Reflecting on these very early days of Edwards' campaign, we're seeing the first honest and heartfelt words coming out of a viable candidate's mouth in decades. Let's see how long he can keep it up.

Sure didn't take long to throw "fiscal responsibility" out the window once the election was won.

Look for "ethics in government" to follow it out the window in short order. Most lobbyists already have the phone numbers in their Rolodexes changed already.

Takeitinthechin:

Good grief, Edwards has as much as admitted that deficits don't matter once the Democrats have the checkbook again, and you kiss his butt for it?

"Look for "ethics in government" to follow it out the window in short order. Most lobbyists already have the phone numbers in their Rolodexes changed already."

Ha!! Pot to kettle "you are soooo black."

So sad to see Edwards jump the shark so quickly.

Has he learned nothing from Walter Mondale?

(maybe he's too young to remember Mondale?)

And, of course, the reason the deficit was put into place was to deny public figures like Edwards the option of pursuing any of the things he cited in his reply.

This might not be a bad stratgy. After all, the job of Democrats is to use the government to improve America's infrastructure and government services. Republicans don't believe that the government should do this, yet they deficit spend, anyway.

The way I see it, the Democrats are doing the Republicans a favor by making sure Republicans "return to their roots" by becoming fiscal conservatives. Republicans can cut spending and raise taxes after the essential infrastructure and public services are put into place by the Democrats. Why should the Democrats do the Republicans' job for them?

Say it ain't so, John. While I admire Edwards for at least approaching this issue with some honesty, I just don't see how we can sustain our high debt load any longer. We need to reduce the deficit now. This is especially true with a weak dollar, which makes investment in our debt much less attractive. Several months ago, Australia's financial chief called for Australian and Asian central banks to begin an "orderly withrawal" from US dollar investments. So far, China has not really heeded that call, but when they do, we will be in a world of trouble. It will send the dollar into a freefall. Furthermore, China is under serious pressure to float their currency, which will also cause a painful drop in the dollar. With all these negative pressures on the dollar, the US would be wise to at least start showing the appearance of fiscal responsibility to stem the exodus of investment. I admire Edwards and Krugman a lot, but their ideas on this are genuinely scary.

I give Edwards a lot of credit for an answer that is both honest and thoughtful. I'd give him even more credit for something a tad more economically literate -- something to the effect of "the deficit is fairly modest now both in historical terms as a percentage of GDP and in comparison to the deficits of other wealthy nations. Of course, ideally we'd currently have a balanced budget now that we're in the middle of an expansion to counter the inevitable and desirable borrowing we'll need to do the next time the business cycle heads into recession. And structurally, over the long term, the budget situation is indeed dire largely due to the incredibly irresponsible policies enacted by Republicans."

This might not be a bad stratgy. After all, the job of Democrats is to use the government to improve America's infrastructure and government services. Republicans don't believe that the government should do this, yet they deficit spend, anyway.

The way I see it, the Democrats are doing the Republicans a favor by making sure Republicans "return to their roots" by becoming fiscal conservatives. Republicans can cut spending and raise taxes after the essential infrastructure and public services are put into place by the Democrats. Why should the Democrats do the Republicans' job for them?

I would like to hear Edwards' detailed comments on the proposals outlined by Amory Lovins et al in Winning the Oil Endgame:

... surprisingly, it will cost less to displace all of the oil that the United States now uses than it will cost to buy that oil. Oil's current market price leaves out its true costs to the economy, national security, and the environment. But even without including these now "externalized" costs, it would still be profitable to displace oil completely over the next few decades. In fact, by 2025, the annual economic benefit of that displacement would be $130 billion gross (or $70 billion net of the displacement's costs).

To achieve this does not require a revolution, but merely consolidating and accelerating trends already in place: the amount of oil the economy uses for each dollar of GDP produced, and the fuel efficiency of light vehicles, would need only to improve about three-fifths as quickly as they did in response to previous oil shocks.

[...]

Investing $180 billion over the next decade to eliminate oil dependence and revitalize strategic industries can save $130 billion gross, or $70 billion net, every year by 2025. This saving, equivalent to a large tax cut, can replace today's $10-billion-a-month oil imports with reinvestments in ourselves: $40 billion would pay farmers for biofuels, while the rest could return to our communities, businesses, and children.

Several million automotive and other transportation-equipment jobs now at risk can be saved, and one million net new jobs can be added across all sectors. U.S. automotive, trucking, and aircraft production can again lead the world, underpinned by 21st century advanced-materials and fuel-cell industries.

A more efficient and deployable military could refocus on its core mission—protecting American citizens rather than foreign supply lines—while supporting and deploying the innovations that eliminate oil as a cause of conflict. Carbon dioxide emissions will shrink by one-fourth with no additional cost or effort. The rich-poor divide can be drastically narrowed at home by increased access to affordable personal mobility, shrinking the welfare rolls, and abroad by leapfrogging over oil-dependent development patterns. The U.S. could treat oil-rich countries the same as countries with no oil. Being no longer suspected of seeking oil in all that it does in the world would help to restore U.S. moral leadership and clarity of purpose.

Ruuning deficits in order to pour billions down a rat hole called "global war on terra" - Good

Running deficits in order to allow the public access to universal health care, work diligently on the major problems of global warming and energy while helping the poor and the middle class affected by the off shoring our our jobs - Bad

Must ponder - Geez, as a human being, which would I choose? The Pubs blow up the world, or the Help Your Fellow Citizens. Tough call

fostert wrote: "While I admire Edwards for at least approaching this issue with some honesty, I just don't see how we can sustain our high debt load any longer. We need to reduce the deficit now."

