My criticisms are long, but there is a lot to criticize.
>The code word for “socialist” in Democrat rhetoric is “liberal.” This is part of the dissimulation and misdirection that is practiced in Democrat politics. In Europe, “liberal” still means support for individual rights, limited government, and the free market. Democrats, indeed, don’t believe in any of these things.
This is absolute bunk. Democrats of course believe in individual rights far more than Republicans as is proven by their stances on the separation of church and state, homosexual issues, abortion, stem cell research, religious discrimination, and drug legalization. This is agreed upon by you in earlier articles and in the diamond quiz you cite, which places liberal on the side of “social freedom.” If anything, it’s Republicans who do not believe in individual rights. Right-wing protests against a nonexistent Islamic cultural center (incorrectly dubbed the “Ground Zero Mosque”) that had little chance of ever being built show a large number on the right do not believe in the separation of church and state or even property rights. Calls from Newt Gingrich, Mike Huckabee, Bob Beckel and John Hawkins from Townhall Conservative.com for Julian Assange to be assassinated show many Republicans don’t even believe in trials or the rule of law.
Everyone knows that today’s social liberalism of the civil rights era, which people like John McCain and Glenn Beck want to simultaneously identify themselves with and demonize, is completely different than the classical liberalism of the 19th century. Thus, Martin Luther King was a conservative, as the Heritage Foundation claims, and conservatives were “the people who did [civil rights] in the first place,” as Beck says.
Even though limited government and free market ideas do go back to “classic liberalism,” modern liberals still take inspiration from the Enlightenment and correctly identify that as the main inspiration behind the Founding Fathers while conservatives follow a mythology that these ideals were derived from the Bible, though it was apparently lost for 1400 years (unless you’re Rick Santorum, in which case only people who hate the West are critical of the Crusades).
If it’s dishonest that liberals do not feel the need to make the distinction between classic liberals (of which there’s very few) and social liberals, then the right is guilty of the same misdirection by refusing to make the distinction between the anti-“nation building” conservatism of Bush 2000 and the Irving Kristol neo-conservatism of Bush 2001. Maybe you agree that “9/11 changed everything,” but if so, you probably shouldn’t be identifying yourself with the “Party of Principle” then, because a date isn’t a principle.
It’s also ridiculous that you cite Europe as a mode of comparison since, for the most part, their conservatives are more socialist than American liberals, easily proven by asking any European conservative their opinion on the country’s universal health care, their stance on the Iraq War, or their support for state-funded renewable energy. Investors Business Daily made the laughably ignorant claim that Stephen Hawking, who credits the British National Health Service with saving his life, “wouldn’t have a chance in the U.K., where the National Health Service would say the life of this brilliant man, because of his physical handicaps, is essentially worthless.”
> The proper meaning of the word begins to emerge when we travel further into Leftist discourse. There, “liberalism” or “neo-liberalism” means the revival of free market economics after Ronald Reagan. On the hard Left, mainstream Democrats are contemptuously called “liberals,” very much as the word might be used by Rush Limbaugh. Limbaugh, however, is aware that mainstream Democrats, as Fabian Socialists, only use the word to disguise their ultimate goals, which are not much different from those of the hard Left.
So liberals are liars because they don’t accept the adopted saint of conservatism as their glorious leader? You conflate “liberalism” and “neo-liberalism” as if they are the the same thing, and then go on to suggest that they were both “revived” under Reagan, as if Carter, Nixon, and Kennedy (the last president to self-identify as a liberal), did not believe in free market economics. There is a difference between classical liberalism and the neo-liberal policies of the 1980s Washington Consensus. As Ayn Rand wrote: “Mr. Reagan is not a champion of capitalism, but a conservative in the worst sense of that word—i.e., an advocate of a mixed economy with government controls slanted in favor of business rather than labor (which, philosophically, is as untenable a position as one could choose—see Fred Kinnan in Atlas Shrugged, pp. 541-2). This description applies in various degrees to most Republican politicians, but most of them preserve some respect for the rights of the individual. Mr. Reagan does not: he opposes the right to abortion.”
