I got home well after the Democratic debate started. I was at the Cubs game. I was able to follow the debate pretty well on Twitter. I follow both right wing and left wing people so I get both sides.
From Twitter, it looked like Hillary did well. She successfully painted Bernie Sanders as a gun lover. Sanders also showed that he doesn’t have the spine to be President. He offered up a mea culpa on her email scandal. The question I would have about that is this: How many politicians and people in our different departments of government use private unsecured hackable email accounts for government business?
Governor O Malley from Maryland did well. He made some points and provides an alternative to the Clinton Express.
What’s really interesting to me is how Democrat politicians view the world. For example, if someone gets a government transfer payment, or gets
by the government, they see that as a net gain to the economy. In fact, it’s a 0 gain. The dollars that go into the bureaucracy to administer that program are negative. The dollars that are paid to the people are not negative, but just reshuffling the cards. Those dollars had to come from somewhere. Here are where they come from:
- Taxes. That means someone else has less so the government can transfer the money to someone it chooses to have it.
- Issuance of Debt. This is a tax on the future income that Americans will earn. Debt is not free, and it has huge consequences to impede future growth. There are a lot of faulty statistics, or meaningless stats being circulated about Obama that are designed to obfuscate the reality. President Bush expanded the deficit. President Obama obliterated it. America is in debt by over $16 trillion. That’s almost double since 2008, and it’s not going down.
The stock market number isn’t really a determinant of how well America is doing. It’s one factor, but so many things go into it. A truer measure is real GDP growth. GDP always grows in America. We have a dynamic economy. It’s the percentage growth from a high base that is important. Higher rates of growth contribute to higher standards of living for each and every one of us. Real GDP growth has been anemic since Obama took over. To be fair, he inherited a mess. But, his policies haven’t helped.
This is the equation economists use to calculate GDP. Understand, different economists calculate the same equation using the same data different ways. Some weight different factors more. Some make different assumptions. That’s why arguments happen between them. For example, Keynesian economists weight heavily the G component of the equation. Classical economists give it far less weight.
Here is what the data shows on the effect of increased G on real GDP.
Amazingly choppy. Amazingly inconsistent. With all the spending the government has been doing and all the increases in transfer payments to individuals, you’d think we’d have a nice smooth rally in real GDP growth. Remember, interest rates have been priced at roughly 0% since Obama took over. The interest rate is really the “cost” of money-so having 0% interest rates mean the cost to get it is close to zero. In 1979, that cost was as high as 20%. Sort of like a payday loan.
Both parties will try and bend the facts to fit their narrative. What I think is that most Americans want efficient government. They are willing to spend a bit on it-but they don’t want to overspend on it. As William Galston observed, 41% of the Democratic party are now very liberal. This is why a socialist like Bernie Sanders can get a following. 41% flies in the face of “socially liberal and fiscally conservative”. Very liberal isn’t fiscally conservative. Very liberal policies aren’t designed to leave Americans alone.
I think most Americans are sick of the political discourse in America. The truth is, we have brought it on ourselves. Gerrymandering in political districts has allowed more “ethnically pure” candidates from each party to win. The US Senate is probably more indicative of where the country is. If elections were held every two years instead of six, I wonder what it would look like.
I am a big fan of redrawing all districts in the US to make them more competitive. More competition will make big political money toothless, since they won’t be able to concentrate on certain races. I am also a big fan of term limits-provided that we limit the size and scope of the bureaucracy. I don’t want to be ruled by agencies. I prefer to be governed by elected officials.