The blog recently posted with the title “Battlefield Shifts to the Economy” may seem factually sound and intellectually logical on the surface; but the underlying argument beneath the complicated tax talk is false. The following is a rough outline of how the argument veered off track.
First: The concept that governmental spending hurts an economy during a recession or depression only exists in “reactionary minds and out-dated economic text books.” A trip down memory lane will bring us back to the New Deal of President Franklin D. Roosevelt. It is the Laissez-Faire/free market ideology that John McCain supported for twenty six years as a product of the Reagan Administration that created the current financial mess. And as for creating a trust corporation, this will pretty much be a blank check for creating a completely new governmental organization. Not only is this governmental spending, but it is governmental spending that doesn’t go to the struggling American people. It is simply paradoxical to argue that massive governmental spending will hurt the economy while supporting a blank-check governmental organization. Doesn’t that go against your “reduce government influence in the public sphere” platform anyways? What we are seeing here is the collapse of 8 years of fiscally conservative policies and the Republican base running away from their own beliefs. The irony is that while a crisis on Wall Street demands more government involvement—and has already resulted in it—John McCain promises to give us a small government. This is similar to the Democratic-Republican Thomas Jefferson who believed in small government and whose only major presidential accomplishment was the Louisiana Purchase.
Second: The article “Tax Cuts, Real and Imaginary: Obama’s spending programs in disguise” by Newt Gingrich and Peter Ferrara is referenced as the backbone of the post. Just by looking at the authors it is obvious that the content and agenda of the article is slanted and is designed to help the Republican cause. It is also argued that there is a necessity for the presidential debate to return to the real issue at hand: the economy. This is true, but to reference an article written by Newt Gingrich, the man who single handedly stonewalled some of the best bi-partisan public policy efforts in decades during the Bill Clinton sex scandal is simply antithetical. If one wishes to return to the real issues, Newt Gingrich is not a man with credibility. Since when is Newt Gingrich an authority on economics and the economy? Also, Peter Ferrara heads the Bush Administration’s Social Security Project of the Free Enterprise Fund whose aim is to privatize social security and given the recent financial crisis, it has become more evident that privatization of social security without providing a safety net for seniors to fall back on in case the personal investment accounts see losses is imprudent and unwise. Overall, it is clear that these two men are not objective in their reporting and have very flimsy economic resumes.
Third: The argument is made that a 500 dollar tax cut for middle and lower class families would hurt the economy because of an increase in spending. There are many holes in this assumption: First of all, President George W. Bush has offered a similar solution with multiple stimulus checks, and it has been proven helpful. Secondly, the argument is made that this would increase debt, not stimulate the economy. Well, in the year 2000 when President Bill Clinton left office this country had a budget surplus; it has been the last eight years of fiscally conservative policies that created the massive debt the next president will inherit. Was all that peace and prosperity during the Clinton years so bad? And obviously, putting 500 dollars into the hands of the average American would not only reassure them, but HELP them curb the rising costs of everyday necessities. Doesn’t John McCain support a gas-tax holiday? What will help Americans more: a couple of cents at the pump or $500 cash in hand? The gas-tax holiday will not only cut 18.4 cents per gallon of gasoline from the US Treasury income, which in turn would have to cut funding for highways, roads and bridges to compensate for it, but it also offers very little relief to the average consumer. Average Americans would only save about $30 over the “holiday.” You only need to understand the basics of supply and demand to know that the gas prices will likely rise back up after the tax-holiday has been implemented because of the rise in demand. Offering the $500 to working families will go a long way in encouraging spending and stimulating the economy, this being compared to a gimmick gas-tax holiday that would do nothing to change anything for better nor offer long-term solutions.
If one really wants to talk about fixing the economy, then why don’t we bring up the millions of bankruptcies that are caused by lack of affordable health-insurance?
Fourth: What will John McCain do to stimulate the economy? It seems all the blog post did was criticize Obama’s plan and offered very little sustenance on the John McCain side. John McCain’s solution: regulation on wall-street. Something he has opposed for a life-time.
It is also argued that a raise in the capital gains tax would hurt middle class investments. This is a flimsy assumption at best. Why don’t we talk about the billions of dollars in tax-cuts given to big Oil? Are we really worried about the middle class here, or just the wealthy elite?
The argument over the economy is more simple than complicated. Bill Clinton inherited a recession from the fiscally conservative policies of Ronald Reagan in 1992 and was able to turn it around. The same thing has happened in the last eight years with the ‘trickle down’, ‘pull yourself up with your own bootstraps,” “ownership society” governmental mentality. If we are going to take advice from Newt Gingrich, then this country will have some serious problems in the next four years.
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