How Economic Doldrums Are Impacting The Election
A spate of bad economic news foretells a shift in the campaign for President.
We’ve always known that the economy would be the driving force in the election, but last weeks economic news, starting with a disappointing GDP revision and signs of economic downturns in Europe, China, and India, and ending with an abysmally weak employment report, is bringing that issue back to front and center again. At the beginning of the year, when it seemed like the economy was starting to improve significantly and job growth was approaching levels that could be called respectable, the general assumption was that this would work to the President’s advantage and the Republican’s disadvantage. After all, it’s fairly hard to kick an incumbent President out of office to begin with and an improving economy would make it even harder. With the news this week seeming to confirm that we’re yet again entering a spring/summer slump, just as we have for the previous two years, though, re-election is looking like a tougher prospect for the President if these economic trends continue or get worse:
WASHINGTON — The weak employment report on Friday held the potential to reshape the presidential campaign, members of both parties said, lifting Mitt Romney’s efforts to make the race all about President Obama’s handling of the economy and making it harder for Democrats to break through in their efforts to define Mr. Romney on their terms.
On Capitol Hill, the signs of a slowdown focused new attention on the economic implications of the partisan standoff over tax and spending policy. On the campaign trail, both sides saw the news as a potential turning point in a critical battle at this stage. The race may be a referendum on Mr. Obama, as Republicans want, or, as Democrats prefer, a choice between a president nursing the economy back to health and a challenger who represents the failed policies that caused the crisis in the first place.
Democrats in particular were left off balance, sensing that most of their policy ammunition has been spent and that Republicans have nothing to gain politically from lending a hand on a compromise that could spur economic growth this year.
“It’s going to be a close election. Everybody’s worried,” said Representative Jim Cooper, Democrat of Tennessee. “We’ve already floored the accelerator. We’ve already gripped the steering wheel. I’m not sure they’re attached to anything anymore.”
At a stop in Minneapolis, Mr. Obama renewed his call on Congress to enact measures to revive the economy, warning that they were needed not only to shake the United States out of its torpor, but to act as a buffer against storm clouds in Europe.
“Our economy is still facing some serious headwinds” from high gas prices and the financial crisis in Europe, he said from a factory floor at Honeywell International. Europe, in particular, he said, is “having an impact worldwide and is starting to cast a shadow on our own” recovery.
Mr. Romney fired back that the president was simply finding a new way to deflect blame for an economic malaise that his policies were prolonging. His campaign said that Mr. Romney’s core message that it was time for a change in economic stewardship would resonate more clearly among voters.
“This is the race that we came ready to run,” said Stuart Stevens, Mr. Romney’s chief strategist. “This is the race that we believed we would be in.”
The signs that the recovery is being derailed could further complicate maneuvering over the fiscal cliff the federal government faces at the end of the year. The government faces nearly $8 trillion in higher taxes and automatic spending cuts when all of the Bush-era tax cuts expire at the same time that $1.2 trillion of automatic spending cuts on military and domestic programs go into force in January.
Republicans have called for an extension of all those tax cuts and a cancellation of the military cuts, and said Friday that a weaker economy would make it all the more urgent to avoid tax increases this year. Mr. Obama and Congressional Democrats favor allowing tax cuts for the rich to expire and have stood firm on the automatic cuts.
“Instead of another campaign speech, the president might want to engage with Democrats and Republicans here on Capitol Hill to handle the big policies that are affecting our economy,” the House speaker, John A. Boehner of Ohio, said, citing the looming tax increases and spending cuts and the growing national debt.
Dan Balz argues that the plethora of bad economic news means that the President’s campaign must begin doing more than just going negative on Mitt Romney:
What Obama hasn’t yet done is offer any clear idea of what his second term would be about. He argues that the country should not go back, but what his real goals are for a possible second four years in office remain cloaked largely in campaign generalities.
The meager jobs report puts additional pressure on him to do more than bemoan the possible consequences of turning the White House over to the Republicans. If he is campaigning on a new agenda to lift the economy, most voters couldn’t describe it. If he hopes to come out of the campaign with a mandate for particular policies, he hasn’t talked much about them.