>The dissimulation of Democrats is so effective that it even fools Communists (people who otherwise only became “good liberals” when they were exposed and confronted with their treasonous allegiance and obedience to the Soviet Union).
Are you talking about the same Soviet Union that has been non-existent for almost 20 years? Are we going to bypass Europe in socialism and go straight to the Soviet Union? Because 40 years of the increasing gap between the rich and the poor appears to be positioning us to look more like Mexico than Europe.
>Bad faith is evident, for instance, in the way they carefully avoid admitting that they are socialists. They know that people are aware of the meaning of socialism — the ownership and control of everything by the government — and that Americans especially have an immediate and visceral antipathy to that. Democrats think that if they talk about freedom (while promising free stuff) while in fact creating tyranny, they will be able to deceive enough people to get away with it.
So public education and public health care is tyranny but secret wars in South America and never-ending Middle East occupations is the “policing of pirates”? I suppose Nixon was a liar for not calling himself a socialist since he created the EPA and his health care plan was more to the left than Obama’s. Romney’s health care plan was similar to Obama’s and Dole’s health care plan was similar to Clinton’s, but I didn’t hear anyone calling them socialists. You may call Bush policies like agriculture subsidies, pork-barrel spending, education, and medi-care socialist, but you don’t call Bush himself a socialist, even though his spending dwarfed Clinton’s. Considering Reagan’s taxes were for the most part higher than under Obama, Reagan should also have admitted to being a socialist too. Republicans also put up “Wanted” signs of JFK for the crime of being a “socialist” as well, so I guess the real question for you is who isn’t a socialist?
>Footnote: Another good example of incoherent falsehoods, and not just from these individuals, is the Democrat slogan, “Bush lied; people died.” The idea there is that because George Bush said that Saddam Hussein had weapons of mass destruction (chemical, biological, or nuclear), and no such weapons were found after the invasion of Iraq, Bush therefore had lied. Since the ordinary meaning of a “lie” is to utter an intentional falsehood, one might wonder how the slogan chanters know that Bush was uttering an intentional falsehood. Oh, that’s easy, we can leave out the “intentional” part. If there were no WMD’s in Iraq, then Bush ipso facto lied. I kid you not. I actually saw Michael Moore argue in an interview with Bill O’Reilly that it was a lie simply because it was false. This is something worse than just sophistry. It is an infantile petulance. But we get a lot of it from the Democrats.
In September of 2007, Sidney Blumenthal of Salon wrote: “On Sept. 18, 2002, CIA director George Tenet briefed President Bush in the Oval Office on top-secret intelligence that Saddam Hussein did not have weapons of mass destruction, according to two former senior CIA officers. Bush dismissed as worthless this information from the Iraqi foreign minister, a member of Saddam’s inner circle, although it turned out to be accurate in every detail. Tenet never brought it up again.” Rumsfield certainly lied when he said “We know where they are” and Powell’s chief of staff Lawrence Wilkerson has characterized the falsehoods Powell delivered to the U.N. as “a hoax on the American people” that he unknowingly participated in. In Bush’s 2003 State of the Union address, he said “From three Iraqi defectors, we know that Iraq, in the late 1990s, had several mobile biological weapons labs … Saddam Hussein has not disclosed these facilities. He’s given no evidence that he has destroyed them.” In fact, there was only one Iraqi source — Curveball — and there were no labs. In February 2011, Curveball admitted that he had lied about the existence of the WMDs in order to influence the United States into ousting Saddam.
>Thus, after the collapse of the mortgage and housing bubble, Congressman Barney Frank, confronted with videotape of he himself saying earlier that Federal mortgage lenders Fanny Mae and Freddie Mac were financially sound, and that only enemies of poor people and minorities were calling their financial health into question, nevertheless simply denied, in a bald-faced lie, that he had ever said any such thing.
Here’s the quote you are referring to: “I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They’re not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.”
