Ouch

[Kelly the Dog]

Bruce Bartlett was one of the original supply-siders, helping draft the Kemp-Roth tax bill in the 1970s. In the 1980s and 1990s, he was a leading Republican economist. He now considers himself to be a political independent.

 

Leading conservative economist Bruce Bartlett writes that the Obama-hating town-hall mobs have it wrong—the person they should be angry with left the White House seven months ago.

 

Where is the evidence that everything would be better if Republicans were in charge? Does anyone believe the economy would be growing faster or that unemployment would be lower today if John McCain had won the election? I know of no economist who holds that view. The economy is like an ocean liner that turns only very slowly. The gross domestic product and the level of employment would be pretty much the same today under any conceivable set of policies enacted since Barack Obama’s inauguration.

 

Until conservatives once again hold Republicans to the same standard they hold Democrats, they will have no credibility and deserve no respect.

 

In January, the Congressional Budget Office projected a deficit this year of $1.2 trillion before Obama took office, with no estimate for actions he might take. To a large extent, the CBO’s estimate simply represented the $482 billion deficit projected by the Bush administration in last summer’s budget review, plus the $700 billion Troubled Asset Relief Program, which George W. Bush rammed through Congress in September over strenuous conservative objections. Thus the vast bulk of this year’s currently estimated $1.8 trillion deficit was determined by Bush’s policies, not Obama’s.

 

I think conservative anger is misplaced. To a large extent, Obama is only cleaning up messes created by Bush. This is not to say Obama hasn’t made mistakes himself, but even they can be blamed on Bush insofar as Bush’s incompetence led to the election of a Democrat. If he had done half as good a job as most Republicans have talked themselves into believing he did, McCain would have won easily.

 

Conservative protesters should remember that the recession, which led to so many of the policies they oppose, is almost entirely the result of Bush’s policies. According to the National Bureau of Economic Research, the recession began in December 2007—long before Obama was even nominated. And the previous recession ended in November 2001, so the current recession cannot be blamed on cyclical forces that Bush inherited.

 

Indeed, Bush’s responsibility for the recession is implicit in every conservative analysis of its origins. The most thorough has been done by John Taylor, a respected economist from Stanford University who served during most of the Bush administration as the No. 3 official at the Treasury Department. In his book, Getting Off Track, he puts most of the blame on the Federal Reserve for holding interest rates down too low for too long.

 

While the Fed does bear much responsibility for sowing the seeds of recession, it’s commonly treated as an institution independent of politics and even the government itself. But the Federal Reserve Board consists of governors appointed by the president and confirmed by the Senate.

 

Because the president appoints the board, he has primary influence over its policies. This is especially the case for chairmen of the Fed appointed by Republicans because they often have ties to Republican administrations. Chairman Ben Bernanke was originally appointed as a member of the Fed in 2002, serving until 2005, when he became chairman of the Council of Economic Advisers in the White House, a position that made him Bush’s chief economic adviser.

 

As early as 2002, a majority of the seven-member Federal Reserve Board was Bush appointees, and by 2006 every member was a Bush appointee. While many critical decisions about monetary policy are made by the Federal Open Market Committee, the board’s position always prevails.

 

The Treasury secretary also has had breakfast with the Fed chairman on a weekly basis for decades. Consequently, most economists generally believe that every administration ultimately gets the Fed policy it wants. Therefore, one must conclude that if there were errors in Fed policy that caused the current downturn, it must be because the Fed was doing what the Bush administration wanted it to do.

 

To the extent that there were mistakes in housing policy that contributed to the recession, those were necessarily committed by Bush political appointees at the Department of Housing and Urban Development, Fannie Mae, Freddie Mac, and other agencies. To the extent that banks and other financial institutions made mistakes or engaged in fraudulent activity, it was either overlooked or sanctioned by Bush appointees at the Securities & Exchange Commission, the Comptroller of the Currency, the Commodity Futures Trading Commission, and elsewhere.

 

There is a lot more, continue on...

http://www.thedailybeast.com/blogs-and-sto...aced-rage/full/

 

[The Poojer]

i think that is kind of a mixed argument....the town hall dissention is based on the health care issues, not the economy....of course the economic mess cannot be pinned on the current president.....but that's not where the dissent is rooted

 

Bruce Bartlett was one of the original supply-siders, helping draft the Kemp-Roth tax bill in the 1970s. In the 1980s and 1990s, he was a leading Republican economist. He now considers himself to be a political independent.

 

 

There is a lot more, continue on...

http://www.thedailybeast.com/blogs-and-sto...aced-rage/full/

 

[Kelly the Dog]

i think that is kind of a mixed argument....the town hall dissention is based on the health care issues, not the economy....of course the economic mess cannot be pinned on the current president.....but that's not where the dissent is rooted

 

I don't think most of the real anger at the town halls is more about the health care issue than it is a bubbling over of frustration based on a bad economy -- a bad future deficit problem -- previous and current bailouts -- excess spending -- and changes to policy that people don't understand -- combined with a hatred for Democrats from the most vocal. Now they hear about health care (mostly misinformation IMO) and it all hits the tipping point.

