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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: Lizzie Tudor who wrote (12459)	10/16/2003 5:53:43 AM
From: LindyBill	Read Replies (1) \| Respond to of 793597

I sure don't agree with you LindyBill I should have made myself clearer. I don't expect Bush to carry California. But having Arnold there will make it closer and cause the Dems to spend more time and money than they otherwise would. If, on the other hand, We find Bin Laden's body, capture Saddam, and he tells all, it could be a landslide. :>)

To: Lizzie Tudor who wrote (12459)	10/16/2003 6:13:30 AM
From: LindyBill	Respond to of 793597

The one thing I thing we can say about the economy for sure is that "The Cake is Baked." No changes from here on out are going to make a difference by November 4th, '04. And things are looking better. If the economy is in good shape, it will be almost impossible to turn out Bush - without a collapse abroad. The "Wall Street Journal" is smug about it. :>) __________________________________ The Tax-Cut Expansion Democrats may want to change the economic subject. Thursday, October 16, 2003 12:01 a.m. The good economic news keeps coming. Yesterday's reports included bullish growth for September and early October from 10 of 12 Federal Reserve districts, and another spate of sharply higher corporate earnings. Sooner or later all of this is going to get noticed by the American electorate, perhaps even by the Democrats running for President. We understand that the non-incumbent party has to make the case for change. And for months now Howard Dean and his pursuers for the Democratic nomination have pounded away at President Bush's economic record. "The worst economy since Hoover" is a favorite refrain, which even for politics is a tad hyperbolic. General Wesley Clark has uttered what he seems to think is deadly criticism--that Mr. Bush's economic policy has consisted almost entirely of "tax cuts." Well, yes, and fortunately so. We have expressed our differences with the White House on trade, currencies and federal spending. But there's no doubt that the second round of Bush tax cuts, which advanced the marginal-rate reductions to this year, are having exactly the growth effect that supply-siders predicted. They boosted incentives, both for individuals and small businesses that pay taxes at the individual tax rate, and investment has accelerated in turn. The Federal Reserve has also had the monetary throttle open, perhaps too much, and certainly enough to erase any further fear of "deflation." The U.S. economy tends to rebound naturally left to its own devices, but it doesn't hurt to have sound tax policy helping it along. In Keynesian theory still popular in media circles, the tax cuts should provide only a one-time boost to consumer spending by putting "more money in peoples' pockets." But if that's true, growth should be petering out now that the summer's rebate checks have been spent or saved. The Keynesians overlook that the Bush tax cuts included much more than punchless rebates and in particular were aimed at raising taxpayer incentives to work and invest. The dividend tax cut, in addition, has induced dozens of companies to offer or to raise dividends and has given the stock market a lift. Consumer spending has remained buoyant, notwithstanding a September dip due largely to declines in auto sales. Overall, retail sales are now 12.2% above the second quarter levels on an annual basis, suggesting strong consumer confidence. Meanwhile, business investment is also rising, and that is likely to increase if corporate earnings continue to roll in with double-digit percentage increases. The one big weakness is job creation, but even that will turn around if growth continues and history is any guide. Temporary employment has been strong--the Fed's Beige Book reported higher demand in five Fed districts--and that has traditionally signaled future hiring. While the biggest companies are still streamlining, surveys of small companies show a greater appetite to add employees. All of this poses a challenge for the Democrats running to replace Mr. Bush. The premise of their economic criticism is that the tax cuts have failed, so the way to stimulate the economy is to raise taxes and spend that money on health care or homeland defense or to reduce the deficit. But growth is already shrinking the deficit estimates as revenues increase above expectations. Last week the Congressional Budget Office shrank its estimate for the 2003 deficit to $374 billion from $401 billion. Perhaps this explains Senator Joe Lieberman's recent rhetorical turn on taxes. Instead of merely proposing to repeal Mr. Bush's cuts, the Presidential candidate is now wrapping his tax-increase proposals in a theme of "tax reform." In return for cutting taxes further on lower earners, Mr. Lieberman would return to the Clinton tax rate of 39.6% but at a lower income threshold for married couples earning just $150,000, plus another 5% surcharge on those making more than $250,000. No one favors rewriting the IRS code more than we do, but this looks to us like Robin Hood dressed in a business suit. We've been around long enough to recall when Mr. Lieberman was known as a "growth Democrat." He favored cutting taxes on capital gains, among other good things. But the lure of the party's nomination has led all of the Democrats to reject the kind of tax cuts that one of their own patron saints, John Kennedy, promoted. As a political matter, the Democrats may soon find themselves blaming tax cuts for the sins of mankind just as the voters are concluding they deserve credit for the recovery. opinionjournal.com