From John DeFeo at TheStreet.com, comes these 10 Myths That Politicians Want You to Believe (but you shouldn’t)

10. Quantitative Easing Helps the Economy
Yes, quantitative easing is “printing” money. No, it won’t help the economy. Make no mistake, quantitative easing is a gift to bankers and nothing else. The Federal Reserve is giving bankers risk-free trading profits and causing food and gas prices to surge (making it even harder for Americans to get out of debt).

9. Republicans Are Fiscal Conservatives
From 1946-2010:
Democratic President
* Total Years: 29
* Average Inflation Adjusted Deficit: $150.73 billion

Republican President
* Total Years: 36
* Average Inflation Adjusted Deficit: $202.28 billion

8. President Obama Is an Enemy of Wall Street
* The two men who served as principal negotiators for banking deregulation: Gene Sperling and Larry Summers.
* The two men who President Obama appointed to become his top economic advisers: Gene Sperling and Larry Summers.
* Two guys who happen to be paid millions of dollars in consulting and speaking fees by “too big to fail” banks: Gene Sperling and Larry Summers.

7. The Financial System Is Safer Today Than in 2008
The majority of “too big to fail” banks are even bigger. Meanwhile, high-frequency trading is alive and well and the causes of the Flash Crash have not been addressed.

6. The ‘Bush Tax Cuts’ Increased Tax Revenue
Washington has always had a spending problem, but since the “Bush Tax Cuts,” we have a revenue problem as well. From 1990 to 2000, U.S. tax revenue had a period of exceptional growth. Following the 2001 tax cuts, revenue plummeted — then recovered — then plummeted again.

5. ‘No One’ Could Have Seen the Financial Crisis Coming
No one — except for everyone who did. TheStreet has interviewed numerous economists and money managers who have been pounding the table for years.

4. If You Support Capitalism, You Support Big Business
Can a corporation be socialist? Corporations and governments are very similar entities, and both can have capitalist or socialist leanings. If a politician praises big business while chastising big government, or the other way around, be skeptical.

3. Republicans Are a Bunch of Fat-Cat Millionaires
The average congressperson is a millionaire, and if you break down the 50 richest members of Congress by political party, here’s the split:
Republican: 22
Democrat: 28

2. The U.S. Has the Highest Standard of Living in the World
According to the United Nations’ most recent Human Poverty Index (from 2008), the U.S. standard of living ranks 17 of 19 among developed countries.  The ranking is a composite of life expectancy, literacy, long-term unemployment and income equality — while this data is over three years old, it’s not unthinkable that our situation has worsened in the aftermath of the Great Recession.

1. U.S. GDP Is Growing
U.S. GDP has increased by 4.26% from 2007 to 2010, according to data compiled by the U.S. Bureau of Economic Analysis. In the same period of time, the U.S. national debt has increased by 61.6%, according to the U.S. Treasury. Looking at these numbers, you don’t need to be an economist to see that something is very, very wrong.

We’ve lost our way, misled by Republicans and Democrats alike.

Go read the full article here.

>

Source:
10 Myths That Politicians Want You to Believe
John DeFeo
TheStreet.com  06/07/11   
http://www.thestreet.com/story/11142443/10-myths-that-politicians-want-you-to-believe.html

Category: Markets

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

56 Responses to “10 Myths That Politicians Want You to Believe”

  1. machinehead says:

    ‘We’ve lost our way, misled by Republicans and Democrats alike.’

    These two parties are a shining example of what RICO was supposed to stop.

    It’s not too late!

  2. Concerned Neighbour says:

    Looks like we’re continuing the HFT-driven melt up from yesterday. Perhaps DOW 36K by close? Meanwhile, France isn’t growing and we had the worst consumer confidence rating since 1980. Fascinating to say the least.

  3. wally says:

    “We’ve lost our way, misled by Republicans and Democrats alike.”

    We know this… but today’s faddish third option – the Tea Party – is even worse.

  4. lunartop says:

    Nice, and spot on!

