Obama's Choice: FDR or Reagan

[peejay 327]

Obama's Choice: FDR or Reagan

by Patrick J. Buchanan

Posted 01/09/2009 ET

Barack Obama, it is said, will inherit the worst times since the Great Depression. Not to minimize the crisis we are in, but we need a little perspective here.

The Great Depression began with the Great Crash of 1929. By 1931, unemployment had reached 16 percent.

By 1933, 89 percent of stock value had been wiped out, the economy had shrunk by one-third, thousands of banks had closed, a third of the money supply had vanished, and unemployment had reached 25 percent -- among heads of households. And in those days, there was no unemployment insurance, no Medicare, no Medicaid, no Social Security, no welfare.

FDR's answer: vast federal spending, tough new regulations on business and higher taxes -- like Herbert Hoover before him, only more so.

The Depression lasted until war orders from the Allies brought U.S. industry back to life. Before 1940, not once did unemployment fall below 14 percent. In May 1939, Treasury Secretary Henry Morgenthau testified:

"We are spending more money than we have ever spent before, and it does not work. ... I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. ... I say after eight years of this administration we have just as much unemployment as when we started ... and an enormous debt, to boot."

Politically, the New Deal was a smashing success, with FDR's landslides in 1932, 1934 and 1936 virtually wiping out the GOP.

Yet, economically, the New Deal was a bust, failing utterly to restore prosperity. Despite the indoctrination of generations of schoolchildren in New Deal propaganda, that is the hard truth.

Consider, now, how Ronald Reagan responded to the economic crisis of 1980, the worst since the Depression. In the "stagflation" of that Jimmy Carter era, interest rates had reached 21 percent and inflation 13 percent.

Reagan's answer was the tight money policy of Fed Chairman Paul Volcker and across-the-board tax cuts of 25 percent, while slashing the highest rates from 70 percent to 28 percent.

While unemployment hit 10 percent in 1982 and Reagan lost 26 House seats, in 1983 the tax cuts kicked in.

From there on out, it was boom times until Reagan rode off into the sunset, having created 20 million new jobs. "The Seven Fat Years," author Robert Bartley called them.

Reagan had followed the lead of Warren Harding and Cal Coolidge, who had cut Woodrow Wilson's wartime tax rates of near 70 percent to 25 percent, resulting in "The Roaring '20s," a time of unrivaled prosperity.

The JFK tax cuts of the 1960s, also a Reagan model, were equally successful.

Harding, Coolidge, JFK and Reagan all bet on the private sector as the engine of prosperity. All succeeded. Franklin Roosevelt bet on government. And the New Deal failed. It was World War II that pulled the United States out of the Depression ditch of the 1930s.

Comes now the financial collapse and economic crisis of 2008, inherited by Obama, with 40 percent of all stock values wiped out in a year, foreclosures pandemic, and unemployment near 7 percent and surging.

In crafting his solutions, Obama seems to be brushing aside the Reagan, JFK and Harding-Coolidge models, and channeling FDR and the New Deal Democrats.

Already staring at a $1.2 trillion dollar deficit for the year ending Sept. 30, about 8 percent of the entire U.S. economy, Obama intends to add a stimulus package of $700 billion to $1 trillion, yet another 5 percent to 7 percent of gross domestic product. The resulting deficit would be twice as large as Reagan's largest, 6 percent of GDP, which was the largest since World War II.

And how is this Niagara of money to be spent?

Hundreds of billions will go out in checks of $500 to $1,000 to wage-earners and individuals who do not even pay taxes. This is much like the George McGovern "demogrant" program of 1972, where every man, woman and child, if memory serves, was to get a $1,000 check from the U.S. government.

Other hundreds of billions will go to shore up state and municipal spending. Other hundreds of billions will go for "infrastructure" projects, another name for earmarks, which is a synonym for pork.

Now, as Obama does not intend to raise taxes, at least now, he is going to have to borrow this near $2 trillion from foreigners or U.S. taxpayers, or the Fed will have to create the money. Undeniably, this will have an impact upon the economy. But what will that impact be?

Where in history, other than World War II, is there evidence that such a mass infusion of spending restored prosperity?

Obama and the Democrats are taking a historic gamble, not only with their careers but with the country. If this monstrous stimulus package, plus the trillions in hot money, do not work; if the two ignite rampant inflation, rather than real growth, we are all out of options. The toolbox is empty.

