Poll: Bush still blamed for economy

[Machjo]

Quite so, the only recipe for success is to increase taxes and cut spending. Unfortunately, that is also the recipe for political suicide in USA. So I don't see that happening.

It will happen sooner or later. Sooner or later, an eloquent gloom and doom candidate with a Churchillian flare for making people rally in favour of sacrifice will come onto the scene. Once people realize it's either that or watch the value of their currency melt before their eyes, with the risk of uncontrolled inflation, I think they'll finally opt for a tax increase and spending cuts as a much lesser evil. It's just a question of when that candidate will come onto the scene. It might also require the beginnings of a monetary meltdown before people take him seriously, a little like Churchill himself being rejected until it became obvious to the people that was was inevitable.

 

[Machjo]

Who was in charge when the Berlin Wall came down? Who brought back a sense of pride and patriotism to America after the limp-wristed presidency of J. Carter? (Who had to rely on Canada to get his diplomats out of Iran). I believe it was Ronald Reagan.

There's more, but I have to watch the Olympics.

Reagan was outdone only by Bush Jr. when it came to debt spending!

 

[SirJosephPorter]

I'd rephrase that as "One of Obama's big mistakes came in bailing out the bankers."

Now this is where you are wrong. Anyway, I think it was Bush who did most of the bailing out of banks. But it was essential; we were staring down the face of disaster.

If anything, Bush was too slow in bailing out the bankers. His main mistake was not to bail out Lehman Brothers. Not bailing out Lehman Brothers played well with Main Street, with average person, who was happy to see the bankers get it in the neck.

Unfortunately, that also played havoc with Wall Street and with financial sector in general. After Lehman Brothers went belly up, the credit market froze up completely, all the lending stopped. Nobody was lending to anybody.

When the flow of credit stops, economic ruination is certain to follow. Stop the credit flowing for a couple of weeks and the result is a depression. We were literally staring down the face of depression. It was essential to bail out the banks and to do it quickly. Hence the speed with which Bush got the stimulus package passed.

In the hindsight, if Bush had bailed out Lehman Brothers with a few billion dollars, the stimulus package (worth a few hundred billion) probably would not have been necessary. But the politics of it was wrong; rescuing Lehman Brothers was tantamount to political suicide.

Once Lehman Brothers went belly up, rescuing of the banks was essential to avoid a deep depression.

 

[lone wolf]

Now this is where you are wrong. Anyway, I think it was Bush who did most of the bailing out of banks. But it was essential; we were staring down the face of disaster.

http://www.nytimes.com/2009/02/09/business/09bailout.html

http://www.msnbc.msn.com/id/29415050/


Whatever you do, Potty, don't let facts get in the way of your own agenda. Obama approved the second ... and he was Prez when the banks went right back to their self-congratulatory way.

 

[Machjo]

Now this is where you are wrong. Anyway, I think it was Bush who did most of the bailing out of banks. But it was essential; we were staring down the face of disaster.

If anything, Bush was too slow in bailing out the bankers. His main mistake was not to bail out Lehman Brothers. Not bailing out Lehman Brothers played well with Main Street, with average person, who was happy to see the bankers get it in the neck.

Unfortunately, that also played havoc with Wall Street and with financial sector in general. After Lehman Brothers went belly up, the credit market froze up completely, all the lending stopped. Nobody was lending to anybody.

When the flow of credit stops, economic ruination is certain to follow. Stop the credit flowing for a couple of weeks and the result is a depression. We were literally staring down the face of depression. It was essential to bail out the banks and to do it quickly. Hence the speed with which Bush got the stimulus package passed.

In the hindsight, if Bush had bailed out Lehman Brothers with a few billion dollars, the stimulus package (worth a few hundred billion) probably would not have been necessary. But the politics of it was wrong; rescuing Lehman Brothers was tantamount to political suicide.

Once Lehman Brothers went belly up, rescuing of the banks was essential to avoid a deep depression.

Why bail out the rich? Why not have put that money into providing education in a trade or profession for the unemployed. That way, it would have helped the most vulnerable Americans rather than the rich. How does bailing out the banks help anyone other than the upper classes mostly, maybe some of the middle classes, maybe even some of the lower classes. But bailing out the banks certainly does nothing for the most destitute. We could argue as capitalists that no one should get a bailout. Fair enough. But socialists would argue that only the most vulnerable should get a bailout. So whether you're a capitalist or a socialist, it's pretty clear that none but the most destitute should get a bailout, if anyone should get a bailout.

When we start bailing out the banks, then we know who's really running the country.

