Is Reaganomics The Culprit For The Approaching Meltdown Phase 2?

Paul Farrell is out with another rather dismal outlook on the financial system (better known in the vernacular as the feloneous Ponzi scheme), and how while the immediate causes of the crash, and its disastrous aftermath, which benefits only the upper class at the expense of everyone else, are certainly a function of the current and previous administration, one has to look further back to see the flawed foundations on which everything is built. As far back as Reagan, in fact, and his eponymous Reaganomic doctrine according to Farrell. "Was their Reaganomics ideology so rigid, so blinding, they couldn’t (and
still cannot) admit they were wrong? Forcing them to lie to America?
Cover up the lies? The evidence is clear.

Today, a harsh lesson from history, facts and a warning. Listen closely
America. It’s already happening again. The collective Reaganomics Brain
has gone from crash to cover-up to comeback kid to
capitalism-for-the-super-rich in three short years. Now with absolute
power over America." Sure enough, Farrell sees the events of 2008/9 as only the first step in the unwind of Reaganomics. Step two is coming, and it will be the final end of not only the Great Moderation experiment started in the early 80s, but, luckily, of that organization at the heart of it all: the Federal Reserve.

From Marketwatch:

The worst is yet to come. The forces behind the 2008 crash are stronger today. Like the villain in a horror-flick sequel, the dark side is now hungrier. Phase 2 is already in full swing as the Reaganomics Brain aggressively races to complete unfinished business — the 2008 meltdown — which will implode Wall Street banks and the Fed, ending the reign of the dollar as the world’s reserve currency

Recently we reported some bearish predictions for 2011 by two respected market leaders: Ned Davis warns of a “midyear peak” before a new cyclical bear. Jeremy Grantham warns investors to get out before Christmas. Market Crash 2011: It will hit by Christmas.

Bad news for investors angry at the past, worried about the future. Remember, the Dow’s barely above its best 2000 level of 11,722. Adjusted for inflation, the market has flatlined the past decade.

Here are the incremental catalysts that have lead us to where we are now:

America’s boomers don’t have to be rocket scientists to see the workings of the Reaganomics Brain here, how it’s destroying capitalism, democracy and their retirements. Here’s hard evidence of lies and cover-ups in past and future catastrophes:

March 2004. Fed Chairman Greenspan ‘cover-up’ of coming crash

In a Bloomberg Market’s magazine column last year, “Greenspan Cover-up,” Roger Lowenstein, author of “The End of Wall Street,” wrote that in a newly released transcript of a March 2004 meeting Greenspan “argues against disclosing too much to the public lest the Fed ‘lose control of a process that only we fully understand’.” Yes, a cover-up.

Lowenstein was classy, but went ballistic: “This statement ranks as a sign of monumental arrogance. It was Greenspan himself who didn’t understand, much less ‘fully understand,’ that the Fed’s lax mortgage regulation and easy monetary policies were setting America up for a disastrous fall.”

Then the indictment: “Had the Fed publicized such concerns, it might have led to a crackdown and forestalled millions of bad mortgages that would be written over the following 2 1/2 years. Instead, the Fed released minutes with sanitized phrases that had been stripped of alarming language.” Lying by omission, then a cover-up.

Now ask yourself: Was Greenspan so blinded from being inside the myopic echo chamber of the collective Reaganomics Brain for so many years that he, like all other insiders, is forced to lie, then cover up the lies?

Aug 2006. New Treasury secretary in ‘cover-up’ of crash dead ahead

As a postscript to the meltdown, Bloomberg later reported that back in August 2006, a month after Henry Paulson left Goldman Sachs as CEO with a net worth of over $500 million to become the new Treasury secretary, he spoke to the White House staff at Camp David: “Paulson held up over-the-counter derivatives as an example of financial innovation that could, under certain circumstances, blow up in Wall Street’s face and affect the whole economy.”

Reminds us of Warren Buffett’s famous reference to derivatives a “financial weapons of mass destruction.”

Cover-up? Conflict of interest? You bet. America’s Treasury secretary had the facts, but never warned the public. Worse: Instead, happy talk and lies from Paulson, covering up the risks. More than anyone in America, as Goldman’s CEO, Paulson knew about all about the deadly risks in the $500 trillion global derivatives casino, from years building Goldman’s derivatives business.

Worse: Later, when we learned about Goldman’s cover-up in failing to disclose to its own investors its double-dealing with AIG and hedge fund shorting, Paulson’s conflict of interest became clearer. He should have disclosed the risks, yes, had a duty to warn America, but instead refused to share, chose instead to lie and cover up for years.

July 2007. Paulson and Bernanke ‘cover up’ crash after it began

Cover-up? Lie? America’s Treasury Secretary? Yes, a cover-up at the top. One year after becoming Wall Street’s Trojan Horse on the inside of Washington, as the meltdown spread rapidly across Wall Street, this guy with the keys to trillions of the American taxpayer’s retirement money, could have come clean. But instead he was locked into the collective Reaganomics Brain ideology, forced to perpetuate the cover-up.