Nothing in there about “enemies of poor people and minorities… calling financial health care into question.” And he never denied that he had said Fannie and Freddie were financially sound. What he denied was O’Reilly’s accusation that people took his line about “They’re not the best investments” to mean “They are really good investments.” Here’s the exchange they had about that quote:
O’REILLY: All right, that’s swell. But you still went out in July and said everything was great. And off that, a lot of people bought stock and lost everything they had.
FRANK: Oh, no.
O’REILLY: And — yes, oh yes. Oh, yes.
FRANK: I said it wasn’t a good investment. Please stop yelling.
…
O’REILLY: Oh, none of this was your fault! Oh, no. People lost millions of dollars. It wasn’t your fault. Come on, you coward! Say the truth.
FRANK: What do you mean coward?
O’REILLY: You’re a coward. You blame everybody else. You’re a coward.
FRANK: Bill, here’s the problem with going on your show. You start ranting. And the only way to respond is almost to look as boorish as you. But here’s the facts. I specifically said in the quote you just played that I didn’t think it was a good investment. I wasn’t telling anybody to buy stock. I said it wasn’t a good investment.
Did you really come away from that conversation thinking Frank was lying and O’Reilly was completely truthful? O’Reilly, like you, tried to put words in [his] mouth, claiming that he said “everything was great” and people were led to invest in them. It’s interesting that you go so far to defend Bush as not being deceitful about Iraq in a footnote yet use such a minor quibble as your first (formal) attack against the Democrats in this essay.
In the early 1990s, while the Democratic Party still held the majority in Congress, Barney Frank supported bills to increase regulation of Fannie Mae and create a government regulatory agency that would supervise and have authority over some aspects of the company. In October 2005 the House passed a bill to establish a new federal regulator created for Fannie, Freddie and the Federal Home Loan Banks authorized to set capital standards and, if it deemed necessary, require reductions in mortgage portfolios. The Bush White House opposed the proposed legislation and instead supported the pending Senate bill, but the Senate bill never came up for a vote, and the legislation died.
In early 2007, Barney Frank sponsored a bill to create the Federal Housing and Finance Agency, granting that agency “general supervisory and regulatory authority over” Fannie Mae and Freddie Mac, and directing it to reform the companies’ business practices and regulate their exposure to credit and market risk to make sure that Fannie Mae and Freddie Mac “operated in a safe and sound manner, including maintenance of adequate capital and internal controls” and to establish standards for “management of credit and counterparty risk” and “management of market risk.”
Regardless of how financially sound Barney Frank thought Fannie and Freddie was, the whole issue has been completely inundated by Republican propaganda that Fannie and Freddie were the original cause of the financial crisis and that Barney Frank “was almost single-handedly responsible for the economic crisis,” as quoted by Fox News contributor Monica Crowley. Fannie and Freddie got into subprime junk and helped fuel the housing bubble, but they were trailing the irrational exuberance of the private sector. They lost market share in the years 2002-2007, as the volume of private issue mortgage backed securities exploded. Investment banks created a demand for subprime loans because they saw it as a new asset class that they could dominate, and Fannie and Freddie actually had to change their rules just to keep up. The private sector made subprime loans because they could get paid for making the loans, for turning them into securities, and for trading them often using borrowed capital, not because the government forced them to.
At any rate, though Fannie and Freddie do have government sponsorship, they are still private companies with stockholders, and they are hardly Democratic constituents alone, as many McCain campaign aides like Wayne Berman, John Green, Charlie Black, Arthur Culvahouse, and William E. Timmons were also lobbyists for Fannie and Freddie. “It’s a bipartisan problem,” said Bill Beach, director of the Center for Data Analysis at the conservative Heritage Foundation. Their part in the crisis would have been even larger if temporary restraints on both Fannie and Freddie by regulators hadn’t curtailed their lending just as housing prices were really taking off.
