Democrat’s Loss Of Super-Majority Causes Dow To Fall 268 Points!

by Ben Hoffman

With the swearing in of Scott Brown today, panic swept through America and people sold their stocks, fearing the worst. Democrats no longer have the super-majority needed to pass even the most trivial of legislation.

Our country is in serious trouble. Just to keep running, the government needs to borrow $14.3 trillion dollars. The federal debt is now at over $12 trillion, thanks to the irresponsible tax cuts in 2001 and 2003, the two wars, and high unemployment that has greatly reduced revenues, not to mention the over $400 billion dollars a year we pay to interest on the debt.

When Bush’s first fiscal year began on Oct. 1, 2001, the federal debt was $5.8 trillion. At the end of his final fiscal year on Sept. 30, 2009, the debt was $11.9 trillion. He increased the federal debt by some $6.1 trillion, more than doubling our debt.

Of course, the Republicans have a history of radical fiscal policies. Reagan more than tripled the debt. It went from a modest $900 billion to $2.8 trillion during his tenure.

So it’s understandable that people would be concerned about the economy with another Republican in Congress. This might be a good time to go short in the market.

Note: the European debt problems and worse than expected jobs report may also have contributed to the stock market drop today.

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15 Comments to “Democrat’s Loss Of Super-Majority Causes Dow To Fall 268 Points!”

  1. Mr. Hoffman,

    ” Note: the European debt problems and worse than expected jobs report may also have contributed to the stock market drop today. ” 🙂

    Since the stock market is made up of evil corporations, the Dow’s 268 point drop is by progressive standards a good thing. So everything is going according to Obama’s plan of destroying all of the the kapitalist Korporations. Then all will be replaced by government owned production kommunes. I wish to put in application to be kommissar of kollective farming.

    It is glorious, isn’t it komrades ?

  2. Ben is exactly right on with this. When will Americans learn that supply-side economics and tax cuts for the wealthiest amoung us do not help, but hurt the economy.

  3. It says something that the Dems can’t do anything with even a majority, let alone a super-majority. I think investors (foreign and domestic) get wise to this from time to time, looking past the fearmongering and Bush-bashing to see that this government really doesn’t have a handle on what it’s doing.

    Instead of getting wrapped around the axle trying to figure out who’s to blame for this debt, why don’t we start discussing things of substance that can help pull us out of it?

  4. The Conservative Lie,

    ” Ben is exactly right on with this. When will Americans learn that supply-side economics and tax cuts for the wealthiest amoung us do not help, but hurt the economy. ”

    As Alan always says, show me where your stuff works. Screwing the wealthy doesn’t work. Unlike you I can cite examples. Reagan’s tax cuts did work. George W. Bush’s tax cuts pulled us out of the 911 economic blues. Being so young you obviously do not remember how the economy froze up with fear after 911. I do. If they had not worked, how could Bush have gotten reelected in 2004? Even Rove was not that brilliant.

    Further proof. […] Look at all of the 50 states. For 3 years they all have had a rough time. HOWEVER, which ones have faired better, and which ones have faired worse.

    In this real world Darwinian environment the states who tried to keep taxes and spending with in reason, are surviving. As the national economy revives these will prosper first. Even while getting less from Barry, Nancy, and Harry.

    Now Mr. Conservative lie, how well are your Green, Socialist, screw the rich states doing? California, New York State, and New Jersey, which at one time were the richest States, are all the equivalent to Banana Republics. The rich are fleeing. Businesses are fleeing. Tax revenue is drying up. Why, why, why ?

    They are doing everything you say they should do. They have screwed the rich. They have screwed the polluters. They have diverted millions in to green nonsense. They have spent like crazy on education and infrastructure. Yet they are virtually bankrupt. How can that be?

    State like Texas and Indiana where they welcome the rich and their money, are doing better. WHY ?

    If you are as smart as you pretend to be, you should have no problem destroying my facts and arguments. Please be specific and do not just label my words as talking points. I won’t say who does that here.

    Oh, the rest of you big government, big welfare, anti capitalists are welcome to destroy me if you dare.

    • being so young? I’m 41 and an 18 year military vet. I remember reagan tripling the debt and throwing us into recession, I remember GW’s tax cuts again producing a record debt and resulting in the current debacle. Whereas clinton’s taxes on the wealthy put us in the longest period of economic growth in US history and resulted in a budget surplus.

