Hillary's Stupidity on Trickle Down Economics

During the debate, Hillary Clinton criticized Donald Trump's economic plan as "Trumped-up, trickle-down" economics.  Then, she went on to say that "trickle-down never worked" and “slashing taxes on the wealthy hasn’t worked. And a lot of really smart, wealthy people know that.”

First of all, let me say, everything she said above is false.  While not an economist by title, I have studied economics and economic theory in college and have continued to study it ever since.   I can assure you that there is no such thing as "trickle-down" economics.  It was a purely political pejorative used by the Democrats to criticize any economic plan that would cut any taxes on the rich or corporations.  It was first used during the Great Recession by humorist Will Rogers whom, I am quite sure, was not an economist.

Let me also criticize Hillary's statement that "slashing taxes on the wealthy hasn’t worked."  Obviously, she has no idea of what she's talking about.  The Bush tax cuts -- including tax cuts on the rich -- helped right the economy following the 9/11-caused recession.  But, more importantly, she obviously has no understanding of the history of her own party when she makes a statement like that.  In 1963, Democratic President John F. Kennedy proposed tax cuts for both the top wage earners and corporations in order to stimulate the economy.  While he was assassinated before he could get passage of his proposal, then-President Lyndon Johnson was successful in getting the Revenue Act of 1964 passed into law.  As a result, the top tax bracket was lowered from a rate of 91% to 70%.  The corporate rate was lowered from 52% to 48%.  In, addition, all other tax rates were lowered by 20%.

The results were remarkable.  By 1966, the economy was growing at the unusually high rate of 6.6% and unemployment fell to an almost historical low of  3.8%. In addition, tax revenues increased by 68% and poverty was cut by a third.

So, to Hillary: Trickle-down works.  Get your facts straight before you start lecturing, or perhaps lying to us about the history of economics.

References:

Wall Street Journal: Donald Trump vs. Hillary Clinton on Tax Cuts for the Rich: https://www.google.com/search?q=Donald+Trump+vs.+Hillary+Clinton+on+Tax+Cuts+for+the+Rich&ie=utf-8&oe=utf-8

Trickle-Down Economics: https://en.wikipedia.org/wiki/Trickle-down_economics

Trickle-Down Theory: http://www.investopedia.com/terms/t/trickledowntheory.asp

Revenue Act (aka Tax Reduction Act) of 1964: https://en.wikipedia.org/wiki/Revenue_Act_of_1964

What J.F.K. Knew About Economics And What Most Democrats Today Don't: http://cuttingthroughthefog.blogspot.com/2015/05/what-jfk-knew-about-economics-and-what.html

NPR: JFK's Lasting Economic Legacy: Lower Tax Rates: http://www.npr.org/2013/11/12/244772593/jfks-lasting-economic-legacy-lower-tax-rates

What J.F.K. Knew About Economics And What Most Democrats Today Don't

In 1963, President John F. Kennedy -- a Democrat -- was entering his second year in office and was enjoying robust economic growth.  Faster than that of either of his two predecessors.  Even so, he declared that "the absence of recession is not tantamount to economic growth."  What he was referring to was the fact that, despite good GDP numbers, nearly 1-in-5 Americans (+38 million) were in poverty and the unemployment rate was still high at 6%; although down from 7% before he took office.

Thus, to fix the poverty and unemployment problems, Kennedy proposed across the board cuts in income taxes and a reduction of the corporate tax rate; including reducing taxes on the rich from a rate of 91% to just 65%.  In doing so, he offered no offsetting spending cuts to pay for the reductions.  His argument for not cutting spending was simply his belief that"a rising tide lifts all boats".  Or, in other words,  lowering taxes would create jobs for those who were unemployed and in poverty and, as such, revenues would increase so much so that his proposed tax cuts would naturally be offset.  That is as long as spending was controlled. Sadly, Kennedy was assassinated before he could see his tax reductions passed into law.

Then, in 1964 and just three months after Kennedy's death, President Lyndon Johnson signed into law the Kennedy tax cuts in what is now known as the Revenue Act of 1964.  All of Kennedy's assumptions were proven correct.  As such, Johnson had the lowest average unemployment rate of any President since World War II.  Revenues grew 68% from when Kennedy took office.  The most astonishing fact was that, in just four years, the number of Americans in poverty fell from more than 38 million in 1964 to just over 25 million by the end of 1968.  A 34% reduction.