It sounds to me like Edwards is in favor of reducing the deficit now -- he is saying pretty clearly that he doesn't believe it is possible to eliminate the deficit while at the same time investing in the things that he believes the USA should be urgently investing in.

Say it ain't so, John. While I admire Edwards for at least approaching this issue with some honesty, I just don't see how we can sustain our high debt load any longer. We need to reduce the deficit now.

We don't really need to reduce the deficit now. The government is borrowing an amount somewhere south of 2.5% of GDP. That's not ideal for an economy entering its sixth year of expansion, but hardly a crisis that merits asking "how we can sustain our high debt load any longer." We can sustain our "high debt load" because the interest on that debt is modest in comparison to the size of the economy as a whole. The long term outlook is considerably more problematic, I'll grant you, and will likely require biggish tax increases in future decades. I wouldn't lose sleep over it now, however. When we reach that point we'll know because financial markets will be sure to inform us.

First, Edwards deserves credit for an honest, informative answer.

Well, we absolutely cannot tolerate that sort of behavior in the White House, so he's off my list.

Secular Animist,

Hear, Hear - I just get a tad perturbed with some Economists starting to think like bean counting CPAs - People and individuals tend to become "units" and "numbers" to them. Humanity gets tossed out the window in the endeavor to prove some "economic theory".

Just food for thought: Today, 29 December 2006, Britain is paying the final installment on their WWII debt.

SecularAnimist:

John Edwards says he "would like to reduce the deficit" but he is placing a higher priority on the spending. Given his realism on what can be accomplished, I think this means higher deficits in the short term. I think it would be better to stabilize the dollar and have that investment come in the form of higher foriegn participation in the stock market. I do think that some of John's ideas are worth investing in, primarily energy research. But we should take that money out of the war in Iraq or eliminate some of the oil industry's tax breaks to pay for it.

Global, I think we should demand double that last debt payment after all they were the folks who gave us Borat.

Well, since the new deficit was created by the GOP in only a few years, it's all their fault. And as the party of personal responsibility, they won't mind at all if we take the deficit, divide by the number of registered republicans, and send them each a bill.

If they don't pay, it's off to Gitmo for some "alternative tax collection techniques."

Problem solved. Next.

Simple, pull our troops out of Iraq now and save 10Os of billions of dollars immediately- Then we can Start investing $ to rebuild our tattered military and social infrastructure

Global Citizen,

Do you mean they can start to pay off the Falklands now?

Good grief, Edwards has as much as admitted that deficits don't matter once the Democrats have the checkbook again

No, he didn't. He said they matter, but not to the exclusion of all else, that they won't likely be practical to eliminated (again, as the last Democratic President did) in the short-term, but must still be controlled while other priorities are addressed.

Sure didn't take long to throw "fiscal responsibility" out the window once the election was won.

Eliminating the deficit is no more borrowing. Fiscal responsibility is not the same thing as the absence of borrowing. It is borrowing, if at all, responsibly, in a way which secures the future ability to pay off the debt. UHC which improves competitiveness and productivity, efforts to reduce poverty, to stabilize the economic future by dealing with energy security and global warming, these all can (presuming the particular programs are well-planned and responsible) be responsible things to borrow to support.

Is Germany honor bound to pay off the debts by the 3rd Reich to the heirs of Prescott Bush?

We only ever reached surplus under Clinton because of the "Peace dividend". Bush has blown that out of the water by increases in defense spending. Clinton spent $300 Billion per year and now Bush has us up to $550 Billion and unfortunately, it is likely to hit $600 Billion by the time Bush leaves office. The new president will have to find ways of cutting the defense budget in the face of the enormous legacy costs of Iraq.

Edwards, doesn't say "taxes" but it is doubtful that the next president will be able to keep Bush tax cuts from expiring. Spending under Bush as % of GDP is less than spending under Reagan. The trick is to reallocate money from defense into building our economy, infrastructure and workforce. A combination of tax cut expiration and shifting money from defense to domestic programs will keep the deficit much better in check than Bush has done.

And, of course, the reason the deficit was put into place was to deny public figures like Edwards the option of pursuing any of the things he cited in his reply.

Yeah McCorley, tax cuts for the rich baby, accomplished two things at once. Don't you just admire the Republican Party?

fostert wrote: I do think that some of John's ideas are worth investing in, primarily energy research. But we should take that money out of the war in Iraq or eliminate some of the oil industry's tax breaks to pay for it.

You will be happy to hear that the Congressional Democrats are planning legislation to do just that:

Democrats Seek to Use Oil Cash for Renewables
By H. Josef Hebert
The Associated Press
Tuesday 26 December 2006

House Democrats in the first weeks of the new Congress plan to establish a dedicated fund to promote renewable energy and conservation, using money from oil companies. That's only one legislative hit the oil industry is expected to take next year as a Congress run by Democrats is likely to show little sympathy to the cash-rich, high-profile business.

Whether the issue is rolling tax breaks - some approved by Congress only 18 months ago - pushing for more use of ethanol and other biofuels instead of gasoline, or investigations into shortfalls in royalty payments to the government, oil industry lobbyists will spend most of their time playing defense.

Details of a renewable fuels fund have yet to be worked out. Nonetheless, it's one of the initiatives the House will take up during its first 100 hours in session in January, according to aides to Speaker-elect Nancy Pelosi. At least some of the money - revenue gained by rolling back some tax breaks - will go to a program to support research into making ethanol from sources other than corn.