Yes, Paulson could have told the truth to the American public, to investors and taxpayers, but instead Paulson told Fortune magazine: “This is far and away the strongest global economy I’ve seen in my business lifetime.”

What a whopper. Part of the bigger overall cover-up of the collective Reaganomics Brain ideologues, for during these pre-meltdown years, Paulson, Greenspan and new Fed Chairman Ben Bernanke were regaling America with happy-talk about the subprime mortgage crisis being “contained,” just “regional froth.”

October 2008. Meltdown, then Paulson cons a clueless Congress

America’s Treasury Secretary, Hank Paulson was Wall Street’s man on the inside in the fall of 2008 just before the presidential election.

He failed America when the derivative markets collapsed, by conning Congress into protecting his Wall Street buddies with cash, credits and sweetheart deals, even though they were insolvent, virtually bankrupt and had no negotiating power.

Cover-up? Yes, the Reaganomics Brain ideologues were inside, running America for Wall Street’s benefit rather than the American taxpayer. Paulson’s old buddies were all well-protected — to be paid out of retirement monies from America’s boomers.

March 2011. Greenspan leading new Reaganomics resurgence

The Reaganomics Brain that’s ruled America for the past generation is making a swift comeback as the dominant political ideology favored by Wall Street. Last week Bloomberg news put this dangerous resurgence in the spotlight, in effect confirming that the worst of the 2008 meltdown was never completed, historical lessons never learned, and that another crash — like the aftershock of a deadly earthquake — is coming soon to complete the unfinished business.

Here’s why: Bloomberg just reported on a Greenspan’s article in International Finance magazine. He’s not only defending his legacy with renewed allegiance to the ultra-conservative Reaganomics Brain dogma that sustained him for 18 years; Greenspan now blames Obama’s Keynesian policies for the slow recovery. Listen:

Greenspan’s “conclusions fit with his long-held free-market ideology.” He warns “a surge in U.S. government ‘activism,’ including fiscal stimulus, housing subsidies and new regulations, is holding back the economic recovery.” But like Paulson and the rest of this Reaganomics Brain resurgence, there’s no acceptance of his personal past in the meltdown, only blame.

Greenspan sees the problem with the recovery of the American economy as the Democrats failure to embrace free market, deregulation and massive tax cuts, not Greenspan’s failed monetary policies, not Bush’s costly preemptive wars, not Cheney’s belief that “deficits don’t matter.”

What comes next is nothing short of the second revolution per Farrell:

Back in an early 2008 quarterly letter to investors, Jeremy Grantham, whose GMO firm manages $100 billion worldwide, said the warning signs of a coming crash were everywhere. But few listened.

As Grantham put it, “the three or four dozen-odd characters screaming about it are always going to be ignored.” Past and future. Why? It’s a brain defect, trapped in our DNA, overriding our rational abilities.

Worse, the new Reaganomics ideologues like Bernanke, the GOP, Tea Party, even Obama, are now marching in lockstep, embracing Reaganomics, squashing all descent, and repeating the same economic blunders as Greenspan and Paulson.

For more information read my report of 22 warnings from major market figures starting in 2000 till the 2008 meltdown. My summary includes warnings by one SEC chairman, two Fed Governors, five leading economists, four billionaires, five money managers overseeing trillions, two leading financial historians, and many more not on the list. 20 reasons a new mega-bubble will pop in 2011.

All their warnings were ignored, lied about and covered up by Greenspan, Paulson and all the other Reaganomics Brain ideologues running Washington and Wall Street the past generation. But soon a powerful revolution will stop the lies and the cover-ups.

Is Farrell being unduly alarmist? Perhaps. Then again, few predicted the tsunami of "liberation" that is sweeping MENA, and soon Asia. The precedent has been set, and it is slowly but surely moving toward the west. With the relentless theft from the middle class by the oligarchy accelerating, and appreciated by everyone, sooner or later there will be nothing left in the great American welfare state to keep the zombified Joe Sixpeasant satiated. At that point all bets will be off.

Comments

[sellstop]

Why not blame the dead guy?

The best thing that happened to Reagan is that he had Alzheimers and lived for 10 years after we found out he had it. No-one wanted to be tough on the poor guy with alzheimers! So the spin doctors had 10 years to fabricate his "legacy".

Read a good book: "Tear down this myth".

gh

[sellstop]

Zerohedge, your math problems are killing me!!!

gh

[baby_BLYTHE]

Paul Craig Roberts VS. Paul Ferrel

Reaganomics
by: Paul Craig Roberts (founder of "Reaganomics")

Reagan came to Washington to put an end to stagflation and the Cold War. Keynesian demand management had the wrong policy mix. Easy money pumped up aggregate demand, but high tax rates reduced the response of supply to demand. Consequently, prices rose. The problem was reflected in worsening "Phillips curve" tradeoffs between inflation and employment. As time passed, higher rates of unemployment were required to bring down inflation, and higher rates of inflation were required to boost employment.

Washington was concerned, including Democrats in Congress, because stagflation threatened every category in the budget.