  5. ToNYC says:

    We’ve lost our way, misled by Republicans and Democrats alike.

    How blazingly obvious does it need to be illustrated than this culture is not misled, but rather totally sold out on gaining by not taking risk or working very diligently, but finding the best lubricated social club to avoid dealing with too many other tribes.

  6. number2son says:

    Agreed. And to item #2, it is obvious to anyone who has been paying attention that things have gotten worse since 2008. And given the current political and economic climate, the situation will continue to decline. The only question is how far and how fast.

    Of course, for those who only care about our relative position in this ranking there is always hope that other countries are doing worse. Watch your back, England!

  7. sometimes, a few ‘Pictures’ help communicate the *Point..

    http://dont-tread-on.me/learning-old-lessons/

  8. Concerned Neighbour says:

    This list is very refreshing, and I’ve been arguing many of these points for years. I found it extremely refreshing to hear Roubini lay most of the blame for this mess on Bush in his latest WSJ interview. It’s time to call a spade a spade, and not let extreme partisans on either side cry bloody murder.

    People don’t let facts get in the way of propaganda today. That’s extremely disturbing.

  9. ilsm says:

    Capitalism, I am all for it. Let me know where it is.

  10. Fred C Dobbs says:

    This post is right on, except for two things: who is responsible for which debt, and the standard of living. It advances nothing to waste time discussing the comparative fault and contribution of the two political parties to the growth in the crushing debt, when it is clear that it was the ‘compromisers’ in both parties that gave us and our children this debt to service. Also, it is a waste of time to compare the US to other nations over their relative standard of living. No other nation is comparable, so our own standard of living is incomparable and unique. For example, those nations that rate the highest are typically very small, more or less homogenous, and the overwhelming majority closely sharing common principles. The US is conflicted with large numbers of its population who, within their groups share principles in common that are in conflict with others. For example, the splintered political minority wants to use government to legalize what would otherwise amount to theft of income and property earned by the political majority. For example, Blacks will vote for Obama even if he leads us over a cliff, for they know their claims to entitlement are falling on deaf ears. Norway, Sweden, Finland, Switzerland, Japan don’t have this civil war to deal with.

  11. Francois says:

    “The Federal Reserve is giving bankers risk-free trading profits and causing food and gas prices to surge.”

    Let’s never forget that Brother Obysmal himself twisted a lot of arms to keep BurntWinkie at the helm of the Fed.
    Oh! Let’s not forget the laughable HAMP “program”, another gift to the financial industry while giving flase hopes to struggling homeowners.

    While all this manure is being shoveled at us, events, like grains of sand, keep tumbling and settling up on the mound of history. At any moment, the mound will crumble in a catastrophic fashion, and chaos shall be unleashed. The trigger will be totally unremarkable; it’ll just happen.

    We saw what happen in the UK. Authorities can blather any amount of law and order bullshit they want, but one fact remain: people with a stake in society’s future do not behave like the rioters did.

    How many people in the USA have lost any chance to have stake in society’s future?

    Confy in DC, where money and power overflow from every corner, elites can’t (and won’t) see all this. THey just can’t be bothered…for them, life is just so good right now.

    This is not going to end prettily.

  12. franklin411 says:

    “3. Republicans Are a Bunch of Fat-Cat Millionaires
    The average congressperson is a millionaire,”

    The finances of each party’s congressmen is not what I think of in this case. I think of who the party serves, defined by who has the ear of each party’s leadership. For the Dems, it’s ordinary working people, educators, and high tech innovators. For the GOP, it’s the ultra-rich, foreign corporations, religious nuts, and racists.

