We're facing an election that pivots on two contrasting tax policies. McCain is charged with "giving tax breaks to the wealthy". Obama is charged with "taxing the wealthy" and "spreading their wealth". Socially conscious liberals can't see any virtue in giving tax breaks to the wealthy. Market conscious conservatives can't see any virtue in penalizing the engine that drives the economy.
These issues have re-ignited the classic debate between a "free market economy" and a "socialist economy". At the core of this debate is the fundamental "social" difference between Capitalism and Socialism:
- 1) Capitalists believe a free economy, without intervention, will provide the same opportunity to all its members, allowing each member to decide his own "effort-benefit" ratio.
- 2) Socialists believe a "socially conscious" intervention in the market will guarantee all its members "equal benefit".
The beauty of the American economy is the fact that it is both Capitalistically driven and Socially conscious. Our country is the greatest country in the world because it is BOTH.
Our government was set up to "sit in the balance" between BOTH. We must understand that we can not endorse a "Wall Street" candidate with no heart for its members, or a "Social Humanist" with no mind for its enterprise. We must not vote for a candidate that would destroy the BALANCE (unless of course, you would like to destroy the balance).
Enough theory, here's the straight skinny on what's really going on:
George Bush's "economic policies" didn't ruin this country and didn't cause an economic decline. Wall Street's financial manipulation caused the current economic decline of the stock market and housing values. The culprits are the financial speculators, the credit market managers and the banks' unregulated business arms.
Remember that financial "earnings" (interest) are NOT part of GNP. The argument is, "banks don't contribute anything of value that can be considered a "product"of the country". The rest of us contribute (work) to create the collective wealth of our nation (measured in Gross National Product). (Okay, its Gross Domestic Product these days...almost the same)
Our country's GNP has not declined. Reports indicate we are all better off than we were eight (8) years ago, we can look around and see that is indeed the case. (except for those of us who can't convert our variable rate home loans, and/or our variable rate credit card balances...take that argument up with the Wall Street crowd "that doesn't respect its members").
George Bush increased spending because international terrorists declared war on America. The Bush adminstration's spending was defense related, not "housing" or "stock market" related.
John McCain rightly endorses the Bush doctrine (giving terrorists MORE OF THE SAME), but McCain does not/did not indorse Bush's "blank check" bail out package of our financial institutions.
Businesses in the United States are currently doing fine (except those that depend on the same financial markets to survive). The fact that businesses are "doing fine" is why the rest of us are "doing fine". Business in general, and small business in particular, are the innovators in our economy. Innovation and Consumption are in balance. Unemployment is holding.
McCain wants to give an advantage to "business". Tax breaks is one way to do that. Reinvestment tax credit is another way to do that. The theory is sound. Such advantage to business will solidify the labor base, increase jobs, increase research and developement and ultimately, exports. That's simply the way enterprise works.
McCain wants a temporary moratorium on government spending, particularly on earmarks to States.
McCain's policies are "Reaganesque". They are not more of the same Bush economics.
Obama wants to tax incomes over $250K. He wants to redistribute a portion of the resultant "wealth" to the lowest 40% of income earners as a rebate. He wants to "hold" the tax rates for 95% of the population, but he wants to cancel Bush's temporary tax cuts. Yet, at that, he wants to spend more on energy development and health care.
The operative strategy in Obama's economic plan is "WANTS TO".
"Wants To" is an attitude. It's an attitude of hope. "Hope" is a virtue, but it is not a strategy. You can not have economic recovery unless you have a strategy that is beyond "hope". A wish list of platitudes that are not positively correlated is NOT an economic plan. It is only a script.
Socialist scripts are "one sided" or "one minded". If they are implemented, they operate separateely from the economy, separately from the free market.
I fear a would-be President who suggests that "social reforms" are an economic policy. At its best that is blind inexperience. At its worst, it is intellectually dishonest.
I also question the associations that Barak Obama has had with "one sided" and "one minded" social activits throughout his life. What ever we can say about William Ayers or Reverend Wright, we have to admit they were NOT BALANCED influences.
Socialistic goals are never reached (by definition). Socialistic policy can't be measured in dollars because "equality" is multidimensional, money is not. If the United States was suffering from social or political inequality, we might need a socialist administration.
The fact is, the United States isn't socially sick. It doesn't need to "get well" socially. It needs to get well economically.
America needs to remain socially conscious and economically driven.
10/23/08 - Captain Econ
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