Sick And Tired Of Democrats?

[BluesLegend]

My friend BOTH parties are guilty of this. These politicians encouraging everyone to go into debt up to their eyeballs may be our downfall one day, look at the damage its done to date. And not just in the mortgage market, there's over $1 trillion dollars in outstanding student loan debt, that's just insane.

During the postwar years the American middle class had high wages and benefits. As a result, we were able to support the most robust consumption economy in history. It was a virtuous cycle because the ability of Americans to flock into Main Street stores waiving consumer dollars meant that small businesses could start-up and thrive and hire more people.

But there was a flaw. The labor costs, tax polices and trade polices of the postwar years placed limits on profit. The cost of supporting a free, upwardly mobile middle class (as compared to cheap wage-slaves in 3rd world countries) was too high for the transnational mega-corporations who started taking over Washington with the rise of Reagan. Our best and brightest wanted cheaper operating costs, which mandated the restructuring of labor markets on the 3rd world model.

So Reagan (and all the presidents thereafter, Left & Right) supported trade, labor and tax policies that greatly reduced the burden on investors. As a result, production was shifted from high wage regions in the West to China and global South (the "3rd world"). This resulted in the deindustrialization of the U.S. as communist China became the globe's manufacturing center of the world (and the greatest partner American capitalism had ever known. Don't kid yourself, capitalism doesn't like freedom as much as they say. Capitalism loves the ultra-cheap labor costs that come with freedom-hating, dictator-lead countries where the political oppression gives Nike investors sweat-shop costs for sneaker poduction).

Another consequence of this deindustrialization of the USA and the shift of production to more profitable 3rd world labor markets was that the US worker no longer had the wages/benefits for robust domestic consumption. This was a threat to "Main Street" businesses who required a certain level of aggregate demand to stay afloat.

Guess how we solved the problem?

Answer: we launched the most aggressive expansion of credit in history. Don't take my word for it. Research what happened to household debt starting in 1980, when we all started receiving 3 credit offers a week. The American economy traded manufacturing for financialization, which made it possible for American families to survive as the globe moved production to the 3rd world and reduced the wages/benefits of the pampered Western worker. We replaced manufacturing and wage-based consumption with cheap labor, credit cards and debt-based consumption. The result was a massive concentration of wealth on top coupled with growing poverty and debt down below.

This strategy actually worked for a while. The tsunami of credit created powerful booms in the 80s and 90s. We called it "Morning in America" but nobody realized the extent to which it was supported by American Express, MasterCard and Visa. It wasn't just consumer borrowing. Reagan tripled Carter's government debt (and that debt has been growing ever since).

Now we are lying in that bed. The virtuous capitalism of the postwar years - where capital made concessions to labor so that we could maintain domestic consumer demand - has been replaced by a predatory monopoly capitalism, which turns its profits on top of freedom-starved 3rd world labor markets and U.S. debt-slaves (so that a tiny minority of people can realize enough wealth to fund elections and buy the government).

Welcome to the compromises that were made when debt trickled down instead of money and good jobs. America swallowed poison in 1980, and both parties were squarely responsible.

That's quite a diatribe, here's mine. I see no mention of the left's high taxes and the utterly ridiculous amount of government regulations that have chased jobs out of the US. Do you have any idea how much regulations government is heaping on US business, 800,000 freaking pages of the shit in just the last 10 years. Its not high wages crushing US manufacturing its high taxes and government regulations. These assholes in government now invent taxes on businesses that are not even based on profit, they slapped property taxes on the manufacturing equipment that have to be paid even if the business doesn't make a profit or loses money in a year. Government IS the problem.

 

[Mad_Cabbie]

Ho hum, how easily they forget that the crash was the direct result of subprime mortgages "encouraged" by the federal government to increase minority home ownership (ACA). Another example of disastrous social engineering by the Democrats.

So who was that guy acting like George Bush the President when he (Bush) was proudly proclaiming that increasing home ownership rates was one of his big objectives? Who was that impostor who told the bank regulators to ease up on underwriting standards for home mortgages?

You be delusional dude. And efforts have been made for well over a year to educate you Republican dumb asses as to what actually happened in the housing crash. But you fucks be to dumb to learn and just keep repeating the same ole bullshit. Weird. To bad the only ones who believe you are the same dumb fucks that always believe in the Republican myths and fantasies.

Btw, has there ever been a Republican who took responsibility for their actions? Or is passing the blame and ignoring your own responsibility a pre requisite for being a Republican?

Sorry, Zeke -- the housing bubble was not a right-wing brain fart. It had bi-partisan support all the way, starting with Bill Clinton and House republicans.

The housing bubble is all on W's shoulders. He's the guy who lowered interest rates to almost nothing to spur home ownership. The Republican Congress pushed through deregulation of the banking industry, which paved the way for a multitude of fiscal shenanigans although Clinton signed the bill.

W's presidency was the most toxic mix of failed Republican policies, lack of regulation and unfunded wars. Plus he gave tax breaks to companies that moved jobs off-shore. That Obama was able to stop the economic free fall he was left with, is a miracle.

That isn't true, not one bit -- interest rates were being raised in order to prevent the economy from overheating. The time after the 2000 elections when there was uncertainty of not knowing who the potus was going to be, interest rates were lowered to unstal it.

Bank lobbyist spent record amounts of money to educate congress on the benefits of deregulation; Clinton and House republicans voted for deregulation.

 

[Dragonlady]

Bush lowered interest rates AFTER 911 to encourage US investment in jobs and the economy. Deregulation of banking industry occurred late in Clinton's second term, after Republicans won control of the House and Senate.

 

[Mad_Cabbie]

Bush lowered interest rates AFTER 911 to encourage US investment in jobs and the economy. Deregulation of banking industry occurred late in Clinton's second term, after Republicans won control of the House and Senate.

It passed with bi-partisan support. Clinton was a strong proponent as were many other dems.

Bush did not raise rates -- Alan Greenspan raised them.