The nonpartisan Politifact.org website says: “Lax regulation also played a significant role in the crisis. Some regulatory agencies had regulation powers that they never utilized or didn’t utilize well. The Federal Reserve has the power to tighten lending standards, for instance, or raise interest rates. But officials there discouraged new rules and advised Congress repeatedly not to regulate derivatives.” Politifact also places blame for the crisis on the fact that: “In 1999, Republicans passed legislation, signed by President Clinton, specifically exempting [credit default swaps] from regulation.” Even Alan Greenspan and Republican/Libertarian-leaning Ben Bernanke admit it was lax regulation, not over-regulation, that helped cause the economic crisis.
>The preposterous thing here is that any major Democrats, especially “Chucky” Schumer, worry in the least about balancing the budget. The only reason they ever complained about Republican spending or deficits is that they wanted to sucker people into putting them in power so they can have even greater spending and deficits. The Democrat explanation for all their failed programs is always that they didn’t spend enough — the programs were not “fully funded.” Since their spending will never make their programs successful, they will, by necessity, always need greater spending. If they ever worry about paying for this, they only think about raising taxes.
Actually, G.W. Bush increased government spending by more than any of the 6 presidents before him, including the king-socialist himself, LBJ. The Congressional Budget Office estimated Paul Ryan’s plan to replace Social Security and Medicare with vouchers and to raise taxes on 90% of Americans while cutting taxes for the top 10% would add $62 trillion to the debt.
You may not like taxes on high income but it’s far more effective at driving down deficits than mythical non-military “spending cuts.” The United States has some of the lowest taxes in the world after Switzerland and tax bills in 2009 were at their lowest level since 1950. Polls show that most Americans oppose cuts to education, social security, and defense, but do want cuts to foreign aid, which they generally believe is much larger than it really is. Republicans may praise cuts but never specifically identify what spending cuts would even put a dent in the deficit. Military cuts are usually off the table despite the fact that it’s our largest and most bloated expenditure (23%), with more money going to it than the next 15 largest military budgets in the world combined (including tons of money for tanks and planes that never get used), even though our primary enemy now are terrorist groups that hide out in caves or residential zones.
David Wessel of the Wall Street Journal writes: “Say Congress zeroed out all annually appropriated domestic, nondefense spending, which amounts to about 17% of all federal outlays and excludes benefits such as Social Security and Medicare. That would mean no air-traffic controllers, tax collectors or cabinet secretaries. No test tubes, lights in federal buildings or federal job-training grants. The deficit in 2020? Still uncomfortably large: $668 billion and growing, according to estimates by the Committee for a Responsible Federal Budget, a deficit watchdog.” In comparison, the Sustainable Task Force, which includes Barney Frank and leading defense and budget experts, has identified $1 trillion in waste that that can be cut from the defense budget over the same 10 years by eliminating unnecessary Cold War-era programs.
I’ve noticed you make it a habit to justify any complaint about income inequality by stating that income roughly correlates with hours worked, but that isn’t true for the top 5%, who on average work less than the rest of the top quantile. But the larger point is there is a huge difference between 8 hours of physical labor and 12 or 14 hours of pushing papers. According to the Wall Street Journal, the richest 400 Americans have more wealth than the bottom 50% combined. According to an analysis done by Citigroup, the top 1% owns more financial wealth than the bottom 95%. A study by the Southern Economic Journal found that “71 percent of American economists believe the distribution of income in the US should be more equal, and 81 percent feel that the redistribution of income is a legitimate role for government.” With America having the highest inequality and poverty (and growing) in the OECD after Mexico and Turkey, even Alan Greenspan said that the income inequality in the United States “is not the type of thing which a democratic society – a capitalist democratic society – can really accept without addressing.”
Michael Snyder at BusinssInsider.com has published “22 Statistics That Prove The Middle Class Is Being Systematically Wiped Out Of Existence In America”:
[Statistics Redacted]
>Indeed, when it was pointed out to Barack Obama by a reporter that revenue could be increased by cutting taxing, candidate Obama responded that “fairness” was more important than revenue. Thus, although the stock Democrat response is to deny that cutting taxes increases revenue (although one of the best examples of increased revenue is when Lyndon Johnson, a Democrat, did it), Obama incautiously revealed, as he has done more than once, his real agenda — attack wealth, regardless of the damage it may do to all. Revenues may fall, unemployment may soar, the Nation may be impoverished; but the government, and the self-righteous Left, will prosper.
