Which Party Do You Think is Better for the Stock Market?

You guys all give the government WAY too much credit with regards to the economy.

First of all, if presidents could <i>really</i> control the economy it would always be good. There is absolutly no political gain to be made with a bad economy.

As a matter of fact, I belive that the emphasis on a president's control over the economy is bad for the nation as a whole. Clinton and Gore were in a perfect position to develop an energy policy (a "road map" if you will) towards a less oil-dependant economy. They had the charisma, it was a platform they and their party stood for and they had the money and strong economy to suffer any ill effects that the transition would cause. They chose not to do anything (their biggest failure, IMO) because they didn't want to rock the economy and thus take a beating from the other side.

Bush, jr. is relaxing environmental regulations now to relieve economic pressure on businesses in an effort to get the economy going because those rules and regulations costs businesses money and right now is not the time to put economic pressure on businesses. (Personally I'm in favor or stronger environmental regulations but I understand that, like a mouse going through a snake, it costs money which costs jobs until things settle down.) Neither Bush, Sr nor Clinton would sign Kyoto (which is/was a bad protocol anyways) because it would hurt the economy. Even if it were good for the world, the economic impact would cost the president his job. Do you guys really think that during an election the other side is going to say "It was the right thing to do even if it costs you your job."? No way in hell. They'd slam the incumbent for mis-managing the economy.

Both of those are/were bad moves (Clinton not doing anything with regard to oil and Bush un-doing environmental regulations) and they were done because politicians try to take credit or lay blame for something as controllable as the weather.

The <i>only</i>thing the government can do to to stimulate the economy is put more money into it. They do that three ways:
1. Cut taxes
2. Increase spending
3. Lowering interest rates (and the government doesn't even really do this one - the fed does)

I'm all for the cutting taxes, but only if you reduce spending. When so much pressure is placed on the president with regards to re-election on the economy it forces the administration to do all of the above and that's bad.

Blame Bush for Iraq, blame Clinton for Cosovo but don't blame either or give credit to either to something they don't have control over! It's all maddness!

And if any of you start crying that Bush is only doing this or that to make his friends rich or that Clinton did this or that to get laid all those consipiricies are about as believable as aliens in secret airforce bases...

 

I agree with your post except for the preceding; the only pressure that was on President Bush to deliver a long term tax cut was from the extreme right anti-tax wacko Hooverites like Grover Norquist. Nor was their any pressure on him to deliver such a disproportionate one to the rich.

Now, the standard response to this argument is "Well, of course it benefits rich people more, they pay more taxes." While the logic behind this is true, it's utterly misleading in that it presupposes that a dividend tax cut or a targeted income tax reduction are the ONLY ways to cut taxes.

This is just untrue. The kind of tax cut that would benefit more Americans would be a payroll tax holiday (advocated by Krugman, among others). This is better in every respect than the tax cuts we ended up with: 1. you don't have to be super rich to benefit, and 2. it provides for a more immediate and greater stimulus effect, because middle and lower income types are more likely to consume that upper income types

Contrast this with what we got. Long term tax reductions for high income earners and dividend tax reductions. 1. These deliver the vast majority of their benefit to the rich over the long term; 2. which is bad because it fails as a short term stimulus, the stated rationale for it.

So, if you believe the president had to reduce taxes, fine, but the fact remains that he picked a way that disproportionately benefits the rich and provides very little short term stimulus.

This of course, doesn't address the fact that the President is setting us up for a long term fiscal disaster. THat's a whole other question.

Make your own decision as to why, but this President exercises a great deal of control over fiscal policy, and we have a legitimate right to hold him accountable and question his motives when he enacts tax cuts that seem to have no real effect other than to benefit the super rich and cripple the governments pocketbook for future generations.