 

[SirJosephPorter]

It will happen sooner or later. Sooner or later, an eloquent gloom and doom candidate with a Churchillian flare for making people rally in favour of sacrifice will come onto the scene. Once people realize it's either that or watch the value of their currency melt before their eyes, with the risk of uncontrolled inflation, I think they'll finally opt for a tax increase and spending cuts as a much lesser evil. It's just a question of when that candidate will come onto the scene. It might also require the beginnings of a monetary meltdown before people take him seriously, a little like Churchill himself being rejected until it became obvious to the people that was was inevitable.

I don't see such a candidate coming up. I think USA needs to have a monetary meltdown first, before people will agree to the austerity measures of tax increases and spending cuts.

Unless there is a monetary meltdown (run on the US dollar, US defaulting the loan payments, stock market crashing a few thousand points in a day etc.), I don't think people will be willing to make the necessary sacrifices.

Once people see that their living standard is in serious danger, only then they will agree to the sacrifices.

 

[Machjo]

I don't see such a candidate coming up. I think USA needs to have a monetary meltdown first, before people will agree to the austerity measures of tax increases and spending cuts.

Unless there is a monetary meltdown (run on the US dollar, US defaulting the loan payments, stock market crashing a few thousand points in a day etc.), I don't think people will be willing to make the necessary sacrifices.

Once people see that their living standard is in serious danger, only they they will agree to the sacrifices.

You might be right. But once that begins to happen, certainly such a candidate will appear on the scene, or one who was previously ignored will finally be taken seriously.

And if the two major parties stick to their current policies, many Americans might then make a run for some independent candidates willing to stick their heads out for the people.

Of course, once that happens, the parties will likely smarten up too to try to regain any votes lost to independents.

 

[SirJosephPorter]

Why bail out the rich? Why not have put that money into providing education in a trade or profession for the unemployed. That way, it would have helped the most vulnerable Americans rather than the rich. How does bailing out the banks help anyone other than the upper classes mostly, maybe some of the middle classes, maybe even some of the lower classes. But bailing out the banks certainly does nothing for the most destitute. We could argue as capitalists that no one should get a bailout. Fair enough. But socialists would argue that only the most vulnerable should get a bailout. So whether you're a capitalist or a socialist, it's pretty clear that none but the most destitute should get a bailout, if anyone should get a bailout.

When we start bailing out the banks, then we know who's really running the country.

You got it Machjo. Like it or not, but banks do run the country. When credit market freezes up completely, you are looking at deep, long lasting depression.

Not bailing out banks would have been cutting off one’s nose to spite someone else. If credit market had remained frozen, millions (or tens of millions) of people would have lost their jobs within a matter of weeks. The same people who are now blaming Bush and Obama for bailing out banks would have been screaming bloody murder, wanting to know why the banks were not bailed out and a depression avoided.

So like it or not, it is the Wall Street which rules the economy. You cannot have a rich, vibrant economy without Wall Street being happy.

 

[Machjo]

You got it Machjo. Like it or not, but banks do run the country. When credit market freezes up completely, you are looking at deep, long lasting depression.

Not bailing out banks would have been cutting off one’s nose to spite someone else. If credit market had remained frozen, millions (or tens of millions) of people would have lost their jobs within a matter of weeks. The same people who are now blaming Bush and Obama for bailing out banks would have been screaming bloody murder, wanting to know why the banks were not bailed out and a depression avoided.

So like it or not, it is the Wall Street which rules the economy. You cannot have a rich, vibrant economy without Wall Street being happy.

Because we have chosen to make it so. If that same government money would have gone towards job training for the unemployed, it would have created jobs in the education sector. The unemployed attending these schools would have received a temporary government income to pay the rent, buy food, etc, again putting money into the economy and creating jobs. And since those unemployed, at least while in training, would not be looking for work, that would make it easier for the rest to find work. Looking at it that way, it would have had a similar effect on the overall economy as a bank bailout or auto industry bailout. The main difference though is that instead of the middle to upper classes benefiting from it, the most destitute would have, resulting in a less extreme wealth gap in the society. Also, as for once the recession is over, it would mean that these newly trained workers would be ready for the new high tech jobs coming on the scent. It would also have meant less crime since the less education would then be more educated and thus more employable and so less likely to commit crime in the fist place. This could have brought about great savings in the economy later. It would have been a real investment in educating the population.

Instead, the poor remain unemployed while the banks are secure. Once the recession is over, these poor will be even poorer, going back into the same jobs as before, likely to become unemployed again come the following recession, poorer, no better educated, and more likely to engage in crime. In the end, the government will have nothing to show for its debt but interest payments, with the banks confident that they can do what they want and will get a bailout next time they screw up.

