatest. They're not really doing their job in the economy, which is to invest in ventures creating employment, anyway. That's been the claim of Reaganomics all along, right? That top tier tax cuts would create constructive investment and more jobs, right? So where is it?

 

[Mursilis]

Let's try interjecting some sense into the discussion, shall we?

Maybe we can agree on a few points.

1. Federal expenditures far exceed revenue.

2. Cutting Federal expenditures to match current revenues would devastate the economy even further, given the number of people laid off in the process and the spending on various projects never realized.

3. Private enterprise is either unwilling or unable to pick up the slack in unemployment we have today, let alone the much larger numbers that 2. would create.

4. Propose an honest solution taking all 3 factors into account.

I contend that the answer to 4. is to raise taxes, particularly on those whose income is greatest. They're not really doing their job in the economy, which is to invest in ventures creating employment, anyway. That's been the claim of Reaganomics all along, right? That top tier tax cuts would create constructive investment and more jobs, right? So where is it?

So, when are your Democratic heroes going to get around to doing that? I'm still waiting for my tax increase. Bet it doesn't come either. Like the Republicans always talking about cutting gov't (which never happens), the Dems aren't actually going to raise much of anything tax-wise, at least not nearly enough to close the budget gap. Regardless of party, why would a politician commit political suicide? It will be deficits as far as the eye can see.

 

[Craig234]

i don't know about editorials, but on the news side the editors often title the stories.

Of course they do - the news side is 'their' content they're responsible for.

I'm just saying the claim that the 'destroy' quote was invented by the columnist is wrong, and that his claim Stockman wrote it is at least plausible, probably probable.

With that info, it's fine to ask for confirmation, but baseless to make accusations of fraud.

And as others have noted, regardless it's a pretty fair summary of main points of the article.

 

[Fern]

Let's try interjecting some sense into the discussion, shall we?

Maybe we can agree on a few points.

1. Federal expenditures far exceed revenue.

Agreed.

2. Cutting Federal expenditures to match current revenues would devastate the economy even further, given the number of people laid off in the process and the spending on various projects never realized.

"Devastate" is too strong a word I think; how much cutting are you talking about?

I think this is not as simple as you might make it.

Cutting federal expenditures would, in the short term, reduce demand. That would not be helpful in the short term, either.

However, continued spending will have other ramifications, some of which are negative and need to be balanced with the benefits of maintaining the demand government spending generates. And how that continued spending is financed is an important part of the equation. Is it financed from increased borrowing or increased taxation?

Increased borrowing obviously brings negatives and risks. I'll mention the possiblility of increased interest rates (Fed Bond ratings lowered) and leave it at that for the moment.

Increased taxes? In the broad economic picture this has the ecomonic effect of moving money from your right pocket to your left pocket. People could spend less so the government can spend more? That's a net zero.

But my main point is that any benefit in using the government to prop up demand must be balanced with the attendant costs/risks/problems inherent in doing so.

Currently, we've increasing government spending to do so. e.g., bailouts for states to prop up their budgets. In this economy we've seen business slim down and become stronger, could we benefit in the long term by seeing the states do the same?

Ultimately governments are consumers (or at best re-allocators) of resources, the less they consume the more we can (as individuals) consume.

3. Private enterprise is either unwilling or unable to pick up the slack in unemployment we have today, let alone the much larger numbers that 2. would create.

As predicted by many, the government's absorption of large amounts of capital (selling bonds etc) is starving the other sectors. GDP is created by businesses, not governments.

Creating jobs is different than creating demand by spending. Government spending has proven to be ineffective at creating jobs. If we want jobs I'm convinced we need to get more capital to small businesses, not suck it away to give to government.

4. Propose an honest solution taking all 3 factors into account.

I contend that the answer to 4. is to raise taxes, particularly on those whose income is greatest. They're not really doing their job in the economy, which is to invest in ventures creating employment, anyway. That's been the claim of Reaganomics all along, right? That top tier tax cuts would create constructive investment and more jobs, right? So where is it?

Raising taxes on the very top tier will not generate much revenue. There simply isn't enough people in that group. Heck instead of raising taxes on those people just take ALL their money. That would do what? It would be a one-time giveaway of about $3K to each of the other +300 million people, or dent our debt by about a $trillion. Neither of those is going to do anything significant.