  13. VennData says:

    That people don’t like the health insurance reform in the Affordable Care Act…

    http://www.thedailybeast.com/newsweek/2010/02/18/the-polling-contradiction.html

    …however they like each detail in the bill. Increasing intra-state competition, figuring out why there are such wide regional cost differences for identical treatments, identifying the best care options, choose your own physician… etc… etc

    So the GOP media machine running the advertising of the repeal movement focuses on the “backroom deal” the Democrats cut, as shown by sometime-Presidential candidate Huckabee’s “non-profit” ads (that are making him a nice living as an executive in the so-called repeal PAC… )

    http://mobile.salon.com/politics/war_room/2010/12/30/huckabee_scam/index.html

    …but now GOP voter saw the GOP making the political sausage during the debt scream fest and don’t have a leg to stand on, that the backroom deal is the nature of politics, and if you want and end to backroom deals, then support candidates who want openness, like Obama’s…

    http://www.whitehouse.gov/open
    http://www.recovery.gov/Pages/default.aspx
    http://www.whitehouse.gov/the_press_office/TransparencyandOpenGovernment/

    P.S. “Thanks” GOP Supreme Court nominees for removing the financial and operating control from these secretive PACS. Voting has consequences.
    The GOP media machine has one set of values for one issue, then drop that important issue when the situation changes… think about “deficits don’t matter” and you begin to wash the GOP voter sleep from your eyes.

  14. riverrat says:

    “We’ve lost our way, misled by Republicans and Democrats alike.”

    True in a broad sense but this implies that blame is equally shared, which is simply not true.

    Over the past 20 years or so, the Democratic Party as a whole has shifted to more centrist positions, while the Republicans continue to jettison pragmatic centrist members who do not embrace extreme far right positions.

    Make no mistake about it- the Tea Party is a faction of the Republican Party, not a third party. From deregulation, to lack of enforcement of existing regulations, to wildly irresponsible tax cuts and spending on an unnecessary war, the Republicans own our current fiscal situation to a vastly greater extent than the Democrats.

    Sure deficit spending has continued under Obama, who’s been a huge disappointment in his failure to draw lines in the sand on taxes, and putting foxes in charge of the henhouse as noted above. He has also failed to realize how concerned citizens are about debt, and his need to explain why deficit spending is necessary in the short term, coupled with realistic tax structures, to get us out of recession.

    But the policies that got us here are, by and large, Republican policies.

  15. craig.r.jackson says:

    Quantitative easing is not the same as printing money. QE increases the Fed’s assets and increases the Federal government’s liabilities; the transaction must be matched at some point in the future. Printing money to pay government debt would actually reduce government liabilities. Reducing debt would affect the banking system only so far as banks decided to sell their treasury debt back to the government. I highly recommend that the Federal government print money to pay back the debt. It is an easier option with the consequence of lowing the dollar exchange rate than raising taxes. Everyone benefits from government largess from corporations, wealthy individuals, the poor, even the middle class. If no one will accept taxes to pay for the largess, well, then printing money is the only option. It’s better than dramatic spending cuts that cripple economic growth.

  16. [...] Barry Ritholtz directs us to John DeFeo’s Ten Myths Politicians Want you to Believe. The one that jumped out at me was this one: According to the United Nations’ most recent Human Poverty Index (from 2008), the U.S. standard of living ranks 17 of 19 among developed countries. Share this:TwitterDiggFacebookRedditPrintEmailMoreStumbleUponLike this:LikeBe the first to like this post. [...]

  17. AlexM says:

    Another myth:

    We are in trouble because government spending supports the lazy, stupid and poor among us; if we cut off those freeloading bloodsuckers (otherwise known as the poor, which includes homeless veterans, children, the elderly, the sick and disabled, the unemployed and let’s not forget illegal immigrants) we will solve all of our nation’s problems.

  18. machinehead says:

    Printing money to pay government debt would actually reduce government liabilities. — craig r. jackson

    Evidently you are unaware that currency IS a liability. That’s why it shows up on the liability/equity side of the Fed’s balance sheet, not the assets portion:

    http://federalreserve.gov/releases/h41/Current/

    So your proposal amounts to exchanging a short-dated liability for a long-dated one. Kinda like auto-fellatio, if you’re sufficiently flexible !

  19. RW says:

    An excellent list except for #1 which is simply wrong as craig.r.jackson’s comment above points out.