    • Furthermore, I see you got your talking points from either beck or boortz this week as this is what they were talking about, but since all the right wing media lapdogs get their intel from grover norquist, I guess it could have come from any of them.

  5. Conservative Lie,

    Even though you pulled the Hoffman trick of calling my arguments talking points, I congratulate you in going to the next step and actually refuting me point for point. Many Liberal-Progressives never reach the advanced state of mind of thinking for themselves. It puts you in the top 1% in your philosophical group.

    Now for me to refute you point for point. Of course any Conservative could do it, because all of us are trained independent thinkers.

    ” I remember reagan tripling the debt and throwing us into recession, ”

    A typical Liberal half truth. The debt did go up under Reagan. But just what recession do you mean ? Be SPECIFIC !! When Reagan came in, the country WAS in recession. In mid 83 the country began coming out of it. We did have the stock market crash of 1987. I know because, as a mutual fund investor I experienced it and lived to tell the tale. A year later the market had recovered. If the economy was not in relatively good shape when Reagan left office, we would have had President Dukakis.

    ” I remember GW’s tax cuts again producing a record debt and resulting in the current debacle ”

    Again another half truth. The debt did go up under W. The debacle, if you care to actually GOOGLE it, was caused by your buddies, The Democrats, juicing the housing market by way of the GSEs. That would be Fannie Mae and Freddie Mac. From the late 1990s on they encouraged lenders to drastically lower borrowing standards. Where do you think the toxic assets originated ? Check it out for yourself. Prove me wrong.

    Don’t just say it, do the work and prove it. You might learn something.

    • Hold the presses here. Are you agreeing that Reagan tripled the national debt, but claiming that by the time he left, the economy was in good shape? First, are you saying that he SPENT us out of recession? Really? Is a republican’t saying Reagan SPENT us out of recession? First of all, this is patently untrue. Even Bush Sr. disagreed with Ronnie’s economic strategy, as HE was the one who first coined the term “voodoo economics” referring to Reagan’s trickle down, supply-side economic theories.

      The recession of 1982, not 1983 by the way, occurred during Reagan’s second year in office. Double-digit inflation was well on its way to being defeated by this time, and Reagan’s tax cuts and deregulation policies were already in effect. Assumptions that Carter’s tax and regulation policies were to blame for the recession are tenuous at best.

      Carter got the worst of a bad situation that included Nixon, Ford, Vietnam and the OPEC crisis. Wanna know how he dealt with it and Reagan got the credit, while actually tripling (yes tripling – I’ll say it three times – tripling, tripling, tripling) the national debt?

      Reagan’s administration started in January 1981, and within 108 days he passed a budget that contained his famous and insanely dangerous “supply-side” tax cuts. The budget passed in 1981 would not be enacted until 1982.
      Additionally, the “Bedtime for Bonzo” star quickly imposed a moratorium on any and all new federal regulation enforcement the instant he took office. In fact, he began decimating already existing regulations.

      Yet, for some kooky reason, 1982, up to that point in time, was the worst year since the Great Depression, with NEGATIVE 2.2 percent growth. That’s -2.2! How could that possibly be?

      Not finished here, stay with me if you can; by 1982 there had already been huge cuts in the capital gains tax, the most sacred of all tax cuts to you conservatives. Between 1978 and 1982, the top rate on capital gains was cut from 39 to 20 percent. And the top rate on unearned income (that would be income that nobody worked for, you know, RICH people money they get just for being rich) fell from 70 to 50 percent.

      As for deregulation, that actually began under Carter, not Reagan. Carter deregulated airlines, trucking, railroads, oil and interest rates, and set up much of the deregulation machinery that Reagan would use.

      And Carter’s double-digit inflation? It was already falling dramatically by ‘82.

      Inflation (1)

      1979 11.3%
      1980 13.5
      1981 10.3
      1982 6.2
      1983 3.2

      George Sr., considering the yardstick by which is measured, didn’t do that bad. Certainly better than Ronnie or his coke snorting, drunk driving son. Though he didn’t do too well either.
      By most standards he continued the Reagan economic policy. He reneged on his “read my lips” promise not to raise taxes. He presided over a stagnant economy, at best. Economic instability and low consumer confidence led to Clinton’s landslide victory. Remember “It’s the economy, Stupid”?
      Then ensued the longest period of economic growth our country has ever had. And the end result was the largest budget surplus our country has ever had. But the left grew complacent, the rich weren’t getting richer fast enough like this, and so the right pounced and appointed George W. Bush as President.
      In addition to squandering the budget surplus and hitting another record setting debt AND deficit, Bush the Lesser also presided over:

      1. Republicans in Washington resumed raiding the Social Security Trust Fund during President Bush’s first year in office and spending every penny of the Social Security surplus since 2002. (Congressional Budget Office)
      2. The unified federal budget, which included the Social Security Trust Fund, returned to a deficit of $158 billion in 2002. The unified deficit increased again in 2003 to $378 billion, the highest level ever. In 2004, the unified deficit reached another record high of $412 billion. (Office of Management and Budget)
      3. The deficit in 2005 was over $333 billion–the third largest unified budget deficit in American history. That makes Monkey Boy the only President in American history to oversee three consecutive years of record high deficits. (Office of Management and Budget)
      4. The Bush Administration’s budget will spend a conservatively projected total of $2.5 trillion from the Social Security Trust Fund surplus over the next 10 years. (Congressional Budget Office) Cumulative unified budget deficits over the next 10 years are expected to be as high as $4.8 trillion. (Goldman Sachs, Deficit Reduction: Don’t Pass Up This Investment, 6/10/05)
      5.Republican deficits were financed by an unprecedented level of foreign borrowing. During President Bush’s administration, foreign ownership of U.S. debt more than doubled, from $1 trillion in 2001 to $2 trillion in 2005 and on upward ever since. The United States is now the world’s largest net debtor country. (U.S. Treasury Department)
      6. Japan and China represent nearly half of the foreign holdings of U.S. debt. While other countries have either reduced or left their holdings of U.S. debt roughly unchanged, China has steadily increased its ownership by 65 percent in 2005 alone. (U.S. Treasury Department)
      7. The record trade deficit is also being financed by foreigners. Every year the Republicans were in power, the U.S. trade balance deteriorated to new low levels. China alone accounts for over 28.5 percent of the total U.S. trade deficit. (Bureau of Economic Analysis, U.S. Department of Commerce)
      8.With more money going to pay interest on the national debt, we have less money to spend on critical national security measures, increasing investment and job creation in our economy, and meeting our commitment to extend Social Security solvency. Republicans, who controlled the White House and the Congressional agenda, did nothing to address these challenges.
      9. U.S. multinational companies (MNCs) have shifted more jobs overseas since President Bush took office. These firms reduced their U.S. workforce by nearly 10 percent during the first three years of the Bush Administration: 2.1 percent in 2003, following a 3.0 percent reduction in 2002, and a 4.1 percent reduction in 2001. (Bureau of Economic Analysis, U.S. Department of Commerce)
      10. At the same time, employment at their foreign affiliates based overseas increased by 1.2 percent in 2003, following a 1.0 percent increase in 2002 and a 0.1 percent increase in 2001. (Bureau of Economic Analysis, U.S. Department of Commerce)
      11. With current lack of regulation, the offshoring trend continues: in the next 10 years, 3.4 million white collar jobs are expected to move offshore. (Hira and Hira, Outsourcing America)
      12. President Bush and his cronies have the worst job creation record of any President since Herbert Hoover. The average annual employment increase over the past 70 years has been more than 2 percent. After eight years as President, and with the power of his own party behind him in both houses of Congress, President Bush has achieved a record low annual average job growth, creating NO new jobs and losing over 3 million jobs.(Bureau of Labor Statistics, U.S. Department of Labor)
      13. The job losses associated with the recession that began in March 2001 has been the most protracted jobs slump since at least the end of World War II. On average in the postwar period, job losses stop about a year after the onset of the recession and employment begins to increase after about 15 months. Within two years, employment surpasses its pre-recession peak and is expanding at a healthy pace. (Joint Economic Committee Democratic staff)
      14. Long-term unemployment more than doubled to during the Bush Administration. (Bureau of Labor Statistics, U.S. Department of Labor)
      15. The manufacturing sector has been hardest hit during the Bush Administration. Manufacturing employment is now at its lowest level since 1950. (Bureau of Labor Statistics, U.S. Department of Labor)
      16. After adjusting for inflation, the median household income was down by more than $1,500 during the first three years of the Bush presidency. This was the greatest decline for any previous administration for which data is available, and it continued to drop during his tenure. (Joint Economic Committee Democratic staff)
      17. Personal income growth lagged behind inflation, reducing purchasing power for every day necessities such as food, gasoline, housing, and health care. (U.S. Department of Commerce) Lower purchasing only adds to unemployment.
      18. He initiated TWO unfunded wars. Previous generations paid specific taxes to support war efforts. Ours got a tax cut – the first war-time tax cut in US history, and maybe the first in history period. Whether you agree with the lies that got us into Iraq or not (I was there and I don’t), you can’t fight unfunded wars, unless you plan on just passing the buck for that onto the next administration and your own grandchildren.

