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Did Republicans deliberately crash the U.S. economy?

atomikmom 2012/06/12 01:51:29
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Did Republicans deliberately crash the US economy?

Be it ideology or stratagem, the GOP has blocked pro-growth policy and backed job-killing austerity – all while blaming Obama











































Senate Republican Leader Mitch McConnell of Ky., House Majority Leader-elect Eric Cantor of Va., and House Speaker-designate John Boehner of Ohio, leave a news conference, on Capitol Hill in Washington Tuesday, Nov. 30, 2010, where they talked about their meeting at the White House with President Obama. (AP Photo/Alex Brandon)
The Republican party congressional
leadership (left to right): Senate Republican minority leader Mitch
McConnell, House majority leader Eric Cantor, and House speaker John
Boehner, after the 2010 midterms. Photograph: AP Photo/Alex Brandon




So why does the US economy stink?

Why
has job creation in America slowed to a crawl? Why, after several
months of economic hope, are things suddenly turning sour? The culprits
might seem obvious – uncertainty in Europe, an uneven economic recovery,
fiscal and monetary policymakers immobilized and incapable of acting.
But increasingly, Democrats
are making the argument that the real culprit for the country's
economic woes lies in a more discrete location: with the Republican
Party.

In recent days, Democrats have started coming out and saying publicly what many have been mumbling privately for years – Republicans
are so intent on defeating President Obama for re-election that they
are purposely sabotaging the country's economic recovery. These charges
are now being levied by Democrats such as Senate majority leader Harry Reid and Obama's key political adviser, David Axelrod.

For
Democrats, perhaps the most obvious piece of evidence of GOP
premeditated malice is the 2010 quote from Senate minority leader, Mitch
McConnell:

"The single most important thing we want to achieve is for President Obama to be a one-term president."

Such
words lead some to the conclusion that Republicans will do anything,
including short-circuiting the economy, in order to hurt Obama
politically. Considering that presidents – and rarely opposition parties
– are held electorally responsible for economic calamity, it's not a
bad political strategy.

Then again, it's a hard accusation to
prove: after all, one person's economic sabotage is another person's
principled anti-government conservatism.

Beyond McConnell's
words, though, there is circumstantial evidence to make the case.
Republicans have opposed a lion's share of stimulus measures that once
they supported, such as a payroll tax break, which they grudgingly
embraced earlier this year. Even unemployment insurance, a relatively
uncontroversial tool for helping those in an economic downturn, has been
consistently held up by Republicans or used as a bargaining chip for
more tax cuts. Ten years ago, prominent conservatives were loudly making
the case for fiscal stimulus to get the economy going; today, they treat such ideas like they're the plague.

Traditionally,
during economic recessions, Republicans have been supportive of loose
monetary policy. Not this time. Rather, Republicans have upbraided Ben
Bernanke, head of the Federal Reserve, for even considering policies that focus on growing the economy and creating jobs.

And
then, there is the fact that since the original stimulus bill passed in
February of 2009, Republicans have made practically no effort to draft
comprehensive job creation legislation. Instead, they continue to pursue
austerity policies, which reams of historical data suggest harms
economic recovery and does little to create jobs. In fact, since taking
control of the House of Representatives in 2011, Republicans have
proposed hardly a single major jobs bill that didn't revolve, in some
way, around their one-stop solution for all the nation's economic
problems: more tax cuts.

Still, one can certainly argue – and
Republicans do – that these steps are all reflective of conservative
ideology. If you view government as a fundamentally bad actor, then
stopping government expansion is, on some level, consistent.

So,
let's put aside the conspiracy theories for a moment, and look more
closely at how the country is faring under the GOP's economic
leadership.

As Paul Krugman wrote earlier this week, in the New York Times, while a Democrat rests his head each night in the White House, the United States
is currently operating with a Republican economy. After winning the
House of Representatives in 2010, the GOP brokered a deal to keep the
Bush tax cuts in place, which has reduced the tax burden as a percentage
of GDP to its lowest point since Harry Truman sat in the White House.
At the insistence of the White House, Congress also agreed to extend
unemployment benefits and enact a payroll tax cut – measures that
provided a small but important stimulus to the economy, but above all,
maintained the key GOP position that taxes must never go up.

But
as Congress giveth, Congress also taketh. The GOP's zealotry on tax cuts
is only matched by its zealotry in pursuing austerity policies. In the
spring of 2011, federal spending cuts forced by Republican legislators
took much-needed money out of the economy: combined with the 2012
budget, it has largely counteracted the positive benefits provided by the 2009 stimulus.

