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Ok, You Two, What Would You Do to Solve This Mess?

NEWSWEEK

From the Editors (1)
Fineman: Obama, McCain: Come Clean on the Economy

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McCain's wide-net approach to the financial crisis may reflect the lack of a dominant voice on his team since he parted with his closest adviser, Phil Gramm. The former Texas senator, a champion of financial deregulation, left the campaign during the summer after he decried Americans as a "nation of whiners," embarrassing McCain. But McCain has relied on no one as much since. "Everything that John learned before the campaign about economics he learned from Phil Gramm," says a former longtime McCain adviser who would talk about the candidate's positions only on condition of anonymity. "Senator McCain seeks advice from a broad and diverse group of people," says a senior McCain adviser, who requested anonymity in disputing about these characterizations.

Despite his experience chairing the Senate commerce committee, McCain has never had a particularly comfortable relationship with Wall Street, says a Republican fund-raiser who works in the financial industry and asked for anonymity in discussing politics. At one Wall Street fund-raiser, the candidate seemed so stilted and awkward in talking about finance it was like he was "going to visit the dentist," says the GOP fund-raiser. The senior McCain adviser tells NEWSWEEK that the senator "has been in Congress for over two decades and he is obviously well versed on issues relating to the American economy. His wife also owns a successful business, so he has that perspective as well." The adviser adds: "Obama is fond of pointing out the presence of Rubin and Summers on his team, but … their sole contribution to the debate was to wait and see what the administration came up with."

For Obama's part, his aides say that his adoption of the core Clinton economics team doesn't mean a return to Clintonomics. Officials who led the former president's deficit-cutting efforts in 1993 say this is a different environment: Summers, for one, has publicly counseled deficit spending to get the economy healthy again. And as the crisis has spiraled further out of control, Obama has been forced to step up and offer more specifics. He has also made a personal visit to see Bernanke (McCain has not, though he has talked to him on the phone). Recently Obama proposed a "stability fee" that Wall Street's bailed-out firms should pay back to the government and a plan to help small businesses by extending a tax credit. Like McCain, says one of the Obama aides, Obama knows that if he's elected he's "going to have to hit the ground running on Jan. 20." Ground that, it seems, is ever shifting.

With Mark Hosenball and Suzanne Smalley

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Member Comments

Posted By: Oplis @ 11/02/2008 12:00:14 PM

If Dems do, ...McCain will lose!
There are more Dems registered than Republicans this time, and if the undecided Democrats vote along party lines, Obama will win. This is why it is so important to get out the vote on the Dem side, we have to get this republican policy out , and get a different policy in place. Whether you believe Obama will be as affective as he says or not, McCain , will not be affective in change policy at all, he will be a Bush clone,....no?....he wants to stay in Iraq, " stay the course",..he wants to keep tax breaks for Corp.s in place including oil companies, plus add additional cuts for the oil industry, he wants to keep the tax rates for wealthy Americans, at present rate, he has no health plan, no education plan, and no solution to the economic crisis. Obama , is just the opposite, he knows that if you broaden your tax base with new jobs , in the form of green jobs, and high tech jobs, because of new training, and put the wealthy back in the tax rate they had under Clinton, and bring the troops home , saving 150 billion per year, all of this combined will improve the economy in the long run, and in the short run, a tax break for the middle class, and the troops out of Iraq.
Posted By: Nowforthetruth @ 10/27/2008 8:41:19 AM

http://www.youtube.com/watch?v=iivL4c_3pck

2001 Chicago Public Citizen Radio Interview criticizing the Warren Court as not radical enough for not pursuing redistribution of wealth.

Says that community organizing is for the purpose of assembling the political power to force redistribution of wealth.
Posted By: Nowforthetruth @ 10/26/2008 9:36:14 PM

The Kennedy tax cut.

http://www.heritage.org/Research/Taxes/bg1765.cfm

About half way through the article.

"President Kennedy proposed massive tax-rate reductions, which were passed by Congress and became law after he was assassinated. The 1964 tax cut reduced the top marginal personal income tax rate from 91 percent to 70 percent by 1965. The cut reduced lower-bracket rates as well. In the four years prior to the 1965 tax-rate cuts, federal government income tax revenue--adjusted for inflation--increased at an average annual rate of 2.1 percent, while total government income tax revenue (federal plus state and local) increased by 2.6 percent per year . In the four years following the tax cut, federal government income tax revenue increased by 8.6 percent annually and total government income tax revenue increased by 9.0 percent annually. Government income tax revenue not only increased in the years following the tax cut, it increased at a much faster rate.
The Kennedy tax cut set the example that President Ronald Reagan would follow some 17 years later. By increasing incentives to work, produce, and invest, real GDP growth increased in the years following the tax cuts: More people worked, and the tax base expanded. Additionally, the expenditure side of the budget benefited as well because the unemployment rate was significantly reduced.
Using the Congressional Budget Office's revenue forecasts (made with the full knowledge of the future tax cuts), revenues came in much higher than had been anticipated, even after the "cost""of the tax cut had been taken into account. Additionally, in 1965--one year following the tax cut--personal income tax revenue data exceeded expectations by the greatest amounts in the highest income classes.
Testifying before Congress in 1977, Walter Heller, President Kenned''s Chairman of the Council of Economic Advisers, summarized:
What happened to the tax cut in 1965 is difficult to pin down, but insofar as we are able to isolate it, it did seem to have a tremendously stimulative effect, a multiplied effect on the economy. It was the major factor that led to our running a $3 billion surplus by the middle of 1965 before escalation in Vietnam struck us. It was a $12 billion tax cut, which would be about $33 or $34 billion in today's terms, and within one year the revenues into the Federal Treasury were already above what they had been before the tax cut.
Did the tax cut pay for itself in increased revenues? I think the evidence is very strong that it did."