    In that same vein, printing money and lots of it, is exactly what should be occurring right now but isn’t. Bernanke made the economics of depression and Japan’s lost decade(s) his special are of study and, among other things, concluded that huge infusions of cash — ‘dropped from helicopters if needs be’ — was an optimal solution.

    We would have been better off if he had remained consistent when his turn at bat arrived.

    I bow to no one in my disappointment regarding Obama’s conservatism and center-right, Hooveresque policies but he’s a politician so the bad is on me. Bernanke is another matter: He really knew better and, at one time at least, joined logic with conviction …until the crunch came.

    What did the Hare brothers say? Something like, half the failures in life are caused by pulling in ones horse in mid leap?

  20. Raleighwood says:

    Makes me want to vomit …
    ======================

    8. President Obama Is an Enemy of Wall Street
    * The two men who served as principal negotiators for banking deregulation: Gene Sperling and Larry Summers.
    * The two men who President Obama appointed to become his top economic advisers: Gene Sperling and Larry Summers.
    * Two guys who happen to be paid millions of dollars in consulting and speaking fees by “too big to fail” banks: Gene Sperling and Larry Summers.

  21. rktbrkr says:

    myth #11
    Tax breaks for the wealthy benefit those who don’t get tax breaks, the old “trickle down” BS. The wealthy create jobs for the proles, without tax breaks we wouldn’t be able to cut their lawns, staff their yachts.

    reductio ad absurdum – to achieve true prosperity we should eliminate all taxes for the wealthy

  22. ZackAttack says:

    In a socialist system, man exploits man. In a capitalist one, it’s completely the other way around.

  23. DebbieSmith says:

    Here’s an article showing how ineffective quantitative easing has been at propping up Japan’s stock market over the long term:

  24. Tarkus says:

    7. The Financial System Is Safer Today Than in 2008

    > Are they Marking-To-Market those mortgage-backed assets again?

    5. ‘No One’ Could Have Seen the Financial Crisis Coming
    No one — except for everyone who did. TheStreet has interviewed numerous economists and money managers who have been pounding the table for years.

    > And the FBI. In 2004.

    But politicians are middlemen. They do the bidding of others to have enough money to be re-elected.

  25. Junior says:

    I’m seeing alot of this type of mythbusting conversation going on in various places. Does anyone else feel like the conversation is shifting or am I just in a self-created echo chamber?

  26. red eye repub says:

    Does the Tea Party consist of fiscal conservatives?

    Yes. God bless them.

  27. brh1968 says:

    Not sure I agree with the comment on Bush tax cuts. Every graph I have seen on US revenue shows big increase thru 2000, then decrease from 2000 to 2003, then increase from 2003 to 2007, then decrease again. These points match exactly to the stock market action over the period. In other words, the decline in revenue coincide directly with the decrease is earnings attributed to the stock market, on which many people pay tax. Less income from stocks, less taxable income, less revenues. The Bush cuts didn’t come in until 2001 anyway.

    Also, little known fact (but becoming more well known) is that lowering the tax rates kicked many more people into the AMT system, which contributed to tax revenue significantly.

    In short, IMO the decline in tax revenue had nothing to do with the cuts, and everything to do with the stock market declines during the exact same period. Happy to entertain alternative views.

    ~~~

    BR: Its a thoroughly vetted data point, one you don’t even have to adjust for population growth or inflation.

    You are comparing the post Bush tax cuts to a range of accurate revenue forecasts w/o Bush tax cuts, ncluding data from Bush’s own treasury dept.

    They were revenue killers

  28. UncleMilty says:

    On #6: When I hear, “plummet, recover, plummet,” I assume revenues would end up far lower than when they started. But this isn’t exactly true.

    Gov’t Revenue (in Trillions) per http://www.whitehouse.gov/omb/budget/historicals:

    1999: 1.8
    2000: 2.0
    2001: 2.0
    2002: 1.9
    2003: 1.8
    2004: 1.9
    2005: 2.2

    Revenues went down in 2002 and 2003 due to the recession.

    * SNIP *

    ~~~

    BR: FAIL The recession officially ended November 2001.