"What we'll do is roll back the subsidies to Big Oil and use the resources to invest in a reserve for research in alternative energy," Pelosi, a California Democrat, recently told reporters.

little ole jim from red country,

And remember, it started under David Stockman with Reagan - The Shrubs just perfected the scheme.

The global warming thing doesn't have to cost the government a significant amount of money (and in this context a significant amount is in the tens of billions). It is much more about general regulations (eg cars have to get milage x, yes and this includes suv's and makes constructing them basically illegal because they can't reach the requirement), and changing priorities (rather than building yet another suburban highway lane to support energy wasting sprawl we build a light rail line, or whatever, to support energy saving urban evelopment).

It's mainly about making sure than we encourage and in some cases require energy efficient infrastructure rather than, as we have for the past 50 years, the opposite.

The way you waste a lot of money and don't have much effect is a government funded crash r&d effort to invent an escalade that gets 30 mpg, or runs on natural gas derived hydrogen fuel cells.

I dunno, this just sounds like the perfect opening for the borrow-and-spend-but-pretend-we-don't GOP to once again claim that they're the party of fiscal responsibility.

Universal Healthcare = Good
Energy Independence = Good
Social Justice = Great

Enabling GOP stereotypes = Very, Very Bad

I see the "eight-fold path" solution working best- eliminate corporate welfare and Large Farm subsidies, reform the bloated Medicare prescription plan and re-adjust the top tax bracket back to 38% to demonstrate to the country that democrats are for financial responsibility, then use a portion of that to reduce the deficit and another portion for modest progressive initiatives.

Being elected partly because the Republican incumbent couldn't stop throwing money out the window and then trying to institute policies that a good chunk of America thinks is still throwing money out the window is not the wisest method for cementing election gains.

I must agree with SecondAnimal and T3P: nowhere does Edwards say "deficits do not matter". Rather, he seems to believe they matter quite a bit, and should be reduced.

But he also believes there may be an even higher priority at first: re-establishing the economic middle and fighting poverty where possible.

He also points out the inconsistency of any candidate who promises they will do both.

After Bush tries to starve the beast we have to choose whether to declare the beast starved. If we do then Bush will have won the war in Iraq.

I'm waaaay late to this discussion, apparently, but ... Edwards is so strongly for universal healthcare that his statement about it doesn't even spark a single comment?

I wasn't aware he was pro-universal coverage. Which other 2008 candidates (or possible candidate) agree?

And remember, it started under David Stockman with Reagan - The Shrubs just perfected the scheme.

Yes, I remember well. I think the Reagan people stumbled upon the phenomenon, then certain people recognized that it could be turned into a strategy.

Ah, Kevin.

HILARIOUS!!!

For years we hear about how the "big bad" Bush administration is so horrible because they took the surpluses of the Clinton years (which never existed, btw) and turned them into deficits.

Never mind that Bush delivered on his promise to cut the deficit in half.

Now, suddenly the Dems are in power (for now) and suddenly we're hearing "oh no, we couldn't possibly cut the debt.

You're all a bunch of hypocrites! Lie down in the gutter, you dogs! I laugh at you with abandon!

egbert, if you are competing for the title of Stupidest Most Ignorant Right-Wing Dittohead Moron To Ever Post A Comment On This Site, you have some formidable competition from Jay and rdw. But I must say, that was an impressive effort. They'd better watch out.

"Never mind that Bush delivered on his promise to cut the deficit in half."
Quick question, egbert: Is the national debt higher or lower now than on Jan. 20, 2001? Smarter trolls, please.

Emartin:

I said deficit, not debt. Better ignorant lefties, please.

People don't remember that at the beginning Rubinonics was a disaster politically for Clinton..

He adopted Rubinonics and shelfed one of his key campaign promises of a middle class tax cut which was taken out of deficit reduction plan in 1993 - the Republicans used this broken tax cut promise in 1994 to regain the Congress

Well, cutting the deficit in half is another success that hasn't been achieved yet.

I would be, and really am very sympathetic to the concept of debt reduction. The reality is that the Republican party's goal is to prevent the Democratic party from taking power away from big contributors. They use running up deficits to do this. They have no intention of behaving responsibly.

So assuming that focusing on debt reduction would create a 4, maybe 8 year swing for the Democrats, then they'd lose to the same old Republicans, who would redo all the damage..and worse, that line would make no sense.

Except, of course, if the debt reduction hawks can convince the public that debt reduction is in their best interest, then polls state that debt reduction is a winning issue, then it's a different issue altogether.

While the debt load will crash the economy/society, so will health care/energy policy. As seeing as we can't fix the debt load in the current political environment, the best thing is to stop making the problem worse, but to GET SHIT DONE, show the American public that somebody can do that, and take the reins of power for 30-odd years or so, and gain enough time to deal with the debt as well.

The real issue in fiscal management is financing the debt, as a poster said-the measure of deficit is 2.5% (I think it is actually higher if you factor Iraq -but as debt financing continues to grow (9% of budget) it will hinder all governent expenditues-the answer lies in creating a long term graph comparing debt growth as a percentage of GDP- ideally the line would be even but I shudder that it isn't.

As I said recently: Don't confuse the deficit (current imbalance of payments, a bit of which can be tolerated) with the debt, which is accumulated from past deficits and interest - it is very large now. Once the debt gets big, deficits are harder to tolerate (like putting even more purchases on a credit card when you already own a lot on it.)

