Democrats: The Party of Responsible Economics
The GOP has long held that it is the party that best handles the economy, and many American still believe that. It is, of course, completely false. The fact is, Democrats have a far better record.
The Clinton boom was longer and more prosperous than the Reagan boom, but try getting a Republican to admit that. And Clinton erased the deficit during his boom, while Reagan outrageously inflated the deficit during his–but again, don’t try to convince a Republican. A Republican will tell you that the Reagan deficit was the fault of Democrats in Congress, no matter how much you try to point out that 7 of Reagan’s 8 budgets asked for more money than the Democratic Congress finally voted into effect. A Republican will tell you that the elimination of the deficit under Clinton was really the work of the Republican Congress, despite the fact that the budget bill that got the deficit work done was passed without a single Republican vote.
Never mind that the GOP is wrong on all kinds of reasonable progressive issues, like minimum wage; every time the Democrats try to raise that rate to anywhere near a reasonable level, Republicans wail about how it will put small businesses out of business–and it never does. Minimum wage hikes are followed by a good economy as often as they are by a bad one, and usually are followed by a net increase in jobs.
Democrats believe in the same brand of economics that Henry Ford did when he decided to pay his workers well enough so that they could afford to buy his cars. Pay the people good, decent wages and they’ll buy things, thus generating a good economy. Republicans believe in the elitist trickle-down theory, which essentially says that if you give enough money to people who are already rich, enough is bound to trickle down to poor people, like scraps falling from an overloaded table, who will then use those scraps to buy more goods. Republicans see investments by wealthy people as strong for our economy, despite the fact that these wealthy people see more profit in investing that money overseas, paying people there a fraction of what Americans need to get by. It may be good for businesses, but that brand of business is bad for Americans.
And Democrats are good for jobs, too. Just refer to the chart at right (from American Assembler) which shows the net job increases of all presidents for the past 80 years, since Coolidge. What a surprise that job increases have always been better under Democrats and worse under Republicans–that the worst performance by a Democrat is better than the best performance by a Republican.
You want a better job, better pay, better benefits and a sound economy overall?
Vote Democrat.
You’re doing excellent work- keep it up. The righties just refuse to admit that the practical application of their theories suck, but if you keep pounding away with real-life facts and examples, enough of the center folks will (hopefully) come into line and vote properly.
Paul: Thanks, but I’m pretty aware that I’m preaching mostly to the choir. But if this blog changes even only one vote, it’ll have been worth it. And as Michael Moore said, the choir can get pretty demoralized and can use some preaching to….
Yep, preaching to the choir here, in that I’m a Democrat, but more loyal on social issues, which are easy to relate to, than economic ones, which I don’t truly understand. I understand the microeconomic interaction of supply and demand, and I know how salary and taxes and the prices of goods affect my personal budget, and how my paycheck influences my willingness to work. But when faced with politicians’ claims about how their plans will affect the economy, I don’t get it. I need to hear lots of arguments about why Democrats are good for the economy … and I am NOT alone in that.
Well, apart from the numbers speaking for themselves, there are a few points as to why this is true.
First, Democrats have been, for at least the past several decades, the party of responsible economics, despite many believing that the Republicans hold that mantle. Strategies change over time, of course, but current Democratic leadership wants to balance budgets and pay down debts; this leads to stability and encourages markets. Republicans are “good” for the “economy” in the sense that they favor big businesses, give them lots of breaks and bounties, but that’s not really good for the economy per se. Republicans cut taxes for the wealthy and for corporations, while Democrats try to tax them more on the progressive tax scale; Republicans tend to gorge themselves on pork and buy into massively wasteful programs like missile defense; Democrats also spend on pork, but they spend much less and much of it goes to people who will pump it right back into local economies.
Democrats also tend to favor the working American, vying for higher minimum wage, better working conditions, better insurance and so forth. This puts more money into the pockets of individuals, or regular Americans, who then spend it and bolster the economy in this way. Republicans have a bass-ackwards way of thinking of this, in their “trickle-down” theory, in which if you shower the rich with loads of money, some of the scraps from the overloaded table will fall down to the middle and lower class, who will then spend it and bolster the economy. Note that both groups believe that average Americans spending more will help the economy; the Democrats simply have a far more efficient means of getting the money to where it’ll really help.