    You are in the penalty box.

  29. RW says:

    Should have said the first one in the list in my comment above WRT Quantitative Easing — the item is labeled #10 in the list rather than #1 (the countdown schtick, I get it) — but the comment still stands as is: QE is not “printing money’ and that’s a real shame because it would probably have a much greater positive impact on the economy if it was. As it was it stabilized asset prices and helped a bunch of big banks avoid immediate insolvency but wasn’t enough juice to give Households and Main Street the boost they needed.

  30. Soylent Green Is People says:

    #9 isn’t as Truthy as it could be. The real data point is X years Republican control of house X years Democratic control of house, then the same for Senate control. The President has Congress to deal with and more often than not it’s easier to get along than pick a fight in a losing battle. Witness RR and taxe hikes in the 80′s and WJC in the 90′s with Welfare Reform.

    My .02c

    Soylent Green Is People.

  31. Joe Friday says:

    brh1968,

    Not sure I agree with the comment on Bush tax cuts. Every graph I have seen on US revenue shows big increase thru 2000, then decrease from 2000 to 2003, then increase from 2003 to 2007, then decrease again.

    In short, IMO the decline in tax revenue had nothing to do with the cuts, and everything to do with the stock market declines during the exact same period. Happy to entertain alternative views.

    According to the independent non-partisan Congressional Budget Office and the U.S. Treasury Dept, after numerous rounds of tax cuts for the Rich & Corporate:

    Receipts in 2004 … As a share of GDP, they accounted for the smallest proportion since 1959

    http://www.cbo.gov/doc.cfm?index=6002&type=0

    According to the independent non-partisan CBO, the subsequent increase in federal income tax revenue was as a result of a corporate tax cut expiring.

    Once again, other than on Bizarro World, when you cut taxes revenue decreases, when you increase taxes revenue increases.

  32. UncleMilty says:

    On #2, I’m willing to concede we aren’t the highest, but any measure that puts us at 17/19 is a little silly. The inputs to HPI are probability to reaching age 60 (at birth), functional literacy, long-term unemployment and income inequality.

    The Euros have us on literacy as most of them know two languages and our educational system is a mess. As for long-term unemployment, we’re starting to look at lot more like Europe. The probability to reaching age 60 is partly because we have it so good we are all too fat (and lazy) while our extraordinary ability to keep people alive, especially shortly after birth, and our propensity to have children with dissabilities rather than abort them may also contribute. I view these as strengths, not weaknesses.

    Lastly, income equality is a poor measure if our poor have a higher income level than their middle class. We get hammered because if you stay clean, go to college and work hard, America is one of the best places in the world to get rich. We don’t have them all beat, but it’s hard to see where Spain’s (#15 on the list) $30k/yr per capita GDP will hold a candle to us when our worst state (Mississippi) is at 32k/yr. The whole EU averages only 32k.

    We’re not the highest, but we’re nowhere near the bottom. How about including things like median household income, number of people with multiple flat screen TVs and premium cable, number of MRI machines per capita, number of people with dishwashers, etc.

  33. winstongator says:

    The part of #1 that references debt is false. Overall debt in the US, which includes households, financial sectors and government is $52.6T, while it was $52.4T at the end of 2008. Source: http://www.federalreserve.gov/releases/z1/Current/z1r-4.pdf It did increase from 2004-2008 from $37.8T to $52.4T. We as a nation are barely more indebted than we were in 2008 (0.4% increase), but we became much more heavily indebted from 2004-2008, 39% increase. Why the worry about debt today when in 2008 it was not a problem?

    There is a difference between our ‘national debt’ and the ‘debt of the federal government’. Debt is debt. Look at our financial crisis first. It was private sector debt causing problems. Look then to Ireland. Was it gov debt that caused them problems? It was banking sector debt that eventually got absorbed by the government.

  34. jnemonic says:

    #3 is total BS. better to measure voters who identify themselves as republicans not such a small sample of congressmen.