...Bush delivered on his promise to cut the deficit in half.... egbert at 5:18 PM

1. Even accepting the most optimistic predictions, the deficit will not be cut in half. The article asserts that the deficit for this year may end up being $270 billion, or 2.1% of GDP. Even accepting that optimistic assessment, the 2004 deficit was $412 billion or 3.5% of GDP. For those of us living in reality, that’s not cutting the deficit in half.
The White House projected a deficit of $512 billion for 2004, but that never happened. At the time, budget experts warned the number was inflated for political purposes.

2. The budgetary outlook for 2006 has degraded by about $800 billion since Bush took office. In January 2001, the Congressional Budget Office predicted a $505 billion surplus for 2006. The optimistic deficit number pushed by International Business Daily is still $775 billion worse.

When it comes to fantasy, no one can exceed those pathetic Bush lickspittles who bottle Bush's fartgas for their daily buzz.

egbert--what is your source that a surplus did not exist when Bill Clinton left office?????
You just make shit up. As we are moving full speed ahead into the post-Bush era, start telling the truth for a change

Raul:

I had a pretty good idea about what such a graph would like, and I was right. We've been in worse situations before during the early post WWII and Reagan years. But the trend is not good. Anyway, here's the graph:

http://zfacts.com/p/318.html

People don't remember that at the beginning Rubinonics was a disaster politically for Clinton

Quite right and Krugman remembers the box Rubin placed Clinton into. In addition to lying about the tax cuts he also lied about spending increases. Clinton was forced to be far more stingy that he wanted. He ended up infuriating the left and the right.

Rubinomics never worked. The economy actually had momentum when Clinton took office and slowed after the tax increases just in time for the election. It wasn't until after the 94 election and the GOP reversed some of the tax cuts and enforced real spending cuts that the economy regained momentum.

Oddly, Rubin is still the GOD of Democratic econimic guru's while Krugman has become a clown. Yet he is quite correct. So is the Breck Boy. You can't promise more healthcare and budget defict.

Edwards has something else on Krugman. He's been seeing the tax revenue data. It's surging. The deficit is going to be less than 1% of GDP and a minor issue by 2008.

RDW: Paul Krugman is a respected economist and a straight-shooter. John Edwards is not the Breck Boy. How demeaning. I despise the way you slam people. And you have such an arrogance in your texts.

Edwards and the Libs will want to stay far away from tax policy as well as the deficit. One of the more interesting aspects of the supplyside tax cuts of 2003 is the surge in revenues led by the Corporate sector.

IN 2005 Corporate collections were a historic $278B, 13% of total raxes collected. This is well above the bubble year of 2000 when $207B or 10.3% of total taxes collected.

So much for attacking the GOP for taking care of Corporations. You'll do it anyway because your base is stupid but it won't work.

In 2006 this number will be above $310B and in 2007 above $340B and near 15%. That would be 60% more than the Clinton average as a percent of total collections.

We're all supply-siders now.

Wouldn't you be well received over at redstate blog or little green footballs? I'm sure you would be, rdw

Paul Krugman is a respected economist

Krugman was a well respected economist turned into a liberal buffoon. He's devastated our economic growth is so kick-ass compared to Western Europe and bitter it's so obvious.

Paul has always favored the Big Government European model and he knows there's no chance in hell that will fly here. Reagan changed the world and there's no going back. Do you realize few people under the age of 55 even remember 55% tax rates and if you told them now rates were actually 70% before Reagan cut then to 28% they won't believe you. They will tell you it's no possible to have rates that high because no one could be that stupid.

Gone are the days when you can sell tax the rich (and we'll skate) schemes. The typical family has two wage earners and is making over $100K. They're working hard for their money and not much interested in supporting slackers or drug addicts. In a day of 4.4% unemployment and a shortage of nurses and other skilled workers you can get a good job.

Th fact is these same working Americans have 401k's, IRA's, Pension plans, etc., invested in stocks and they fully understand the differences between American Style capitalism designed by Reagan and the European welfare state espoused by liberals. Europe is choking on our exhaust my friend and everyone knows it. We're not going that way.

I'm afraid that's bullshit RDW. Bureau of Labor Statistics reports the average annual wages in the U.S. as $36,764, so your assertion of a $100K per year average household income makes you about as full of shit as the proverbial Christmas goose.

rdw: They're working hard for their money and not much interested in supporting slackers

True. Get a job.

or drug addicts.

I heard Rush Limbaugh has got a job.

consider wisely

You really don't like life outside the choir do you? Afraid a dissenting opinion might make sense and you'd have to change your thinking from the herd?

Here's the website with the actual budget data listing corporate tax collections though 2005. You'll see 2005 is by far the most Corporations have paid in taxes and as a percent of total taxes paid. It's also more than 60% higher than the average of the Clinton years. 2006, 2007 and 2008 will be highr yet. And you twits will still babble on about Coprorate tax breaks because you know your base is that stupid.

http://www.cbo.gov/budget/historical.pdf

I heard Rush Limbaugh has got a job.

If you consider sitting in front of a mike and babbling for 3 hours a day 40 week a year working. I guess since he makes $25M a year it still qualifies as a job.

EDWARDS - ANOTHER MORON.

WE HAVE UNIVERSAL HEALTH CARE IN THE USA! ANYONE WHO NEEDS CARE GETS CARE . . . THIS THANKS TO, BUT NEVER APPRECIATED BY REGRESSIVE-DEMOCRATS . . . THE BLOOD, SWEAT, AND TEARS OF THE USA TAXPAYER --- ESPECIALLY THE HARDEST LIFE-TIME WORKERS AND RELATIVELY MOST ARDENTLY FRUGAL USA CITIZENS - THE WEALTHY.