The solution is to substantially increase GDP. Increased GDP means increased revenue for the government to help with deficits/debts, it also means increased employment (along with all it's financial benefits - more tax collections, decreased welfare/Medicaid etc.).

The only way to do that is through the private sector. Government does not create GDP, it absorbs it.

Fern

 

[Fern]

1. Those word were the sub-title to the article, printed in the print NY Times but omitted from the Online version of the editorial. They are apparently Stockman's words.

2. You are not someone with any right to challenge others on misrepresenting what people say.

I was concerned about the Stockman quote here, and looked it up. You on the other hand have felt free to lie about what people say, such as your recent lie about Bill Clinton.

Of course they do - the news side is 'their' content they're responsible for.

I'm just saying the claim that the 'destroy' quote was invented by the columnist is wrong, and that his claim Stockman wrote it is at least plausible, probably probable.

With that info, it's fine to ask for confirmation, but baseless to make accusations of fraud.

And as others have noted, regardless it's a pretty fair summary of main points of the article.

He has every right on challenging that quote. We do it all the time in P&N and there's nothing in the OP's links justifying the validity if it.

In fact, we've got nothing to justify it other than your 'theory', that's insufficient.

Fern

 

[Fern]

i don't know about editorials, but on the news side the editors often title the stories.

They do it on editorials too.

I have seen the same editorial carry different titles.

Fern

 

[BurnItDwn]

Sounds like a revolution might just be on the way. Too soon to start my guillotine business?

 

[Craig234]

He has every right on challenging that quote. We do it all the time in P&N and there's nothing in the OP's links justifying the validity if it.

In fact, we've got nothing to justify it other than your 'theory', that's insufficient.

Fern

As usual, sometimes you are reasonable as in another post I've seen of yours today, and sometimes you are a reading-challenged or otherwise quite bad poster.

Let me type slowly for you.

The accusation that *the columnist just made up the quote* is completely wrong. Debunked. Factually inaccurate.

There is no more, as was insinuated, 'he just made it up'. Clearly, he got it from the NY Times' printed sub-title. The only question now is, did Stockman write the title?

This would be an incorrect inference totally different than 'he just made up the quote', at worst, and he might well be right - no one here yet knows.

This was all explained, and yet you insist on responding by obfuscating the issue that was just explained, undoing the separation of 'he just made it up' from 'he assumed the article's sub-title was written by Stockman', and you put them both back together as if they're the same referring simply to 'challenging the quote', as if 'challenging' it with 'he made it up' and 'challenging' it with 'was he right that Stockman wrote the sub-title correct' are the same thing.

I discussed both of these and clearly said why the latter is fine, and the former is proven wrong, and yet you reply ignoring what was said and posting nonsense.

As for your last sentence:

I stated as fact that the article had the sub-title. That disproves that the columnist 'mde up the quote'. That's not a theory.

I stated that it's a valid question whether the columnist was correct in saying that the quote was from Stockman - it could be from the editor.

Here, you post a straw man pretending to disagree, where you misrepresent my saying it's a valid question by pretending I said it's not, and you are the one saying it is.

What a crap post.

 

[Craig234]

Sounds like a revolution might just be on the way. Too soon to start my guillotine business?

There won't be another revolution, just a political battle between the 'haves' and the army of idiots they manufacture with right-wing propaganda, against the rational citizens.

The odds favor the haves.

Whatever happens, the days of the guillotine are gone. The great reduction of the wealth can happen and there won't be any revolution able to prevent it.

 

[Jhhnn]

Like it really matters whether those were Stockman's precise words or not. He lays the process of destroying the economy at the repubs' doorstep. So he didn't ring the bell- he didn't have to.

Fern's whole bit about taxes and the govt not creating GDP is mere ideological posturing. The govt has paved the way for GDP growth many times- in the TVA, in the myriad water projects in the West, in the REA, in the interstate highway system and countless other projects. Not only has the govt created the infrastructure of progress, but also employed millions in the process. Thousands of WPA infrastructure creations still serve the public to this day.

