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Stock Ideas Investors Daily Edge War and Peace and Politicians Who Spend Too Much
Stock Ideas Investors Daily Edge War and Peace and Politicians Who Spend Too Much 
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By Chris Johnson Dear Reader, Bullish on Bailouts. That's the best way to describe what we saw last week, as investors bought equities while evidence continued that government aid would be available to help the market through its current crisis. |
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| War and Peace and Politicians Who Spend Too Much |
| Wednesday, 24 September 2008 | ||||||||
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In Unplugged, we answer emails and comment on your comments… or let you have the stage all alone. The news is full of the banking bailouts, meltdowns and so on, which you may be expecting to hear about. But the most comments I got lately were in response to something I said about Ronald Reagan and the Westernization of American politics. Less government, more personal responsibility to put it succinctly. Several people objected that I said something nice about Mr. Reagan at all, a few applauded. But my favorite letter was this: “Lynn - Good article, you restrained what biases you may have to give us a good and often overlooked perspective, thank you.... now, if you could just talk some similar sense into that husband of yours!” First, thank you for noticing my restraint. I try very hard to be evenhanded and to remember that even the politicians I loathe were admired by enough people to put them in office. Insult one of those suckers and the people who voted for them take it personally. But I will own up, Ronald Reagan is middling on my scale of presidents—neither the very worst nor the best. I didn’t agree with his viewpoints on many issues, did agree on others. But he could hardly have enforced them all by himself since everything he wanted required an Act of Congress. Blame Congress. As for restraining that husband of mine, though-- What! Heresy! That would take all the wild and crazy fun out of this marriage. One restrained person is enough in any couple. Sometimes I look around restaurants and see two old people eating together hardly talking, no longer looking like they enjoy socializing with each other, and think happily, “boy, that’s never going to happen at this table!” It’s always interesting around here. Now, to the rest of the letters… From the Reagan supporters… Good Morning Ms Lynn: Interesting article this morning. My mother from, Wilmington Mass, went through the same treatment. Being a Northerner and even worse a CATHOLIC. She made few friends down here but they were all keepers.
When I think of Mr. Reagan, it is mostly with the relief of getting rid of missing President Carter. To me one of the most inept people to occupy that house after Mr. Grant. The aggrandizement of Mr. Reagan by the Republican Pinheads as the SLAYER of the Soviet Bear cast a shadow on his memory. He only completed the work of his predecessors, such as Mr. Nixon, who actually chipped the first crack in the Soviet Wall. I disagree somewhat with your Western Premise. Personal Responsibility was an American trait until the Socialist Revolution of 1965 under Mr. Johnson with his Great Society (read Vote BUY). And this: Of your article on Ronald Reagan's western philosophy & faith: It is well researched and presented. It speaks of the "Invisible Truth": Responsibility. The day voters could vet office seekers on responsibility, not eloquence, the USA will shine. Of course, I am a Californian. And this: It’s about time somebody got it right on one Ronald Reagan. Hope history books do too. He was the best for the rest. He’s really missed. From the less enthusiastic: Most think Reagan was a great president. I think he should have stayed were he was - a good actor for B movies. Unfortunately, you get what (or less) than you pay for - including in taxes. Tax less - receive less. This may be good but it doesn't repair our infrastructure or clean our air. That was one of the mild ones. The other anti-Reagan letters were vehement. There were several versions of “treasonous bastard,” and then they got downright insulting. But several readers also commented on Reagan’s great weakness. For all his talk about restraining government spending, he did a terrible job many noted. I have to agree on the outcome versus the philosophy. Government grew rather than shrunk, despite his fiscal conservatism. Then again, it usually does when a conservative grabs the presidency or control of Congress. There is something astounding about fiscal conservativism in America. Just as redheads are particularly likely to have freckles, American “small government” types are extremely likely to be fans of big military. The two views are not logical mates, but for some reason they are most often linked in American politics. Eisenhower was probably the only president to be a fiscal conservative who was for a smaller military. This hatred of government and love of the military in U.S. politics leads to strange priorities. An amazing number of politicians and their backers would take a loaf of bread out of a kid’s mouth (some church can take care of charity, right) so they can buy a new jet or invade another country. They would spend billions on strangers in Iraq, including humanitarian aid, and begrudge a doctor to one of their own. Of course, in popular discourse these days, the root of all government debt either goes back to FDR and the New Deal (even though it was actually the cost of World War II that sent government spending to an all-time high) or LBJ and the Great Society. Rarely is military spending mentioned as a cause of budget overruns among declared conservatives. This is illogical since military spending accounts for 50.1% of the U.S. budget, according to the Center for Defense Information. That’s a cautious estimate. If ongoing obligations to past military personnel are included, defense spending rises to 53% of the budget. But I will end with another letter from a European reader who has something to say on this very matter: Your article on USA and westerners responsibility has to be seen in this light. After WWII the national debt changed as follows: * Truman: 90% to 72% of GDP * Ike: 72% to 56% * Kennedy-Johnson: 56% to 40% * Nixon: 40% to 35% * Carter: 35% to 33% * Reagan, Bush I: 33% to 66% * Clinton: 66% to 57% * Bush II: 57% to 65% It's not what you say it's what you do that counts. Looking at this list, the real fiscal hero here was, of all people, LBJ, because the national debt as a percentage of GDP went down while the Vietnam War was escalating and sending military spending up sharply. The costs of Johnson’s Great Society did not force debt higher in the next administration, either. Nixon did quite well at continuing to reduce the national debt as those programs came on line. For our non-U.S. readers’ perspective, Truman was president from 1945, the last year of World War II, to 1953. He also was president when the Korean War began (1950-1953). Eisenhower benefited from the first sustained period of peace when he was in office (1953-1961) The Vietnam War was the U.S. name for the Second Indochina War. Our involvement began in 1959 in a very small way. The larger-scale involvement began in 1961 under Kennedy, then the first declared combatants (previous troops were “advisors”) went to Vietnam under Johnson in 1963. So, our writer has a good point. It’s not what you say; it’s what you do. That’s it for this week. Maybe I will follow Andy’s example and say something outrageous next week. Probably not. Andy is Andy, and Lynn is Lynn. P.S. To let me know what you thought of today's article, send an e-mail to: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
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