What we don't have is Universal Asset Protection Insurance in the Event of a Catastrophic Illness. [This is to the good for many reasons, among them because, as Hurricane Relief shows, when the government provides, the poor and middle income abuse shamefully.]

And, nearly all uninsured Americans can afford to go to the doctor; it might mean owning a less expensive car (when was the last time you saw a used Chevy Aveo on the road?), renting or owning a less expensive apt/home, going without cable TV, less illegal narcotics, less alcohol, less x, y, z, but if health care were the priority Regressive-Democrats say it is, these uninsured Americans can easily adjust their budgets.

But I have an idea!

If we want people and their children to go to the doctor yearly, we should make a valid yearly medical examination certificate (proof of a doctor visit) requisite for 1) driving, 2) voting, 3) school enrollment (parents have to have the doctor visit done, too), etc.

UNIVERSAL HEALTH CARE IS ALL ABOUT TAKING FROM THOSE WHO WORK AND EARN AND PAYING PEOPLE TO VOTE FOR DEMOCRATS; DESPICCABLE.

TOH

rdw: If you consider sitting in front of a mike and babbling for 3 hours a day 40 week a year working.

Probably affirmative action for drug addicts.

It's all going swimmingly, and might continue to do so for a bit lionger. But the debt to China is going to come due, and this fucking war is costing $3000 per second that has not been figured in the budget. That will come due as well.

Then there is this. Perhaps you missed it while you were masturbating with glee over the problems Europe is facing.

Now go sweep your three-car garage or something.

The Objective Historian: UNIVERSAL HEALTH CARE IS ALL ABOUT TAKING FROM THOSE WHO WORK AND EARN AND PAYING PEOPLE TO VOTE FOR DEMOCRATS; DESPICCABLE.

Too wordy. We prefer to call it the "Dictatorship of the Proletariat".

Global Citizen: the debt to China is going to come due

That's the biggie (China and the rest of the world). The trade (current account) deficit is over twice the budget deficit, but gets less attention. I've gotten tired of trying to convince people that it's a bigger problem.

Fortunately, rdw has a solution.

so your assertion of a $100K per year average household income

Not quite princess. You pulled average annual wages which is a fraction of average household income. You are citing a per person rather than family number and it includes junior working at McDonalds.

I am talking about married couples working full time or mostly full time who also vote. I was describing the political reality of the possibility of transitioning to a Europeam style economy with a dramatically higher tax burden and a transfer of economic power from hard working families to pencil-necked bureaucrats.

It ain't happening here sister. The Breck boy can talk about more helth care and more environmental spending and more of everything and as soon as he talks about more taxes he is toast.

Think about Mondale. That was pathetic. He was killed pledging to raise taxes and that was BEFORE Reagan cut them to 28%. It's been 26 years since we had Carter level tax rate.

Do you really think these kids (anyone uder the age of 45) are going to vote for massive tax increases? Especially when they start moving into their highest earning years? You really have an impossible demographic issue. These are Reagan babies.

Remember, if you are a 68 lib you are very probably on the wrong side of age 60. That's almost 40 years ago. The days of 40% tax rates are over and with so many people invested in stocks capital gains rates above 15% won't be working either.

One other thing. The comparison with Europe gets worse every year. We are so far ahead it's sad but even worse is we are consistently growing 2x's to 3x's faster. The 2004 data is bad. It compounds by 2008.

I'll admit the Breck Boy is pretty. But if he tries to sell Europe he's an airhead.

rdw: You pulled average annual wages which is a fraction of average household income.

US mean household income in 2004 was $60,528 (down from $62,671 in 2000). Median household income was $44,389 in 2004 (down from $46,058 in 2000).

Sorry about the facts - I know it's dirty pool.

Alex - you forgot the miracle of compound interest!

(Forget the fact that debtors must pay interest before investors can be paid interest. I know those 4.6% CD's are raking it in for me! Woo Hoo!!!)

Wages have stagnated and corporate profits have doubled.

Read "The Great Wealth Transfer" by Paul Krugman @ rollingstone.com issue 1015 12/14/06.
I also recommend "The Great Unraveling: Losing Our Way in the New Century" by Krugman.

"Truth is based upon the belief that we are all in this together, part of a moral community. It is tough to convince people in a highly stratified society that the rich and the poor share common values, much less a common fate."

That quote is from Eric Uslaner, political scientist, studing the effect of inequality on trust

GC,

Could not access yout link so I don't know the point.

I am not gleeful over Europes failures. They are not good for the US. I am gleeful the failures are so obvious it's impossible for liberals to even suggest we take their path.

I am gleeful GWB had been so skillful is creating distance between the USA and Western Europe and setting the table for much closer relations with growing powers such as Japan, India, Eastern Europe and Australia.

There is nothing positive for the USA in the collapse of Western Europe. They've been a drag on USA growth since WWII. We spent a fortune defending them for 40 years and the last 20 they've been a drag on the global economy and often an enemy on foreign policy.

Adults recognize the world as it is and not just as we want it to be. I'd love for them to find their Ronald Reagan. But they want no parts of that and it's all but too late anyway. We have to move on.

I would have thought that the solution was pretty obvious. If taxes have to rise, surely the first place to look to place those taxes would be those who've done best over the last decade or two.

Yep, tax the billionaires who've been making out like thieves.