For these reasons, Republicans give more money to corporations and wealthy people regardless of whether they grow jobs or not, spending massive amounts in specific places that mostly go to few people in terms of jobs and wealth. Democrats spread the money around in ways that encourage people not only to get jobs but also to earn money and spend it so as to encourage even more job growth.
This is an entirely unprofessional and unresearched layman’s view, but I believe it has more than just a grain of truth to explain the dynamic so clearly represented in the chart in this post.
Thanks! It sounds like this is the crux of the argument, regarding trickle-down economics vs. spending on social programs: “Both groups believe that average Americans spending more will help the economy; the Democrats simply have a far more efficient means of getting the money to where it’ll really help”
My intuitive, completely selfish, intuitive, simple and non-macroeconomic reason for supporting Democratic economic policies:
One way or another, we all pay for poverty. We can pay to help people be able to take care of themselves as much as possible (education/training, healthcare, adequate minimum wage and welfare to support families and provide some stability they can build on) or we can pay for what happens when they have no hope of a decent life (crime, homelessness, epidemics, rundown neighborhoods, hatred of various groups). The former strategy creates a far nicer place to live for everybody — and at the same time, may well decrease poverty in the long term. It’s not about building the “economy” or about making a moral argument — it’s just about taxpayers deciding what, if any, investments in the country are going to pay off for them.
Justice-wise, the only argument that really works for me is one I’ve seen repeated on this blog: American society made the accumulation of wealth possible. Therefore, it is reasonable for American society to take back a share of that wealth. There is no reason society can’t justly demand a higher percentage from rich people than from poor people — the society that makes the wealth possible can set limits on how much, and how fast, someone can accumulate it.
For those who see things from a spiritual perspective, and not just from a “fairness” perpective, it seems obvious — meeting everyone’s needs is the right thing to do. Some would say that private action is better for meeting people’s needs, but as that isn’t happening, government appears to be the way to go.
I don’t know anything about deficits except that being in debt scares me. I don’t know in every case whether the natural optimization found in free markets outweighs the unequal distribution of benefits and the externalities they ignore. I don’t know whether immigrants and foreign labor are powering the economy or draining it. I really hope the people running the country are smarter than I am.
The problem with these arguments, as I understand it, is that, time and time again, it has been shown that planned economies do not work and that prosperity and economic growth increase in proportion to how free the markets are kept. The numbers that Luis says speak for themselves to not really speak for themselves – they are a vast oversimplification and a significant distortion. In many cases, tax cuts have a delayed effect, so Republicans can argue quite credibly that Democratic presidents win on the basis of those cuts’ short-term ill effects and take undue credit for their long-term benefits. In addition, I don’t think it is reasonable to lump all Democratic presidents or all Republican presidents together – for example, Kennedy was more fiscally responsible than Johnson.
I am a registered Democrat, but mainly because I am against the social conservatism of most Republicans, the attempts to enforce or foist religious views and nonscientific values on the populace. I think the very weakest aspect of our party’s platform is its deplorable lack of wisdom when it comes to economic policy. Democrats are unfortunately still open to the “tax and spend” criticism that defeated us throughout the 80s and since the middle of Clinton’s second term, and that will continue to defeat us unless we wise up.
Democrats tend to assume that the government knows best how to allocate resources, and that people will vote bad governments out. But it is not so easy to change our leadership in a huge, red-tape-ridden representative democracy like the USA. Furthermore, in a free society the right thing to do is to let people make as much money as they want and do with it what they want, as long as it is within the law. When I say within the law, I mean apart from the tax code. The US tax code is an unwieldy, byzantine morass of so-called reform piled upon so-called reform. Each so-called reform makes the tax code more complex and less tenable. What we need is something approaching a flat tax: 15% for everyone except perhaps the poorest of the poor. And we should abolish the sales tax. Under such a scheme, similar to what exists, for example, in Hong Kong, Singapore, and some of the newer additions to the European Union, the rich still pay much more than the poor, but in absolute terms, not as a percentage of their income. And all loopholes should be eliminated so that they cannot get out of paying that percentage. Redistributing the country’s wealth by taxing the rich more heavily than the poor only incentivizes people to look for loopholes and lobby for so-called reform measures, and that’s how we got into this mess. The best way to allocate resources is to let business and consumers speak with their wallets – rich and poor alike will follow their interests to the best of their ability, and no one has to tell them whether to spend or save or what to spend on or invest in.