And Nate Silver sees serious risk for the President in the months ahead:
The concern for Mr. Obama, however, is not so much what might happen if the election were held today but what will happen in November. The economic news in recent weeks has been poor enough to suggest that if the economy finally breaks from its pattern of tepid growth in the second half of the year, it could be toward the downside.
Walter Russell Mead, meanwhile, points out the rather obvious fact that, if the trend we’ve seen since April continues through the summer then things are likely to become very difficult for the President electorally. The problem that the President faces in that regard is that, if the economy truly is heading for another slowdown, there’s very little that he’ll be able do about it, at least in the short term between now and Election Day. Partly, this is because the odds of actually getting anything through Congress in the next five months are fairly low. Partly, it’s the fact that even something like another stimulus package would take months to trickle through the economy and show up in the statistics, assuming it worked at all which is by no means guaranteed. To a large degree, though, it’s simply because a large part of what could go wrong between now and November is out of the control of any American politician. The situation in Europe, which seems to vacillate between crisis mode and complacency on a regular basis, is due by and large to a structural problem in European politics that can only be solved by the Europeans themselves. And, of course, there’s little the United States can do about economic conditions in China or India. Perhaps the only good news in all of this is that, thanks to what appears to be a slowing world economy, oil prices have been declining fairly rapidly recently, which means that there will be no $5.00 gas this summer and that some parts of the country may even see gas prices dip below $3.00/gallon.
Balz gets it largely correct, I think, when he says that the state of the economy right now means that the Obama campaign is going to have to shift away from simply attacking Romney and start explaining to the country what a second Obama term would be all about. Even in the midst of an economic boom that would make the current state of our economy look pathetic by comparison, Ronald Reagan didn’t just spend the 1984 election talking about the great job he’d done the previous four years, he also talked about what a second term would be all about, both domestically and internationally (and remember, this was a year before Mikhail Gorbachev was anything other than a Politburo member most Americans had never heard of). Obama is going to have to do the same, especially if the economy continues to be as stagnant as it has been for the past several months.
None of this is to suggest I’m anywhere close to predicting a Romney blowout. Whoever wins this election, I continue to think we’re looking at a close election like we saw in 1976, 2000, and 2004. More importantly, while the head-to-head polling continues to show a tight race between the two candidates,there’s yet to be any evidence of a series dip in the President’s job approval numbers. Until that happens, I’d argue that the odds still favor the incumbent. However, it seems rather undeniable that bad economic news is bad news for Team Obama, and they must surely recognize that by now.
I posted the Salmon/Walsh article, The slow-burn jobs crisis, in the other thread. It seems the prime response to this though. You write:
Seriously, the GOP is blocking action here, using PR skills to misdirect conversation from economic reality.
I apologize for the same quote in two threads, but look … you are talking about economics doldrums, jobs stagnation, trouble for the President … when his jobs plan (conservative as it was) was DOA.
People with memory and a little economic awareness must be thinking “what the heck?”
The key phrases there are “seven months of brinkmanship” and “doesn’t think [Congress] can mature on a whim.”
This is problem a half-decent spin doctor could turn into an advantage. “Look, I can’t fix it in 6 months. But give me 4 more years…”
The Republicans need to be careful, too. If it looks like they’re trying to throw a wrench in the economy to swing the election to Romney, people* will notice.
* as in, “People other than political junkies like us.”
It will be different for Obama’s people to argue a counterfactual, and tactically that is to the Republican’s advantage.
That said, honest answers to questions like these do deflate their argument:
1. Did you oppose Obama’s jobs bill?
2. Does your argument look good in retrospect?
3. Did you propose an alternative?
4. Does that alternative look good in retrospect?
5. Or did you essentially argue “stay the course?”
6. Are you complaining about that course now?
(It will be difficult for Obama’s people to argue a counterfactual.)
And Romney proposes to improve things…how?
If the Republicans are able to sell Romney as anything other than a sleepwalking drone reciting the standard GOP economic mantras, then Obama should be worried. I just don’t see it happening, however. Right now, the media is faced with an utterly revolting election story, and because most of these people have to eat, we’re getting these hedged could/possibly/maybe pieces where pointless advice is given as if the electorate responds exactly like a desperate Politico writer thinks they might.
