My visit to Andy Card at the White House in early 2003 led to the Bush tax cuts that are expiring,
and the payroll tax holiday I promoted from 2008- 2010 is expiring as well.

🙁

18 Responses

      1. @markg,

        Either way, they’re paying with public initiative. Might as well optimally organize to optimize the dynamic value of public initiative.

  1. That must mean you were responsible for the Pelosi takeover of Congress in 2006. Remember how they preached fiscal responsibility?

      1. @WARREN MOSLER,
        When I’m out preaching MMT, and someone invariably tells me how the Clinton tax hikes led to the prosperity of the 90s, what to say? “Imagine greater prosperity” never seems to go that far, and there’s pretty wide amnesia for the 2000 recession. I need talking points!

      2. the deficits of the early 90’s caused the Clinton boom.
        the tax rate increases caused the budget to go into surplus during the expansion
        fueled by private sector credit expansion.
        This was appropriate as the combo was sufficient to get unemployment below 4%

        But when private sector credit expansion failed, which was inevitable as it was ultimately income limited,
        the govt should have been much quicker to turn it all around with an appropriate fiscal adjustment

      3. @vincent,

        “the deficits of the early 90′s caused the Clinton boom.”

        I think that’s reading way too much into fiscal policy.

        My view is that it was excitement over the internet that fueled the boom in the mid-90s. In fact, the start of the boom coincides very closely with the founding of Netscape in 1994. And of course the prior recession under Bush 41 was caused by a reduction in military spending after the end of the Cold War.

      4. @vincent,

        “the deficits of the early 90′s caused the Clinton boom.”

        The internet boom was just the expression. Still couldn’t have happened without the currency liquidity to invest.

      5. @vincent,

        The tax increases of 1993 came during 3 – 4% GDP growth. I believe the next year GDP dropped in to the ~2% range before growing again. Check FRED to confirm.

        If you are going to raise taxes and cut spending, it seems more reasonable to do so during reasonably strong growth (vs the weak growth environment we have now).

      6. @vincent,

        “When I’m out preaching MMT, and someone invariably tells me how the Clinton tax hikes led to the prosperity of the 90s, what to say? “Imagine greater prosperity” never seems to go that far, and there’s pretty wide amnesia for the 2000 recession. I need talking points!”

        Also point out what happened to countries whose currencies and/or credit arrangements were USD-linked and where there was significant leverage in terms of credit and/or exports: Asian Flu, Russia, Argentina. China avoided most of the damage b/c it devalued big time around 1993, if memory serves. (I’ve asked friends over there if the PBC devalued preemptively b/c it knew the damage Lloyd Bentsen’s “strong dollar” policy would do. They insist it did not, but the timing was extremely fortunate nonetheless.)

      7. stable oil prices as the texas railroad commission was price setter. the saudis took over in the early 70’s as demand outstripped texas supply, and they had a different agenda…

  2. the Clinton boom

    I went to a party once that was just so much fun that I didn’t want it to end, lots of good food, free beer and dozens of gorgeous babes. Unfortunately, 5 am rolled around and the host and hostess had to go to work so they could afford to give more parties and I, too, had to show up at the hockey puck factory so I could make the payments on my new Prius that I drive to cool parties.

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