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Bush Fiscal Policy Worst In 200 Years?

As President Bush enjoys his month-long vacation in Crawford, Texas, punctuated by the occasional fundraising gala, many Americans are still looking for jobs from which to take that vacation.

Bob Herbert writes and quotes in The New York Times (registration required):

It’s too bad George Akerlof wasn’t at the meeting. Mr. Akerlof, a 2001 Nobel laureate in economics, bluntly declared on Tuesday that “the Bush fiscal policy is the worst policy in the last 200 years.” Speaking at a press conference arranged by the Economic Policy Institute, Mr. Akerlof, a professor at the University of California at Berkeley, said, “Within 10 years, we’re going to pay a serious price for such irresponsibility.”

And George Akerlof isn't alone.

Also participating in the institute's press conference was Robert Solow, an economist and professor emeritus at M.I.T. who is also a Nobel laureate. He assailed the Bush tax cuts as "redistributive in intent and redistributive in effect."

"There has been a dissipation of the huge budget surplus," he said, "and all we have to show for that is the city of Baghdad."

But 10 years down the road is a long time for bad policy to shake out. Is there any immediate fallout?

Ralph Plumb, president of the Union Rescue Mission on L.A.'s skid row, said his agency, traditionally a haven for homeless men with drug and alcohol problems, is providing shelter for more and more "intact" families. Their problems are not the result of drug or alcohol abuse, or mental impairment. They simply have no money. Forty percent of the people at the mission are there "purely due to economic issues," he said.

-- snip --

"Homelessness in major cities is escalating," the article said, "as more laid-off workers already living paycheck to paycheck wind up on the streets or in shelters."

That story ran one day after a front-page Wall Street Journal article that spelled out how sweet just one of the Bush tax cuts has been for those in the upper brackets: "The federal tax cut, which slashed the tax rate on dividends and prompted many companies to increase their payouts, is proving to be a boon for some corporate executives who are reaping millions in after-tax gains."

It has always mystified me to see ads like those of the recent H&R Block campaign which carried the tagline, "It's your money." It certainly is, and it's also your house and your children that are protected by the police and fire departments that are paid for by your money, and your neighbor's money.

There's some odd disconnect between people's understanding that taxes actually pay for something--services. We may disagree on which services take priority, but to simply cut taxes because "it's your money" at the expensive of functioning schools in Oregon, a police and fire fightering force in NYC (they're "heroes," rememeber?), college tuition aid in Albany, jobs in LA, or maintaining hazard pay for US soldiers in Iraq, seems to be an odd tradeoff.

Posted by jeremy at August 14, 2003 12:03 PM