Bottom line: since 1992, the GOP has one won Presidential election (with 2000 being a toss-up), and that was due to Iraq/WMD/terror stupidity by voters. I honestly don’t believe there is anybody smart enough left in the party who is willing to risk taking on the Fox bubble and their paid position within to turn this around. Everybody says how Romney won’t be doing what McCain did (Palin) but to me, it’s all but inevitable that by August, after enough of these game-changing stories about Obama’s problems have fizzled out and the polls are the same, Romney will be forced to do what McCain did, and whatever moronic effect emerges, however much it will boost him in the polls for a day or two, will have the same result as before.
@Hey Norm:
The Ryan-Romney budget is out there.
One thumbnail response was:
… so I guess the gameplan for November is to blast the President for doing nothing, downplaying that it was GOP votes that blocked action, and then to make the same old song and dance that “tax cuts will work this time, honest” and “the poor just need to be responsible for themselves.”
I actually laughed at loud at the following portion of that NYT article:
No agenda there, eh? Geez. I actually miss the days when the biases of the loopy liberal media were expressed with the proverbial feather as opposed to a sledgehammer.
Earth to the NYT: Obama is “nursing the economy back to health” nearly in the same ways in which Kathy Bates in “Misery” nursed James Caan back to health. Plus I didn’t realize that Republican policies somehow caused mortgage lenders to lend above 100% of appraised value to people who didn’t even have jobs much less verified income. What makes that meme particularly ironic is the fiasco with Barney Frank and Fannie and Freddie, not to mention that various Republicans started issuing warnings about the GSEs when Obama still was in law school.
In any event, obviously the economy is cratering and it goes without saying that that’s a monumental problem for Obama. On the other hand, Obama nevertheless will receive at least 95% of the black vote on heavy turnout, along with overwhelming majorities from college and grad students, full-time academics, public union members, Latinos, federal government workers other than the military, Oprah women, the extremely wealthy and the extremely loopy. That adds up to a lot of people. Separately a few million evangelical conservatives will stay home and not vote for Romney, based solely upon religion.
Romney’s absolute ceiling probably is a miniscule majority and not too far above 270 electoral votes. Obama still has to be considered the favorite, although if the job market actually begins shedding net workers between now and November then all bets are off.
Tsar whips out the CRA Fannie/Freddie myth.
If your opinion is based on mis-information and factual errors then your opinion is based on mis-information and factual errors. Would acknowledging those inaccuracies make any difference? Probably not. It’s called the Dunning-Kruger Effect.
@ Norm…
President Romney WILL improve the economy…because he will be unfettered by a reflexive opposition party. Left to do as he wants he will do what Republicans always do…he will increase spending and grow the Government.
http://www.nytimes.com/interactive/2012/05/04/business/economy/off-the-charts-shrinking-government.html?ref=economy
That in turn will get un-employment down significantly.
http://www.epi.org/publication/public-sector-job-losses-unprecedented-drag/
These are the things Republicans have always done, but particularly during recessions. These are also things that Republicans are currently preventing Obama from doing. Frankly I see it as treasonous to intentionally hold back the economy for personal political gain. But it is what it is. If Bush gets away with torture then economic sabotage is never going to be an issue.
The funny thing is to hear small Government politicians complaining about slow growth. Duh…what did you think was going to happen when you shrunk Government?
More on shrinking government jobs.
http://research.stlouisfed.org/fredgraph.png?g=2Dx
Pretty impressive how this President manages to be a socialist…and shrink Government.
The highest underemployment are not in swing states. No matter how bad the economy is in California, New Jersey, or Illinois are going to vote for the Democrats. However, swing state are doing very well such as Iowa, Virginia, and New Hampshire.
Can Romney win enough states no matter how bad the economy is doing or are there enough automatic Democratic Party voters that a bad economy is irrelevant to a presidential election?
@Hey Norm:
Norm, virtually all of those cuts are state and local employees from jurisdictions that are not allowed to run deficits. The Obama Administration tried to help state and local governments make payroll with stimulus money but now that money has run out.