Subsequently,
the GOP's refusal to countenance legislation that would help states
with their own fiscal crises (largely, the result of declining tax
revenue) has led to massive public sector layoffs at the state and local
level. In fact, since Obama took office, state and local governments
have shed 611,000 jobs; and by some measures, if not for these jobs,
cuts the unemployment rate today would be closer to 7%,
not its current 8.2%. In 2010 and 2011, 457,00 public sector jobs were
excised; not coincidentally, at the same time, much of the federal
stimulus aid from 2009 ran out. And Republicans took over control of
Congress.

These cuts have a larger societal impact. When teachers
are laid off, for example (and nearly 200,000 have lost their jobs), it
means larger class sizes, other teachers being overworked and
after-school classes being cancelled. So, ironically, a policy that is
intended to save "our children and grandchildren" from "crushing debt"
is leaving them worse-prepared for the actual economic and social
challenges they will face in the future. In addition, with states
operating under tighter fiscal budgets – and getting no hope relief from
Washington – it means less money for essential government services,
like help for the elderly, the poor and the disabled.

This is the
most obvious example of how austerity policies are not only harming
America's present, but also imperilling its future. And these spending
cuts on the state and local level are matched by a complete lack of
fiscal expansion on the federal level. In fact, fiscal policy is now a
drag on the recovery, which is the exact opposite of how it should work,
given a sluggish economy.

This collection of more-harm-than-good policies must also include last summer's debt limit debacle, which House speaker John Boehner
has threatened to renew this year. This was yet another GOP initiative
that undermined the economic recovery. According to economists Betsey Stevenson and Justin Wolfers,
"over the entire episode, confidence declined more than it did
following the collapse of Lehman Brothers Holdings Inc in 2008." Only
after the crisis did the consumer confidence stabilize, but employers
"held back on hiring, sapping momentum from a recovery that remains far
too fragile." In addition, the debt limit deal also forced more
unhelpful spending cuts on the country.

Since that national embarrassment, Republicans have refused to even allow votes on President Obama's jobs bill in the Senate; they dragged their feet on the aforementioned payroll tax and even now are holding up a transportation bill with poison-pill demands for the White House on environmental regulation.

Yet,
with all these tales of economic ineptitude emanating from the GOP, it
is Obama who is bearing most of the blame for the country's continued
poor economic performance.

Whether you believe the Republicans
are engaging in purposely destructive fiscal behavior or are simply
fiscally incompetent, it almost doesn't matter. It most certainly is bad
economic policy and that should be part of any national debate not only
on who is to blame for the current economic mess, but also what steps
should be taken to get out from underneath it.

But don't hold your
breath on that happening. Presidents get blamed for a bad economy; and
certainly, Republicans are unlikely to take responsibility for the
country's economic woes. The obligation will be on Obama to make the
case that it is the Republicans, not he, who is to blame – a difficult,
but not impossible task.

In the end, that might be the worst part
of all – one of two major political parties in America is engaging in
scorched-earth economic policies that are undercutting the economic
recovery, possibly on purpose, and is forcing job-killing austerity
measures on the states. And they have paid absolutely no political price
for doing so. If anything, it won them control of the House in 2010,
and has kept win Obama's approval ratings in the political danger zone.
It might even help them get control of the White House.

Sabotage
or not, it's hard to argue with "success" – and it's hard to imagine
we've seen the last of it, whoever wins in November.


Read More: http://www.theguardian.com

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  • SoCalEx-Dem 2012/06/12 15:46:56
    NO
    SoCalEx-Dem
    +1
    That would have been the Democrats. Which is part of the reason I left that party. No accountability for anything they do.
  • atomikmom SoCalEx... 2012/06/13 20:08:59
    atomikmom
    Who do you represent now? I was a former Liberal myself, and now i am Nonpartisan, by choice.
  • SoCalEx... atomikmom 2012/06/13 20:14:53
    SoCalEx-Dem
    +1
    I am independent. I don't support any party. I support America, the military and my faith. Which excludes the Democrats, with their war on my Catholic faith.
  • atomikmom SoCalEx... 2012/08/30 03:55:13
    atomikmom
    I am Nonpartisan and i don't support any Party what's so ever. I also support America and the military and the People. I don't support the Democrats or the Republicans or the Tea Party. I don't like their evilness.
  • SoCalEx... atomikmom 2012/08/30 16:08:53
    SoCalEx-Dem
    Why do you say the Tea Party is evil?
  • atomikmom SoCalEx... 2012/08/30 23:16:58
    atomikmom
    They like to pick the bones of the people after the Dems and Republicans are finished. They can't seem to have their own policies as a separate party would.
  • SoCalEx... atomikmom 2012/08/31 01:57:08
    SoCalEx-Dem
    I don't believe thats the case. The Dem party and the Republican Party have both been infested with progressives. When I left the Dems Party I just wanted to be for Country, that's what the tea party is about, returning to the constitution, remaining one nation under God. We want to stop the corruption on both sides of the aisle and get folks willing to work for the people into office.
  • Brian 2012/06/12 12:04:28
    Undecided
    Brian
    +1
    This incredable! Sodahead has found a why to communicateacross the space/time continuum to an alternate univerise. Amazing the samething is happening here...only with Democrats!
  • Sport_Geoff 2012/06/12 11:58:33
    NO
    Sport_Geoff
    +2
    NO........the democrats did.Barney, Harry, and Nancey all refused to investigate and regulate Fannie and Freddie. They were told that the loans were toxic and bad and their reply was LET THE MONEY FLOW.THERE'S NOTHING WRONG WITH THE MORTGAGE MARKET.