Today, Democrats like President Obama want to punish the rich and corporations with higher taxes.  In wanting to do so, they always point to President Clinton who, despite raising taxes, enjoyed strong economic growth.  However, what those same Democrats fail to recognize is that during Clinton's time, it was mostly due to the dot-com business and wealth boom of the 1990's.

Kennedy's economic prowess -- with economic growth faster for both him and Johnson than Clinton -- is anathema to most Democrats because, if they were to praise Kennedy for cutting taxes on the rich and corporations, this would be to deny themselves of their victimization strategy in order to get votes.  After all, corporations and the rich are supposedly at the heart of everything that is evil and wrong in this country and the rest of the world.  Kennedy was rich and he never tried to hide it; unlike Hillary Clinton who is also rich.  She would prefer that you think that she and Bill were dead broke when they left the White House; and, would like you to think they still are.   Of course, it's really hard to bash the rich when you're one of them.

References:

Kennedy Presidential Library: JFK on the Economy and Taxes:  http://www.jfklibrary.org/JFK/JFK-in-History/JFK-on-the-Economy-and-Taxes.aspx

Economic Growth By President: http://www.msnbc.com/rachel-maddow-show/chart-economic-growth-president

The Revenue Act of 1964: http://en.wikipedia.org/wiki/Revenue_Act_of_1964

U.S. Unemployment Statistics by President:  http://historyinpieces.com/research/us-unemployment-rates-president

Historical Lesson of Lowered Tax Rates: http://www.heritage.org/research/reports/2003/08/the-historical-lessons-of-lower-tax-rates

Census Bureau: Poverty from 1959 to 1968: http://www2.census.gov/prod2/popscan/p60-068a.pdf

A Story of Higher Taxes & Tax Cuts and of Spending and Spending Cuts

When we look at the last 3 decades of economic activity, under five different presidents, we find an interesting story.  A story of how higher taxes, tax cuts, increased spending,  and spending cuts affected the economy; specifically, in terms of how the Gross Domestic Product (or, our total economic output) was impacted.  And, the reason that I chose to look at the Gross Domestic Product (GDP) is because a healthy and growing GDP means less unemployment and higher federal tax revenues.  Or, in other words: If our businesses are growing and their economic output is increasing, they will pay higher taxes and hire more employees; who, in turn, will also pay taxes. So,  to tell that story, I've prepared this chart; making note of the President who was in office at the time and what tax changes and spending took place at the time:

Reagan/George H.W. Bush. When George H.W. Bush took over the presidency from Ronald Reagan in 1989, he inherited a roaring economy that was a pure product of Reaganomics.  In 1988 and 1989, the economy grew at 7.69 and 7.48 percent; respectively.  But, Bush also inherited deficits from Reagan.  That's because Reagan used over-the-top military spending to break the back of the Soviet Union and stop the Cold War in its tracks.  So, the task became to reduce the deficit.  Working with the Democrats, Bush agreed to reduce spending and raise taxes to reduce the deficits; with the tax increases starting first.  So, the famous "Read my lips. No new taxes" taxes when into effect.  But, as we know, today, the Democrats snookered Bush and they never implemented a single, promised spending reduction to also help reduce the deficits. The result of those tax increases was simple: The growth in the economy slowed significantly; with GDP growth slowing to as low as 3.3%  in 1991.  Ultimately, Bill Clinton was able to use his famous "It's the economy, stupid" to defeat Bush.

Bill Clinton. Bill Clinton increased taxes in 1993.  Primarily aimed at the rich, it raised the top income rate from 35% to 39%.  It increased the corporate tax rate to 35%; and, removed the tax cap on Medicare taxes so that the rich paid more.  Now, to this day, Democrats point to the fact that the economy got stronger after taxes were raised on the rich.  And, if you look at 1994, the economy was actually stronger than it had been the year before; when taxes were lower.  But, the real reason that the GDP jumped in 1994 wasn't taxes.  It was the 1993 passage of the North America Free Trade Agreement (NAFTA). Because of that treaty, American manufacturers did a one-time ramp up in inventories (product) in anticipation of increased trade with Canada and Mexico.   It's the same thing we see, every year, when manufacturers hike production to cover Christmas and holiday buying season.  But, to get to the true answer on whether or not tax hikes on the rich helped the economy, you need only look to 1995 where growth was at only 4.65%.

In 1997, Clinton bought into Newt Gingrich's "Contract with America" and signed into law the Balanced Budget Act.  That law dramatically cut spending in many areas of the government.  It created a budget surplus which many Democrats only attribute to Bill Clinton.  More importantly, the economy grew at an average of over 6% during Clinton's last 4 years in office.  At least until the dot com bubble burst in late 2000.