No mainstream economist believes this. As the nonpartisan website Factcheck.org points out: “We found that a slew of government economists – from the Congressional Budget Office, the Treasury Department, the Joint Committee on Taxation and the White House’s Council of Economic Advisers – all disagreed with that theory, saying that tax cuts may spur economic growth but they lead to revenues that are lower than they would have been if the cuts hadn’t been enacted…. For example, N. Gregory Mankiw, former chair of the current President Bush’s Council of Economic Advisers, calculated that the growth spurred by capital gains tax cuts pays for about half of lost revenue over a number of years and that payroll tax cuts generate enough growth to pay for about 17 percent of what is lost.”
As written in Karl Case and Ray Fair’s Principles of Economics (2007): “The extreme promises of supply-side economics did not materialize. President Reagan argued that because of the effect depicted in the Laffer curve, the government could maintain expenditures, cut tax rates, and balance the budget. This was not the case. Government revenues fell sharply from levels that would have been realized without the tax cuts.”
When Bush and Cheney tried to use the exact same “supply side” line, Andrew Samwick, the chief economist on Bush’s Council of Economic Advisers for 2004/05 said: “You are smart people. You know that the tax cuts have not fueled record revenues. You know what it takes to establish causality. You know that the first order effect of cutting taxes is to lower tax revenues. We all agree that the ultimate reduction in tax revenues can be less than this first order effect, because lower tax rates encourage greater economic activity and thus expand the tax base. No thoughtful person believes that this possible offset more than compensated for the first effect for these tax cuts. Not a single one.”
Reagan and G.W. Bush were the only two presidents who advocated supply side economics, the same two presidents to have their own chief economist or budget director accuse them of lying about the profits of supply side, and the same two presidents who presided over a massive explosion in national debt. The last time we started balancing the budget was under Clinton, which FactCheck.com says primarily came from his tax on high income which Republicans falsely called “the largest tax increase in history.” The Bush Administration broke it by adding $5 trillion to the debt. Dick Cheney famously said that “Reagan proved that deficits don’t matter. We won the mid-term elections, this is our due.”
>Of course, when the Soviet Union owned everything in the country, there was no private economy to tax, and the economy still didn’t work, Stalin decided it was time to kill people — “wreckers” — because sabotoge [sic] was the only explanation he could come up with for continued failure.
The Soviet Union divided property ownership into two categories: “capitalist” private property (the means of production) and “socialist” personal property (everything else). This distinction has been a source of confusion leading to the erroneous belief that all individual property was abolished, when it was not.
>The Democrats are not at that point….yet.
Is it perhaps possible to discuss financial policy without associating one side or the other with Stalin?
>This strategy goes back to the Depression, when the recession created by the collapse of the Stock Market, which was recovering by 1930 (unemployment was back down to 6%), was turned into a Depression by the Smoot-Hawley Tariff bill and then when the Federal Reserve allowed the banking system to collapse. This was actually the fault of Herbert Hoover and the directors of the Federal Reserve System. However, the Democrats wanted to blame it on “speculators” and on the banks themselves. Thus, when FDR came to power, what was wrong was misdiagnosed and policies were implemented, usually following in Hoover’s footsteps (without any credit to Hoover, except privately), that prolonged the Depression through the rest of the decade. This failure is what the Democrats have never wanted to admit, and still will not admit.