And what will follow may truly resemble the 1930s.

http://www.humanevents.com/article.php?id=30214

[Mr. Big Dog 10,747]

The roaring 20's? Did ole' Pat forget how the roaring 20's ended? Or what the long term impact of Reagonomics (a.k.a. voo-doo economics) actually is? The latter it's right before our very eyes. Neither of these periods ended well for America. Both, it may be argued, led to the most disastrous economic conditions at the beginning of each the 20th and 21st century. Let's try and learn from this for a change.

[peejay 327]

The roaring 20's? Did ole' Pat forget how the roaring 20's ended? Or what the long term impact of Reagonomics (a.k.a. voo-doo economics) actually is? The latter it's right before our very eyes. Neither of these periods ended well for America. Both, it may be argued, led to the most disastrous economic conditions at the beginning of each the 20th and 21st century. Let's try and learn from this for a change.

There have been recessions and financial panics in the USA since the founding of the republic.

Nobody complains when things are roaring nor do they meddle to cool it off. Recessions serve that function.

If economics is an exact science that is absolute...then why are there so many conflicting schools of thought?

This is just another "school of thought". Take it or leave it. I just posted it for another perspective. I don't claim to be an economist.

I was an adult living and working in the US economy from Carter through today. The Carter economy was in shambles. Whether this was his fault is open to one's perspective. Things did improve a lot during Reagan and then the inevitable recession came during old man Bush's reign. Old man Bush's recession had little to no impact on my life. Clinton didn't veer too far from his predecessors and had to contend with a Republican congress for most of his term. Things improved during Clinton. Clinton's term had its bad economic moments too. So far, this downturn hasn't hit me yet. I count my blessings. Who knows the future?

The fact is that this country has been living in a fantasy world for a long, long time. I'm neither a registered Republican nor am I a registered Democrat. I've voted both ways as I'm an independent. However, I do confess I'm a conservative. I just see things through my own eyes and my own life.

[one...two...tree 2,762]

"We are spending more money than we have ever spent before, and it does not work.

The Bush Administration has spent the money, but you've got to look on just where the money was spent...not on infrastructure, which is what Obama is wanting to spend the money on. It does make a difference where the money goes. Pretty silly of Buchanan to make a blanket statement that spending money doesn't work....it really depends on the situation.

[Mr. Big Dog 10,747]

"We are spending more money than we have ever spent before, and it does not work.

The Bush Administration has spent the money, but you've got to look on just where the money was spent...not on infrastructure, which is what Obama is wanting to spend the money on. It does make a difference where the money goes. Pretty silly of Buchanan to make a blanket statement that spending money doesn't work....it really depends on the situation.

Yep, the old difference of gainful investment vs. wasteful giveaways.

[peejay 327]

"We are spending more money than we have ever spent before, and it does not work.

The Bush Administration has spent the money, but you've got to look on just where the money was spent...not on infrastructure, which is what Obama is wanting to spend the money on. It does make a difference where the money goes. Pretty silly of Buchanan to make a blanket statement that spending money doesn't work....it really depends on the situation.

The quote above was attributed to FDR's Treasury Secretary Henry Morgenthau after 8 years of all kinds of spending on infrastructure. Ever heard of the TVA, CCC, etc.? This after 8 years of FDR's reign as president and well into the New Deal. What's up with that? If it didn't work back then, why should the same policy work now? It took the manufacturing in the war economy after 1940 to finally get things rolling again.

So what is the next trick on Obama's agenda? To start WW3 to bring us back to prosperity again? True to FDR's economic blueprint? New Deal part deux?

[w¡n9Nµ7 §£@¥€r 123]

I just see things through my own eyes and my own life.

Most people do. There's nothing wrong with that. You have the advantage of years, your point of view is more expansive than mine is. When you (and others of your generation) talk about how bad the Carter years were, I believe you. All of you can't be wrong and all of you say the same thing. For people in my age group, our career started at the tail end of the Clinton years. Wow, what a time. Money, money, money. We were fresh out of school and companies were flying us first class to meetings we didn't need to be at and sending us to beautifully appointed, remote upstate New York facilities for team building sessions. And then the dot com bubble burst, around the beginning of the Bush years. Most of my peers were laid off (yes, most) but I made the transition to a conservatively run insurance company just at the right time. The first few Bush years were great for me, but not for those I know. Lately, it's more or less sucked for everybody.

[peejay 327]

I just see things through my own eyes and my own life.