George W. Bush. In 2001, the economy took a one-two punch.  First, the economy was already slowing when George W. Bush took office; with the slowdown due to the collapse of the dot com bubble the year before. Growth for the First Quarter of 2001 slipped to just 1.3%.  So, in June of that year, Bush signed into law the first round of tax cuts to stimulate the economy; with most of the cuts phased in over a period of 9 years.  Initially, it looked like the cuts were working, and, then, the knockout punch came with 9/11.  The result was that growth slowed to just 1% in the 3rd Quarter.  Some conservative economists think the impact of 9/11 would have been much harder had the cuts not been in place. That may be true because, despite the horrendous impact of 9/11, the economy did remain above water.

In 2003, it was obvious that the economy was not recovering fast enough.  So, the second round of Bush tax cuts were put into effect.   Actually, the 2nd Bush cuts were the same as the first; except that, instead of a 9-year phase in, the cuts were made immediate.  As you can see from the chart, the economy started growing again until late 2006 when the Great Recession hit.

Barack Obama. As is well known and as we are reminded of with nearly every Presidential campaign speech, Barack Obama inherited the Great Recession which started in December of 2006 and that ended 5 months after Obama took office.  Not knowing that the recession would actually end just 4 months later, Obama and the Democrats sign into law a $787 billion stimulus bill in February of 2009.  Monies under that law were to be sent out to the states for shovel-ready projects that would help put people back to work.  But, there was a snag and these so-called shovel-ready projects weren't so shovel ready.  In fact, money for the first projects didn't go out the door until August; almost two month after the recession had ended.  In fact, only about 26%, or so, of the stimulus was applied in 2009.  Yet, from 2009 to 2010, the economy actually turned itself around.  And, it did so despite the stimulus.  If anything, the application of more stimulus in 2010 and 2011 only saw a slowing of the economy.

Summary.  From the above we know that Reaganomics, with a combination of broad tax cuts and selective tax increases, produced the hottest economies in the last 3 decades.  Tax increases had negative results under Bush Sr. and Clinton; even when the Clinton taxes were only aimed at the rich.  Spending cuts by Clinton in 1997 made him a surplus spending hero.  The "W" Bush tax cuts, too, netted positive results.  And, Obama's massive spending has only produced a lackluster recovery. 

Conclusion.  It is spending cuts and tax cuts that have historically given our economy the biggest boost.  The last thing we should do is allow Obama to have another stimulus in the form of a jobs plan and raise taxes on the rich.  Both these actions have produced nothing but slow economies; and, if you researched it, you would also find higher unemployment.  This is why, everyone in the country should push for the Simpson-Boles Deficit reduction plan or the tax and spending plan from Paul Ryan.  Either would make this country better off than what Obama plans to do.

Obama Has Left The Well Dry For An Economic Turnaround And Job Creation

If a government is going to do something positive to revive an economy, it takes money. A lot of money.  But, in less than 4 years, Obama has literally squandered the government's ability to realistically do anything to spur on any type of  recovery.  He's done that by increasing the nation's debt by nearly 50%; upping it from $10.6 trillion when Bush left office, to today's $15.8 trillion -- and counting.

Now, significant tax cuts are off the table because they, themselves, would seriously increase the nation's debt.  Tax increases would help lower that debt but, at the same time, cripple an already weak economy by draining it of much needed capital and discretionary spending.   Additionally, any government austerity, to reduce the debt and possibly reduce taxes, could actually have a debilitating effect because government employee layoffs would ensue and many forms of expenditures would be cut.  This could cause a ripple effect  and even higher unemployment.

The fact is that we are at an impasse in expecting the government to do anything related to taxes and spending.  The money well is dry.  The first thing that should be done is to freeze government spending at current levels; thus stopping any further increases in debt. Then, any excessive job killing government regulations should be suspended or repealed. This would spur on the private sector to create more jobs adding to economic revival.  Approve the Keystone pipeline and allow drilling areas that are now off limits.  This will also create jobs and put money in people's pockets because of lower prices at the pump.  Get the EPA off coal's back.  This too would help people with their expenses and allow money to be spent on something other than energy.

Further, dump ObamaCare.  It's reducing small business profits; it's causing health care insurance premiums to rise more quickly; and, it's associated taxes are taking money away from the economy.   Then, there is long term unemployment insurance.  There are 3.5 million jobs out there that people are applying for.  Often, this is because it's more comfy to stay on unemployment insurance than to find a job.  Lets cut insurance from the current 99 weeks to, say, 80 weeks and see if the job's situation improves.  If so, cut back the weeks of covered insurance even further. 