When Jude Winniski first proposed this alternative theory for the Great Depression being blamed entirely on Smoot-Hawley (or”Hoot Smalley”) as a part of his wider “Mundell-Laffer Hypothesis” of 1978, it was widely criticized by most economists of his time, including Milton Friedman. “In fact, few economists think the Smoot-Hawley tariff (as it is most often known) was one of the principal causes of the Depression. Worse mistakes were made, largely out of a misplaced faith in the gold standard and balanced budgets,” according to The Economist. Dennis Sevakis writes in the conservative American Thinker[:] “Of the $131 billion in lost economic output over the five-year period, only about $0.7 billion seems attributable to trade. This is shown as the last entry in the last row of the table. In either absolute or relative terms, the trade portion of the economic contraction of the Great Depression appears to be of little import.”
Politifact.com says that the tax laws then in force during the first three years of the depression “were initiated by steep tax cuts urged by long-serving Republican Treasury Secretary Andrew Mellon and enacted under Hoover’s predecessors, Warren Harding and Calvin Coolidge — not necessarily a winning argument in favor of low taxation.” The site goes on to say that “The second dip of the “double-dip” recession of the early 1980s — which occurred entirely on Reagan’s watch — lasted 16 months from peak to trough. That made it the longest recession between the Great Depression and today’s “Great Recession.”” but adds that “Focusing on the presidential role in combating recessions ignores other important factors.”
Although Smoot-Hawley was harmful to international trust, the majority of economists and historians believe a weak banking system, overproduction, bursting credit bubble, financial inequality for farmers and industrial workers, the Dust Bowl, and a government-held laissez faire policy were more to blame. The economy improved after the New Deal far more than it did under Hoover. According to Christina Romer, Chair of the Council of Economic Advisers and an expert on Great Depression era economics, swift government action brought forth market stability. Also notable is, shortly before the current financial crisis, the gap between the rich and the poor increased to levels not seen until right before the 1929 stock market crash.
To say Democrats alone should “admit” to a theory blaming it all on Smoot-Hawley when the New Deal has been legitimized by every sitting American president — including Reagan (as you yourself admit!) — is absurd. Jefferson himself said that banks were more dangerous than standing armies and that “the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.”
>What the Democrats (and Mr. Frank) leave out is that banks, far from being left “to their own devices” by deregulation, were threatened by regulators (and Democrats) that if they did not make loans to underqualified, largely minority, borrowers, they would be subject to regulatory and legal sanctions. This was backed up with tendentious statistical studies intended to show discrimination against minority borrowers. Lenders were thus coerced into making loans they would not have done otherwise. They would be accused of racial discrimination if the statistics did not show the right “diversity” balance in their lending, with all the evils of legal prosecution and bad publicity falling on them. There was a remedy for this, which was for lenders to pass on the risky mortgages, often packaging them with other securities to conceal or balance the liability. These became “toxic assets,” which could be passed around like hot potatoes (with the danger that knowledge of their problems could later be used to accuse them of fraud).
While the “National Homeownership Strategy” did start under Clinton, it was greatly expanded by G.W. Bush’s “Ownership Society.”
A study released by a law firm specializing in CRA compliance estimated that in the 15 most populous metropolitan areas, 84.3% of subprime loans in 2006 were made by financial institutions not governed by the CRA. Moreover, the president and CEO of the Federal Reserve Bank of San Francisco, stated in 2008 that “studies have shown that the CRA has increased the volume of responsible lending to low- and moderate-income households.” A study published by the American Sociological Review found that “Predatory lending aimed at racially segregated minority neighborhoods led to mass foreclosures that fueled the U.S. housing crisis.” Politifact.com points out that both Obama and Hillary Clinton spoke out against the Bush Administration on “various aspects of the issue as early as 2006,” including predatory lending, while Bush ignored it.
>In January 2010, Fannie Mae and Freddie Mac have been given a virtual blank check to go into unlimited debt. We are therefore going to see a new credit bubble forming. Meanwhile, the Democrats simply practice the Bart Simpson defense: I didn’t do it.
You can thank Bart Simpson for a good deal of your own misinformation because just like he said in one of the episodes that isn’t 20 years old: “I had this dream where my whole family were just cartoon characters and our success led to some crazy propaganda network called Fox News.”
[To be concluded…]
