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MESSAGE BOARD Boom and bust
In "Boom and Bust," Jeff Madrick questions the significance of the American economy's recent good news. Is his pessimism justified?
Page 1 I couldn't find a more pessimistic piece. The economic recession started under Clinton (yes, Bubba oversaw negative GDP in his last 6 months in the white House and did nothing to address it). Jobs growth typically trails GDP growth by about a year; the puny tax cuts implemented in the last 18 months are taking effect now. Stock market growth leads in the advance of the economy by 12 months as well. So everything will be hitting stride just in time for Bush's re-election...which, I'm happy to predict, will tick you guys off to no end! Lou, Wenham, MA Totally one sided, where's the equal time for this political ad? He takes plenty of potshots at Reagan but the 80's were certainly good economic times in general, as were the 90's. He tries to give way too much credit to falling interest rates and home refinancing to the current economic resurgence but the rates have been falling somewhat steadily for 12 years and had much more to do with the boom of the late 90's than today. He offers no proof for his "The first line of defense against a downturn in profits is now to cut jobs and squeeze more hours out of workers" comment and reeks of plain old corporation bashing. He talks of consumers spending instead of saving as if it's a new thing, encouraged by the Bush administration, while it's been an ongoing trend for 30 years and was the hallmark of the late 90's economic boom. Finally, he talks of long term unemployment, as if extending benefits to people even longer is a good thing. There are a lot of unemployed people who need to realize that the bloated, overpaid jobs of the late 90's are gone and aren't coming back (esp. web related). Cutting off benefits will finally force them to make the realization and get back to work. Benefits were already extended too long. Lazlo, Waltham The president has put us on a path toward a stronger economy, not a weaker one. His tax cuts were modest. Mine were cut about 10%, so the government still gets 90% of what I was paying. That's fair, since it reins in at least some waste (example: 50 people in the University of Maryland system make more than $250,000. Reason: the unfair income tax. I assume some of my federal taxes make their way there). Sure wish it were the other way around though (me keeping 90% and them getting 10%)! I'm hoping that we'll eventually get there. The signs looks good. Two states last week voted in Republican governors, and the People's Republic (now a misnomer) voted down rent control 60-40. Even Howard Dean recognized that publicly funded campaigns are counter-productive (how's that for irony, a Democrat saying no to a big-government program!). A recent George Will column said that slightly over 60% of the people live under Republican governors. The deficit can't exceed 5% of GDP, so that limits how much Washington can spend. Once that limit is reached there will be no other choice than to cut spending. The spending cuts will make us stronger since much of the spending is wasteful (example: the Big Dig. $2 billion per mile for an 8 mile highway). So that money will be put to better use. Peter, Cambridge It isn't good enough. The average American could really care less about GDP and all these other stats they keep pumping out to tell us things are good. The only stat that matters to us is jobs, and last month, U.S. employers announced a total of nearly 172,000 more layoffs. That is on top of the 3 million jobs already lost since 2001. You can tout the fact GDP is up 7.2% all you want, it doesn't mean diddly to those who are out of work and have been for a long time. Lance, Revere I think we should be able to vote where our tax dollars go. At least at a gross level when we file our taxes. COnservatives who hate taxes and services but loves the military can vote to devote their dollars to military. Bleeding heart liberals who hates the military but support other social services can vote their tax dollars to libraries, schools, housing social services, medical services. Pay raises for congress should also be decided by the polls or at least a combination of the GDP and CPI. No group should decide their own pay raises. Where is the accountability? Frankly, I have doubts about the numbers recently. They may be revised downwards later. If growth is that robust, where is inflation? I think inflation is there but they are not measuring the right things. Matt, Newton I am as pessimistic as the author, but not for the same partisan reasons. People still seem not to get the concept of jobs going offshore and NOT COMING BACK! When you lose your job, you now have to wonder if it's not only your job, but the whole class of jobs for which you're qualified (programmers, etc.) will now be done by people with the same skills willing to work for 1/4 of your pay. How you feel about the ecomony should really be based on your opinion of the following-are the Chinese, Indians, Malysians, etc. going to have their standard of living raised to match ours, or is ours going to be lowered to match their's? Rick, Melrose Oh please Lou, Clinton saw decreased GDP for six months? Out of eight years?! This president took a record surplus and turned it into a record deficit, while over three million Amercians lost their jobs, all in three years. One more year and then its back to Crawford, Texas. Mike, Norton No his pessimism isn't justified. It is a matter of time before the economy gets back on track. It's slowly stating to happen. The tax cuts were the right thing to do. They will take some time to have an effect but they will work. I know I'm happy that I take more money home every week. I can pay my bills, save for my retirement and even spend some too. I should be able to take home even more. Maybe someday in the future we will all be able to keep what we make. How about a nice 5% or even 10% flat tax for everyone. Then everyone will pay the same percentage and it'll be as fair as it could be. Don't forget that the rich would still be paying more money but as a percentage we would all be equal. By the way I'm not rich and I get more money every week. I though the rich were the ones to get the tax cut. The democrat candidates are lying through their teeth. Ed, Boston Wow this guy is a real idiot. Yeah, I think when people die their family shouldn't keep what they have worked so hard for in thier lives. It should go to the government so they can give the money to a crackhead mother of 12 with 13 different fathers who all combined don't have a third grade education. Mr. Bush lowering the estate tax is a good thing. The money in these estates have already been taxed before and what does the left want to do. Tax them again. This whole article reeks of partisan jealousy. They can't handle the fact that the tax cuts have worked. They haven't been to the rich either. Yes the rich got money back too but they pay a higher percentage of taxes anyway. they deserv it. Do the democrats get the big picture. When the rich get a tax cut or pay less taxes what do they do with their money, hide it under thier bed? No, they invest in American companies and create American jobs. This is how you get the economy moving again. Now I'm sure that there are alot of people out there who are in over their head with bills but they shouldn't be racking up debt if they don't make enough money. If they do they will get burned in the end. You'll see the housing market will crash within the next two years and people will be screaming about that too. Remember if your a Democrat that everything that is bad is Bush's fault. Everything that is good is because of Clinton. Open your eyes people. We're in good hands let's keep it that way. VOTE REPUBLICAN! Ed , Boston Oh please Mike from Norton. The economy goes in cycles and neither Bush nor Clinton could stop this runaway train of the late 90's from crashing. It actually started under Clinton. It was bound to happen. Yes, jobs have gone offshore but why. Many are going because people here want their unions and want to be paid $150.00 to put in a lightbulb instead of a fair wage. Your right I'll pay an Asian $5.00 to do the same job. I have a college education and high school dropouts make more money than me. I don't have much money. I give most of it to Teddy Kennedy to help illegal immigrants blow things up! Bill, Boston
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