[tw]

Originally Posted by Undertoad

In 2002 the economy was sluggish, hurt in many sectors but not in actual recession. Some disagreed and said not only were we IN recession but being pushed deeper ...

The economy was getting pretty good in 2004... "as economists would define it." ...

The economy was in great shape in 2005.

Apparently you ignored what was posted back then. What did the 2002 tax cut create? Economic results appear four to ten years later. As posted so often and ignored in this UT post: the resulting return on investment - all that spent money in 2002 - has only recently appeared in the real economic numbers. How curious. Back then when UT was parroting the George Jr mantra, he cited the Kennedy tax cut. He also forgot the resulting downturn that resulted from that tax cut many years later.

When did the massive spending on Nam in the late 1960s result in economic disaster? Mid 1970s. There is no free lunch. Throwing money at the economy like a grenade creates a short term drunken party for the finance people; followed by economics taking revenge years later. Those tax cuts were criticized by this author for doing what is happening now.

Throw money like a grenade and it will cure economic problems? Classic bean counter rationalization where today’s investments are only measured in this year's spread sheets. So we reaped a massive reward from 2002, 2003, 2004, etc tax cuts by a market growth of 15% or 20% annually? Oh. The stock market has had near zero growth since George Jr took office. That near zero growth is what happens when government solves economic problems by pumping money into the economy. And inflation. And rising commodity prices. Jobs with stagnant income growth.

UT, there was never a budget surplus from George Jr - except in George Jr press releases. The only government surplus has been in lies. How convenient. They forgot to include the debts from selling Treasury bonds, etc overseas. All that incoming foreign cash to the government was surplus as long as we forget the long term debt obligations. How curious. Enron accounting.


America has been leaching wealth everywhere for the past seven years. Eventually what happens when we spend wildly on welfare to the rich? Eventually even the dollar drops to only 60% of its value. Good that we punish everyone for that 'welfare to the rich' tax cuts?

George Jr's reign has harmed the American economy. We are only just beginning to see the resulting debts. Deja vue Nam - the worst has yet to appear. Since we are spending like a drunken sailor on "Mission Accomplished", then the economy has not yet been punished for that disaster. That punishment will get worst as soon as war spending terminates. Still pending is the economic punishment that should result from "Mission Accomplished".

Which war resulted on only a mild downturn? Desert Storm. Why? The world paid America for much of that war. We have yet to see most of an economic backlash from "Mission Accomplished".

Let's see. How good was that economy? When George Jr came to office, the stock market was about 11,000. At average growth (8%), that market should be at 18,800. Instead, the market is only at a paltry 12.500. A market growth of only 1.8%. UT says that is a robust economy? If these tax cuts were so good, then where is that 10% and 20% growth rate? And still to come is the resulting downturn created by that 'welfare to the rich'. Still to come is the resulting downturn when "Mission Accomplished" ends.

Yes recessions occur and are necessary - because bad management must be removed. Recessions occur mildly or infrequently when management is more responsible - driven by the product and not by money games. America before George Jr was doing quite well with mild recessions and a longest periods of growth because (in part) the government did real tax cuts. Government cut spending rather than provide 'welfare to the rich'.

Recessions are also inevitable because the naive somehow and stupidly believe voodoo economics - throwing money at problems. Recessions have one factor in common. An economy drunk on too much money creates wealth in money games rather than in product innovation. Enron, 'welfare to big Pharma', tax cuts only for the rich, stifling of science and technology especially by White House lawyers, ... Massive economic activity fueled by easy money means "Greed is good" or "The purpose of a company is profits". No wonder GM need not create a hybrid after the government gave GM $100million. George Jr loves corporate welfare. No wonder the airlines can be given $8billion by the government with no strings attached, eat through that money in 8 months, and come back to George Jr for more. Welcome to the George Jr economy where the Haliburtons get wealthy by producing nothing. Where GM's business school graduates design products so crappy as to require 0% financing. So where are the profits from that 0% financing? Now GMAC, the last profitable part of GM is losing money. Using money games, GM simply deferred their losses to make top management look good. More Enron style accounting.

How ironic that most of this nation's innovation occur as far away from George Jr as possible - the west coast.

Any nation that spends almost $100billion annually on "Mission Accomplished" AND racks up record debts selling bonds to pay for those debts can have good looking economic numbers (ie 2004). Those numbers belie the eventual reality which is just starting to appear. Long term debt did not result in capital profits. America must now sell more capital assets to pay for George Jr's "we will fix the economy" mismanagement. For example, who is buying American mortgages? Foreigners. Within the next decade, who will prosper from an ROI from all those mortgages? Not Americans. We are and must sell off America to pay for the drunken party in 2002, 2004, etc.

A government that once had surpluses has had recorded deficits every year under George Jr - an MBA. The markets have seen how much growth under George Jr? A paltry 1.8% - and UT calls that economic growth. Pension funds once needed 5% to break even. During George Jr's reign, pension funds started assuming a 10% growth. So what are those investments averaging? 1.8%. How will GM pay for that $7billion pension fund deficit? PBGC. Pension fund shortages will then be paid for by the government. Just another looming problem created because American financial growth has been so pathetic and the problem ignored. "Don't worry; be happy", says UT.

If things are so good, then why has the average American seen his income drop by 2% in the past seven years (adjusted for inflation)? According to UT, this is also good? Why are we witnessing the greatest income disparity since the great recession? UT also says this is good economics. And then American wealth decreased by another 40% with a falling dollar. Back during Nixon's time, the bean counters also said that massive dollar drop was good. Then the 1970s recession got only worse.

It’s not all as bad as this post might imply. But UT's rosy picture is a drunk with a credit card that has no limits. We have massive debts to pay due to President Cheney's gross economic mismanagement, corporate and wealthy people welfare, "Mission Accomplished", protection of high drug prices, immigration problems, White House lawyers doing the science, unilateral termination of world treaties, stifling of innovation especially where we needed it most (energy consumption technologies), etc.

UT is denying the lessons even from the Kennedy tax cuts. We are now reaping the 'benefits' of those tax cuts. Only question is how severe that resulting economic punishment.