Most people do. There's nothing wrong with that. You have the advantage of years, your point of view is more expansive than mine is. When you (and others of your generation) talk about how bad the Carter years were, I believe you. All of you can't be wrong and all of you say the same thing. For people in my age group, our career started at the tail end of the Clinton years. Wow, what a time. Money, money, money. We were fresh out of school and companies were flying us first class to meetings we didn't need to be at and sending us to beautifully appointed, remote upstate New York facilities for team building sessions. And then the dot com bubble burst, around the beginning of the Bush years. Most of my peers were laid off (yes, most) but I made the transition to a conservatively run insurance company just at the right time. The first few Bush years were great for me, but not for those I know. Lately, it's more or less sucked for everybody.

I stayed working all during the Carter administration. I was unemployed for 4 months when Reaganomics brought on the pain that finally ended the rampant inflation of the Carter years. How well I remember the COLA (Cost of Living Adjustment) raises I used to get in the Carter years to keep up with the inflation. The problem is that it is inflationary in itself.

Since that unemployment I experienced in 1983, I have been seamlessly employed ever since. Never missed a beat. My dad got drafted right out of high school at 18 years old. After my dad got out of the US Navy after WW2 he never saw unemployment until he retired in 1986 to die of cancer that same year. My dad's father got out of the US Marines after WW1 and never saw unemployment his whole life. He retired in 1966 from Conoco. Three generations working in the energy sector. It has been good to us so far. Many of my dad's relatives had a hard go of it in Dust Bowl Oklahoma and Kansas during the Depression. He saw a lot of misery as a kid. That's the breaks in life.

My mom's dad had the hardest go of it here in the USA, but he persevered. I remember my mom telling me that as a kid just getting an apple and orange for Christmas' during the Depression. Still no matter how bad it got for them it was a hell of a lot better here in the USA that it was in his native Belorussia ruled by Stalin. Going back "home" just wasn't an option. It would have been a death sentence. Things improved for the family during the WW2 economy and he never new unemployment after that and retired with a union pension here in the USA.

So the point to remember is that even with 16% unemployment...there is 83% employed. And people do survive adversity. America is a modern welfare state today. Something nonexistent my grandparent's generation and when my parents were growing up. Back then it was root hog or die. You do what you gotta do.

Edited January 11, 2009 by peejay

[zqt3344 21]

WE are screwed, we have no leadership and no chance with this ignorant uneducated non-business policy lawyer from Harvard, and what the hell does a community organizer do or how do they qualify for this is beyond my comprehension, I just want to say I told you so, so that when in a year or two or three from now things still suck and are worse under this idiot you all voted for, do not come on here crying and whining around and trying to excuse make your way out of it, for you deserve it, you voted for the moron. HAHAHAA

Obama's Choice: FDR or Reagan

by Patrick J. Buchanan

Posted 01/09/2009 ET

Barack Obama, it is said, will inherit the worst times since the Great Depression. Not to minimize the crisis we are in, but we need a little perspective here.

The Great Depression began with the Great Crash of 1929. By 1931, unemployment had reached 16 percent.

By 1933, 89 percent of stock value had been wiped out, the economy had shrunk by one-third, thousands of banks had closed, a third of the money supply had vanished, and unemployment had reached 25 percent -- among heads of households. And in those days, there was no unemployment insurance, no Medicare, no Medicaid, no Social Security, no welfare.

FDR's answer: vast federal spending, tough new regulations on business and higher taxes -- like Herbert Hoover before him, only more so.

The Depression lasted until war orders from the Allies brought U.S. industry back to life. Before 1940, not once did unemployment fall below 14 percent. In May 1939, Treasury Secretary Henry Morgenthau testified:

"We are spending more money than we have ever spent before, and it does not work. ... I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. ... I say after eight years of this administration we have just as much unemployment as when we started ... and an enormous debt, to boot."

Politically, the New Deal was a smashing success, with FDR's landslides in 1932, 1934 and 1936 virtually wiping out the GOP.

Yet, economically, the New Deal was a bust, failing utterly to restore prosperity. Despite the indoctrination of generations of schoolchildren in New Deal propaganda, that is the hard truth.

Consider, now, how Ronald Reagan responded to the economic crisis of 1980, the worst since the Depression. In the "stagflation" of that Jimmy Carter era, interest rates had reached 21 percent and inflation 13 percent.

Reagan's answer was the tight money policy of Fed Chairman Paul Volcker and across-the-board tax cuts of 25 percent, while slashing the highest rates from 70 percent to 28 percent.