Most stimulus just means more spending on local and state governments and means higher state and local states in the future.
@superdestroyer:
On that, from September 2011:
How many people now reveling in “Obama’s bad jobs numbers” also endorsed Obama’s plan?
(I note that the idiot downvoter on my post above did not deign to answer the six questions.)
@Tsar Nicholas:
“Obama is “nursing the economy back to health” nearly in the same ways in which Kathy Bates in “Misery” nursed James Caan back to health. “
Ah, a wonderful analogy! Your entire post, though, was very good.
@jan:
New Obama Jobs Plan Gets Same GOP Rebukes
Yeah Jan, let’s all chortle, having rejected all of Obama’s plans, that all he can do is “nurse.”
@jan:
This pretty much sums up the problem for Romney. Obama is a politician who is consistently likeable and trusted, yet the GOP base will need to hear a bunch of stories about how Obama is a sociopath socialist who is out to break the legs of small business owners with a government-built hammer.
I predict that the version of Romney created by the Obama campaign will not be a vicious capitalist out to ruin America, but a somewhat blundering and unlikeable Wall Street guy who has never done anything (aside from Romneycare) for anyone other than himself, and that this guy, as successful as he was, has no business being President.
Meanwhile, the GOP is going to be forced to go with socialist Obama, a few idiot lies about the financial crisis, tax cuts, a stupid drill-baby-drill chant, and call it a day.
@Herb:
There is no way to spin economic data this grim, not when the economy is teetering on a recession. Unemployment has been increasing each year and growth is at or below inflation, so this is going to be the issue that decides the election and the President’s only defense is “Romney would be worse”.
It’s also a bit of a straw-man to say this is all the fault of Republicans. The President hasn’t proposed any significant stimulus since the Re-investment Act; to the contrary he’s talked spending cuts and would have gotten them if the Republicans hadn’t decided the deal wasn’t harmful enough to suit them.
@Modulo Myself:
“Meanwhile, the GOP is going to be forced to go with socialist Obama, a few idiot lies about the financial crisis, tax cuts, a stupid drill-baby-drill chant, and call it a day. “
I wouldn’t count on it being as simplistic as that, Modulo.
@Ben Wolf:
Obama downsized his stimulus ideas again and again, to get Republican votes.
Which is the strwaman here? Perhaps the idea that Obama should have proposed things that would have been even more strongly rejected?
@ Superdestroyer…
Yes it’s true…most Red States cannot survive without Federal Money.
For instance Louisiana makes up almost half it’s annual budget from Federal Funds…and they spend $1.78 of Federal money for every dollar they send to Washington. Sarah Palin’s Alaska? They recieve $1.84 for every dollar they send.
So yeah…they are required to balance their budgets…but they can’t without money from the Blue States.
Too bad those Republicans can’t get their fiscal houses in order.
http://thecentristword.wordpress.com/2012/01/26/red-states-addiction-to-welfare-a-gop-dilema/
Oo out of one side of your mouth you are complaining about slow growth…and out of the other side of your mouth you are saying we can’t help the States stop laying people off, or start hiring back those they laid off, because it will mean higher taxes later. What do you want? Historically low taxes? Or growth? Because the Private Sector is growing. It’s Public Sector shrinkage that is holding us back. So which is it?
Well, if history is our guide, it will be.
@Hey Norm:
The solution is for Americans to take their medicine, pay full fare for the government they want, and set up long term conditions that will promote private sector growth. During the Clinton Adminstration, the federal government went six years with no new programs, no new taxes, and no new entitlements. Those six years were a healthy time for private sector business to expand.
Now the private sector faces higher taxes in the future, worse demographics in the future, tougher international competition, and higher operating costs.
What too many progressives want to do is expand the public sector (creates more automatic Democratic Party voters), expand entitlements (creates more automatic Democratic Party voters), and control which business will succeed or fail. What progressive seem to want to avoid is letting the economy work the issue out and let bad business fail.
Everyone should remember (especially Republicans) that stimulus spending today just means more people addicted to government spending tomorrow and more automatic Democratic Party voters.