I think the reports of the economic collapse of western europe may be premature. It's true that their growth rates have been a little low recently, but those growth rates are measured relative to the Euro. The slightly better growth rate in the US is measure relative to the dollar, which has lost more than 30% of it's value relative to the Euro during Bush's term in office. So, if our growth were measured in Euros, like the European economy, our growth would be profoundly negative ("freefall" would be the appropriate term). In terms of world purchasing power, we really aren't doing that well at all. And nobody wants our currency. A few years ago I was trying to buy a book off a 9 year old kid in Cambodia. He was giving me a really bad price in dollars, but a fair price in Thai Baht. I asked him why the difference and he explained that the US dollar was no good and the Thai Baht was a more stable currency. So he wanted me to pay in Baht. Turns out he was right. The Thai Baht gained 12% relative to the dollar since then.

Yep, tax the billionaires who've been making out like thieves.

C'mon. They're all self-made men and it's their money. Their successes have nothing whatsoever to do with the society in which they operate. They coulda made their chunks any place, Burkina Faso, Haiti, Somalia, Tuvalu, you name it.. absolutely anywhere but Yurp. Their stinking fellow citizens had absolutely nothing to do with their successes. They don't owe anything in that direction! No input and no due.

(nice though to see a politician talking like an adult)

(ah, the resident blowhard is spluttering on again about places he's never been to)

UNIVERSAL HEALTH CARE IS ALL ABOUT TAKING FROM THOSE WHO WORK AND EARN AND PAYING PEOPLE TO VOTE FOR DEMOCRATS; DESPICCABLE.

Tell me about it. I've been working hard and spending my hard-earned dollars on health insurance for years, and all I got out of it was a couple of x-rays for sore knees and a few sitches from a kitchen accident! I found out that all these years the insurance company has been taking my money to spend hundreds of thousands of dollars on other people with cancer! The nerve!

rdw

Lets see,longer life spans,more time with their families,better infant mortality rates...God,How can thoses poor Europeans stand it.

Heck, Beijing, China's got a better infant mortality rate than Washington, D.C. But in rdw's world, these differences are only because Americans are more free to make bad lifestyle choices. And that your shopping malls rock!

It is borrowing, if at all, responsibly, in a way which secures the future ability to pay off the debt. UHC which improves competitiveness and productivity, efforts to reduce poverty, to stabilize the economic future by dealing with energy security and global warming, these all can (presuming the particular programs are well-planned and responsible) be responsible things to borrow to support.
Posted by: cmdicely

I wholeheartedly concur. Borrowing to invest productively in the future as opposed to borrowing to enrich cronies and the top .5%.

Now about the current account and the trade deficit...

Fostert-thanks for the chart- it is very problematic.
rdw- you just killed your credibility (the 100k family average wage is hilarious as it does not factor median income- in other words the wealthy skew the average)- but what really hurts you is the assesment that corporate taxes have gone up from 10% to 13% of all taxes collected. You see, if you ban all personal income taxes the corporate would be substantially higher and thus proving nothing as deficits swell! No rdw- the real gauge is corporate taxes as a % of GDP- in this sense- the # has halved from 20% to 10% in the last decades.

rdw wouldn't know credibility if it jumped up and bit him. Please just ignore him. He's an odious little cretin.

Righttard Dipshit Wastewad is one of those assholes who thinks he can prevail by sitting on a dead thread and posting the same talking points over and over. Painfully transparent and pitiful to those able to think and reason.

The Republicans are like the farmer eating next years seeds. Any business man knows he has to invest in machines and human capital in order to produce and make a profit. So the nation has to invest in health, education, housing, infrastructure after all the decades of neclect. Why is it so hard to understand? wonderful, Edwards is talking about it and he makes sense.
It is high time to stop the military madeness and put the wealth to work for a better nation, we need it badly.

Thanks, Steve. This post did more to solidify my support for Edwards than any number of emails from his campaign.

How can thoses poor Europeans stand it.

Apparently not very well. They're not even bothering to reproduce and emigration is up across the continent while immigration is surging in places like the USA and Australia.

Your allies are toast my friend. Western Europe is screwed. Fortunately, they are not my allies. Fortunately, thanks to a long series of investigations into the oil for palace scandal as well as countless others public support for the EU and UN is in the toilet.

It gets even better. They don't much care for the USA either. You know what happens when attitudes set in for a spell. They don't change. We don't much care for them. They don't much care for us. So what's the point?

I'll repeat a most relevent stat that says it all. Intel now gets less than 20% of it's Sales from Europe and more than 60% from Asia. That's 3 to 1. In five years it'll be 15% to 65%. That's 4.3 to 1.

Are you sure Western Europe is important? Are you thinking the next big breakthrough will come from Western Europe? No chance!

Think India. Think Japan. Think Australia. Think Israel. In an ERA where military tecbnology is most vital this chain will be most critical.

You see, if you ban all personal income taxes the corporate would be substantially higher and thus proving nothing as deficits swell!

What are you babbling about? Personal income taxes are not down nor are total tax collections.

Corporate tax collections were not even close to 20% of GDP 10 years ago.

The number of households making > $100K is up dramatically destroying anychance for Edwards style populism. Dual wage earning families making $125K (nurse and an electrician) consider themselves middle class. Tell them they need to work even more to take home the same pay and you will not be getting their vote.

I would be thrilled to see the Dems run on tax increases. And why not. Mondale carried one state.

You buffoons will run on massive health care increases and lower deficits. It will not work. Plus you've got a moron like Krugman sitting on the NYTs editorial page taking shots at Ronald Rubin, your only star.

All of the stock indexes are at record highs, the economy is sound, interest rates are very low, inflaltion is very low, corporate profits are sky-high and tax collections are surging. People have more benefits than before not less and have record 401K balances as well as home equity balances.