So, the government goes into debt, invests little, sends a bad message of impunity to the banks, and still leaves the poor destitute.

 

[lone wolf]

You got it Machjo. Like it or not, but banks do run the country. When credit market freezes up completely, you are looking at deep, long lasting depression.

Not bailing out banks would have been cutting off one’s nose to spite someone else. If credit market had remained frozen, millions (or tens of millions) of people would have lost their jobs within a matter of weeks. The same people who are now blaming Bush and Obama for bailing out banks would have been screaming bloody murder, wanting to know why the banks were not bailed out and a depression avoided.

So like it or not, it is the Wall Street which rules the economy. You cannot have a rich, vibrant economy without Wall Street being happy.

How much would your own investments suffer if US banks failed? Too bad about you if a public awakening has to come to wizen them.

 

[Machjo]

y investments are globally distributed, so a failure in the US alone would hurt them only a bit. Of course the worldwide recession dropped them considerably, but I'm sure they'll bounce back, as they've stated to do already.

However, I'm not going to ask the government to bail me out as long as I have a roof over my head. We should be thankful for what we have and though I'm not necessarily a socialist, I'd still say that if (with emphasis on 'if') the government helps anyone, it should always be the most destitute, or no one at all. But certainly not the bankers, and not me either. I might not be rich, but I'm certainly not poor either, and so I'm not the one government should be helping if it helps anyone.

 

[JLM]

JLM, we can only speculate, we cannot know for sure. However, I have reasons to believe that if Gore had won in 2000, American economy would be markedly different today.

The first thing Bush did (with the support of the Republican Congress) was to get rid of all the surplus and enact huge tax cuts, mainly benefiting the rich. Gore would never have done that. At that time, fiscally responsible attitude (foisted by Clinton) was prevalent in the Democratic Party. Gore would not have enacted the crazy tax cuts and would have continued running healthy surpluses.

Indeed, if you want to see how USA would have performed under Gore, you only have to look at Canada. When Bush was in office in USA, Liberals were in power in Canada, they were running the economy in a responsible manner. While Bush was racking huge deficits, Liberals were building up healthy surpluses.

Today, the economic downturn is much milder in Canada compared to USA; one of the reasons is the prudent fiscal management by the Liberals. Gore would have been no different. Bush laid the foundation for the current meltdown with his crazy tax cuts. If Gore had been the president from 2000 to 2008, the economic downturn in USA today would have been much milder. Gore would have continued running a surplus right until the recession hit. Even after that, if he had to run a deficit, it would have been much smaller than what they have today.

Also, Gore would not have taken USA into the pointless, insane war in Iraq. That would have resulted in saving huge amounts of money.

Probably some truth in what you say but still the bulk of the problems is still attributable to the sub prime mortgages and C.E.O.s taking obscene bonuses. I don't know how much the war in Iraq cost but probably not nearly as much as people imagine as the military is getting paid regardless, maybe just the cost of a little more fuel and some gun powder........................:lol:

 

[JLM]

I'd say I blame both, but Bsh more so far, since he's responsible for a larger chunk of that debt that Obama is, not to mention that Obama is responsible for cleaning some of Bush's messes.

That said, I still say Obama is partly to blame in that he chose to expand the debt even farther, even if not nearly as much as Bush did.

Have you ever tried to turn around without going any further in the direction you're going?

 

[JLM]

Stimulating the economy is fine, as long as you can do it without pushing the debt, interest rates, or inflation up. I can see only a few ways to do that, one being a tax increase, and the other being that the government spend in such a way as to invest the money, such as in education, to ensure that a qualified workforce comes out of the recession so as to be able to stave off inflation later.

Reducing taxes is fine too, as long as it's done after the debt is paid off, with inflation and interest rates under control. Any tax reduction should come not as a first step towards helping an economy, but rather as a reward for a job well done in having paid off the debt while keeping inflation and interest rates down.

With the US debt as it now is, now would not be the time to reduce taxes, nor is it the time to increase spending.

I think if you want to work your way out of a recession, reducing taxes is wise as pretty well everyone knows the people spend money wiser than the gov't. can and when the money is in the hands of the people, employment is created as when goods are purchased and tradesmen are hired. Better that way than just topping up the trough.

 

[Machjo]

Have you ever tried to turn around without going any further in the direction you're going?

To be fair to both Bush Jr. and Obama, granted neither of them has absolute power, and in the end they themselve are only partially to blame, with each member of the Senate and the House of Representatives carrying some of the burden of blame too.