[Wacka]

I've seen it all -blaming the anger at the biggest Socialist grab in history on Bush. Kelly, what the hell do you do for a living that has your lips so welded to Obama's ass?

[Kelly the Dog]

I've seen it all -blaming the anger at the biggest Socialist grab in history on Bush. Kelly, what the hell do you do for a living that has your lips so welded to Obama's ass?

It's from a renowned lifelong conservative (now independent), supply-side economist, cretin, who worked in the Reagan and GW Bush administrations. "In January 1977, Bartlett went to work for Congressman Jack Kemp (R-New York) as staff economist. Bartlett spent much of his time on tax issues, helping to draft the Kemp-Roth tax bill, which ultimately formed the basis of Ronald Reagan's 1981 tax cut."

 

Not any of them are my words.

 

Sure, it's wiki but it's still a rather straight forward review of his career

[Alaska Darin]

I've seen it all -blaming the anger at the biggest Socialist grab in history on Bush. Kelly, what the hell do you do for a living that has your lips so welded to Obama's ass?

KTFABD's politics aside, why not try refuting the points? Let me guess...Because you can't?

 

I know it's hard for you apologists to admit that the idiots you follow screwed things up royally but that's reality. Now you can complain about the current administration but it falls on deaf ears because of what happened when your guy was in charge.

 

Welcome to reality. Republicans suck. Democrats suck. The people who blindly follow each suck even more. In case you were wondering, that's you.

[Kelly the Dog]

This is another nice little portion for those who didnt read the link...

According to the CBO, federal taxes will amount to just 15.5 percent of GDP this year. That’s 2.2 percent of GDP less than last year, 3.3 percent less than in 2007, and 1.8 percent less than the lowest percentage recorded during the Reagan years. If conservatives really believe their own rhetoric, they should be congratulating Obama for being one of the greatest tax cutters in history.

 

Conservatives will respond that some tax cuts are good while others are not. Determining which is which is based on something called supply-side economics. Because I was among those who developed it, I think I can speak authoritatively on the subject. According to the supply-side view, temporary tax cuts and tax credits are economically valueless. Only permanent cuts in marginal tax rates will significantly raise growth.

 

On this basis, we see that Bush’s tax cuts were pretty much the opposite of what supply-side economics would recommend. The vast bulk of his tax cuts involved tax rebates—which failed in 2001 and again in 2008, because the vast bulk of the money was saved—or tax credits that had no incentive effects. While marginal rates were cut slightly—the top rate fell from 39.6 percent to 35 percent—it was phased in slowly and never made permanent. Neither were Bush’s cuts in capital gains and dividend taxes.

[Magox]

I don't think most of the real anger at the town halls is more about the health care issue than it is a bubbling over of frustration based on a bad economy -- a bad future deficit problem -- previous and current bailouts -- excess spending -- and changes to policy that people don't understand -- combined with a hatred for Democrats from the most vocal. Now they hear about health care (mostly misinformation IMO) and it all hits the tipping point.

with this I agree.

[GG]

Lies, damn lies & statistics?

 

Let's shed some more color on the numbers that Bartlett uses. In some respects we're living in extraordinary times where we've witnessed two asset bubbles within a decade. The primary difference is that the dot com bubble was an equity based catalyst, while the housing bubble was a debt driven catalyst. The differences are very important in how they relate to the budget, and obviously the overall economy and the downside risk.

 

So, the run up in revenues from the effect of the tech bubble, especially the cap gains taxes fueled gov't revenues in Clinton's term much higher that the real estate bubble of Bush's terms. So using data that shows outlays as % of GDP is misleading, unless you equalize the revenue streams.

 

A better comparison would be to analyze the increase in expenses year over year. In this case, Clinton's increases were also smaller than Bush's over the 8 years. But a closer inspection reveals that the biggest reason Clinton's cost increases were smaller was his axe to the DoD budget. But we can argue how effective that peace dividend was over a longer term.

 

Another interesting note is that taking DoD out of the equation, Clinton's spending on Human Resources (bigger budget item than DoD) was running well ahead of Bush in Clinton's first 3 yrs in office. Suddenly he reversed course in '95. Wonder what happened.

 

So, in the end, there's no denying the budget run up in Bush's years, as the economic growth that was envisioned evaporated, much like Clinton's growth. Unfortunately, debt-based bubbles take a much longer time to cycle through the economy, so the revenue figures will be down for some time. But I just wanted to poke some obvious holes in Bartlett's numbers.

 

Never believe statistics blindly.

[finknottle]

Never believe statistics blindly.

 

No, believe them.

 

But you have to understand what they say and what they don't say. And that is where the analytical illiteracy of America is coming home to roost.

[Kelly the Dog]

Lies, damn lies & statistics?

 

Let's shed some more color on the numbers that Bartlett uses. In some respects we're living in extraordinary times where we've witnessed two asset bubbles within a decade. The primary difference is that the dot com bubble was an equity based catalyst, while the housing bubble was a debt driven catalyst. The differences are very important in how they relate to the budget, and obviously the overall economy and the downside risk.