Th economist is forecasting very decent global growth especially in the USAs best export markets and we are going to cruise into the 2008 elections in very, very good economic shape. We will in fact have labor shortages.

You are going to keep doing woe is me but Americans are not pessmists. Edwards is toast.

Yikes. The Kraken awakes.

It gets even better. They don't much care for the USA either.

and even better! Neither do us Chinese, nor do the Aussies, the Indonesians or the Koreans. Japanese look more to Europe for thoughts as to how to organize a society and the Indians very emphatically do not look to the US as a model.

You're all alone to stew in your own hubris.

The Republicans are like the farmer eating next years seeds.

Renate, do yourself a favor and check out Ethanol.org. Farmers love this administration specially it's ethanol program. Business is boffo and getting better. There's tremendous investment in farms and farmers. Demand for the corn crop is surging such that it will be hard to meet.

Ethanol plants are being build at fantastic rates proving and average of 250 new jobs and substantially helping the state economy with investments.

It is the most successful alternative energy program of all time now and it's going to double in size in two years and keep growing. It's America at it's best.

Indians very emphatically do not look to the US as a model.

They most certainly do. That's why they have all of our call centers. That's why trade is exploding. That's why we've just engineered one of the most important nuclear power deals in history. We have much in common and relations have never been better.

India is also moving away from socialism toward capitalism. They know they need rapid growth and economic effenciency and that's only possible with a large private sector.

In terms of them liking us I don't know but I think they do.

The important thing is the Europeans don't and given their rigid thinking and arrogance this is a good thing. I see Western Europe as hopeless. Casting them adrift is the only smart option. Like a child at home too long we've protected them too long. It's time for them to go it alone. Perhaps then they'll reform. I doubt it. I have absolutely NO desire after 90 years of fixing their messes to go near them agin.

As a political reality these polls on each side of the Atlantic all but ensure the steps GWB has taken to separate are permanent. Politicians do not ignore polls this definitive.

What's done is done.

RDW- you are not worth arguing with- you say corporate taxes are up because personal taxes are up- in scale my friend-(note the lack of insult-something you seem incapable) - the government expenditures remain 20% of GDP but collection are lower-18%; as to 100k households- you basically excuse a deteriorating quality of life-the numbers do not lie-median income has been stagnant for 10-15 years; on GDP and government and corporate taxes- please read more attentatively- I said decades not decade- as to one company's sale in one continent over another- it means little-I do not know the macros of the company-industrial trends would support your argument better but it seems you always get one piece of data while ignoring the important facts- anyways- to counterargue: 1-emerging markets spend more on automation- 2-Asia is much larger than Europe. As to tax increases - a proposal to raise the taxes on the 1-2% earners does not strike me as unpopular- but hey - I belong in the bracket and it is just an opinion. One question I do have- are you a reflexive rightwinger or do you actually ponder the issues- I bet the immigration issue must be tearing you apart. Peace.

you are not worth arguing with- you say corporate taxes are up because personal taxes are up-

I said no such thing you twit. One has nothing to do with the other. Corporate taxes are surging because corporate profits are surging. personal taxes are also surging but not as quickly.

you basically excuse a deteriorating quality of life-the numbers do not lie-median income has been stagnant for 10-15 years; on

I didn't address anything about deteriorating quality of life because the concept is absurd. We are post 81. This is not Jimmy Carters America. There is no national malaise. Our quality of life is up sharply. Every product we buy is dramatically better than it was two decades ago and is cheaper as a percent of our incomes. PCs TVs Cell Phones, Radio, GPS systems, Cars, Boats, houses are all bigger and better. Our life expectancy is longer and our health is better, aside form obesity, which is too much wealth.

Median incomes have not been stagnant and our buying power has increased dramatically. PC's, TVs Phone service, etc are half the prices of a decade ago for better performance. All of our appliances are better and cheaper. We have a far wider array of products and materials for the house that weren't avilable 15 years ago. We eat our more.

Nothing in America is ever stagnant except for liberal brains.

as to one company's sale in one continent over another- it means little-

It means everything. Our foreign policy is largely defined by our business interests. You've heard the term, "follow the money'. Well the money is in Asia.

It's not just Intel. It's GE, Catepilar, IBM, HP, Wal-mart, etc.

There is more to it then money. There are threats. We have much in common with Japan and South Korea regarding the threats from NK and China while Western Europe is not a factor in the region. Moreover the UN has been absolutely useless as is European style appeasement. The other threat is radical Islam and here we have much more in common with Israel, India and Australia.

The combination of rapidly diverging business interests along with very different political and economic ideology ordain the moves GWB has been making. American liberals might align with Europe but conservatives could not be any further as are most independents. The USA is 30% liberal. Europe is 85% liberal.

The real problem is Europes failed economic policies. They're not just very slow growing but innovation has dried up. They still have a few top companies but Europe is shrinking scientifically faster than economically.

Business means everything. In another decade you will be shocked at how much Western Europes share of global GDP has fallen. They have no military power and their diplomatic power has to rely on economic power. It's not growing.

a proposal to raise the taxes on the 1-2% earners does not strike me as unpopular-

Of course not. Democrats have been doing it since there have been democrats. By definition it makes 98% of the population happy. It's called class warfare.

The question isn't is it popular. The question is is it smart? Do you want the most succssful among us devoting their time to making money or dodging taxes? People invest based on after tax incomes. Take away the incentive to invest and they won't. This is core to supply-side and as we've seen in the relative performance of supply-side versus Europe since 1981 we're seen kick ass.

