LAST NIGHT'S FLORIDA DEBATE ON THE ECONOMY WAS A LOSER BUT THE CAMPAIGN ADS...

Utterly clueless

Willard's attack on McCain is under this morning's post on the Florida debate. McCain's response ad (below) plays up the Flip-Flip Mitt theme not many voters find too admirable.

While these two clowns-- not to mention the fast-fading Giuliani-- argue about which one loves the Bush tax cuts (neither of them supported) more, economists who are looking at the data and results of Bush's economic policies are reaching a consensus that Bush's tax cuts for the wealthy and other pro-corporate/anti-worker/anti-consumer policies have been disastrous for America, including for the American economy.

...[T]he underlying problems that ail the markets and the economy cannot be waved away by the Fed's magic wand. In truth, we're at the beginning of a long, arduous process of figuring out how much of the post-tech bubble prosperity was real and how much was the result of a credit-induced frenzy. The answer will determine what we can expect.

The housing markets, of course, overshot as too many buyers took out subprime mortgages they couldn't afford. The outcome will be a decline in home values, with prices in some areas already down.

But the economic writedown is likely to go far beyond housing. Household spending, consumer debt, financial sector profits: All may need a retrenchment, sudden or gradual, to get back to sustainable levels. That's bad news for investors and the global economy, which still depends heavily on U.S. consumption for growth.

There may even be a reassessment of whether recent productivity gains were fueled by excess credit. If growth in productivity slows, the economy will stagnate, real wages will weaken, corporate earnings targets will be harder to meet, and inflationary risks will increase.

A few days ago The Agonist demonstrated how banks which acted like pigs at Bush's trough, going for quickie profits rather than reasonable, long-term, sustainable growth have damaged the economy. It's a very Republican mindset, certainly the Willard mindset and one that Giuliani and McCain, though not really understanding it, both buy into. On top of that, widespread international boycotts of American brands by people the world over pissed off about Bush's foreign policy, have been extremely damaging.

It's not just many of the 1.5 billion Muslim consumers, either, that have quit buying Made in America. It's people from France to Brazil to Canada to India, and it is a trend that began even before Bush invaded Iraq -- remember those angry millions the world over that took to the streets urging him not to start it?

When foreigners, who once valued American craftsmanship, stop buying U.S. products, it's got to worsen the balance of trade. And that can translate into layoffs, into closed factories, into reduced consumer spending. The Census Bureau is reporting the trade deficit in goods and services was a whopping $63 billion in October-- and that's a factor in the current meltdown.

And this, of course, is separate from the warning we had from economists that a prolonged occupation of Iraq would lead directly to a U.S. recession.

Today David Sirota points out how the "Stimulus" package Insider Democrats have conspired with Bush and the GOP to foist on us, is a sham and a swindle, designed to help out big political donors-- of both parties-- in the financial industry, not the people who are hurting.

Specifically, most GOP presidential candidates are demanding corporate tax cuts as the "stimulus" to improve American competitiveness, ignoring a recent Treasury Department report noting that the United States already has among the lowest effective corporate tax rates in the developed world. Republicans like John McCain, fresh off a Merrill Lynch fundraiser, say we need not expand unemployment benefits and food stamps to help workers and give the economy a reliable Keynesian boost. No, they say we must hand over more cash to the same financial industry that just gave its executives $39 billion worth of year-end bonuses.

Leading figures of both parties seem eager to help limit the debate over "stimulus" and make the final package a corporate goodie bag. According to the Washington Post, Democratic Sen. Max Baucus (Mont.) asked economists affiliated with The Hamilton Project -- a Citigroup-backed think tank -- to testify to Congress at its initial hearings on a stimulus package. Labor economists, by contrast, were not invited.

You might think Citigroup's central role in creating the current financial crisis would disqualify it from influencing legislation addressing that crisis. But remember, Citigroup gives lavishly to Democratic politicians and pays Democratic financier Bob Rubin roughly $10 million a year as a top executive.

Not surprisingly, congressional Democrats appear poised to support a package stripped of increases in safety-net programs and comprised largely of business tax cuts. This, even though experts agree the former would have an immediate economic impact and the latter will take at least six months to hit. As usual, We the People are told to wait patiently as moneyed interests claim their latest gift from Washington.

President Bush is undoubtedly pleased. He said he wanted "stimulus" built primarily on tax cuts and no new public investment -- more proof of his desire to win the Most Out of Touch President title from Herbert Hoover (at least Hoover proposed new infrastructure with the tax cuts he claimed would prevent the Great Depression).

Let's be clear: There's nothing inherently bad about Washington interacting with Big Business, and nothing wrong with "stimulus" as a concept. But as this recession intensifies, there's a big problem with politicians catering exclusively to Big Business and an even bigger problem with converting "stimulus" into yet another code word for "swindle."

So while you digest all that, enjoy Willard blowing in the wind:




UPDATE: McCAIN SLAMS WILLARD WITH A SPOT ON RADIO AD

A few weeks ago Huckabee pointed out the American workers and their families might prefer someone in a position of leadership who is like them rather than like the guy who's laying them and their friends off. That summed up Willard pretty well but for those who missed the point, McCain made drove it home in his new anti-Willard radio spot today, which points out that Romney is just some kind of manager, not a visionary or a leader. But the extreme right still hates McCain and will never support him-- even if it means getting behind a pathetic empty-suit nonentity like Willard. The really radical, deranged kooks are especially virulent in their psychotic hatred for McCain.

UPDATE: WHO YOU GONNA TRUST?

Although he denies it now-- pants on fire-- McCain once famously declared that he knows next to nothing about economics. Maybe that why he keeps Lieberman around. In any case, his run of the mill right wing talking points about how to fix the economy almost make Willard look like he knows something. Well, to be fair, Willard does know something-- how to suck an entity dry for short term profits while killing the long term prospects. That's his specialty and he could conceivably be worse for the economy then even Bush, as hard as that is to believe. In any case, none of these idiots are worthy of trusting. And the Democrats? I'm not sure. Read a real economist's analysis of the bogus stimulus package the Democrats and Republicans put together. Paul Krugman shows why it stinks.

I’d guess that the top two quintiles are unlikely to be liquidity-constrained, so the rebate will have little effect on their spending. But they get 58% of the money. The bottom two quintiles, which are the place you’d most expect to have an impact, get only 21% of the money. Split the difference on the middle quintile, and you’ve got a plan where around 2/3 of the outlay is likely to be ineffective."

That's what we need Democrats for? What about food stamps or an unemployment insurance extension for the people who are actually in need?