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Reagan 5 (Clinton 3)

by t-------------- Thu Nov 13th, 2008 at 10:43:04 AM EST

Is the US heading for President Reagan 5 (or Clinton 3)?

Via Naked capitalism.

Dean Baker: The high priests of the bubble economy. Some snippets

Those following the meeting of Barack Obama's economic advisory committee could not have been very reassured by the presence of Robert Rubin and Larry Summers, both former Treasury secretaries in the Clinton administration. Along with former Federal Reserve Board chairman Alan Greenspan, Rubin and Summers compose the high priesthood of the bubble economy. Their policy of one-sided financial deregulation is responsible for the current economic catastrophe.


While the Bush administration must take responsibility for the current crisis (they have been in power the last eight years), the stage was set during the Clinton years. The Clinton team set the economy on the path of one-sided financial deregulation and bubble driven growth that brought us where we are today. (The deregulation was one-sided, because they did not take away the "too big to fail" security blanket of the Wall Street big boys.)

For this reason, it was very discouraging to see top Clinton administration officials standing centre stage at Obama's meeting on the economy. This is not change, and certainly not policies that we can believe in.

Worth reading...

On economics, Clinton and Reagan are nearly indistinguishable. Clinton's era was the era of Supply-Side Democrats almost as enamored of neo-liberal policy prescriptions as the other side. Trickle-down was simply re-packaged as "a rising tide lifts all boats" but, if you look carefully, you'll see the gini coefficient rising just as quickly under Clinton as under Bush II.

This being said, it was the GOP pushing the headlong descent into deregulation, Dick Armey at the fore, though of course, nothing was stopping Mr Clinton from signing that bill, and in fact, others like it (eg the Telecommunications act).

The Hun is always either at your throat or at your feet. Winston Churchill

by r------ on Thu Nov 13th, 2008 at 11:38:16 AM EST
Clinton and the Dems pushed through a tax increase which brought our budget back on a path to balance.  Instead of govt soaking up credit, it was there for others to use or speculate with.  Long rates dropping made everyone's housing expense drop like a stone.  I still remember a 10% mortgage and an 18% car loan.

Now had we kept on that path and actually paid down debts the last 8 years, the economy wouldn't have gotten quite a frothy and the US debt would be $3-4 trillion instead of $10-11 trillion.

by HiD on Thu Nov 13th, 2008 at 04:38:45 PM EST
[ Parent ]
The Republican strategy to curb the development and further growth of liberal-socialist programs is the inflation of the National Debt until interest payments make such developments unthinkable. So said Tip O'Neal, the Speaker of the House during the Reagan administration. Clinton's economics is not called Republican Lite for no reason, even though he was able to reduce the budget deficit by his last year.

by shergald on Thu Nov 13th, 2008 at 07:36:49 PM EST
[ Parent ]
Hmmm....I remember this a little differently, but with the same emphasis on the 'lite' mode.

In the first two Clinton years, there were moves to go to the heart of his program of the left. He got snookered by the Republicans of the Democratic party, then the Gingrich cabal.

The best Clinton could do was take some pragmatic steps. It was obvious in '93 that he was leaving programs that would explode the year after he left.

The worst he could do was be the shill for the international corporate interests.

He got lucky with the tech revolution, and if he had acted as smart as he was, he would have found a way to quench the smoke and larceny of that era instead of allowing it to froth-out.

Showing how to get a budget in order in the 7th year? Good politics. It would have been good policy to get it done earlier, but the Republicans wouldn't let it even if Clinton had the heart. Without the froth in the economy, he would have otherwise raised taxes on the rich...which is the option now. Not just income taxes...it is time for the US to go after the big swinging heros of the Rape of Middle America with a Wealth Tax.

Never underestimate their intelligence, always underestimate their knowledge.

Frank Delaney ~ Ireland

by siegestate (siegestate or beyondwarispeace.com) on Fri Nov 14th, 2008 at 03:23:45 AM EST
[ Parent ]
I understand that line of argument, but do not agree with it. The US economy grew under Clinton not because of those surpluses, but because the speculative bubble was inflated under him, something Dubya inherited and of course made worse.

I still remember a 10+% mortgage and an 18% car loan too, and it's a good thing we do, because maybe we can help fellow Americans how to deal with these things in the near future, because that's what's coming.

The Hun is always either at your throat or at your feet. Winston Churchill

by r------ on Fri Nov 14th, 2008 at 06:28:01 AM EST
[ Parent ]
Oh finally...someone is seeing the forest...
Clinton born again...

Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Sat Nov 15th, 2008 at 08:54:26 AM EST

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