It also seem to me that Fern is engaging in his own version of being deliberately obtuse wrt taxes. There aren't that many people top 1 percent, of course- it's the top 1 percent. OTOH, their share of income in 2007 was twice that of the bottom 50 percent combined, over 23 percent of all AGI. Raising taxes by 5 percent of income for the top 1 percent would have the same effect as raising taxes by 10 percent of income for the bottom 50 percent. Which group can better afford it? Raising the top 1 percent effective taxes to 1980 levels would decrease the deficit by about $300B annually, and would then allow the nation's wealthiest to lead by example, pave the way for more modest tax increases on the rest of the upper middle class...

Increasing GDP sounds peachy and all that, but in the absence of any sort of plan to actually do that just means we're gettin' a little more sunshine pumped up the ol' skirt...

Like I offered earlier in kinder and gentler terms- Let's get real, OK?

 

[BoberFett]

LOL.

Craig.

 

[Fern]

My take on the editorial:

First I'll point out he absurdity of mentioning municpal debt in conjuction with the Bush tax cuts. Municipal debt is from the states and has nothing to do with federal taxation. State borrowing is state borrowing.

It looks like it was spawned by the current discussion of extending the Bush tax cuts.

He lays out four factors as the priamry cause of our economic problems:

1. Dropping the gold standard. My take on that position is that it falls into some Ron Paul kind of looney territory. Most people here (and elsewhere) have no appreciation for this complaint. That he holds this unusual position may well color one's view of the rest of his remarks.

2. Explosion of federal debt. Claiming this came (only) from decreased taxes is disingenuous. It's like run-away spending doesn't matter or exist.

This debt explosion has resulted not from big spending by the Democrats, but instead the Republican Party’s embrace, about three decades ago, of the insidious doctrine that deficits don’t matter if they result from tax cuts.

Riiiiigt, "big spending" doesn't cause debt, tax cuts do. It's axiomatic that you can't have debt/deficits if you don't spend. So to leave out spending, or diminish it is crap.

He barely manages to mention the ballooning "welfare state" and rushes by to criticize national defense spending. To some extent he has a point, but evevy war has had an end, you can't say the same about government programs; they just keep getting bigger. More rubbish by mis-focus and omission.

How Dems applaud this, I don't know. He's complaining about entitlement program, education and water projects NOT being cut. The Left is trying to do the opposite.

OK, another of his remarks:

By fiscal year 2009, the tax-cutters had reduced federal revenues to 15 percent of gross domestic product, lower than they had been since the 1940s.

Now does anybody possibley think that an economic downturn could drive federal revenues lower? Maybe that's why it dipped in 2009?

This chart shows fed revenue consistantly bouncing around between 15 and 20 percent (BTW: it shows in dipping down to 15 percent in the 50's too, contrary to his asssertion):

http://www.nationalpriorities.org/Federal%20outlays and revenues

However, I also found this chart:

http://www.usgovernmentrevenue.com/..._2010&units=p&title=Revenue as percent of GDP

It shows a completely different picture with the federal percentage much higher, and trending higher until the recession hit. I'm guessing this chart includes all federal revenue and not just income taxes.

Whether taxes generally bounced around between 15 and 20 percent, or have been trending up this would demonstrate that spending is the real problem (it's what's really changed).

3. Expansion of our Financial Sector. My only complaint here with his remarks is assigning blame to only one side. This has been discussed numerous times here so will drop it.

However, I think it interesting to note that he's complaining about Wall Street etc since he worked there. He also started his own fund etc. Ultimately he took his firm into bankrupcty and was charged with fraud (charges were dropped in 2009).

4. The hollowing out of the larger American economy. Somehow he's claiming this is the Repubs fault, but gives absolutely no reason why it is, rather he speaks of it happening, but provides no reasons why it did happen. WTH?

He writes as though the Repubs have running this country by themselves for decades, he marginalizes the Dems by pretty much refusing to acknowledge their existance, much less their role in government. As has been pointed out, the Dems have enjoyed control of Congress which has power over the budget and domestic affairs.

Otherwise, looks like a poorly organized article. Lots of things appear to be included for no point or without any explaination; it looks jumbled up. E.g., this remark:

Having lived beyond our means for decades by borrowing heavily from abroad, we have steadily sent jobs and production offshore

Now why does living beyond our means necessarily translate into sending jobs abroad? He doesn't explain it all. I would argue that living beyond our means doesn't necessarily translate into sending jobs abroad. You could have gone into debt purchasing domestic products (a house, a car etc). It's our trade policy that can send jobs abroad, yet he doesn't even mention it?