    ~~~

    BR: These are supposed to be myths; are you saying this is true ?

  35. He didn’t really refute #3

  36. Sechel says:

    Glad to hear someone speak the truth about quanitative easing. It’s a gift to the banks who get to front run, nothing else.

  37. UncleMilty says:

    BR: Can I appeal my banishment to the penalty box?

    The data shows that tax receipts often lag the economy as corporate carryforwards are burnt off, capital gains are realized, employment tightness leads to raises/bonuses, etc. A recession ending in November 2001 and a tax receipt rebound in 2003 is pretty normal. The most recent recession started in 2007 but 2008 tax receipts were only 2% lower.

    My point, which you cut-off, was that the Bush tax cuts did lower revenues compared to if we had kept Clinton’s tax policy. But the media, and the article you posted, twist that to suggest that absolute tax receipts are lower than they were under Clinton. This is untrue. The same line of thinking also suggests that the high earners are paying less in relative and absolute dollars. This is also untrue.

    As you preach to us so often, I’m just trying to follow the data.

  38. ToNYC says:

    In a socialist system, man exploits man. In a capitalist one, it’s completely the other way around.

    I go you one better by changing the original from “man” to “more men”.
    I’ll pay my royalties to the author, and I’ll take the cover.

    In a socialist system, more men exploit man. In a capitalist one, it’s completely the other way around.

  39. NMR says:

    “The whole EU averages only 32k.”

    Uncle Milty needs to be introduced to the social wage. Spaniards, for example, receive lots of in kind benefits that the residents of MS don’t.

  40. UncleMilty says:

    To NMR: As I understand it, per capita GDP is the total country’s output divided by some measure of the population. This is not neccessarily the amount of wages/benefits earned/given to each person. Perhaps this is part of Spain’s problem…they don’t realize that somene has to actually produce something in order for it to be taxed in order for it to be included in someone’s “social wage.”

    Crazy deficits aside, the fact that so much of Europe’s economy is wrapped up in social hand outs shows how much less in disposable income they have then we do. And the lower income folks get stuck with a nasty VAT tax that our poor and middle class don’t pay (yet). That’s why the Euros have smaller houses, bad teeth and fewer phat screen TVs, dishwashers, air conditioners, etc.

  41. winstongator says:

    Regarding tax receipts, overall nominal tax receipts may have been higher in 2007 than 2000, however there are two key facts to look at. If you look at ‘individual income taxes’ only, AND adjust for inflation, receipts were (using constant 2005 dollars) $1145B in 2000 and $1092B in 2007. Cycle peak to cycle peak, with a 7% increase in population. You have to take out ‘social insurance and retirement receipts’ because Bush didn’t touch payroll tax rates (which happen to be regressive, especially at the highest incomes).

    http://www.gpoaccess.gov/usbudget/fy12/pdf/BUDGET-2012-TAB.pdf
    Use Table 2.1 for the receipts from source and Table 1.3 for the GDP deflator.

  42. StatArb says:

    ….From 1946-2010

    Why not 1910-2010 ?

    Check out the adjusted numbers then and see how Reps vs Dems stand

  43. wojmax says:

    I don’t see anyone moving to the top 18 countries that are so called, ‘better’ than the USofA!

  44. mongbat says:

    9. Congress controls the purse strings. That said, many Republicans are perfectly happy to be the party in minority, so they can pretend to hold back the wave of spending while in fact enjoying the continued centralization of national power.

    8. Obama is an enemy to capitalism, which ultimately makes him an enemy of Wall Street. Summers or any other beard (and really? Summers is your best pick here?) does not change that fact. However, you are perhaps hitting on the SPIRIT of the issue if not the actual facts (like a genuine version of the Dan Rather “Fake but Accurate” claim) which is…

    4. Lots, and LOTS of successful capitalists become crony capitalists once they hit the top. See: GE, Warren Buffett, Bill Gross (I LOVE YOU BILLY! CALL ME!) etc. The incestuous relationship between large companies and Washington is a big problem. And really, it’s created mostly by Washington (See: MSFT’s lobbyist budget pre-Reno antitrust lawsuit vs. post-Reno antitrust suit. MSFT learned their lesson. Nice business you got there, Bill, shame if something happened to it.) That said, it’s disgusting to watch “capitalists” turn to the dark side when they get on top.

