I always love it when pundits try to explain the economy. It’s like hearing Brian Boitano analyze college football. It seems that many have forgotten the business cycle. We had a recession in the early 90′s, and six years of economic growth. It was followed by a small recession at the end of the Clinton administration and the beginning of the Bush years. Who’s to blame for these ups and downs? No one, that’s right. It’s called market fluctuations. Bonnie Erbe dabbles in economics in her “Bush tanked the U.S. economy” piece.
Here’s a lesson Bush never learned and one that probably could have kept this country out of recession: You can’t fight an expensive war AND cut taxes simultaneously without sending the U.S. economy into the tank. That is just what Bush has done.
After the tax cuts in 2001 the Unites States economy has been in a boom growing for six years. Evidently Bonnie thinks the economy should grow forever. Why does she believe this, I’m not so sure. Maybe she watched too many Disney movies as a child and thinks we should live “happily ever after.” Wait… there’s more.
There are other contributing factors, of course. The housing bust has hurt this consumer-driven economy mightily. Americans felt richer and borrowed heavily against home equity at the height of the boom. These factors kept corporate profits and the economy growing.
But the bust that has now followed was highly predictable. Real estate always runs in cycles. The last real-estate boom lasted an incredibly long five years. The president should not have been piling up irresponsible debt, knowing the crash would come at some point.
Cycles!!! She admits that real estate market goes in cycles, but what about the economy? If the current housing market is the catalyst for the recession (which hasn’t come yet, I may add) then how is this Bush’s fault?
Let’s clear up this one persistent myth. In the 90′s the Clinton administration drastically reduced the US military budget. The Cold War was over and this was an appropriate measure. However, the economy wasn’t booming because of the surplus. The surplus was the result of a gridlocked Congress, internet bubble, Welfare Reform, and lower defense spending (anyone wonder why our intelligence agencies are in shambles). After 9/11 defense spending had to increase, during the recession a lower tax policy was an appropriate response. I am of the mind that the last two administrations deserve none of the credit for economy (good or bad); however Bonnie wants to blame Bush, but ignore the good economy of the last six years.
don’t forget to talk about the economy in terms of distribution. when you only use per capita figures you don’t tell the whole story. why don’t you respond to liberals’ unfounded accusation that the divide between rich and poor is growing.