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Saturday, September 4, 2010

Quotation of the Week

The rich are better off with a smaller percentage of a fast-growing economy than a larger share of an economy that’s barely moving.
Found here.

Comments (11)

I prefer the David Bragdon man-behind-the curtain moment,

"Our job growth is sluggish compared to the rest of the country.” Bragdon went on to say that Portland’s downtown office and retail vacancy rates were “alarming” and indicated that the city and state were “pointed the wrong way.”

Read more: http://www.enzymepdx.com/2010/david-bragdon-portland-farewell/#ixzz0ybWzuN5q

If you look at what happened during the Clinton years you see the following.

1. Taxes were increased on the wealthiest Americans.
2. The Estate Tax was in full force.
3. A large number of multi-millionaires were created and the economy prospered.
4. The deficit was erased and G. W. Bush was given a surplus which he promptly squandered and created huge deficits, a financial crisis and the worst recession since the Great Depression.
5. A tremendous number of jobs were created.
6. Poverty declined.

So, which do you prefer, Bush policy or Clinton policy? (It's not that difficult a question)

The article is one of the best in terms of explaining what happened and why a policy of stopping the trend towards concentration of wealth and income must occur if the U. S. is to prosper, and why stopping it will benefit even the wealthiest of Americans.

I understand this post will get several hystical, sarcastic, emotional responses. What it won't get are counter-vailing facts. And don't cite Reagan. In 1982 he signed into law what was at that time the largest tax increase in American history.

I would expect that also applies to low income and therefore suspect the best way to improve low income people's lives to to grow everyone's standard of living as fast as possible.


The Clinton years were far from perfect for the poor. According to the U.S. Census Bureau, poverty rates did decline between 1992 to 2000, but most of that decline was for children under 18 years of age (which went from about 23% down to about 16%). That's a good thing, but the rates for seniors (64+) and people between 18 and 64 both went from about 12% to about 10%. which isn't exactly a huge decline. They went down that much or more during the Reagan administration, and — in fact — the rate for people 18 to 64 was practically the same in 1989 as it was in 1999. Clinton just brought it back down to where it had been before the 1990 recession.

Then there was the whole "end of welfare as we know it" stunt. NAFTA. Fiscal deregulation. And a variety of other policies that laid some of the seeds of what would lead to financial ruin during the Bush years.

And -- again according to the Census -- income inequality continued its rise throughout the years. The ratio of average household income of the top 10% vs. the bottom 10% was 10.34 in 1992. It was 10.58 in 2000. By 2008 it was 11.37.

So sure, I think Bush's policies were worse than Clinton's, but there were a lot of people left hanging during the Clinton years, despite what was for many a boom time. That boom fell on the backs of a lot of people who'd been left in the cold in the '80s. Lots of forest workers, factory workers, and other people across the country who lost their livelihood during the Reagan era never got back to where they were. Some of their kids -- who are adults themselves by now -- never even had the opportunities that their parents had.

Unfortunately for the Clinton economic legacy, Robert Reich wasn't the Robert that got the most respect in terms of policy. That would be Bob Rubin. And I know that there are a lot of people who contributed time, effort, money, and votes to the Clinton campaigns who would take an attempt to paint his accomplishments as some sort of untarnished victory with a big grain of salt.

Clinton?? Bush??? I thought this was all Obama's fault.

Bloomberg News is reporting that by a point last year, the government response to the financial meltdown of 2008 in terms of all money spent, lent, or guaranteed, was 12.8 trillion.
Apologists for this financial rescue of these institutions from their own greed, like to cite the payback of TARP, and yes, 700 billion is part of the original 12.8 trillion.
But that ignores what really happened: The elite bankers of this country and abroad have still used over government - the taxpayers - to the tune of 12 trillion.
Of course, they immediately returned to outrageous bonuses and their gambling on derivatives and the like. They are still very rich, and never faced any consequences for their deeds, which amounted to fraud - the selling of a product with a triple-A rating that they knew was not worthy of it.
They're out there right now buying mansions or a soccer team for one of their kids.
So to ponder how the rich could be doing better - after what they brought on this country - is a sure path to madness.

But that ignores what really happened: The elite bankers of this country and abroad have still used over government - the taxpayers - to the tune of 12 trillion.
JK: Of course the irony of this is that, in large part, the whole housing implosion was caused by government planners. It is not widely known, but the housing bubble was far more severe in places with severe government restrictions of land use. Like Oregon and California among others.

Here is what one Nobel economist said:
In Flatland, which occupies the middle of the country, it's easy to build houses. When the demand for houses rises, Flatland metropolitan areas, which don't really have traditional downtowns, just sprawl some more. As a result, housing prices are basically determined by the cost of construction. In Flatland, a housing bubble can't even get started.

But in the Zoned Zone, which lies along the coasts, a combination of high population density and land-use restrictions - hence "zoned" - makes it hard to build new houses. So when people become willing to spend more on houses, say because of a fall in mortgage rates, some houses get built, but the prices of existing houses also go up. And if people think that prices will continue to rise, they become willing to spend even more, driving prices still higher, and so on. In other words, the Zoned Zone is prone to housing bubbles.

By PAUL KRUGMAN, That Hissing Sound, August 8, 2005, New York Times

Don’t miss the links in this article: http://ti.org/antiplanner/?p=3487 and ti.org/antiplanner/?p=2433

So lets all give a big Bronx cheer to the planners for almost destroying the world’s economy. Just like they have done to Oregon.


Individuals give too much unwarranted credence to Clinton for the 1990s economy. Likewise, the rich, as always, can afford to pay more and should unless they can show they are investing 51% of their investment portfolio in companies who create American jobs, not cheaper prices at Wal-mart.

The real drivers for the 1990s economy was the mainstreaming of home computers and the catastrophic rise of the Internet. Tons of new industries were created overnight due to these two factors. Also, the housing bubble that crashed in 2008 started circa 1995.

Bush's presidency had the housing bubble. I often find myself wondering, what if 9/11 never happened and Bush never became a wartime President as a result? I think Bush would have been a one and done president just as Obama is appearing to me.

Sad reality, I don't think we will see another economic bubble equivalent to the dot com boom of the 1990s or the housing bubble from 1995-2008.

Oh, just imagine if Obama had hired Reich and Krugman instead of Geithner and Summers.

I imagine Krugman would shoot everyone earning more than $250,000 a year and Reich would rifle through their pockets and pry out their fillings.

Public universities should be free; in return, graduates would then be required to pay back 10 percent of their first 10 years of full-time income.

That stupid. How would that be any better than being saddled with student loan payments now? When I first got into the workforce after college, I couldn't afford to make my student loan payments.

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