The weird thing is that this shift has taken place while the country as a whole has become much safer. In one of the great under-reported stories of the past 25 years, the violent crime rate has declined roughly by half since 1993. To be precise, the F.B.I.'s count of violent crimes reported to law enforcement has declined from a rate of 747 violent incidents per 100,000 people in 1993 to 387 incidents per 100,000 people in 2012, which is the most recent year for which it has published complete data. This reflects the fact that over this period, the homicide rate has fallen by 51 percent; forcible rapes have declined by 35 percent; robberies have decreased by 56 percent; and the rate of aggravated assault has been cut by 45 percent. Property crime rates are also sharply down. These trends aren’t caused by changes in our willingness to report crime to the police. We see an even more significant decline in violent crime in data derived from surveys asking people whether they’ve been the victims of certain crimes over the past year. The National Crime Victimization Survey reports that the rate of violent victimizations has declined by 67 percent since 1993. This reflects a 70 percent decline in rape and sexual assault; a 66 percent decline in robbery; a 77 percent decline in aggravated assault; and a 64 percent decline in simple assault. The gap between perception and reality is particularly large when it comes to New York City. A YouGov survey asked people to assess the relative safety of 10 large cities. New York was, after Chicago, the city most likely to be rated as “fairly unsafe,” or “very unsafe,” while Dallas/Fort Worth and Houston were most likely to be rated as “very safe,” or “fairly safe.” The reality, of course, is that the actual violent crime rate in New York is around half that in either Dallas or Houston, and lower than that in other big cities.
It isn't a question of the federal government's "right " to tax income once when it is earned and again when it is left to the next generation. The government has the right to do that, just as it has the right to tax corporate earnings at the corporate level and again when those earnings are distributed as dividends. Rather, the question is the much broader one: what is the most desirable way to raise the money the government needs? Now "most desirable" can mean different things to different people such as, "easiest to collect" or "least disruptive to other economic arrangments" or "most conducive to economic growth" etc etc This space is much too small to even begin to evaluate those alternatives.
Do you ever thing for yourself or are you just a Rush Limbaugh/Michael Savage quote-spouting machine? American public education is inadequate to the challenges of the 21st century, I'll give you that, but what is your solution to that problem? And where are the great harms of "political correctness"? That the Washington Redskins owner has to tolerate having his team's name criticized because of its inherent racism seems to me a good thing. Would you be OK (for example) if the Bears changed their name to the Chicago N-words? And providing equal rights to people who have historically been discriminated against is not the same thing as giving them superior rights. As far as illegal aliens go, most of the Constitution's protections are extended to "persons" not "citizens" so your argument is so much hot air.
Where I am completely in agreement with you is that we should not have political dynastys in this country. We have had political families in the past. John Quincy Adams (the 6th president) was the son of John Adams (the 2nd president). Benjamin Harrison (the 23rd president) was the grandson of William Henry Harrison (the 9th president). James Madison (the 4th president) and Zachary Taylor (the 12th president) were second cousins/ Franklin Delano Roosevelt (the 32nd president) was a fifth cousin of Theodore Roosevelt (the 26th president).
Of course, George W. Bush (the 43rd president) is the son of George H. W. Bush (the 41st president). Jeb Bush, should he be elected, is the son of Bush 41 and the brother of Bush 43. And Hillary Clinton, should she be elected, is the wife of Bill Clinton, the 42d President. So the Bush and Clinton families are not unique but it is troubling that we have a political landscape that resembles the succession patterns in a banana republic.
There is a real book that does exactly what you describe: "American Dynasty" by Kevin Phillips (2004) traces the origins and the growth of the Bush family fortune and political influence. Phillips is a Republican who in 1969 published an amazingly prescient book "The Emerging Republican Majority" that quite accurately forecast the coming decaes. He has published many other books and is (imho) one ove the most insightful political writers in the country.
True, the rich got richer over time. But why are YOU complaining about that? Would you support an increase in upper bracket tax rates? Would you support doing away with special treatment for capital gains or hedge fund carried interests? Of course not. You would support lower income taxes on the rich and elimination of the capital gains tax and the estate tax so the rich could get richer even faster. Don't cry crocodile tears over the fate of the poor and middle class. Until you're willing to do something other than supporting programs that will make the divergence between the haves and the have-nots even greater, your protests on behalf of the 99.9% are as phony as a three dollar bill..