      The numbered bullet points are all available at the sources I’ve outlined for you.
      Furthermore, previous recessions and depressions have taken, at a minimum, of 2 years and as long as a decade from which to recover. Obama has been in office only 1 year.
      That was your econ lesson. Would you like to discuss ethics or foreign policy next?

  6. Further, I contend that the housing market dropped, not because of the deregulation (that you cons are usually all about), but because of the above reasons, which affected people’s ability to pay their bills. You can only afford $4.50 per gallon gas for so long.

    Also, restructuring the terms of mortgages so that lower income families can afford them does not equal predatory lending practices. Huge bonuses for signing mortgages maybe should be changed to good bonuses for signing mortgages that don’t forclose in the first 5 years.

  7. Conservative lie,

    ” by the time he left, the economy was in good shape? ”

    Uh,,,,Yea! Unemployment and inflation went down during his administration. Care to dispute that ?????

    ” First, are you saying that he SPENT us out of recession? Really? Is a republican’t saying Reagan SPENT us out of recession? ”

    A thousand and one NOs. Congress overspent during the Reagan years. You remember Congress, don’t you ? The men and women who buy your vote. They do not buy mine.

    The Reagan tax cuts, and relief from stupidity got us out of recession.

    1981 tax receipts= $599.3 billion
    1989 tax receipts= $990.7 billion

    Things would have been even better with a Republican Congress. If Ronald Reagan only had Bill Clinton’s Republican Congress, he would have done even better.

    ” Between 1978 and 1982, the top rate on capital gains was cut from 39 to 20 percent. ”

    Hey Karl you know Marx, did they ever teach you why capital gains get taxed less. It is so that rich people will risk their money to open businesses, to give little socialists jobs.

    ” As for deregulation, that actually began under Carter, not Reagan. Carter deregulated airlines, trucking, railroads, oil and interest rates, and set up much of the deregulation machinery that Reagan would use. ”

    So now Democrats believe in deregulation ? Who knew ?

    That’s all for now.

    I congratulate you on your volume of data. Perhaps you could edit your responses in to a more manageable format. If I am going to converse with you, I will not respond to over 130 lines of text in the future.

    • You make some of my points for me… yes, in spite of the deregulation, in spite of the cuts in cap gains tax, and in spite of the fact that carter gave him an upwardly turning economy, Reagan still screwed it up.
      The policies that clinton put into place, BEFORE the republican take over of the congress in 1994 are the ones responsible for the economic growth.
      I know it was a long post, but did you read it?
      I’ll try to keep it shorter in the future, but you cons just give me so much darned amunition.

  8. [1981 tax receipts= $599.3 billion
    1989 tax receipts= $990.7 billion]

    That’s kind of pathetic. It comes out to about a 60% increase over 8 years. Carter had about the same increase in only 4 years.

  9. Conservative lie,

    ” I know it was a long post, but did you read it?
    I’ll try to keep it shorter in the future, ”

    I appreciate your effort, but I have a low threshold for boredom. If we could scream at each other over 3 or 4 points or groups of statistics, I believe it will be more constructive.

    ” I know it was a long post, but did you read it? ”

    Honestly, not all of it. You cited a lot of numbers, enough for 6 drag down fights. I naturally have to check your numbers and then see how I can intelligently answer you. You used up my available time.

    ” I’ll try to keep it shorter in the future, but you cons just give me so much darned amunition. ”

    I hope you take this the right way, but I truly know how you feel.

    ” and in spite of the fact that carter gave him an upwardly turning economy, ”

    I do not have figures to support my next statement, but I lived and worked through this period. I was in a smokestack industry at the time and I totally dispute your claim. 1980 and 81 were the beginning of the end for my company. We shrank to a third of our size. Inflation and interest rates were the highest of my life. I was unemployed at the beginning of 1983. About the middle of 83 the economy picked up quickly. There was a relative boom until the crash of 87.

    Mr. Hoffman,

    ” It comes out to about a 60% increase over 8 years. Carter had about the same increase in only 4 years. ”

    I concede the figures, but I do not call it pathetic. It does confirm that you can still grow tax receipts while cutting taxes.

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