While unemployment hit 10 percent in 1982 and Reagan lost 26 House seats, in 1983 the tax cuts kicked in.

From there on out, it was boom times until Reagan rode off into the sunset, having created 20 million new jobs. "The Seven Fat Years," author Robert Bartley called them.

Reagan had followed the lead of Warren Harding and Cal Coolidge, who had cut Woodrow Wilson's wartime tax rates of near 70 percent to 25 percent, resulting in "The Roaring '20s," a time of unrivaled prosperity.

The JFK tax cuts of the 1960s, also a Reagan model, were equally successful.

Harding, Coolidge, JFK and Reagan all bet on the private sector as the engine of prosperity. All succeeded. Franklin Roosevelt bet on government. And the New Deal failed. It was World War II that pulled the United States out of the Depression ditch of the 1930s.

Comes now the financial collapse and economic crisis of 2008, inherited by Obama, with 40 percent of all stock values wiped out in a year, foreclosures pandemic, and unemployment near 7 percent and surging.

In crafting his solutions, Obama seems to be brushing aside the Reagan, JFK and Harding-Coolidge models, and channeling FDR and the New Deal Democrats.

Already staring at a $1.2 trillion dollar deficit for the year ending Sept. 30, about 8 percent of the entire U.S. economy, Obama intends to add a stimulus package of $700 billion to $1 trillion, yet another 5 percent to 7 percent of gross domestic product. The resulting deficit would be twice as large as Reagan's largest, 6 percent of GDP, which was the largest since World War II.

And how is this Niagara of money to be spent?

Hundreds of billions will go out in checks of $500 to $1,000 to wage-earners and individuals who do not even pay taxes. This is much like the George McGovern "demogrant" program of 1972, where every man, woman and child, if memory serves, was to get a $1,000 check from the U.S. government.

Other hundreds of billions will go to shore up state and municipal spending. Other hundreds of billions will go for "infrastructure" projects, another name for earmarks, which is a synonym for pork.

Now, as Obama does not intend to raise taxes, at least now, he is going to have to borrow this near $2 trillion from foreigners or U.S. taxpayers, or the Fed will have to create the money. Undeniably, this will have an impact upon the economy. But what will that impact be?

Where in history, other than World War II, is there evidence that such a mass infusion of spending restored prosperity?

Obama and the Democrats are taking a historic gamble, not only with their careers but with the country. If this monstrous stimulus package, plus the trillions in hot money, do not work; if the two ignite rampant inflation, rather than real growth, we are all out of options. The toolbox is empty.

And what will follow may truly resemble the 1930s.

http://www.humanevents.com/article.php?id=30214

[Nikita2Charles 33]

Arnold from California : Actor

Ronal Reagan : Actor Yet so many people are attributing stuff to reaganomic and so on.

Obama: Community org., Lawyer

Let say it's 2am and you have to leave the country, who would you trust to safeguard your business until you return??

Would would you give your business

WE are screwed, we have no leadership and no chance with this ignorant uneducated non-business policy lawyer from Harvard, and what the hell does a community organizer do or how do they qualify for this is beyond my comprehension, I just want to say I told you so, so that when in a year or two or three from now things still suck and are worse under this idiot you all voted for, do not come on here crying and whining around and trying to excuse make your way out of it, for you deserve it, you voted for the moron. HAHAHAA

Obama's Choice: FDR or Reagan

by Patrick J. Buchanan

Posted 01/09/2009 ET

Barack Obama, it is said, will inherit the worst times since the Great Depression. Not to minimize the crisis we are in, but we need a little perspective here.

The Great Depression began with the Great Crash of 1929. By 1931, unemployment had reached 16 percent.

By 1933, 89 percent of stock value had been wiped out, the economy had shrunk by one-third, thousands of banks had closed, a third of the money supply had vanished, and unemployment had reached 25 percent -- among heads of households. And in those days, there was no unemployment insurance, no Medicare, no Medicaid, no Social Security, no welfare.

FDR's answer: vast federal spending, tough new regulations on business and higher taxes -- like Herbert Hoover before him, only more so.

The Depression lasted until war orders from the Allies brought U.S. industry back to life. Before 1940, not once did unemployment fall below 14 percent. In May 1939, Treasury Secretary Henry Morgenthau testified:

"We are spending more money than we have ever spent before, and it does not work. ... I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. ... I say after eight years of this administration we have just as much unemployment as when we started ... and an enormous debt, to boot."

