Why could FDR start so many programs during hard times, and Reagan could resort to deficit spending to spur the economy…but Bush simply has no plan??? You mean the Pres., with all his advisors and such, simply have no clue what to do???
Most economic actions have an equal and opposite reaction. FDR’s solution didn’t actually help much WWII is what turned the economy around and FDR saddled us with a state which now has thousands perhaps millions of people sharing in the national wealth but not contributing to it for no good reason (I’m not talking about welfare, I’m talking about people who are ‘employed’ just not doing anything anyone wants done or doing it with hopeless inefficiency). Reagan really just rejiggered money (by lots of means) so that more of it ended up as capital at a time when capital was needed (supply-side and ‘trickle-down). The problems we have now are largely insoluble because of the ‘solutions’ of the past. We are so burdened we have become inflexible.
I think FDR went into deficit spending to make all those work programs.
Anyhoo
The economy is driven by the people and their spending habits. The Dem’s in an attempt to take as many seats back don’t want a good economy so are talking it down. The people are listening and not spending. If the Dem’s just shut up or better talked it up it should be much better. Bush 43 just can’t compeat with all those voices talking it down.
Just my humble O
The Democrats are trying to destroy the US economy to make the Republicans look bad? Yeah, there’s a true GQ answer.
My WAG as to the OP: no single set of policies has proved to be a magic wand to solve all economic problems. Bush may regard inaction as preferable to poorly-applied policies that exacerbate current problems. Alternatively, foreign policy matters may be more pressing and also influence the state of the economy dramatically, so he may be focusing on that area (attacking the cause rather than the symptoms).
What bad economy? 
No, really. Unemployment is still in relatively low numbers. Intrest rates are very low. And inflation is almost non-existant. Some of you younger Dopers are very unaware of the horrible inflation of the late 1970’s. People that had good jobs still couldn’t afford things because of it.
If you’re talking about the current shut downs and layoffs, and the corporate scandals, well…so what? Things like that happen during great economies. The “downsizing” trend that was rampant during the late 80’s is often credited with empowering the economy of the 90’s. Everything is cyclical. What comes around, go’s around. What’s happening now is nothing more than a minor speed bump. Don’t panic.
This is going to bug a lot of you, but…as long as there is no inflation to gobble up my money, I benefit a lot during these economical speed bumps. You wouldn’t believe how many clients I have calling, needing ways to cut their cost. I made an extra 2k just in overtime & bonuses last month. What bad economy?<SMACK! OW!> (takes money and runs:D)
And actually Bush 42 has a plan - it’s called letting you keep more of your money a.k.a. tax cuts. ANother thing the dems are standing in the way of.
Well, things right now aren’t quite as rosy as pkbites makes them out to be, but they’re certainly not bad. Unemployment isn’t bad right now, people aren’t starving on the streets (at least no more than usual), but Wall Street is taking a beating. Growth is going to be slower than it would be if the market were doing better, and there’s certainly room for improvement, but this is pretty mild by recession standards. Regarding the OP, what can we do to fix it? Stand the hell back and let the market fix itself. The current drop in stock values is a direct result of them being wildly overinflated during the late 90’s. The correction was destined to happen sooner or later (I thought it would happen about a year or two earlier than it did), and now it has. However, when such a huge correction needs to be made, you often see overcompensation. Stocks, generally speaking, are now undervalued. Eventually the market will pick up the slack, but until then, like I siad, we should hurry up and do nothing.
With regards to FDR: The massive welfare plans he put into place are widely regarded as having kept the Depression going, and as Uncle Toby stated, it took WWII to get us out (wars are helpful that way). If you look about 10 years prior to the Great Depression, there was another depression. It was much more sudden, much steeper, and generally worse initially than the Great one. Unemployment hit 11% (from about 1%) in a period of 12 months. What wondrous plan did the government use to save us from that depression? It sat on its hands. One year later, the depression turned into a decade of strong economic growth.
Jeff
That should have been Bush 43
Gee, that’s really comforting. I WAS a victim of the late '70s-early 1980’s crisis with the economy. My parents had to choose between putting food on the table or paying the electric bill. Yeah, things were pretty grim - if you were amongst the unemployed of that era…and the trickle down theory only allowed the rich to get richer.
As for today, now I’m unemployed with no one eager to hire. And reality is that economy is just holding its breath as it stands on the brink of another melt-down. Go ask the airlines or the auto industry if this isn’t reminiscent of 20 years ago!
Yes, it could be worse, but we don’t need sit and wait for it to get to that point. If the Government really wanted to, there are things it could to create jobs, spur the economy, and boost the confidence of the American people once again.