    In the residential appraisal profession it was common knowledge 2 years before the crash what was going on. If an appraiser killed a deal because the value wasnt there mortgage brokers simply went and found another appraiser to "hit the mark". Mortgage brokers routinely called me as an appraiser and "TOLD" me what value they needed and then would state they would not pay me if the loan didnt close which was illegal. Myself and several other appraisers filed complaint after complaint with FHA and other regulatory agencies over the shady practices only to be told there was nothing that could be done about it.

    The only people who were surprised by the housing bubble bursting were the mortgage brokers as they thought they would be able to milk the cash cow for another couple of years.

    Every single bit of the mortgage / housing crash belongs to the democrats....ALL OF IT
  • Marek 2012/06/12 10:21:23
    NO
    Marek
    +1
    But the democrats did.
  • David Lindner 2012/06/12 03:01:59
    NO
    David Lindner
    +2
    how specifically did republicans crash the economy, by a bubble created by clinton and carter?
  • Striker 2012/06/12 02:51:12
    Undecided
    Striker
    +3
    More ignorant than deliberate. Most of it goes way back to Dodd/Franks CRA, and Bush was in charge when that bubble burst. Then came Obama to drive the nails in the coffin.
  • Kane Fernau 2012/06/12 02:39:03
    NO
    Kane Fernau
    +3
    Do you mean when democrats controlled the Presidency, House and Senate with a super majority? The democrats managed to pass Obamacare and anything else they wanted. Nobody makes more excuses than democrats.
  • belle 2012/06/12 02:36:57
    NO
    belle
    +4
    When did Obama and his administration become Republicans??????

    You must have typed in the wrong party and of course once posted, you can;t correct the title.
    obama has destroyed the usa obama has destroyed the usa
  • Birthpangs 2012/06/12 02:36:38
  • Marek Birthpangs 2012/06/12 10:34:16
    Marek
    +2
    Exactly how it happened. Excellent post.
    how democrat congress crashed american economy
  • Artist~... Birthpangs 2012/06/12 14:24:09
    Artist~PWCM~
    +1
    Well said and true!
  • Birthpangs Artist~... 2012/06/12 14:50:43
  • Artist~... Birthpangs 2012/06/12 17:59:13
    Artist~PWCM~
    I copied it and am saving it for the final push in October...hope you don't mind.
  • Birthpangs Artist~... 2012/06/12 18:23:07
  • Beccy 2012/06/12 02:09:31
    YES
    Beccy
    The economy crashed under the republicans. Obama didn't listen to the top economists who tried to tell him that the stimulus was too small and did not stimulate the right things. Only an idiot wouldn't realize that we need tarriffs on goods coming fron over countries. We need to get rid of the bush tax cuts and we need work programs that put people back to work. It;s a no brainer. The country is a losser no matter which of the two idiots running for president that we vote for.
  • Birthpangs Beccy 2012/06/12 13:33:03
  • Beccy Birthpangs 2012/08/30 01:30:52
    Beccy
    This depression like the last one started under the republican watch and for about 4 months nothing was done to ease the pain. That Obama turned out to be a Hoover instead of FDR did not help the situation but not all the blame can fall at his feet.
  • Birthpangs Beccy 2012/08/30 03:34:59
  • Beccy Birthpangs 2012/08/30 23:03:24
    Beccy
    You don't have to be rude and call me names, I am not being nasty to you. I am in fact pretty moderate. Any one who watchs what is going on knows that both parties are pretty vile and neither is good for our country. It's time we stop letting them divide us
  • Birthpangs Beccy 2012/08/31 01:11:33
  • ehrhornp 2012/06/12 01:57:46
    NO
    ehrhornp
    +2
    Deliberately implies intent. Republicans never intend to crash the economy but it is a natural result of their policies. It is like a kid tossing some gas on a fire. He didn't expect the house to burn up but it is a natural consequence of his limited knowledge.
  • atomikmom 2012/06/12 01:53:12
    Undecided
    atomikmom
    +4
    Both Parties had a play in crashing America's Economy, and neither one will accept it as their fault.

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