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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (111373)	2/14/2008 4:37:09 PM
From: Freedom Fighter	Read Replies (1) \| Respond to of 132070

skeeter, I tried to demonstrate that economics is inherently a long term thing and you can't measure the impact of a policy via the current stats. I'll use Bush as a example. We are currently experiencing a significant correction in the credit and real estate markets. I don't know how bad things will get or how long they will last, but it is at least conceivable that we have a significant recession by the end of this year into next. If so, the next president will inherit rising unemployment, significant foreclosures, and a whole slew of other poor economic stats that will have absolutely nothing to do with the policies he or she puts into place. In all probability, the excesses will be cleansed and things will recover a couple years later. That recovery won't be totally correlated to the policies either because it will be a normal business cycle recovery. You have to analyze these things as an ongoing long term process and figure out what the long term implications of what they are doing will be. Here's another example. Medicare is wildly underfunded. Bush added to the long term problem with the drug program. Eventually someone is going to have to cope with this problem by either making huge cuts or raising taxes very significantly. It's not going to be that person's fault when the crap hits the fan. It's going to be the fault of the people that made the promises that can't be kept. In recent years, Clinton inherited a recovering economy from Bush 1 and GW inherited a busted bubble from Clinton. A lot of their stats had to do with fortunate or unfortunate timing and not policy.

To: Skeeter Bug who wrote (111373)	2/14/2008 5:16:42 PM
From: Freedom Fighter	Read Replies (1) \| Respond to of 132070

skeeter, >the truth is, sometimes tax cuts for the rich makes sense and sometimes tax cuts for the lower classes make sense. since you are such an economic guru, i'd appreciate your insight into when trickle down makes sense and when trickle up makes sense.< Lower taxes and lower government spending for everyone should always be the goal. I don't believe in "managing" the economy. I think the tax burden should always be fair, but obviously people have different definitions of "fair". When you lower taxes on consumers (typically the lower middle class and poor), you get a "short term" economic benefit because they spend the money. But over the long haul, consumption is not a good thing. When you lower taxes on savers and investors (upper middle class, rich, business) you don't get as much short term benefit but you get a "long term" economic benefit because they save some of the money. It is increased savings and investment that increases productivity, leads to new businesses, new jobs etc... Economically, the idea is to use capital as effectively as possible. In the vast majority of cases, that means the only things that should be done inside government are the things that can't be done privately. Unfortunately, some people are not blessed and others have misfortunes in life etc....Those people could be taken care of via charity (which would be my preference because of the greater freedom of where the dollars go) but if there aren't enough resources via charity, I have no problem with using government in a limited way.