 

So, the run up in revenues from the effect of the tech bubble, especially the cap gains taxes fueled gov't revenues in Clinton's term much higher that the real estate bubble of Bush's terms. So using data that shows outlays as % of GDP is misleading, unless you equalize the revenue streams.

 

A better comparison would be to analyze the increase in expenses year over year. In this case, Clinton's increases were also smaller than Bush's over the 8 years. But a closer inspection reveals that the biggest reason Clinton's cost increases were smaller was his axe to the DoD budget. But we can argue how effective that peace dividend was over a longer term.

 

Another interesting note is that taking DoD out of the equation, Clinton's spending on Human Resources (bigger budget item than DoD) was running well ahead of Bush in Clinton's first 3 yrs in office. Suddenly he reversed course in '95. Wonder what happened.

 

So, in the end, there's no denying the budget run up in Bush's years, as the economic growth that was envisioned evaporated, much like Clinton's growth. Unfortunately, debt-based bubbles take a much longer time to cycle through the economy, so the revenue figures will be down for some time. But I just wanted to poke some obvious holes in Bartlett's numbers.

 

Never believe statistics blindly.

I thought the comparisons to Clinton were easily the least strong elements of the piece, for numerous reasons, some of which you articulated. But I've been reading, and believe, much of the general theses of the piece: 1] that the vast majority of the problems we have now and in the future are a great deal due to not only Bush policies but previous policies that the present administration inherited rather than crazy progressive spending -- and 2] that the Republicans statements/actions on the economy is so much more effective than the Democrats is just not true. It simply does not appear to be true in the short term or the long term. Neither are perfect, but neither seem to be much better and most of the stats seem to say that the Democrats do at least as good or better on the economy. And I think this does a good job explaining a lot of it.

 

Also, sometimes people confuse "inherited" with automatically blaming Bush, and often the Obama administration uses that as a slam on Bush when it shouldn't. Even though he may have inherited it, it didn't necessarily mean it was Bush's fault. Some could be traced back to Clinton or the Democrats, and some just to the economy as a whole that had little to do with either party. BUT -- even if they overstate whether or not the Bush years were the cause -- it doesn't diminish the fact that he did indeed inherit it, and he wouldn't be doing a lot of this stuff and spending without those cards dealt to him. The piece actually blames Bush a lot more than I do.

[Kelly the Dog]

No, believe them.

 

But you have to understand what they say and what they don't say. And that is where the analytical illiteracy of America is coming home to roost.

Do you know more about what the stats say and don't say than this guy? Is Bartlett analytically illiterate?

[TPS]

Lies, damn lies & statistics?

 

Let's shed some more color on the numbers that Bartlett uses. In some respects we're living in extraordinary times where we've witnessed two asset bubbles within a decade. The primary difference is that the dot com bubble was an equity based catalyst, while the housing bubble was a debt driven catalyst. The differences are very important in how they relate to the budget, and obviously the overall economy and the downside risk.

 

So, the run up in revenues from the effect of the tech bubble, especially the cap gains taxes fueled gov't revenues in Clinton's term much higher that the real estate bubble of Bush's terms. So using data that shows outlays as % of GDP is misleading, unless you equalize the revenue streams.

 

A better comparison would be to analyze the increase in expenses year over year. In this case, Clinton's increases were also smaller than Bush's over the 8 years. But a closer inspection reveals that the biggest reason Clinton's cost increases were smaller was his axe to the DoD budget. But we can argue how effective that peace dividend was over a longer term.

 

Another interesting note is that taking DoD out of the equation, Clinton's spending on Human Resources (bigger budget item than DoD) was running well ahead of Bush in Clinton's first 3 yrs in office. Suddenly he reversed course in '95. Wonder what happened.

 

So, in the end, there's no denying the budget run up in Bush's years, as the economic growth that was envisioned evaporated, much like Clinton's growth. Unfortunately, debt-based bubbles take a much longer time to cycle through the economy, so the revenue figures will be down for some time. But I just wanted to poke some obvious holes in Bartlett's numbers.

 

Never believe statistics blindly.

I agree somewhat on the point you make about revenues, but not about expenditures. Yes capital gains revenues helped, but weren't necessarily the key driving factor for revenues; otherwise why were personal revenues their highest in 2000 when the market fell that year?

 

As for expenditures, people support democrats because they want to see less spending on defense and more on social; and it's the opposite for repubs. Clinton cut spending, which was focused on defense--duh!

 

Nothing though really refutes Bartlett's main point: ersatz conservatives have been hypocrits when it comes to criticizing Obama's economics while giving Bush2 a free pass.

 

As for the Bush2\Clinton comparison, the most telling number is the growth rate difference. One would be hard-pressed to find another administration with 8 years of performance that poor...

[GG]

I agree somewhat on the point you make about revenues, but not about expenditures. Yes capital gains revenues helped, but weren't necessarily the key driving factor for revenues; otherwise why were personal revenues their highest in 2000 when the market fell that year?

 

For the obvious reason that as the market hit its peak at the end of 1999 (the crash really started in March 2000), people would pay their cap gains in April 2000.