    6. We generally cruise in at I think around 18% of GDP no matter what we do. Looking at the 90′s through to 2000 without taking into account massive tax inflows from capital gains during the dot-com boom, amazing nonqualified and to a lesser extent qualified option payoffs selling the stock within a year, AMT past a year and 15% when finally sold, whatever) for employees and contractors, and huge overemployment of tech geeks in their early 20′s making 6 figure salaries, and then comparing it to a 10 year period that included 9/11 and the slowdown in tandem with the dot com bust and topped off with the 2008-2009 debacle is just silly.

  45. nicholsong says:

    4. If You Support Capitalism, You Support Big Business
    Can a corporation be socialist? Corporations and governments are very similar entities, and both can have capitalist or socialist leanings. If a politician praises big business while chastising big government, or the other way around, be skeptical.

    We need more capitalism, not less.

  46. Christopher says:

    …..and until the BIG MONEY is removed from our political system….

    Nothing changes.

    The root of the evil is K STREET.

    K STREET MUST DIE.

  47. AtlasRocked says:

    2001————-
    A liberal website stated that
    $350B of tax revenue was lost
    due to these Bush tax rate
    cuts in 2001-2.
    http://www.ctj.org/pdf/bushtaxcutsvshealthcare.pdf
    The deficit for 2002-3 was
    about $500B total, so we could
    throw in another $150B on
    the Bush tax cuts for a
    total of $500B deficit.

    The GDP growth peaked at 6%
    2 years after the Bush tax rate
    cuts, settled at 2-4%, and tax
    revenues were closing the deficit
    gap.

    2008————-
    Deficit spending went up from
    $400B in 2008, up to
    1.4 + 1.3 trillion = $2.7 trillion
    deficit in 2009-10. The deficit
    increase was over $2Trillion.

    Obama did about $2 trillion dollar deficit spending increase
    and now the GDP growth is .5%.

    So, 2 years after Bush’s $350B of tax-cut induced deficit, we got 2-4% GDP growth and a
    contracting yearly deficit trend.

    Two years after Obama’s $2 trillion of deficit spending, we got .5% GDP growth and the yearly
    deficit is not contracting.

    Disclaimer: Both the fiscal policies of Bush and Obama were fiscal failures. I left the Republican party in 2004 because Bush could not reign in social spending. Social spending increases were 3.5X higher than defense spending increases FOR TWO WARS under Bush.

  48. victor says:

    Sad to see several political partisan comments: My party is good, yours is bad. Imagine the partisan posturing if we had a multi-party system like in many European democracies.

    About #2 @wojmax , agree, still, “everybody wants to come to America”. Combine this with BR’s suggestion to attract educated immigrants (engineers, PhDs) by granting them green cards when they would buy some of the excess housing here and you’ve got a possible winning policy vs. current social engineering schemes our Gov has been trying.

  49. middyfeek says:

    @Franklin 411, venndata, et al

    If you can’t get beyond the partisan political bullshit then YOU are part of the problem. I don’t like the Republicans, and I like the Democrats even less. One of you bright lights brought out the old saw about the Democrats being the “party of the people”. I’m not at all sure that was ever true and it sure as hell isn’t true today.

    Politicians, as a class, are self seeking, self serving parasites. When you support either party you are validating them. They don’t deserve your support. Just look at the last four occupants of the White House (two from each party). None of the four should have ever been there.

    So, what’s the answer? I don’t know, but it damn sure isn’t Democrats or Republicans.

  50. RW says:

    @middyfeek

    “…YOU are part of the problem. I don’t like the Republicans, and I like the Democrats even less.”

    Sans emotions and psychological projection this just means you tend to approve of Republican policies on a relative basis which implies you are more likely than not to vote for them; Franklin411 et al rather clearly do not and would not.