The bottom line is that we could get the economy going again without a lot of government spending and new taxes if our government would just get smart about regulations and wasteful spending. Obama has put our government in a box. It's the only thing left to do.

The Consumer is MIA!

This morning, the latest month's Retail Sales Report came out and, after 2 months of meager but positive growth, the consumer is once again missing in action. The economists who had been surveyed before the report, had looked into their dusty crystal balls and had predicted the future to be a growth in sales of seven-tenths of one percent. In actuality, the overall sales came in with a "loss" of one-tenth of one percent. Worse than that, if you yank auto sales out of the number and their artificial boost due to the "Cash for Clunkers" program, the actual sales in all other areas were down by six-tenths of a percent; down almost as much as they were supposed to be up (Click to See Full Story: "Bleak sales are another reality check for economy"). I really think all those economists should have their crystal balls checked before they make another one of their not-even-close projections.

The ominous thing about this report is that unless the consumer enters back into the picture and starts buying things, our economy will never recover. The economy is 70 percent consumer driven. Obviously, the tax cut that Obama gave to 95 percent of Americans -- the one that gave everybody who got it about $13 a week --- isn't working. As I've said before, that silly tax cut won't even buy a daily donut and a cup of coffee; let alone, even mildly attempt to restart this economy.

We are now nearly 7 months past the enactment of the Stimulus Package and we are still getting horrible numbers. From meager tax cuts to part time infrastructure work, the "Stimulus" is just a flop!

In addition to that bad news, the foreclosure rate just keeps rising. Foreclosures were up by 7 percent in just one month from June to July. On top of that, the number of foreclosure filings, as compared to last year's July number, went up a whopping 32 percent (Click to See Full Story: "Foreclosures rise 7 percent in July from June"). Again, where's that Obama program -- his 31 percent solution -- that was supposed to help stop all these foreclosures? (Click to See My Blog Entry: "The 31 Percent Solution?")

Nothing that this Administration has done or promised to do has come true. That's why Obama and the Democrats "should not be trusted" with any more of our money for things like Health Care Reform and Cap and Trade. First things first! Get this economy rolling again!

Why Tax Cuts or Tax Holidays Would Better Stimulate The Economy

When you or I send a $1 of our money to the Federal government in the form of taxes, it costs a lot of money to process that buck and send it back out into the economy. Actually, when the Federal Government gets through processing every tax dollar, only about 60 cents on each dollar of tax money is able to go back out the door in the form of a check (Click to See the 2007 Results of a Congressional Study). Further, it is estimated that about 9-1/2 cents of each tax dollar is eaten up by the taxpayers (business and individuals) in tracking their income and expenses and in preparing their tax returns. If the Federal government processes a check to a State government, even more excess burden is applied when that State processes those dollars and sends that money back out their doors. That could be as high as another 30 or 35% of administrative and burdened cost on the money being received from the Federal Government.

Therefore, it is safe to say that the "bureaucracies" of both our Federal and State governments will eat up about 58 cents on every tax dollar that was originally sent to Washington D.C. and intended to be spent locally on some program. That's why the Stimulus Program is so ineffective. For every tax dollar being collected, only about 42 cents makes it to any road project or other intended stimulus or other state spending program.

When a tax holiday, tax cut, or a targeted tax deduction is used to stimulate the economy, all that government waste --- that 58 cents of burdened expense on every dollar --- is totally avoided. Each dollar is kept by the taxpayer. Therefore, each dollar is almost 2-1/2 times more powerful, stimulus-wise, then sending that same dollar to the Feds. That is why, to me, the original Republican idea of having a tax holiday to stimulate the economy was a significantly better idea that what we got with the Obama-flop Stimulus Package. All Obama did was to create more bureaucratic waste; minimize the effect of stimulus; and create unbridled debt. I would hope everyone remembers that whenever they go to the voting booths between now and the end of 2012.

The Employed: The Forgotten People

When you listen to Mr. Obama and the rest of the Democrats, they're always focused on that extra 2-1/2 percent of our population that lost their jobs last year as the unemployment rate increased from 5 percent to 7.6 percent. Almost entirely, their recently passed stimulus package is aimed at the unemployed by attempting to use government funds to get construction workers back to work and by using that same funding to provide a social safety net for those who lost their jobs. But, 70 percent of this country's jobs are in small business and, predominately, in the service industries. Not in the construction and manufacturing jobs that will gain under their stimulus bill.