The economy’s only sluggish because people are fearing what’s coming next. But, I don’t believe we’re helpless “sitting ducks” if we could put people back to work on all sorts of Federal projects to help the nation while spurring the economy to grow.
In a nut-shell, Jinx
Nobody knows how to fix economies anyway. I happen to think Clinton had good economic policies geared towards paring down our debt, and I happen to think Bush is a jackass whose policies will hamstring the government for decades and/or force taxes to be raised in a few years, but, having said all that, I must also say that I don’t think anything Clinton did was responsible for the good economy of the Clinton era, and I don’t think Bush can be clamed for the much uglier economy of the current day. Economies steer like huge tankers on the ocean–you mess with the tiller and nothing happens so you do other things. Several hours later, the first corrections you made manifest themselves finally (with things that you did subsequently lined up behind to have their effect) and whoever is at the wheel by then responds by adjusting the tiller. Then, just to really gum up the works, there are the exceptions to the rule, where some current events have overriding “here and now” effects, but you can’t usually control which ones, nor can you easily determine which changes in economic situation are the results of policy adjustments of several years ago and which ones are the results of things that just happened. And riding through the whole mess are these huge swells that, like ocean waves, are just “there” and don’t have anything much to do with steering past or steering present.
Most politicians do what they do in response to current clamor and/or to obtain current favor, which doesn’t help matters much.
Ok, I’ll bite…what’s your job? What speciality could it be that makes a profit off of everyone’s losses? And, if you make recommendations on where to cut, why not start with salary restructuring (starting with the CEOs) - so at least people have a chance to save their jobs, health benefits, etc.
I really don’t mean to rag on you, but it is quite upsetting to have to live through this - again. Now, my kids have to see me choose between feeding them or feeding the fat utilities.
- Jinx
No one has mentioned the cyclic nature of the economy. We go and then we go down. Certain factors make the ups and downs more or less extreme. Many people think restrictive trade polices and a stock bubble in the late 20’s made the 30’s depression “great”. Oil prices have driven ups and downs a lot in the last 30 years. And so on.
In the 90’s, we were on an “up”. The Internet bubble made it go too far up. Oil prices started to go up again. Time for a down phase and since the up was so extreme, it’s going to be one serious down cycle. Certain segments of the ecomony (and certain regions) have been hit unbelievably hard. It really is nasty out there if you’re a 20+ computer geek trying to find a job in Oregon. It is to early to tell if this is spreading (outside of its effects on the markets already).
The “inflation is down” statement is actually starting to worry people who are seeing signs of deflation. Which is very much not a good thing. Japan is still suffering from a deflation cycle when it went bust. If we have deflation it’ll take out real estate, which will take out banks, … And the Fed can’t lower interest rates to cure deflation.
Tax cuts (especially for rich people) are sucker deals for idiot voters. They only hurt things in the long run. The government should focus on long course policies and never, ever try a quick fix.
There are a lot of companies that overexpanded and are stuck with a lot of bad debt, property, etc. They’ll sell off stuff to healthier companies and when those companies start expanding again, good times should follow. Look at the CF bankruptcy. Very bad news for 15,500 CF workers. Good news for other firms, whoever buys their trucks & such. But there will be a lag before it’s noticable.
It’s like a starfish with an infected arm. The faster the arm gets cut off, the sooner a new one will replace it and restore it to full strength.
I promised myself I wouldn’t wade into this, but…
A couple of points:
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Fiscal policy that is jointly controlled by the legislative and the executive branches, is a very blunt tool of limited means and difficult timing. So, a large spending program, such as block grants from the federal government to the states for things like new construction of water projects that were considered marginal pre-recession, may have the wrong effect at the wrong time. If it takes the government six months to realize that we might be in a recession, then takes six months to pass the legislation, then takes six months to enact the legislation and then the states start getting the money, you have a long period of time in which the economy willl begin to recover on its own. As you pump this money in at the wrong time, you can cause distortions in labor and material costs because the government is now competing with business for the same resources. Boom, inflation trouble.
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Monetary policy (I’m a monetarist for the record) also has lag times in it’s impact, but is a quicker fix, e.g., 9 months for the stimulation versus 1.5 years for fiscal policy. It also runs the risk of another type of inflation.
Either way, the best government and the central bank can do over the long haul is provide a stable framework for the economy, e.g., a fiscal policy that allows automatic stabilizers such as unemployment insurance to work and a monetary policy that accomodates growth without inflation.
Reagan’s Savings & Loan bailout was a plan? We are going to pay for it for generations to come.