Also, I agree that at least in the sort term, let's say over the first year, there may be a transition phase where it's not possible to stop the deficit overnight. After a year though, you would have thought that some other plan of action could have been implemented. Again, I realize it's not all Obama's fault, but the government's as a whole.

It would be like trying to blame Harper for everything when he's but one Member of Parliament.

 

[SirJosephPorter]

Probably some truth in what you say but still the bulk of the problems is still attributable to the sub prime mortgages and C.E.O.s taking obscene bonuses. I don't know how much the war in Iraq cost but probably not nearly as much as people imagine as the military is getting paid regardless, maybe just the cost of a little more fuel and some gun powder........................:lol:

Sub prime mortgages was the problem. Obscene CEO bonuses was not the problem. Sure it looked bad, the optics were terrible, but bonuses did not contribute to the economic meltdown.

It was the general atmosphere of deregulation, the attitude of letting Wall Street do anything they want, that led to their taking excessive amount of risk and branch into sub prime mortgages.

With Gore, there would have been more regulation and chances are cub prime crises would not have hit.

The problem was not that Bush and Obama rescued banks, it had to be done. The problem was that Bush totally failed to regulate banks. In Canada we regulate our banks pretty strictly, that was one of the reasons why our banks were involved with sub prime mortgages only minimally.

Wall Street must be left alone to work the magic of capitalism to make money. At the same time, unbridled capitalism is bad, it can lead to economic meltdown, and Wall Street must be regulated. That is where Bush failed miserably; he did not go wrong when he rescued the banks, that had to be done, to avoid a depression.

 

[Machjo]

I think if you want to work your way out of a recession, reducing taxes is wise as pretty well everyone knows the people spend money wiser than the gov't. can and when the money is in the hands of the people, employment is created as when goods are purchased and tradesmen are hired. Better that way than just topping up the trough.

I agree that in normal times of recession, we would normally want to either reduce taxes or keep them as is, but certainly to raise them. I'd argue though that for the US, we're not talking about normal times of recession. They have a massive bloated debt they must pay, and reducing taxes would do nothing for that. I could see no increase in taxes until they're out of recession I suppose, but once the recession is over, they'll have no choice but to increase taxes to pay off the debt.

Now as for creating employment, again, I agree that, exceptions aside, and assuming moderation in all things, it's preferable to lower taxes and let the private sector deal with it. But again, in cases of massive government debt, lowering taxes is just not an option, though reducing government spending is essential, with that money going towards paying off the debt. If counter-inflationary spending is needed in a time of sever debt, then printing money and redirecting it towards the debt could be an option, again only in times of out-of-control deflation and dropping interest rates of course.

 

[SirJosephPorter]

It would be like trying to blame Harper for everything when he's but one Member of Parliament.

Don’t compare Harper with Bush or Obama, our system is totally different. While you have a valid point when you say that Bush and Obama don’t have unbridled power, the same cannot be said of Harper.

In USA, president can only propose legislation; it is up to Congress to pass it. There is no guarantee that president’s own party will support the legislation proposed by him.

In our system, the PM has considerable amount of powers, much more than a US president. He sets the policy, the agenda, and it pretty much is enacted into law. Even in the minority situation, most of what Harper proposed was enacted into law.

So if things go wrong here, it would be totally appropriate to blame Harper (or if things go right, he gets the credit).

 

[Machjo]

Sub prime mortgages was the problem. Obscene CEO bonuses was not the problem. Sure it look bad, the optics were terrible, but bonuses did not contribute to the economic meltdown.

It was the general atmosphere of deregulation, the attitude of letting Wall Street do anything they want, that led to their taking excessive amount of risk and branch into sub prime mortgages.

With Gore, there would have been more regulation and chances are cub prime crises would not have hit.

The problem was not that Bush and Obama rescued banks, it had to be done. The problem was that Bush totally failed to regulate banks. In Canada we regulate our banks pretty strictly, that was one of the reasons why our banks were involved with sub prime mortgages only minimally.

Wall Street must be left alone to work the magic of capitalism to make money. At the same time, unbridled capitalism is bad, it can lead to economic meltdown, and Wall Street must be regulated. That is where Bush failed miserably; he did not go wrong when he rescued the banks, that had to be done, to avoid a depression.

Again, providing job training for the unemployed would have created jobs for teachers and others in education while preparing the workers for the coming boom. The temporary incomes these workers would get during their training would also have gone into the economy creating yet more jobs, especially in those communities that are hardest hit.

 

[darkbeaver]

Paying off the American national debt is impossible. To end the recession just add total global war and bake in an unstable environment for as long as it takes to off four billion unprofitable humans.