Does anyone on the right recall...

[Gilligan (Premo)]

Originally Posted by Sparx

How deficit spending was cool under the bush administration?

I must have missed the memo; nobody I know thought it was 'cool' by any stretch of the imagination.

IF anyone DID think that the defecit spending on Bush's watch was 'cool' then they must also have been a fan of the Dems in Congress who helped that along...and they must think ole Barry is ''waaayyy cool' since he's elevated the art of defecit spending to levels that absolutely dwarf what Bush let happen.

[PsyOps (Premo)]

Originally Posted by Tilted

I think more deficit spending is better than higher taxes - even beating someone up is generally better (for them) than killing them - but neither is particularly cool. The fundamental problem is the spending more so than it is how you choose to 'pay' for it (as being through current taxes or through assuming ongoing fiscal liability as a result of deficit spending).

That said, if your point is that we need to stop electing these fiscal liberals that we've been electing for the last hundred plus years, then I completely agree with you.

This sort of falls in line with what I posted here. Spending has the appearance of fixing things; and we don't feel the effects (having to pay for it) of that spending until about (I think it is) 7 years. Taxes are immediate and painful. It's really like how individuals spend money. Go shopping for a nice Taylor Guitar. Buy guitar with credit card. Feels very good. Bill comes due. Doesn't feel good.

The difference is we HAVE to pay our bills. The government is content with rackiong up the deficit, then raise our taxes under the guise of paying for it, then increase spending. Bad fiscal discipline is the cancer of both parties.

[PsyOps (Premo)]

Originally Posted by Sparx

How deficit spending was cool under the bush administration?

Now don't go silent on us. I think we've confirmed that Bush's spending frenzy was wrong. Were you okay with Bush's deficit spending? Are you okay with Obama's deficit spending?

[Aerogal]

I'm not sure of this (but am sure you will school me if I'm way out to lunch) but FDR's programs did NOTHING to improve the lot of Americans during the depression. In fact it got steadily worse (the dust bowl didn't help either). IMO I believe it was the war machine industry during WWII that brought the US economy back on track, increased the middle class and enabled the luxury of 'retirement' for everyday people.

So - if 'W' increased deficit spending to fund the War Against Terror, didn't he sort of cause the same effect? At least in part?

I believe we would have been ok (recoverable) if it wasn't for the housing regulation to deregulate(?) loan qualification requirements and the unchecked Fed supporting Wall Street shenanigans that did in the rest of the economy. There were so many errors in the past, but no one in DC has ever bothered with hindsight. If they did, it was a matter of "Oh what they did before didn't work, but we're going to do it again, but our way will be better".

[jackers]

Originally Posted by Aerogal

I'm not sure of this (but am sure you will school me if I'm way out to lunch) but FDR's programs did NOTHING to improve the lot of Americans during the depression. In fact it got steadily worse (the dust bowl didn't help either). IMO I believe it was the war machine industry during WWII that brought the US economy back on track, increased the middle class and enabled the luxury of 'retirement' for everyday people.

So - if 'W' increased deficit spending to fund the War Against Terror, didn't he sort of cause the same effect? At least in part?

I believe we would have been ok (recoverable) if it wasn't for the housing regulation to deregulate(?) loan qualification requirements and the unchecked Fed supporting Wall Street shenanigans that did in the rest of the economy. There were so many errors in the past, but no one in DC has ever bothered with hindsight. If they did, it was a matter of "Oh what they did before didn't work, but we're going to do it again, but our way will be better".

Thinking that wartime spending helps an economy is incorrect. It is a popular myth that WWII saved us from the Great Depression. Spending on wars funds destruction. That money is taken from the productive side of the economy and basically thrown away. If that money would have stayed in the economy, the economy as a whole would be better. Think of it this way, if wartime spending is so great, why don't we partner up with a country like Canada, both countries build a huge Navy, then blow those Navy's up every other year? Jobs are created and spending increases, but both countries are poorer in the end. True economic growth comes from saving money, not wasting it.

The problems with our current economy can be traced back to poor investment decisions. These decisions were based off of a poorly managed money supply from the Federal Reserve. The Federal Reserve is the PRIVATE entity responsible for setting interest rates. When they keep interest rates artificially low, businesses are more likely to take out loans, loans that they normally wouldn't take out. This is what they call "bubbles". While the bubble grows, everyone is happy because they think they are getting great deals. It's when the economy rights itself and the bubble bursts, that's when these recessions happen.

So there have been some bubbles, such as the dot.com bubble and most recently the housing bubble. When the dot.com bubble started to burst, the Federal Reserve kept rates extremely low (the former Fed Chairman Greenspan openly admits that) which kept the economy from resetting. It basically pushed the crisis down the road to future generations. At that time, mainstream Keynesian economists like Paul Krugman promote such thinking like wartime spending helps the economy or that bubbles are a good thing and after the dot.com bubble, a housing bubble is actually recommended. So now couple the government incentives for home buyers (tax credits), gov't mandated reduced lending practices for minorities, adjustable rate mortgages that allowed people to purchase more house than they could afford, with gov't backed loan purchasers like Fanny/Freddy which assumed these risky loans. All the while, the Federal Reserve keeping rates low. This all led to everyone feeling like they needed to purchase a house. People were buying houses, fixing them, and reselling them at profit. People were buying houses and taking out second and third mortgages because the housing market was growing so fast builders couldn't keep up with purchasers. This artificially made the housing prices skyrocket. The bubble was awesome! People were making a killing....until it burst.