Either you want the money in the hands of the smart people who created it or you want it in the hands of govt bureaucrats who are govt bureaucrats because they can't create it.

You will raise the taxes on the top few percent and they will lower their incomes. As has been proven time and time and time again you tax more of something you get less of it. This is why America works and Europe doesn't.

I bet the immigration issue must be tearing you apart. Peace.

I am a Reagan conservative. Immigration is not an issue for me except for the fact we don't have control of the borders. I want a fence. Then I want a program to legalize the 10M who are here now. Then I'd like to see higher allowances for immigrants. We need more of them.

The fence is a security issue. I have no problem with Mexican immigrants. They work hard. A 2nd benefit for the fence is the ability to put more pressure on Mexico to reform. mexico should be a wealthy nation. They have a prime location, oil wealth and a hard working population. The fact we absorb so many people has allowed them to delay reform. North America Inc. will be our future only when Mexico catches up with the Canadian and USA legal and economic and educational systems.

I am fine with GWBs proposal for immigration but would prefer a two stage procses which requires securing the border 1st. Reagan passed a similar bill but the security aspects were never implemented.

The fact is we need Mexican labor. We're facing large and serious labor shortages. We have 4.5% unemployment in front of a massive surge in retirements. People are bitching about all of the offshoring but we're going to see a lot more of it in the next year than the last. We need workers. a best case scenario wold be more offshoring to Mexico rather than India. If Mexico grew at 8% they're be creating the wealth and jobs they need. We would not need a fence.

Re: Indians very emphatically do not look to the US as a model.

"They most certainly do."

RDW, this comment clearly indicates that you have never been to India. I have been there, and I know damn well they have their own model of growth. And it mostly involves taking advantage of the US while we are making our mistakes. They understand that we will either come to our senses sometime or crash and burn. So they view the current situation as a temporary windfall. But they will use it to build capital and adapt from there. They are smart enough to be relatively successful, but their corruption problems will always hold them back. In the end, they will never surpass China. China understands how to use corruption to their advantage.

As for your touting of Eastern Europe, you clearly haven't been there, either. True, it is a conservative's dream, where workers are being crunched between increasing cost of living and stagnant wages. (Why do conservative hate people so much?) But, in the end, Eastern Europe is unlikely to ever catch up to Weastern Europe. They suffer from the same resource problems as Western europe, without the capital to overcome them. And they have more corruption problems (another conservative wet dream). They will remain Western Europe's Mexico.

You are somewhat right about the success of Australia, but Australia will win for two reasons that unrelated to supply side economics. First, it has invested heavily in improving public education (typically a liberal pursuit). And second, it posseses the world's largest uranium reserves and very impressive untapped precious metal and gemstone resources. They are the next Saudia Arabia, except they have well educated people who won't squander their potential.

>>True, it is a conservative's dream, where workers are being crunched between increasing cost of living and stagnant wages. - Fostert

China is, in point of fact, looking to 'invest' in Central Europe to take advantage of incremental wage differentials. That and deplorably lax environmental standards.

Gotta hand it to them, they're very astute in locating exploitable populations - whether Central Europe or Africa - no matter.

You cannot reason with Witless and it is pointless to attempt to do so. He craves attention here. Refuse to play, please.

Fostert,

It never ceases to amaze me how liberals see America as the perennial sap nation as the rest of the world takes advantage of our constant mis-steps to pick our pockets clean.

Yet somehow we end up with all of the wealth. How does that happen?

How is it American corpotations keep on delivering record profits with record cash flows pay record dividends and spend record amounts on stock buybacks? How is it Corporate tax payments have been surging growing almost 50% the last 3 years?

How is it that GE has raised it's cash dividend by 25% the last 14 months and bought back over $10B in stock AND still has the rare AAA rating?

How do these saps manage it?

India is very corrupt as is China as is Cuba as it every other socialsitic nation on the planet. Cuba is literally rotting from within. China and India learned they must transition from socialism toward capitalism and are well on their way. The path is very long but they are headed in the right direction.

Check out our Canadian cousins. Are you aware of the tremendous investment in the Tar Sads? It's going to be over $100B. They are going to increase production from 1M barrels of the dirtiest oil a day to 3M by 2012 and export EVERY Drop to the USA. We've got 15B Barrels and ANWR sitting in the ground getting more valuable sitting in reserve. We get the oil. They get all of the pollution.

But we're saps.

Canada is already guarranted to be the worst performer under the Kyoto protocals they so admire yet we're the saps.

We've proven Kyoto is a stupid piece of garbage by doing better than 95% of the signees and we're the saps.

No matter how muh money you recieved in grants from generous Americans you could not buy a clue.

Gotta hand it to them, they're very astute

Good point those astute Chinese. They're not just smarter than Americans they're smarter than everyone.

Just think back over the last 150 years of the worlds great innovations and contributions to science and medicine from the Chinese.

Ok, that won't work because they're arent't any but is 150 years fair to so great a cuture? Of course not. Where's my head?

Just think back the last 1,500 years!!!!!

Ok, Ok, that doesn't work either.

Just think back the last 5,000 years!!!! Where would be be without that abacus!

They suffer from the same resource problems as Western europe, without

You are clueless regarding economics. It's not about resources. It's about freedom and competition. Japan and Israel have few mineral resources. They have free people. Russia has resources coming out of their noses. The middle east sits on an ocean of oil and has nothing else. South America will always be the poor cousin to North America.

Many Eastern European nations have flat tax rates and open economies. They were ruined by 50 years of socialism but are coming back. Eventually they will pass Western Europe just as Australia has.