Politically, the New Deal was a smashing success, with FDR's landslides in 1932, 1934 and 1936 virtually wiping out the GOP.

Yet, economically, the New Deal was a bust, failing utterly to restore prosperity. Despite the indoctrination of generations of schoolchildren in New Deal propaganda, that is the hard truth.

Consider, now, how Ronald Reagan responded to the economic crisis of 1980, the worst since the Depression. In the "stagflation" of that Jimmy Carter era, interest rates had reached 21 percent and inflation 13 percent.

Reagan's answer was the tight money policy of Fed Chairman Paul Volcker and across-the-board tax cuts of 25 percent, while slashing the highest rates from 70 percent to 28 percent.

While unemployment hit 10 percent in 1982 and Reagan lost 26 House seats, in 1983 the tax cuts kicked in.

From there on out, it was boom times until Reagan rode off into the sunset, having created 20 million new jobs. "The Seven Fat Years," author Robert Bartley called them.

Reagan had followed the lead of Warren Harding and Cal Coolidge, who had cut Woodrow Wilson's wartime tax rates of near 70 percent to 25 percent, resulting in "The Roaring '20s," a time of unrivaled prosperity.

The JFK tax cuts of the 1960s, also a Reagan model, were equally successful.

Harding, Coolidge, JFK and Reagan all bet on the private sector as the engine of prosperity. All succeeded. Franklin Roosevelt bet on government. And the New Deal failed. It was World War II that pulled the United States out of the Depression ditch of the 1930s.

Comes now the financial collapse and economic crisis of 2008, inherited by Obama, with 40 percent of all stock values wiped out in a year, foreclosures pandemic, and unemployment near 7 percent and surging.

In crafting his solutions, Obama seems to be brushing aside the Reagan, JFK and Harding-Coolidge models, and channeling FDR and the New Deal Democrats.

Already staring at a $1.2 trillion dollar deficit for the year ending Sept. 30, about 8 percent of the entire U.S. economy, Obama intends to add a stimulus package of $700 billion to $1 trillion, yet another 5 percent to 7 percent of gross domestic product. The resulting deficit would be twice as large as Reagan's largest, 6 percent of GDP, which was the largest since World War II.

And how is this Niagara of money to be spent?

Hundreds of billions will go out in checks of $500 to $1,000 to wage-earners and individuals who do not even pay taxes. This is much like the George McGovern "demogrant" program of 1972, where every man, woman and child, if memory serves, was to get a $1,000 check from the U.S. government.

Other hundreds of billions will go to shore up state and municipal spending. Other hundreds of billions will go for "infrastructure" projects, another name for earmarks, which is a synonym for pork.

Now, as Obama does not intend to raise taxes, at least now, he is going to have to borrow this near $2 trillion from foreigners or U.S. taxpayers, or the Fed will have to create the money. Undeniably, this will have an impact upon the economy. But what will that impact be?

Where in history, other than World War II, is there evidence that such a mass infusion of spending restored prosperity?

Obama and the Democrats are taking a historic gamble, not only with their careers but with the country. If this monstrous stimulus package, plus the trillions in hot money, do not work; if the two ignite rampant inflation, rather than real growth, we are all out of options. The toolbox is empty.

And what will follow may truly resemble the 1930s.

http://www.humanevents.com/article.php?id=30214

[peejay 327]

Arnold from California : Actor

Ronal Reagan : Actor Yet so many people are attributing stuff to reaganomic and so on.

Obama: Community org., Lawyer

Let say it's 2am and you have to leave the country, who would you trust to safeguard your business until you return??

Would would you give your business

None of the above for sure. Mitt Romney actually ran a business and worked in the private sector. He was a governor of a state and has administrative cred. As far as politicians that ran for prez, I'd choose him.

He might even have another chance in 2012 if Obama fails to pull a rabbit out of his hat. Who knows?

At least Reagan and Arnold have administrative experience running a state (and a rather big one at that).

Obama: Community org., Lawyer? He does give good speeches though. Time will tell if he can get 'er done or make the mess worst.

[mawilson 2,133]

3 million jobs created by the government = 1 million workers + 2 million bureaucrats

Big government, yay!

[Saddle Bronc 124]

3 million jobs created by the government = 1 million workers + 2 million bureaucrats

Big government, yay!

Your math's wrong--the real figures are 300 workers and 2,999,700 bureaucrats.