Blame Democrats
| Sat Nov. 21, 2009 8:54 AM PST
Via Matt Yglesias, here is Gillian Tett arguing that a populist backlash against bankers could be headed our way when we have to start getting serious about cutting deficits in 2011-13:
Perhaps that will occur when income taxes are hiked above 50 per cent. Or maybe when hospital budgets are cut, or military spending slashed....“Don’t the bankers realise what could be coming?” I heard one senior western finance official tell a room full of bankers this week, as he argued — with passion and a sense of desperation — that it would be a mistake for banks to pay big bonuses.
Well, stranger things have happened, I suppose, but here's my guess about who will get the blame if we raise taxes or slash spending a couple of years from now: Democrats. End of story. By then, bankers will be yesterday's news, but Republicans and the media will still be eager to haul out the liberal-tax-and-spend narrative and lay into it with gusto. The fact that the financial meltdown happened under a GOP president, the bank bailout was championed by a GOP treasury secretary, and monetary policy was controlled by a GOP Fed chairman won't matter a whit. Democrats will be in power and Democrats will get the blame.
Does anyone seriously want to argue that this isn't how things will play out?
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Comments
The old stories are best.
Submitted by Davis X. Machina on Sat Nov. 21, 2009 9:40 AM PST.
How many times did the Greeks retell, re-package, sequel, prequel, and spin off the stories and characters in the Trojan War?
Our version is the taxnspend Democrats.
On the tombstone of the Republic will be the epitaph "Killed By A Story Arc".
"The fact that the financial
Submitted by Anonymous32 (not verified) on Sat Nov. 21, 2009 9:48 AM PST.
"The fact that the financial meltdown happened under a GOP president, the bank bailout was championed by a GOP treasury secretary, and monetary policy was controlled by a GOP Fed chairman won't matter a whit."
And congress was controlled by, who.... Mickey Mouse?
And good luck selling "a GOP Fed chairman" to anyone.
What if we Don't Raise Taxes?
Submitted by Detroit Dan on Sat Nov. 21, 2009 10:02 AM PST.
The Democrats can get out in front of this by not raising taxes. Big deficits are not a problem at the moment, and may not be in the future.
Really -- What is the problem with the current deficits? We have no inflation. We need the dollar to fall in value to help with unemployment in the current global economic environment. Deficits can go on indefinitely, and can always be paid back without paying taxes.
Oh, and if deficits are a big problem, the Democrats can cut health care spending rather than raise taxes. At least they can try to.
And it's a smart move politically to try to raise taxes on the wealthy, as well as being good policy. This could be a political issue that keeps on giving to Dems, as Republicans are seen as the party of the wealthy and unequal income distribution is increasingly seen to be a problem...
Dems could get around that
Submitted by Art Eclectic on Sat Nov. 21, 2009 10:05 AM PST.
Dems could get around that problem if they enacted huge financial sanctions on every US based company that has off-shored jobs over the past 15 years and continues to off-shore jobs.
Chances of this happening? Zero.
But it's the thought that counts.
This is Reagan's Depression
Submitted by joel hanes (not verified) on Sat Nov. 21, 2009 10:13 AM PST.
Kevin's timeline is too short.
The economic ideas and policies that caused this structural depression came into fashion when they were advocated by the genial and popular President Reagan. They were voodoo then (i.e., false but widely believed-in), and they're voodoo now.
Pace Detroit Dan, (who seems to have internalized the Reaganite fallacy that lowering taxes creates jobs in all economic weathers) taxing the rich and spending on jobs programs is the way out of depression.
It would really help if we hadn't sent so many of our jobs overseas. "Free trade" makes the rich richer, and impoverishes the rest of us.
Yes, but...
Submitted by Nils (not verified) on Sat Nov. 21, 2009 10:32 AM PST.
This is why the Democrats should be continually articulating and rearticulating the causes of and responsibility for the wreckage. Yes, we need to move forward, but responsibility needs to be set in stone. 2008 should become to the deregulate and tax cut crowd what 1938 became to isolationists and appeasers.
Taxes
Submitted by Detroit Dan on Sat Nov. 21, 2009 10:41 AM PST.
I don't regard lowering taxes as the answer to all problems, but neither do I see balancing the federal budget as being particularly important. In fact, I think balancing the federal budget is a bad idea, and that we should have a deficit. I guess that is the Reagan reality (as opposed to the rhetoric about lowering the deficit).