I will modify my previous answer to this extent: from 2009-2013, banks withheld significant numbers of foreclosed properties from the market place out of well-founded fear that if they released their entire inventory at once, it would crash the market. In early 2012, for example, some experts estimated that as much as 90 percent of bank-owned homes were not on the market. Although all areas of the country suffered during and after the Great Recession, foreclosures were concentrated in specific areas (Las Vegas, for instance) which had the highest proportion of "liar loans" before the crash. Banks holding Las Vegas properties had to wait for the local economy to recover or they would have suffered tremendous losses on their REO inventory. Since the spring of 2013, banks have been selling off their inventory as buyers re-enter the market. But they didn't hold the properties because of QE other than in the attenuated sense that they waited for QE to work and for people to once again be able to shop for homes.
I read Dyson's interview and a somewhat longer interview he gave as a follow-up. He makes some valid observations but also makes claims that have scientists who research climate change issues rolling their eyes. Dyson's major criticism of climate models is thoughtful but hardly new: we can construct models that plausibly account for past temperature changes but aren't necessarily good at predicting the future. The difference between explanation and prediction is not unique to climate issues: history consists of books that plausibly explain the past but don't predict the future. In regard to climate, the difficulty of constructing adequate models is immense given the chaotic nature of natural phenomena and the vast number of variables. As a result all climate models contain simplifying assumptions--what Dyson calls "fudge factors"--in an effort to work with a small enough number of critical factors to produce reliable predictions without attempting the impossible task of accounting for the effects of every possible cause. (Recall, in that connection, the "butterfly effect": the climate system is sensitive to even minute inputs that can multiply millions of times over, so that the beating of a butterfly's wings n Brazil might ultimately result in a storm in the north Atlantic.) There's nothing wrong with the approach to understanding the climate; indeed, it's the only practical approach. But it does impose a serious degree of modesty on the proponents of any particular model. For example, nearly all climate models contain assumptions about the degree of "forcing" of specific greenhouse gases. A small change in the forcing assumption can result in a large change in the predicted global temperature change. Dyson makes a socio-political point that also isn't new but should be acknowledged by any serious researcher: drastically cutting fossil fuel burning eliminates the best chance of moving the millions of poor in Asia into the middle class.
If I knew what the "natural" level of prices for any asset class should be, I would be a billionaire in less than a year. Condos on the east side of Manhattan sell for $2,000/square foot and up. Is this an artificially high price? How would you know?
So far as I'm aware, the banks that ended up holding foreclosed single family homes have been selling them off at bargain basement prices ever since the recession began. Your note implies that the banks have been holding on to them for some reason or other related to QE. I just don't think that's factually true.
I think you overstate the claims of people who support the estate tax. Unless you question the legitimacy of taxing people to pay for public services, there is only a technical argument about how to impose the tax. It can be an income tax, a consumption tax,a property tax, a transaction tax, a wealth tax or an inheritance tax (which is a form of wealth tax). And those taxes can be flat or graduated or progressive. And they can be imposed in multiple ways: via withholding, built in to the price of goods, etc.
For a long time I've been a proponent of a flat income tax coupled with an generous personal exemption, if we choose to tax incomes; a VAT-type consumption tax, if we choose to tax consumption; and an estate tax if we choose to tax wealth.
There's no perfectly "fair" way to distribute the burden of taxation. But I think that almost everybody would concur that a regressive tax, one that takes a larger proportion of a poor person's wealth or income than it takes from a rich person, is not a good social policy. To the extent that the estate tax partially compensates for regressive features of the rest of the tax system, it is a desirable thing.
As most everyone now recognizes, the central banks of Europe and the United States took widely divergent paths in response to the Great Recession of 2008. The ECB doubled down on austerity; the Fed went to QE. The results of those choices are apparent. Europe is a mess and the USA has recovered most of the ground lost in the recession. Asset prices have recovered, unemployment has been halved, and wages are beginning to rise across the board.
So why did QE work and austerity fail? I think the answer lies in the role of a central bank in managing expectations. While the ECB was raising rates and pledging to do whatever was necessary to keep inflation near zero, the Fed was cutting rates to zero and pledging to do whatever was necessary to restore economic growth. The Fed backed up this pledge by buying trillions of dollars of bonds, injecting massive amounts of liquidity into the economy. The Fed's determination to do whatever it takes coupled with effectively negative interest rates made saving less attractive than spending, bonds less attractive than stocks, goods more attractive than cash. The result was a gradual return of demand and a gradual recovery of the economy.
The persistent period of near zero interest rates has created an expectation that low rates are going to continue forever. The Fed is now trying to change those expectations by discontinuing QE and speaking openly of raising interest rates at some point. The rate increase, when it comes, will have been anticipated for so long that it will probably have little or no effect on stock prices.