@Hey Norm:
Have you forgotten that the federal government actually owns most of Alaska. Look at what percentage of New Jersey the federal government owns versus what portion of Alaska.
Alaskans could pay more tax dollars if the government allowed more exploration for energy. Since the progressives do not like oil production in the U.S., then it should expect a smaller private sector.
If progressives were really concerned about red states not paying enough taxes, then progressives would support a flat tax and reduce the progressive nature of the income taxes in the U.S.
@superdestroyer:
The GOP has already made the “defense spending as stimulus” argument. So it’s really a bizarre form of cross-talk. Each party has their traditional favorites for stimulus, and both parties could benefit from being more innovative.
That said, I find the Democratic defense of the safety net both better economics and better morality.
Oops, I guess I had the wrong text buffered, I meant to quote this, this time:
Either Ubuntu misfired, or my fingers.
flat taxes and drill baby drill.
what a crock.
@john personna:
Bush thought he could deficit spend and create more Repulbicans. All that Bush II did was create more automatic Democratic voters, bigger deficits, and bigger government.
Conservatives should have found a candidate with a history of balancing budgets and controlling spending instead of another cheap labor, deficit spending, neo-con buttboy.
As the U.S. becomes a one party state, at least conservatives will not feel the need to defend idiots like Romney or Bush. In the coming one-party-state conservatives will get to spend their time in politics nitpicking Democrats much like the few conservatives in Chicago or Mass. do.
@Hey Norm:
If progressives can going to complain about the net taxes spend per state, then those progressives are making an argument for a flat tax. NYC, Boston, and SF would greatly benefit from a flat tax since it would lower the taxes paid by the residents in those cities. The Flat tax would hit states like Alaska the most.
Of course, since progressive want higher taxes on millionaires, then the tax inbalance will be worse in NYC since the residents in NYC will pay more.
So, do you want states to get want they pay in or do you want a progressive tax scheme? You do not get both.
@ Destroyer…
First off…that’s fantasy. But no matter.
Keep in mind that those six years followed tax increases under Reagan, Bush 41, and Clinton himself. The top tax rate was 39.6%. Yet you scream bloody murder about returning to that. It’ll destroy the economy…it’s hurting job creators…blah blah blah.
Make up your mind. Historically low taxes, or growth. You cannot have both. Bush lowered taxes to 35% and averaged 2.2% GDP growth. That’s about where we are today…a little less…only with no Public Sector growth and low spending. Bush was growing Government and spending money like a drunken coked up AWOL Air Nat’l Guardsman.
http://dailydish.typepad.com/.a/6a00d83451c45669e20168e8f57e89970c-800wi
@ destoyer…
I don’t care what states put in or take out.
I want Public Sector growth…instead of shrinkage…or flat-lining. I want all those cops and firemen and teachers and DPW workers that have been laid off to get re-hired. Because that is the only way we get to real growth. As I said before it’s how Republicans always get out of recessions. And it’s what they are preventing…for their own political gain…now.
http://www.epi.org/publication/public-sector-job-losses-unprecedented-drag/
@john personna:
Well that’s the rub, isn’t it john? There is no evidence the President even supports the massive additional stimulus our economy needs, you’re just assuming he’d do the right thing if only the Republicans would evaporate. The only stand he’s taken is to cut, cut and cut some more, and that’s what I’ll judge him by.
@Hey Norm:
If Bush had followed up the lower taxes with cutting spending and trying to create a better environment for economic growth in the private sector, the Bush would not have left office with miserable job approval.
Increasing government employment now just makes it harder to grow in the future and adds to the ratchet effect. PUblic spending does not create growth. More public spending just moves money from the private sector to the public sector. And since the public sector does not really care about the long term effects of its programs, the spending never goes away.
If public spending lead to a better economy, then California would be a boom town due to the massive public sector employment and the high wages paid to state and local employees in California. However, California has a higher unemployment rate than the national average for over 10 years.