Circuity City didn't go under and lay off 36,000 people because 2-1/2 of the population lost their jobs in the last year. With a few adjustments, I am quite sure that they could have handled a proportional loss of 2-1/2 percent of their sales. If one of their stores has 50 people, a 2-1/2 percent reduction in sales could have been easily handled by letting 1 or 2 people go rather than just closing the whole store. But, they went out of business because the 93 percent of us, those who still have their jobs, weren't buying all those consumer electronics at the previous pace. Their sales were down more than 20 percent. The marketplace could no longer support them along with the more popular retailers such as Best Buy, Wal-Mart, Sears, the Internet, etc.

If those 93 percent of us were still buying stuff as they did before, companies like Circuit City could have survived. But their business was based on a certain level of buying activity in order to support all the stores and warehouses that they owned and leased; all those employees; and all the rich inventory they needed to maintain in order to be competitive. And, they couldn't adjust all those factors downward fast enough to support the dramatic reduction in buying activity.

In the grand scheme of things, the 2-1/2 percent of those who lost their jobs is less important to our recovery than the 93 percent who are still working. Even if our government could rehire the 2 million that lost their jobs in 2008, the impact to the economy, at best, would be about 2.5 percent. I say "at best" because people who have been out of work for a while will spend more of their paychecks on paying off the debt that they accumulated while being unemployed than becoming an active buyer of things in the general marketplace. Often, those who were unemployed will not go beyond buying the essentials for 2 or 3 years and until all their debt is paid off.

This, again, demonstrates the difference in philosophy between Democrats and Republicans. The Democrats are always concentrating on those who lost their jobs or those who are at the lowest ends of the pay scale. But, it is the lower middle class and above that drive our economy. Don't forget, Circuity City didn't go out of business because the poor and unemployed of this country weren't buying iPods, Flat Screens, and cell phones. It was the reduced spending by middle to upper classes that killed them.

This is why I and most Republicans keep hammering on the fact that it is "more important" to give tax cuts to the 93 percent of this country, those that are still working, than to worry about the 2-1/2 percent who lost their jobs. This is not to say we shouldn't care for those who lost their jobs and provide for them. But, they should not be our primary focus.

In reality, the stock clerk or the cashier who used to work at Circuity City will not be getting a job under this stimulus plan because they don't have the job skills to be in construction and manufacturing industries. Anyway, there's a lot of construction workers out there who are out of work and who would be better able to compete for those so-called shovel ready jobs.

There's a simple premise to get this country alive again. If we can get that 93 percent of the population to start buying again; then, those 2 million who lost their jobs will get them back. The auto industry isn't hurting because they lost 2-1/2 percent of their sales. They're hurting because they've lost 50 percent of their sales. But, what we're doing in this stimulus bill is just making sure that the well-connected in the construction industry will maintain their businesses and keep their employees while the clerks, cashiers, sales persons, auto dealers, etc. of this world continue to go unemployed as consumer spending continues to fall. That's why so many economists are still projecting 10+ percent unemployment by the end of this year.

Tax Cuts Versus Tax Rebates/Credits

When the income tax rate is cut, the impact is almost immediate. Payroll tax deductions will be quickly lowered. So will self-employment and corporate quarterly tax filings. In both cases, that money becomes immediately available to flow back into our economy and grow it.

Tax rebates and tax credits, on the other hand, don't have any benefit to the taxpayer or to our economy until that person or company files their annual tax return and actually receives a check in the mail; which could be months after filing an income tax return. That means that more than a year will pass before any impact to our economy is actually seen.

That's why tax cuts are so powerful. If you need to stimulate the economy quickly, that's the only way to go. Further, tax credits and tax rebates carry additional administrative costs as that money moves from your pockets to the Federal government; and, then, back again to you. Actually, the non-partisan Cato Institute calculated this "dead weight" to be about 25 cents on every tax dollar that is being collected and redistributed by our Federal government. Therefore, it takes $1.25 in collected taxes "from you" so that our Federal Government can digest it and "give you" back a check for one dollar. Just think about that when the Republicans talk about tax cuts and the Democrats talk about tax rebates and tax credits in order to stimulate this economy.

One last thing. Democrats like sending you a check; even though its more costly, less effective, and hardly timely. They like the psychological power and the pure political message it sends to you when you receive that rebate check in the mail. Mostly, it's because they can attach political ownership to it. A check is absolutely more powerful, politically, than you simply seeing a small decrease in your payroll tax deductions. With Democrats, it's always about the appearance of every action and not ever really about trying to save our economy.