The Fed hasn't been perfect but it has behaved vastly better than its European counterparts.
The federal inheritance tax applies only to estates valued at more than $5 million. A married couple can shield $ 10 million in valuation from the tax. So how many estates qualify? A little over 4,000. And how much will repeal of the inheritance tax for those 4,000+ estates cost the federal Treasury in revenue over the next 10 years? About $265 Billion. So to help out a tiny handful of America's richest people, the House GOP is willing to increase the national debt by more than a quarter-trillion dollars.
As to the "double taxation" argument, most accumulated wealth has been the beneficiary of the many, many special tax breaks and loopholes that are already in the tax code. For example, hedge fund billionaires would not have those billions if it were not for the "carried interest" rule that allows their incomes to be taxed at capital gains rates. But that's just one tree in a veritable forest of favorable tax regulations that lower the effective rate of tax paid by the truly rich to less than the FICA tax paid by a self-employed gardener. I recall reading that Mitt Romney was paying an effective tax rate of around 11%, for example. The inheritance tax makes up for those many favors previously granted the richest taxpayers by a generous Congress.
If you really believe what you wrote, then you would be attacking George W. Bush rather than Barack Obama. It was Dubya who cleared the path for Iran's ascendancy in the Middle East by convertng Iraq from Iran's most dangerous enemy into Iran's most reliable ally. When Bush chose to attack Iraq on the pretext that somehow or other Saddam had something to do with 9/11, we deposed a Sunni dictator who was a mortal enemy of Iran and ultimately replaced him with a Shia puppet who dances when Iran pulls the strings. I think Iran's emergence as the dominant Islamic state in the region lent urgency to the effort to keep Iran from developing a nuclear weapon. Put another way, Iran's emergence, a direct result of Bush's deposing of Saddam, forced the hand of Obama and the European nations that negotiated the nuclear deal with Iran. .
My friend Lan argues that in getting rid of Saddam Bush encouraged the long-suffering populations of other middle eastern tyrants to rise up against them, and he's probably right about that. Unfortunately, what has followed the Arab Spring is the Arab Nightmare, as country after country comes apart at the seams. Maybe that was inevitable; many Arabs never accepted the nation states imposed on them by the British map makers after WW I, a point ISIS makes at every opportunity. But in any case, it wasn't Barack Obama who lit the fuse that blew up the middle east, it was George W. Bush.
But let me reiterate the main point of my post: it's too early to tell. Lan might turn out to be right, and in 50 years, we might be praising Bush's as a visionary who laid the groundwork for a peaceful, democratic middle east. Or not. Time will tell. By the same token, if Obama's healthcare reform survives and if Iran turns out to be a responsible member of the world community, the future will treat him very kindly. Or not.
Almost every President you can name had legions of hostile detractors during his time in office. In recent years we've seen that with Nixon (forced from office by his own party) Carter, Reagan, Bush I (rejected by his own party) Clinton, Bush II (rejected by just about everybody) and Obama. Some like Bush II and Obama fared worse than others like Clinton and Bush I. But the all had and have their haters. Which is why it's a good rule to withold judgment on Presidents for at least 50 years, so the dust can settle, the old antagonists can die off, and we can form a more measured juegment of the men in retrospect.
So who do JFK and Nixon look today? (I know: we're only 41 years from Nixon's departure.). I'd say that Nixon looks better and JFK looks worse than either did during his time in office. It's a little hard to judge Kennedy because his Presidency was cut so short, but what little we know suggests that a full Kennedy Presidency would have been riddled with scandal (personal and otherwise). As for Nixon, his accomplishments increasingly appear to outweigh his mistakes. If Nixon had done nothing other than rewrite the history of America's relaitonship with China it would have been enough to move him well into the upper half of America presidents.
I've often compared Nixon with Obama and perhaps that is the way history will also judge Obama, as someone who got health care reformed and normalized relations with Iran and Cuba, among other things. But that script has still to be written and I'm just sorry I won't be around to read it when it is.
Fox News happened. Rush Limbaugh happened. Michael Savage happened. Etc. The takeover of both AM radio and cable news by people who make their living by feigning outrage at government programs designed to relieve the suffering of the unfortunate, by promoting militarism and aggression in foreign affairs as the only truly American response to the world's challenges and by repeating simplistic slogans to an audience that has a seemingly unlimited appetite for sucht things has resulted in a Republican base that disdains nuance and complexity and votes for the person who will throw the most read meat to the hungry lions.
I'm not a good prognosticator because so much turns on how the economy does. If we have another severe recession, we'll get there fast. If we have return to a strong economy that produces the budget surpluses of the latter part of the Clinton administration--and we don't screw it up this time--we might never get to 20 trillion.
