The Therapy Sessions
Tuesday, September 16, 2003
Is Bush To Blame?
Let's get one thing straight: I am not a big Bush fan. I think his foreign policy approach is the right one, but I think he has gone overboard with federal spending and future generations (me and my children) will pay for this. He shows signs of being a protectionist (which I abhor), and he is a little too cozy with his business associates and the Christian right.
But I will almost certainly vote for him anyway. The safety of my nation is paramount, and the Democrats have proven their incompetence in this regard (and come to think of it, they aren't fiscally responsible either). The Democrats have become the new isolationists.
I can be fair towards Bush, and I generally find him lacking. But some criticism of Bush is way overboard.
Jay at Shared Thought believes that the all powerful president had a choice between sluggish growth and a vibrant economy. He choose poorly, says Jay. He says that the jobless recovery has lasted much too long, and that high budget deficits and the high interest rates to which they might lead will hamper further recovery.
I agree with parts of what he says. But I don't believe that presidential policies have much effect on the economy. The money involved is too small as a percentage of GDP to have much effect (a 5% increase in federal spending (a spectacular amount) is only 1% of GDP). Presidential policies can have some effects, but they take longer than a presidential term to become manifest. The private economy is much larger than its federal component, and businesses don't usually take their cues from Washington.
And the fact is this: balanced budgets are virtually impossible in a recession. Naturally, revenue decreases and budgets are strained. Tax hikes are toxic to economic growth, and cutting spending doesn't help either (though of the two, cutting spending is the best route - Philadelphia has been trying to tax its way into a balanced budget for years, and it has destroyed its economy as a result).
Most industrialized economies are in worse (and more prolonged) recessions than we have faced in memory, and they are also deeply in the red. More evidence? All of the American states are currently facing
budget crunches, and most are in deficit as well. Some of the states in the red have particularly serious deficits: California and New Jersey come to mind.
The recession is global, and things are a lot better here than they are in Europe or Asia. The hangover from the '90's is not Bush's fault: a company doesn't think about the president's leadership when it decides to begin hiring personnel. It thinks about expenses, and likely payoffs.
Looking at history and blaming presidents for the economy is silly, and I don't do it:
I don't blame Carter for a poor economy. (I blame Carter for a disastrous foreign policy that put his country in danger by weakly trying to split the difference with people who want to kill us).
Likewise, I don't give Reagan credit for the economic boom of the 80's, but I feel he helped long term economic growth along by reducing the size of the state. (The state produces nothing; it only redistributes the available
wealth, sucking out a portion to feed an ever-growing bureaucracy. That isn't economic growth, it is mold).
But Bush has lost focus. His high spending is disastrous, and most of it has little to do with the war. Some make the argument that the government's financial straits will force the government to deal with the entitlements nightmare earlier than it would otherwise. Its impending bankruptcy, they believe, will encourage reform.
But that is reckless: it is a bit like a drunk drinking himself into poverty so that one day he won't have the money to buy booze.
But whenever I get fed up with Bush's spending, I only need to look at the Democrats: on every program, they want to spend MORE. They are more protectionist, and they are beholden to the NEA, AARP and the trial lawyers (who are responsible for the biggest problems in the US today). And they consider national defense to be an afterthought.
Is this the party of JFK? Or Robert Byrd?