@superdestroyer:
“If public spending lead to a better economy, then California would be a boom town due to the massive public sector employment and the high wages paid to state and local employees in California”
We all know that CA is in the financial dumper, along with Illinois. These two states have shared many of the same kind of policies, primarily being dictated by democratic governance. And, to no one’s surprise, they are comrades in arms in having massive debt, unfunded public sector pension/benefit plans, with productive members of their populace looking beyond their borders to relocate residences and/or businesses elsewhere.
This November, here in CA, we will be hit with Gov. Jerry Brown’s deficit-busting proposition aimed at increasing it’s state revenue by levying a surtax on the ‘rich.’ How much do you want to bet that, if passed, it will have the opposite effect, by encouraging even more people to pull up stakes and leave, decreasing the revenue flows?
@jan: It’s very simple: the bill has come due for all the promises made over the past 20 years and never backed up. Illinois has a horrible situation; it would be best if we could go through with a blowtorch and get rid of at least 10% of the deadwood at the top, then go though and reset everyone’s pensions (especially those who have been double- or triple-dipping.)
I figure that everyone was responsible for this mess, so we’ll all have to take our lumps. That includes cuts in services and higher taxes just to get back to zero.
@superdestroyer:
For one thing, you need to demonstrate California spends significantly more than the rest of the country. You don’t appear to be aware the state has cut billions in spending over the last four years. Your example, contrary to your assertion, indicates lack of spending is contributing to California’s unemployment crisis.
According to CA Budget fact check, dealing with the 2011-2012 budget, revenues did go up but couldn’t keep up with the spending. This has been a chronic problem for CA, in that the more revenue it gets, the more it spends said revenue, coming up short.
We have an insatiable demand for money in this state, and no sense of fiscal discipline in the democratic-run state legislature. If Brown’s tax policies pass, we will have the highest taxes in the country, and will still be starved for money, having to cut educational funding, and the like.
Like many of our national budgetary problems, it won’t be until we realign our spending habits, entitlement programs, public sector pension plans, and create a less regulatory climate for business that people will see real progress being made in California’s economic future.
@jan: You live in CA. The financial situation there is hardly recent. So I guess you’re not one of the productive members of the populace.
I’ve got some relatives living in Massachusetts, conservatives that never miss a chance to complain about the government. Yet they choose to live in one of the most liberal states in the nation. Can’t say I blame them, or you, though the hypocrisy gets annoying.
Scott,
Wrong, my husband and I are tax-paying, productive residents of CA. I was born here, and love the geographic texture and beauty of the state. So, we take our lumps and continue to support two residences — one in the South and the favored one in the North. However, with a different type of governance, the state could capitalize on all of it’s human talents and geographical resources, returning to it’s previous golden years.
@ Destroyer…
Yes…austerity during lean times is just the ticket.
So you are getting what you want…slow growth.
Don’t complain.
Well, the administration of Pat Brown was pretty much of a golden age for California – is that what you are referring to?
I lived in California for over 15 years. We have spent a lot more time under GOP govs than Democrats.
Sorry, 50 years.
@anjin-san:
I recall the election of Gray Davis, in 1999, being where it seemed CA begin to go south. His management of the electrical grid created the recall, producing Schwarzenegger, who was a complete failure. Now we have Brown, who seems impotent in the face of the intransigence of the democratic legislature and problems with the unions, alliances proving to be difficult to manage or create any compromises with.
I do believe that Meg Whitman would have produced a different tact than Brown. And, I was totally behind Carly Fiorina versus B. Boxer — stances I know that are totally reversed from your own.
Sunday night reflections: just read this story about these Ohio teens being killed just before their graduation from high school, and all the political arguments just fade for a moment. Such events make everything else seem like child’s play.
Adding on to the above post: my husband had a client who had one son. About 10 years ago this son was involved in a similar accident, except he and his friends ended up hitting a corner post, killing everyone in the car. For at least 8 years thereafter, someone kept fresh flowers on that corner denoting the lives lost there. Even though the flowers are no longer there, I continue to think about those young people, everytime I drive by that spot.
You mean after Bush’s pals at Enron screwed each and every ratepayer in California? Lets get real about where that train wreck started.