    Other than that, null content: Accusations of partisanship are neither here nor there; substantive political and policy direction are what determine national outcomes and peoples’ feelings about it are irrelevant if their actions, or lack of action, confirm that direction.

    Disclosure: I don’t like the Democrats and I like the Republicans even less; the former because they are not reliable, the latter because they are.

    NB: I don’t know what the answer is either but I do know that this country needs to be pulled out of the economic doldrums as of yesterday and the only group offering a realistic alternative to the senseless bumper-sticker crap that everyone in Washington D.C., Republican and Blue Dog Democrat alike, appears to be promoting — “it wasn’t really us who created the problem, we can cut our way back to prosperity, everyone must share sacrifice (but some much more than others), contraction is expansion, pointless pain (for others) will save us, austerity now now now” — is unfortunately the politically weakest group in town; e.g., 2012 Budget Proposal of the Progressive Caucus.

    Just the fact that such a proposal exists, CBO scored and judged likely to accomplish its goals, but isn’t even on the table for serious debate tells you all you need to know about the current direction of legislation and the current state of the country. Personally I’ll give money to, work and vote for, anyone I think has even a semi-decent chance of contesting that direction. Call it partisan, call it just plain pissed off, whatever; doesn’t mean squat …unless something changes in consequence.

  51. Joe Friday says:

    AtlasRocked,

    The GDP growth peaked at 6% 2 years after the Bush tax rate cuts

    Ah, no.

    2.5% GDP – 2003
    3.5% GDP – 2004
    3.1% GDP – 2005

    If you’re referencing the 3RD QTR of 2003, that was a little somethin’ called the Invasion & Occupation of Iraq.

    Deficit spending went up from $400B in 2008, up to 1.4 + 1.3 trillion = $2.7 trillion deficit in 2009-10. The deficit increase was over $2Trillion.

    I’m afraid not.

    You’re forgetting that much of the deficits during the previous administration were OFF-BUDGET, which Obama promptly put ON-BUDGET after he assumed office.

    From all of the costs of the Iraq war (including the costs of the military operations and subsequent reconstruction), all military action in Afghanistan, all homeland security expenditures including the creation of the entire Department of Homeland Security, all the costs of rebuilding after September 11th, and all the costs of the ‘Global War On Terrorism’, and MORE.

    The trillion dollar plus deficits were there during the previous administration, they just lied about it, and apparently you fell for it.

    Social spending increases were 3.5X higher than defense spending increases FOR TWO WARS under Bush.

    Nope.

    See previous reference to “off-budget”.

  52. victor says:

    @RW: I opened your suggested link. No thanks. Anyway, the Bush tax cuts WILL expire @end of 2012 and the middle/lower income people will get hammered. The elites will come out just fine, via smart, legal accounting moves available only to them. Soros has already protected himself from a weakened Dodd-Frank. John Kerry will find a low tax heaven for his foreign built yacht. The Koch brothers oil gushers will continue to bring happiness to them. The Walton happy family will continue to happily make billions by reselling cheap stuff made overseas with cheap labor while our trade balance continues to deteriorate. Wall Street will continue to siphon off billions from investors via fees, spreads, unfair bets, etc. The working stiff (if he can find work) will continue to live pay check to paycheck and pay incredibly regressive payroll taxes and a myriad of other taxes even if he doesn’t pay any federal income taxes. The tax at the gas pump will be brutal, it already is. Have a nice weekend.

  53. DeDude says:

    RW, I agree completely. The only real plan in Washington DC is the one nobody hears anything about in corporate media, because it challenge the power of big money and the birthright of predatory capitalism. If there was a super PAC dedicated to strategic donations to progressive candidates in danger of being voted out or with a realistic chance of beating a GOP candidate, I would be a loyal supporter.

  54. victor says:

    @DeDude&RW: contact George Soros.

  55. RW says:

    @Victor: contact David and Charles Koch.

  56. [...] To see the others, read Barry Ritholtz’ piece. [...]