Another Obama-Nomics Lie is Exposed

In his typical campaign-promises-are-always-to-be-hedged-on fashion, Barack Obama is now saying that he may "keep" those nasty "GW" Bush tax cuts for the rich "if" the economy is tanking (See Full Story).

He now feels that taking away those tax cuts could hurt the economy even further. Golly...gee...let me see! Is this an admission that the tax cuts for the rich are actually beneficial to the economy? Is he now admitting that the 2000 Clinton recession and the disastrous economic effects of 9/11 were reversed by those tax cuts for the rich? Are we going to have four more years of the Bush; even if McCain isn't elected? Out of the mouths of babes and sucklings (Psalms 8:2)!

Apparently, the elimination of those tax cuts can only be done during a good economy. That way, hopefully, our economy could survive the consequences of doing so. Hopefully! Now batting, rookie "far left" hander, Barack Obama!

The Big Bill Clinton Economics Lie

Bill Clinton took office in late January 1993. If you listen to Democrats, Bill Clinton's years were the most golden economic years of any American President. They always point to the growth in the economy, job gains, and balancing the budget. Take for example, this opinion piece that was just written by two of Barack Obama's economic advisers (See Full Story).

But, Bill Clinton didn't create the economic boom of the 1990's -- he just fell into one. Bill Clinton was lucky enough to take office during the beginning of the Internet Revolution. In 1990, 3 years before he took office, the IBM online service provider, Prodigy, began selling service nationwide and had already achieved 1/2 million subscribers in short order in that year. America Online began operations in the beginning of 1991. Hundreds upon hundreds of companies were started. Companies that were involved with Internet content, like Cnet and Etrade, and others selling equipment and services to access the Internet, such as Dell and Cisco. Cash from Venture Capitalists was going into anything and everything that had a dot-com name associated with it. Jobs were being created at small startup companies like Netscape, Yahoo, Ebay, and thousands of others. Tax paying millionaires and their companies were being created by the day; not by the year. If 23 million jobs were being created during the Clinton Administration, it wasn't because of his policies. It was because of the Internet explosion.

For those Democrats who always point to Bill Clinton's success, I always ask two questions. If Bill Clinton was such an economic guru, why then did our economy start to falter a year and a half before he left office. Why was George W. Bush handed a recession?

Every person who understands the economy knows it takes about 9 months or more to turn it around with any changes in economic policy. When Clinton ran against the first George Bush, it was all about "the economy, stupid!" This is because the first two quarters of 1992 had negative growth and our economy appeared to be in recession. But, what most people don't know or even understand is that the last two quarters of 1992 had come back and had actually booked modest growth of around 2%. Not great. But, growth anyway. Two quarters of negative growth occur quite often but aren't necessarily the start of a recession. In explaining this, many economists like to use the highly technical term of a "blip" in the economy.

The quarter that was underway when Bill Clinton took office, Quarter One of 1993, actually produced growth of greater than 4 percent and our economy was off to the races from that point on. There is nothing that Bill Clinton could have done before taking office to account for this. Even if he could have, it would have taken another 3 quarters past any implementation to have an effect. For example, any tax changes that Clinton would have implemented when he took office would have not seen any impact until, at least, the fourth quarter of 1993. In fact, Bill Clinton's priority wasn't the economy (stupid) when he took office. It was gays in the military.

To me, the economy of the Clinton-Years is more mystique and mythology than truth and reality. At the beginning, Clinton benefited from the dot-com bubble. At the very end, he suffered from the dot-com bust in 2000 and a subsequent recession (See Full Story). For Obama's economic advisers to use the Clinton-Years as their rationale and model for success under Barack Obama (as noted and linked above), is just wrong. The conditions that existed during the early Clinton years will not be present if and when Obama takes office. If anything, Mr. Obama may inherit a recession. This time, it will be a recession that can't be fixed by an economic boom called the "Internet Revolution". His big tax raising plans will just be counterproductive and, I think, a total economic disaster.

George W. Bush's tax cuts turned an economy around that was suffering from the 2000-2003 recession and a recession that had been exacerbated by the events of 9/11. That was reality. The Clinton boom years were are also a reality. However, not from anything Clinton did. Clinton just happened to be there when the dot-com comet came flying by.

Image by John.Karakatsanis' photostream on Flickr with Creative Commons Licensing. All rights retained. (Click to View Other Works).