I am no fan of Boxer, I knew her before she entered politics, and did not really care for her then. But Fiorina? She damn near ran HP into the ground. Her top priority there seemed to be layoffs, outsourcing, higher compensation for herself, and getting her picture on magazine covers. I know a lot of HP employees and alumni. Have never heard a good word about her from any of them.
@anjin-san:
…and, then you have Corzine and MF Global. Enron was not the only one that screwed people over — there was equal opportunists in both parties. Come on, anjin.
I don’t agree with you on Fiorina. Just look at GE and Obama’s guy (Imelt) who is outsourcing to China. Or, for that matter the cool mac genius who also went over to China for strickly business reasons. Again, you are cherry-picking CEO’s, according to their party affiliation, to make them out to be yucky capitalists, when both dems and republican businesses do the same thing. BTW, HP continues to have problems and lay-offs, and I don’t think it’s all because of wacky Whitman being in charge either.
@jan:
You mention a bunch of people running off (with jobs) to China.
What’s the Republican answer? That we have to take it, because it’s free market?
I know I proposed a very mild import duty yesterday and got some downvotes. I wonder how many people realized that historic tariff levels, before free trade, represented a balance between tax on foreign business and tax on you, the local business community.
When you go free trade you quite effectively shift the tax burden onto domestic business. The comparative tax burden, business tax as a fraction of receipts, goes up.
(If I were a slightly bigger cynic, I’d say “Oh, I forgot. No one is supposed to pay tax, and the budget should balance anyway.”)
You brought up Gray Davis and the California energy crisis, come on yourself. You opened the door, don’t whine because I walked through it. I agree Davis was weak, I voted for his recall. That being said, the CA energy crisis was the result of market manipulation and profiteering by the “free market” folks you so admire, not the result of Davis’ actions. He did a poor job managing a manufactured crisis – that if very different from causing the crisis in the first place. The fact that GW and Kenny Lay were bosom buddies just makes the whole thing stink more.
You don’t aree with me on Fiorina? Fine, explain why she was not an utter failure at HP – your stock “but, but, but… Obama!” argument is just lame right wing boilerplate. BTW, I am not cherry picking, you opened the door on Fiorina as well.
You really have to do better than simply accusing people of being rank partisans. I have spoken in hear on plenty of occasions about Pelosi (overrated hack) and Boxer (narcissist shrew), and had many kind words for Reagan and Eisenhower. A few days ago I was talking about the stellar foreign policy record of GHW Bush and how I would love to have a chance to vote for someone like Chuck Hagel for President.
Try harder.
@jan
We have Enron executive on tape ordering California utilities to cut electrical production so as to drive up prices. That wasn’t Davis’ fault, it was the fault of the Federal Government for not enforcing anti-trust and fraud regulations. As an inter-state matter Davis had no authority over the issue.
@anjin-san:
the California energy regulatory scheme that caused the problems was designed to put the nuclear power plants in California out of business and was based upon a model that assumed cheap natural gas prices. That is why California did not allow long term fixed-price contracts. Of course, when the price of natural gas went up, the higher, unstable costs were not able to be passed on to consumers.
Two good paragraphs from Krugman:
@ JP…
Krugman fails to account for Republican fairy dust and unicorn tears.
Yeah…it wasn’t crooks…it was the regulatory scheme.
@Hey Norm:
The amazing thing to me is that you can say “Krugman” at OTB now and not get a boo in response.
I think just the name would have brought out a half dozen far right true believers a couple years ago.
It’s possible that it’s a shift in OTB demographics, but it’s also possible that his economics are becoming grudgingly accepted. I warned on austerity here myself, and was assured that was what the right wanted. Now perhaps they aren’t so sure.
@john personna:
I think most people have realized that Krugman is the worst example of a stereotype. Krugman’s solution to everything is expand the government and spend more money.
Of course the most important reason to expand the government, create more entitlements, and get more people hooked on government spending is to expand the power base of the elite progressives of the U.S.
I thought when Krugman demonstrated that he had no idea about Simpson’s paradox and was willing to make blatant statistical errors to make a partisan point, that the progressives would have learned to avoid him.
@superdestroyer:
The fact that “superdestroyer” is the only one in 24 hours to attempt a Krugman response is acually my answer.
YMMV.