Answering Krugman on FDR, Taxes

http://www.futureofcapitalism.com/2010/12/answering-krugman-on-fdr-taxes

The New York Times' Nobel laureate columnist, Paul Krugman, writes:

President Obama, by contrast, has consistently tried to reach across the aisle by lending cover to right-wing myths. He has praised Reagan for restoring American dynamism (when was the last time you heard a Republican praising F.D.R.?), adopted G.O.P. rhetoric about the need for the government to tighten its belt even in the face of recession, offered symbolic freezes on spending and federal wages.

Well, since Professor Krugman asks, "when was the last time you heard a Republican praising F.D.R.?," I will try to answer.

It might have been November 9, 2010, when a book by a certain Republican named George W. Bush was published. An article here noted:

After that mid-September meeting, Mr. Bush recalls, he told a few close aides: "If we're really looking at another Great Depression, you can be damn sure I'm going to be Roosevelt, not Hoover."

Or it might have been August 30, 2005, when this same President George W. Bush gave a speech at a California naval base. The Washington Post reported the speech as follows:

CORONADO, Calif., Aug. 30 -- Invoking the spirit of Franklin D. Roosevelt, President Bush on Tuesday cast the war in Iraq as the modern-day moral equivalent of the struggle against Nazi fascism and Japanese imperialism in World War II, arguing that the United States cannot retreat without disastrous consequences....

Reaching back into history, Bush repeatedly cited Roosevelt's steadfastness as the model for today's conflict, comparing the Japanese sneak assault on Pearl Harbor in 1941 to the al Qaeda terrorist attacks on New York and Washington on Sept. 11, 2001. Much as Roosevelt fought pre-Pearl Harbor isolationism, Bush urged against a return to what he called the "pre-9/11 mindset of isolation and retreat."

"He knew that it was the lack of democracy in Japan that allowed an unelected group of militarists to take control of the state, threaten our neighbors, attack America and plunge an entire region into war," Bush said of Roosevelt. "And he knew that the best way to bring peace and stability to the region was by bringing freedom to Japan."

While praising Democratic presidents Roosevelt and Harry S. Truman, Bush...

Or it might have been President George W. Bush's speech on September 14, 2001: "Today, we feel what Franklin Roosevelt called the warm courage of national unity."

The Krugman column also asks: "How, after the experiences of the Clinton and Bush administrations — the first raised taxes and presided over spectacular job growth; the second cut taxes and presided over anemic growth even before the crisis — did we end up with bipartisan agreement on even more tax cuts?"

Again, since Professor Krugman is asking, I will try to answer. One reason is that Clinton didn't just raise taxes, he also cut them. Lawrence Summers has called the tariff reductions that the Clinton administration negotiated through NAFTA and other trade agreements "the largest tax cut in the history of the world." And in 1997 Clinton signed a bill cutting the top long-term capital gains rate to 20% from 28%. The Bush administration also had some pretty strong quarters of seasonally adjusted, annualized GDP growth in there – 6.9% in the third quarter of 2003 and 5.4% in the first quarter of 2006, neither of which is exactly "anemic."

by Ira Stoll  |  Dec 20, 2010 at 10:27 am Related Topics:  Paul Krugman, Politics, Taxes receive the latest by email: subscribe to the free futureofcapitalism.com mailing list