Buffett Rule

[tstew]

Originally Posted by deacon blues

The numbers are the numbers and one can't deny them. Reagan became president when the economy under Carter was a mess. By the time he left office the economy was roaring. It peaked into the mid 90s with only a few years of Clinton as president. Eight years of Reagan and four years of Bush I should be given the lion's share of credit.

And Clinton continued Regean's fundamentals. He cut taxes, he trimmed spending, he revamped Welfare and other government programs. After leaning to the left in 1993-1994 and summarily getting his butt kicked in the '94 midterms, he spent the rest of his presidency leaning back to the right and worked with the Republican led Congress to further promote supply side economics. Under his administration however the seedbed for the 2008 banking collapse took place.

In 1999, Fannie Mae came under pressure from the Clinton administration to expand mortgage loans to low and moderate income borrowers by increasing the ratios of their loan portfolios in distressed inner city areas. Additionally, institutions in the primary mortgage market pressed Fannie Mae to ease credit requirements on the mortgages it was willing to purchase, enabling them to make loans to subprime borrowers at interest rates higher than conventional loans.

In 1999, The New York Times reported that with the corporation's move towards the subprime market "Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980s." Alex Berenson of The New York Times reported in 2003 that Fannie Mae's risk is much larger than is commonly held. Nassim Taleb wrote in The Black Swan: "The government-sponsored institution Fannie Mae, when I look at its risks, seems to be sitting on a barrel of dynamite, vulnerable to the slightest hiccup. But not to worry: their large staff of scientists deem these events 'unlikely'". In his 2006 book, America's Financial Apocalypse, Mike Stathis also warned about the risk of Fannie Mae helping to trigger the financial crisis: “With close to $2 trillion in debt between Freddie Mac and Fannie Mae alone, as well as several trillion held by commercial banks, failure of just one GSE or related entity could create a huge disaster that would easily eclipse the Savings & Loan Crisis of the late 1980s. This would certainly devastate the stock, bond and real estate markets. Most likely, there would also be an even bigger mess in the derivatives market, leading to a global sell-off in the capital markets. Not only would investors get crushed, but taxpayers would have to bail them out since the GSEs are backed by the government. Everyone would feel the effects. At its bottom, I would estimate a 30 to 35 percent correction for the average home. And in ‘hot spots’ such as Las Vegas, selected areas of Northern and Southern California and Florida, home prices could plummet by 55 to 60 percent from peak values.”

The critics of Reaganomics are Keynesian economists like Paul Krugman who criticizes Obama for NOT SPENDING MORE MONEY! Krugman believes deeper debt and higher deficit spending would fix this economy. He touted the wonderful European socialist governments for years. Countries that in some places tax people as high as 70% of their income and where the average taxpayer pays 35-45% of their income all of the many government social programs. Now that Europe is on the verge of financial ruin, Krugman spends a lot of his time writing in the NY Times criticizing the Europeans for cutting spending on government programs. AND THE WORLD GIVES GUYS LIKE KRUGMAN NOBEL PRIZES FOR ECONOMICS! Insane.

You can't argue with the results, even if you have critics. The Patriots may win lots of Super Bowls, but a lot of people still don't like Belichick or Brady and they still get criticized. But you can't deny they are winners. Like Reagan or not, the facts are the facts, America's economy THRIVED under his policies.

My problem is that Democrats will use facts argue that specific things Clinton did is what actually led to the success under him.

You say the economy peaked in the mid 90's before he really had much to do with it, but in reading about his presidency just now I read these bullet points among others:

• The poverty rate also declined from 15.1% in 1993 to 11.8% in 1999, the largest six-year drop in poverty in nearly 30 years. This left 7 million fewer people in poverty than there were in 1993.[68]
• The surplus in fiscal year 2000 was $237 billion—the third consecutive surplus and the largest surplus ever.[67]
• Clinton worked with the Republican-led Congress to enact welfare reform. As a result, welfare rolls dropped dramatically and were the lowest since 1969. Between January 1993 and September 1999, the number of welfare recipients dropped by 7.5 million (a 53% decline) to 6.6 million. In comparison, between 1981–1992, the number of welfare recipients increased by 2.5 million (a 22% increase) to 13.6 million people.[69]

It's just confusing tit-for-tat to me.