[Rhodes22-list] Politics and discussion between Slim, Brad, et al.

[Brad Haslett]

Dave,

Put things in historical perspective.  At the end of the Carter
administration we had 21% interest rates and a 70% marginal income tax
rate.  The country was in the worst recession since the Great Depression.  I
was attempting to sell airplanes at the time.  Because of the excessive
marginal tax rates, you could sell a doctor a new airplane on lease-back and
it would be positive cash-flow for the first year if it never flew once.  We
still didn't sell many anyway because of interest rates and the dismal
economy.

Regan used deficit spending to go on an aggressive military spending spree.
The Soviet economy was already fragile and couldn't keep-up.  How much is
the fall of the Soviet Empire worth?  How much of the "Peace Dividend' that
we cashed in the 90's the result of spending in the 80's?

The Regan tax cuts were responsible for an almost 600% run-up in the stock
market in the next twenty years.

Think of it this way.  Two kids graduate from high school - one goes to
college and the other fries hamburgers for the next four years.  They get
together four years later and one says, "I'm $100K in debt but I have a
college degree and a good paying job!"  The other brags, "yea, but I'm debt
free!"  Who is better off?

It would be great if we never had to borrow money, both personally and as a
nation, but sometimes it makes good sense.  The key is, we should get
something for the money, ie, infrastructure, safety, a booming economy,
etc.  If we borrow to fund entitlement programs, we feel good until the
money runs out.  Kinda like running up the credit card on vacation when you
think about it.

On the other hand, if a persons real beef is deficit spending while cutting
taxes because their real goal is re-distribution of wealth - no amount of
logic or reason will prevail.

Brad



On 11/10/06, DCLewis1 at aol.com <DCLewis1 at aol.com> wrote:
>
>
> Philip,
>
> Believe it or not, I think you and I are converging.  You say Bush
> Sr  wasn't
> a conservative - from a fiscal perspective I totally agree with  you.  But
> I
> would also make that claim about his son Jr.
>
> As for Reagan, the facts are the facts, average $debt/yr in
> Reagan's  first
> term was x3 Carter's.  Again, I'm not presenting Carter as a  paragon of
> virtue, he was just immediately before Reagan so you can compare the  2
> without
> worrying a lot about inflation.  Carters $debt/yr was about the  same as
> Nixon's
> and Eisenhower's, as I recall.  The big jump up - and it  was a really big
> jump
> up - was the debt Reagan took on.  From my  perspective people that take
> on
> extraordinarily large amounts of debt  aren't fiscally
> conservative.  Reagan's
> record is in the national debt  statistics, and I think that disqualifies
> him
> as a fiscal conservative.
>
> About the budget,  I say again,  it's the Presidents job to  prepare and
> submit to the Congress a budget. The individual Congressmen and  Senators
> don't
> remotely have the time and background to personally review  each line item
> and
> understand all the entries in that budget in depth.  You  might think they
> should, I can tell you they don't.  The Presidents  Budget represents
> literally
> millions of hours of staff time by persons in  the operating
> agencies.  The
> Senators and Congressmen understand what  they are voting on at a top
> level, their
> staff usually understand to a  second level, but it is simply impractical
> for
> the Congress and it's staff have  the detailed understanding of the budget
> submissions that staff in the  operating agencies have.  The job of
> Congress is
> to authorize and  appropriate funds, as appropriate, to support the budget
> that has been submitted  by the President.  I doubt there has ever been an
> instance where the  Congress took out a blank sheet of paper and prepared
> its own
> budget.   The Congress does not prepare the operating budget of the
> Federal
> government, the President does.
>
> But you've whetted my interest, I don't recall whether the legislation
> requiring the President to deliver a budget is in legislation or actually
> a part
> of the Constitution.  If I ever get ahead of this board, I might try
> to  sort
> that out.
>
> Dave
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