Once Adustable Rates started adjusting, people couldn't afford their houses. Since lending practices were reduced, people weren't putting the standard 20% down anymore so more and more people were simply walking away. The prices started dropping and people were left with houses that they purchased WAY ABOVE MARKET VALUE. Most of the country started losing their houses and the entire house of cards came down.

Now couple that with the postponed effects of the dot.com bubble that the Federal Reserve basically just sold down the river and you can see how all of this happened. It wasn't just Bush, it wasn't just Obama. If anything, it was the Federal Reserve.

[SamSpade]

Originally Posted by jackers

Thinking that wartime spending helps an economy is incorrect. It is a popular myth that WWII saved us from the Great Depression..

Sorry. It did. But the way it happened is more complicated than you're describing. For one thing, it helped the United States in one way in that it positioned the U.S. as the one unscathed Western power - *we* didn't get bombed into the stone age. The nation went onto a wartime footing; we were selling war bonds, consumer spending was shifted to the war effort and the country geared up for military manufacture as it had never done before. We were now selling supplies to a world at war. GDP shot way up during the war as well as worker productivity.

I don't recall any time in modern history where this country rationed so much, and so many citizens at home were so heavily involved into turning every available resource into a means of supporting the war.

It's not so much that WAR does this, but what the nation does as a response to a war where it believes it is fighting for survival.

Modern wars won't do this - we don't do this for wars in Iraq and Afghanistan. But it would have a similar effect if we were honestly fighting for our lives.

[jackers]

Originally Posted by SamSpade

Sorry. It did. But the way it happened is more complicated than you're describing. For one thing, it helped the United States in one way in that it positioned the U.S. as the one unscathed Western power - *we* didn't get bombed into the stone age. The nation went onto a wartime footing; we were selling war bonds, consumer spending was shifted to the war effort and the country geared up for military manufacture as it had never done before. We were now selling supplies to a world at war. GDP shot way up during the war as well as worker productivity.

As you say, we went to direct rationing. How is that making our economy prosper? The economy suffered so the military could prosper. And of course GDP increased, we were manufacturing. Unfortunately, we were manufacturing in the wrong portion of the economy.

I don't recall any time in modern history where this country rationed so much, and so many citizens at home were so heavily involved into turning every available resource into a means of supporting the war.

Exactly, that money could have been spent here! Where did it go? Into the destructive war effort. Our nation became poorer because of the war, not richer.

It's not so much that WAR does this, but what the nation does as a response to a war where it believes it is fighting for survival.

Modern wars won't do this - we don't do this for wars in Iraq and Afghanistan. But it would have a similar effect if we were honestly fighting for our lives.

So wait, you are saying that the reason we don't have a booming economy while fighting TWO wars is because we aren't fighting for survival? So because we aren't rationing steel and iron, our economy is worse and bankrupt? That doesn't make any sense at all.

[SamSpade]

Originally Posted by jackers

So wait, you are saying that the reason we don't have a booming economy while fighting TWO wars is because we aren't fighting for survival? So because we aren't rationing steel and iron, our economy is worse and bankrupt? That doesn't make any sense at all.

Wow. I said all that? I must not have been paying attention to what I wrote.

I won't get into an endless argument with you over this and nowhere did I make a comparison with today's economy. I just responded to your remark regarding WW2, without all the bluster.

Right now, the wars we are fighting are a net drain on our economy, because we don't reap any of the benefits a nation gains as a consequence of revamping the entire nation into a wartime economy. WW2 had a incredibly galvanizing effect on the nation like nothing else we've seen. I know from my parent's stories growing up during the war, everyone was at work supporting the war, even voluntarily.

[jackers]

Here is a much better explanation than I could possibly give. It is from Dr. Thomas Woods, a Senior Fellow of the Ludwig Von Mises Institute and NYTimes Bestseller. It is a very interesting and fun listen.

Thomas Woods « Antiwar Radio with Scott Horton and Charles Goyette

[jackers]

Originally Posted by SamSpade

Wow. I said all that? I must not have been paying attention to what I wrote.

I won't get into an endless argument with you over this and nowhere did I make a comparison with today's economy. I just responded to your remark regarding WW2, without all the bluster.

Right now, the wars we are fighting are a net drain on our economy, because we don't reap any of the benefits a nation gains as a consequence of revamping the entire nation into a wartime economy. WW2 had a incredibly galvanizing effect on the nation like nothing else we've seen. I know from my parent's stories growing up during the war, everyone was at work supporting the war, even voluntarily.

I agree that employment was way up, the productive and experienced workers were all over fighting in Europe. That left women (who weren't as engrained into the workforce as now) and unskilled workers doing the job of the productive element of the workforce.

I am not trying to fight or argue over this either. If you get bored, just listen to the MP3 link that I pointed to in my last post. It is entertaining at least, and very informative at best. We complain about media and textbook bias but when different opinions are offered from what we have been taught, we are spring-loaded into defending them.

There is a HUGE amount of information about wartime spending. I recommend looking into the Austrian Economic School (this name is just for where the scholars came from, not the Economics of the country of Austria). It is very eye opening to say the least.