I think the real question is how much debt is sustainable given the size of the American economy. Even though that's an easy question to state, it's an amazingly difficult question to answer. Because interest rates are still near zero, we can handle a large debt load. But as interest rates rise, our ability to handle a given quantity of debt decines. A $500,000 mortgage with a 2% rate is a wholly different animal from a $500,000 mortgage with a 7% rate. In the same way, an $18 trillion debt with a 1% rate is a wholly different animal from the same debt with a 6% rate. Right nowe it looks as if interest rates will remain low for a prolonged period. but that could change overnight adn we could suddenly find the debt choking us badly.
It's a shame you didn't pay more attention to arithmetic when you were in the 4th grade. The deficit is the difference between receipts and expenditures in a given fiscal year. The deficit will go down, compared to the prior year, even when spending increases if receipts increase faster than spending does. Let me put it in terms that even you might understand. If you get a $10,000 raise and increase your spending by $5,000 your personal deficit goes down by $5,000 even though your spending goes up. That is what's been happening for the past 5 years; spending has been increasing but at a lower rate than receipts, so the annual DEFICITS have been declining. The DEBT has continued to go up because we continue to have deficits. The debt won't begin to decline until we start runing federal budget surpluses. We were doing just that at the end of the Clinton administration, but the Bush tax cuts blew a hole the size of Texas through the budget and pushed us back into annual deficits.
It gets tiresome reminding you of this but the DEFICIT is the excess of this fiscal year's expenditures over this fiscal year's receipts. The DEBT is the sum of all prior deficits and surpluses. The increasing debt is easy to explain: the debt will continue to increase so long as we have deficits.
I've no doubt the CBO figures are correct and the deficit for the first 6 months of fiscal 2015 is slightly higher than it was in the correponding period in 2014. But that period (October 1, 2014 through March 31, 2015) excludes April 15, when income tax payments are very likely to be higher--perhaps much higher--than they were a year ago. So we won't know if the deficit will continue to fall in 2015 until the end of the fiscal year.
Government expenditures are driven to a significant degree by population growth. The country has added roughly 25 million residents since Obama's election, so a related increase in federal expenditures is what you would expect.
But this is all beside the point: You want to find every possible reason to criticize Obama which is, of course, your right. But a less biased observer would conclude that this administration has been a significant improvement over the one it replaced, at least from a fiscal responsibility standpoint.
As Al Smith was fond of saying, "Let's look at the record". Below I list the deficit for each fiscal year from 2009-2013 both in dollar terms (not adjusted for inflation) and as a percentage of GDP. ( I don't have 2014 fiscal numbers.)
2009 1,412,688,000,000 9.8 percent
2010 1,294,373,000,000 8.8 percent
2011 1,299,593,000,000 8.4 percent
2012 1,086,963,000,000 6.8 percent
2013 679,502,000,000 4.1 percent
As you can see, the deficit in both raw dollar terms and percenage terms was cut by more than half over that period. Federal spending in that 5 year period grew at the slowest rate since the Eisenhower administration. The big drop in fiscal 2013 reflects the end of the recession with increased tax receipts and lower welfare outlays both helping to drop the deficit. If I were to post similar figures for the Bush administration, they would show the deficit growing dramatically from the $200 billion surplus at the end of the Clinton administration to the nearly 1.5 trillion deficit in fiscal 2009. (The federal fiscal year begins October 1, so by the time Obama was inaugurated on January 20, 2009, nearly one-third of fiscal 2009 had already passed and the 2009 deficit was substantially baked in.) Obama pledged to cut the deficit in half and this is one promise he kept.
In all the fretting iabout ISIS (and it is something to fret about, for sure) it's easy to overlook the reality that thanks to bungling by a succession of American administrations, Iran is emerging as the powerhouse country in the Middle East. Dubya began the new era by wiping out Iran's mortal enemy Saddam Hussein and converting Iraq from an enemy into an ally. Iran starts with some huge natural advantages: it's the largest middle eastern country, it is for the most part ethnically and religiously uniform, with its ethnic and religioua minorities well under control. It has existed as a legal entity within roughly the same geographic boundaries for over a millenium. It's people speak the same lanugage (Farsi) and the country is loooking forward to a long boom once sanctions are lifted.
Bibi N has a bee in his bonnett about all this, but even he has to realize taht Iran is a much more powerful force without a nuclear weapon than with one. Iran is opeating very successfully throughthe use of proxies in Iraq, Syria, and Yemen. Going nuclear invites an almost-certain Israeli attack, so why bother?