The guy looks nutty to me, I'm thinking he's pissed off no one (Repubs) will give him a job.

Fern

 

[Fern]

Like it really matters whether those were Stockman's precise words or not. He lays the process of destroying the economy at the repubs' doorstep. So he didn't ring the bell- he didn't have to.

Fern's whole bit about taxes and the govt not creating GDP is mere ideological posturing. The govt has paved the way for GDP growth many times- in the TVA, in the myriad water projects in the West, in the REA, in the interstate highway system and countless other projects. Not only has the govt created the infrastructure of progress, but also employed millions in the process. Thousands of WPA infrastructure creations still serve the public to this day.

It also seem to me that Fern is engaging in his own version of being deliberately obtuse wrt taxes. There aren't that many people top 1 percent, of course- it's the top 1 percent. OTOH, their share of income in 2007 was twice that of the bottom 50 percent combined, over 23 percent of all AGI. Raising taxes by 5 percent of income for the top 1 percent would have the same effect as raising taxes by 10 percent of income for the bottom 50 percent. Which group can better afford it? Raising the top 1 percent effective taxes to 1980 levels would decrease the deficit by about $300B annually, and would then allow the nation's wealthiest to lead by example, pave the way for more modest tax increases on the rest of the upper middle class...

Increasing GDP sounds peachy and all that, but in the absence of any sort of plan to actually do that just means we're gettin' a little more sunshine pumped up the ol' skirt...

Like I offered earlier in kinder and gentler terms- Let's get real, OK?

I agree with your point that some federal projects can pave the way for increases in GDP, but that's not what our government has been doing. That's not how the stim etc money has been spent. Nor have seen any of those type plans offered.

Your tax cacluations are wrong. First of all, in the 1980's we had a ton of decutions, they were eliminated when the rates were lowered. Look it up, it was a pretty negligable effect on fed income tax revenues. So, no, going back to 1980 tax law would not be as significant as you think.

However I do think we could raise a good chunk, but you've got to get around Chuck Schumer. Other than super athletes, the highest earners are fund managers and we need to get rid of the tax law that let's them pay LT cap gain rates on their income.

Otherwise, jacking up rates results in diminishing benefits, all economist acknowlege this. The question is how far? The other question is - in this economy?

I don't really mind bumping our highest rate from 35 percent to 38 percent, although I've heard a few Dems argue against it now because of the economy. But I oppose an across the board increase. It'll kill demand from the private sector etc.

Fern

 

[Jhhnn]

I used numbers from here, Fern-

http://www.taxfoundation.org/news/show/250.html

I think it's important to recognize that top incomes are largely perpetual, and that investors will cash in as a response to lowered capital gains rates, giving a false picture as to the long term effects of doing so. Yeh, sure, that cashing in offsets revenue losses from percentage reductions, but it's only temporary. It's an illusion. Nor was I referencing taxes on earned income, but rather capital gains taxes primarily.

Second, what I see the stimulus money being used for around here is infrastructure, particularly wrt transportation. Almost every time I go by a road construction site, there's a placard saying the money is from the Feds... dunno about where you live, but our roads have gone to hell in a handbasket over the last few years because of state and local budget constraints...

Third, you really haven't addressed your contention wrt GDP growth in terms more specific than sunshine and rainbows...

And there's always that small matter of income share rushing to the top... I realize that was set aside with the rhetorical flimflam about how a rising tide lifts all boats, but that never was true in the whole Reaganomics construct, and it's quite demonstrably not true today...

 

[Darwin333]

There won't be another revolution, just a political battle between the 'haves' and the army of idiots they manufacture with right-wing propaganda, against the rational citizens.

The odds favor the haves.

Whatever happens, the days of the guillotine are gone. The great reduction of the wealth can happen and there won't be any revolution able to prevent it.

How naive you are.

The "haves" just went on the biggest looting spree in history and both of our political parties have been completely complicit. They own your political party and the other one. The "haves" have already won and they are laughing at you for thinking that you can still fight a battle when you have long lost the war.