I do think Reagan was wrong about government in general. We need effective government, and the Reaganite notion of government as a tool to boost corporate profits has proven to be a disaster.
This is, I'm sorry, the kind
Submitted by MaynardHandley on Sat Nov. 21, 2009 10:53 AM PST.
This is, I'm sorry, the kind of post that I am not interested in reading, Kevin.
It exemplifies the worst stupidities of the MSM that I read blogs to avoid --- treating serious issues as horse races.
The issue is NOT democrats vs republicans, and viewing the issue that way is like pondering whether it's time for a red-headed president after the disappointing run of the brown and black-headed ones. The issue is the corrosive control the plutocracy has over US politics. Dems will say its the Repub's fault. Repub's will say it's the Dem's fault. Yawn.
What matters is how this play out --- do we get another round of plutocracy from the GOP for a few more years (Romney?), or do we get the monsters from the id that these people have created (Palin/Huckabee?Buchanan?). That is the point we need analyzed, not commentary pointing out the obvious.
Don’t Increase the Government’s Debt Limit!
Submitted by Detroit Dan on Sat Nov. 21, 2009 10:55 AM PST.
Randall Wray has an interesting column related to the issue of the Federal Debt -- Memo to Congress: Don’t Increase the Government’s Debt Limit!...
The anti-deficit mania in Washington is getting crazier by the day. So here is what I propose: let’s support Senator Bayh’s proposal to “just say no” to raising the debt ceiling. Once the federal debt reaches $12.1 trillion, the Treasury would be prohibited from selling any more bonds. Treasury would continue to spend by crediting bank accounts of recipients, and reserve accounts of their banks. Banks would offer excess reserves in overnight markets, but would find no takers—hence would have to be content holding reserves and earning whatever rate the Fed wants to pay. But as Chairman Bernanke told Congress, this is no problem because the Fed spends simply by crediting bank accounts.
This would allow Senator Bayh and other deficit warriors to stop worrying about Treasury debt and move on to something important like the loss of millions of jobs.
How long was TARP in place
Submitted by Anonymous (not verified) on Sat Nov. 21, 2009 10:57 AM PST.
How long was TARP in place before the inauguration? And how long afterwards?
It's up to Obama to decapitate Geithner/Summers/Bernanke.
Since he hasn't, and since us Dems have done nothing to regulate the banksters, or throw them in jail, I say we deserve every inch of the fucking the Republicans will be giving us.
Apologies for unjustified inference
Submitted by joel hanes (not verified) on Sat Nov. 21, 2009 11:40 AM PST.
D. Dan :
I'm sorry to have attributed to you views so divergent from your actual ideas. Thanks for letting me know.
I do agree that the Republicans will probably be politically successful in
1.) effectively preventing wide recovery by hamstringing the federal government with fake concern over spending and deficits (fake, because they don't ever seem to care one whit about military spending)
2.) blaming the Democrats for the resulting deep and long recession endured by all classes except the economic elite.
Tarp, Banks, Stimulus Bill
Submitted by Anonymous (not verified) on Sat Nov. 21, 2009 7:03 PM PST.
It will be nice when Palin is President!! I mean it, I am so sick of the Republicans lying, distorting, re-writing history, being overtly racist, having TEA parties about non-existant tax increases, and nothing is ever done. lThe media reports every bit, I'm surprised they don't hire Limbaugh, Bortz to co-anchor on CNN. The Democrats look like Barney Fife on crack. They are so damned scared because these Republicans from the ignorant states have so much media coverage and power!
But when Palin gets in office, they'll shut up finally. Just like they did with Bush. Democrats don't believe in protesting the party in power 24-7 if at all. Peace and Quiet is restored!! And I do not think she's any worse than Reagan, Bush, Ford, Carter or Nixon. And now that we've suffered through all these inept leaders, big business is running the country anyway......
finance industry should mutually benefit all participants
Submitted by tpx on Mon Nov. 23, 2009 8:08 AM PST.
Since the finance industry contributes very little to the well being of average Americans, except to burden them with debt and bank over draft charges, it is difficult to see why Americans would blame any dominate political party for constraining the finance industry's ability to put average Americans in thrall.
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