Two Views in the White House on an Economic Fix

Source: NYT

As President Bush weighs a stimulus package to jump-start the sagging economy, a debate has broken out inside the White House over how hard to push Congress to make Mr. Bush’s tax cuts permanent — a priority for the president, but one that Democrats say would kill the plan before it is even considered.

On one side, according to people familiar with the deliberations, is a powerful group of pragmatists, including Henry M. Paulson Jr., the treasury secretary; Joshua B. Bolten, the White House chief of staff; and Ed Gillespie, counselor to Mr. Bush. They argue that the need for a stimulus is urgent, but have expressed concern that the administration may have to scale back its ambitions for permanent tax cuts to get a package through Congress.

On the other side, these people say, are staunch economic conservatives like Keith B. Hennessey, the new director of Mr. Bush’s National Economic Council. They have reservations about the need for an economic rescue package and maintain that if the White House proposes one, it should use the plan as leverage to press lawmakers into making the tax cuts permanent.

. . .

The president’s tax cuts, which lowered rates for individuals and investors, are set to expire at the end of 2010. Mr. Bush has said repeatedly that he will devote his last year in office to making them permanent, a vow he reiterated in a speech in Chicago before leaving for the Middle East.

Read more: http://www.nytimes.com/2008/01/17/us/17bush.html?_r=1&ref=us&oref=slogin

On the other side, these people say, are staunch economic conservatives like Keith B. Hennessey, the new director of Mr. Bush’s National Economic Council. They have reservations about the need for an economic rescue package and maintain that if the White House proposes one, it should use the plan as leverage to press lawmakers into making the tax cuts permanent.

Yep, make the tax cuts permanent and pass some more tax cuts for the wealthy and business. Forget the middle class. They don't do anything for the economy. :sarcasm:

It's going to be fun watching the repub propose more tax cuts for the wealthy and business while the middle class gets shoved to the side.

HE proposes an outrageous bill that the MSM takes as the only way to address the problem and when the Dem's object, the MSM parrots the WH call that the Dem's are obstructionists ...

Two minutes later the Dem's cave...

think of the economy as a huge swimming pool.

take a bucket, dip it into the deep end of the pool, now walk to the shallow end of the pool and dump it in. did the water level get deeper?

the economy should be flowing like a river, instead there's a huge reservoir and a teeny tiny faucet just barely dripping.

tax cuts to corporations does not create jobs. Jobs are created when a corporation needs more workers to keep up with the demand for a product. If there is no demand, no products will be made and therefore no need to hire more workers.

If workers do not have money to spend on products, no products will be sold no matter how well stocked and stuffed the shelves.

the wealthy won't invest in corporations or businesses because consumers aren't spending money - therefore the investment won't grow to create more money for the investor. Who in their right mind would invest in something that is stagnant or failing?

the model the republics keep pushing is one of a funnel with the wealthy at the top, the rest of us at the bottom. Pour enough money into the top and it trickles down onto the rest of us. the problem is there is not enough trickle to accumulate a sufficient amount to pour back into the top.

an economy is circular - money flows from point A to Point B to Point C to Point A.

sending each of us a check or giving us a token tax cut doesn't work either. Checks are either used to pay a bill, or are saved. Token tax cuts amount to less than the cost of 1 gallon of gas per week. (the bush tax cut I received amount to $2.50 per week - less than a gallon of gas today)

there is are no quick fix stimuli - what's needed is a long term steady growth plan. If the government want's to "inject" money into the economy - then start by investing in projects which help all of us - alternate fuel technology, infrastructure repairs/improvement. Put people to work at a good wage and they will spend money.

to coin another analogy - what we have are paramedics following the economy around with a defibrillator zapping the economy when it falters instead of investing in a pacemaker to keep things going at a steady rate.

"snide"-note: the only thing a quick-fix stimulus fixes is a politican's approval ratings during a (s)election year....

Save the corporations and bankrupt the average American so the wealthy can accumulate even MORE wealth.

Cut taxes to reduce gov't revenue and then make waves at gutting social programs to veer back toward balanced fiscal budgets.


Norquist mentality.

taxcuts do not trickle down on the rest of us...

;-)

none is flowing back. We're bleeding ourselves dry cash wise and putting more cash in to the economy will only mean more cash flowing out of the country. We're headed for double digit interest and inflation rates. It's going to be the 1980's on steroids.

It's funny how the corporate taxes of the 1990's were higher yet we seemed to do just fine.

or loaning money to the poor has never helped on a large scale or a small scale. It simply puts people in a situation where they then owe their benefactors. You are right that what is needed is for the government to invest in large scale infrastructure projects that benefit our society at large (alternative fuel and the infrastructure to support it). that way people will have pride in their work, the security of steady work, and from there the economy will blossom. Our country needs to return to producing something.

This economic stimulus baloney is just a show to distract the rest of us while the big players in the market hide their wealth the best they can in the little time left before it becomes obvious to the rest of us that we are screwed. What do you think is going to happen if the market goes back to 10,000 and the last seven years of gains are wiped out of everyone's 401k? People are pretty complacent. Maybe it won't be so bad after all?

I wish I knew what an average worker could do to protect themselves.

The corporations used the tax cuts to send our jobs overseas. As someone pointed out a few weeks ago, the money didn't trickle down to the rest of us, it trickled overseas and up to the CEOs.

which boils down to endless war and poverty for the rest of us.

People are loosing homes and these mother fuckers are worried about millionaires tax cuts.

:grr: :grr: :grr: :grr: :grr:

I don't see how more spending is going to help this problem since over spending is one of the root causes.