The supply-side policy, which some label Reaganomics, reversed the policy mix. Monetary policy was tightened to lower aggregate demand, and marginal tax rates were reduced in order to boost the response of supply.

The policy worked. The economy ceased to experience worsening tradeoffs between inflation and unemployment. I described the policy change in my book, The Supply-Side Revolution, published after exacting peer review by Harvard University Press in 1984.

The Reagan tax rate reduction was modeled on the John F. Kennedy tax rate reduction, which was strongly supported by Reich’s Keynesian colleagues in Kennedy’s time. Both the Kennedy and Reagan tax rate reductions cut marginal tax rates (the rate of tax on additional income) proportionally across the board. Everyone got roughly the same percentage cut in tax rates.

Both the Kennedy and Reagan tax rate reductions raised distributional issues. As the higher incomes are taxed at higher rates, those with higher incomes pay far larger dollar amounts. Thus, when rates are reduced, those with higher incomes get more dollars back. But proportionally both tax rate reductions were equal for everyone. Progressives have focused on who got the most dollars back without acknowledging that lower income people were suffering the most from stagflation.

The Reagan tax rate reductions on earned income were proposed as 30% across the board phased in over three years. If memory serves, when enacted, they were a bit less. Using the 30% figure, the top tax rate on wages and salaries was reduced from 50%—the tax rate on a 19th century American slave—to 35%—a higher tax rate than that imposed on medieval serfs.

In 1980 the top tax rate on investment income ("unearned income") was 70%. It was not Reagan, but the Michigan Democrat William M. Brodhead who put the amendment on the Reagan tax rate reduction bill to reduce immediately the top tax rate on investment income from 70% to 50%.

Reagan had rejected the Treasury’s proposal to reduce the tax rate on investment income. At 4:27 p.m.on February 13, 1981, the Dow Jones wire service reported: "The White House said President Reagan had rejected the Treasury proposal to reduce the maximum tax on unearned income."

Supply-side economics did not originate with Reagan. Supply-side economics grew out of the policy process in the US Congress. During the 1970s, I was a member of the congressional staff, both House and Senate and personal staffs and committee staffs. My best Republican allies were Jack Kemp and Marjorie Holt in the House and Orrin Hatch in the Senate. My Democratic allies were far more powerful—Russell Long, chairman of the Senate Finance Committee, Lloyd Bentsen, chairman of the Joint Economic Committee, and Sam Nunn on the Senate Armed Services Committee.

Everyone forgets, but House Speaker Tip O’Neill, a Democrat, had an alternative tax cut bill to Reagan’s. O’Neill’s bill cut personal income tax rates by 15%, but had expensing—one year write-offs for business investments—in contrast to Reagan’s accelerated depreciation for business investment. My effort to have the Reagan administration compromise with Tip O’Neill in order to gain expensing was blocked by White House chief of staff Jim Baker.

There were more supporters among Democrats in Congress for the supply-side solution to stagflation than there were on Wall Street. Indeed, Wall Street was the greatest problem that the Treasury team faced. Wall Street believed that the Reagan tax rate reductions would cause the double-digit inflation from stagflation to go even higher and destroy the values of their stock and bond portfolios. Wall Street’s two prestige economists, known as Dr. Gloom and Dr. Doom, along with Dow Jones’ Barrons, regularly beat me up in print as a "Keynesian inflationist."

http://www.vdare.com/roberts/101219_reaganomics.htm

[Flakmeister]

  Why dont you ask David Stockman his opinion of Reaganomics....

[Xkwisetly Paneful]

Why not ask Microsoft, Intel, Cisco, Apple any biotech of your choice or  the only crap left on earth that the US still excels with.

[Flakmeister]

And pray tell, why can't we excel at other things?

[Hulk]

Because we are so poooorly educated...

/sarc

[sellstop]

It might have been sustainable, IF he had cut government spending. He didn't. Reagan started the govt. debt snowball rolling. His tax policies were popular and have been used to get politicians elected with great success. But the government keeps on spending. When the govt borrows, it is money created. That is inflationary. And the money lent to us from China was what kept up the charade. The cheap labor kept import prices low and thus inflation low. So Mr. Green kept the green cheap. And we all ate it up. The rich got richer, and the poor got a payday loan. And here we are today. In need of an adult to guide us. DoH!! WE ARE THE ADULTS! DOH!

gh

[Fred Fernakie]

Robert Mundell.

[JR]

President Reagan is not here to defend himself;  fortunately we have a live representative – distinguished columnist and courageous American patriot, Paul Craig Roberts.  Thanks, baby…BLYTHE, for your excellent headline.

[Xkwisetly Paneful]

Stupidest entry yet.

It can't be Reagan's fault by definition no matter what,

he was 100% a response to Carter.

Even if one goes with the tripe that the modern politician has anything to do with anything.

I am eagerly awaiting trickle up economics to work though.

Europe is graphic proof no matter how high taxes are the government will outspend them.

[Flakmeister]

Carter for all his flaws was the last President to speak honestly to the American people.... He was rejected for it. Instead, we know get a bunch of bullshit artists and clowns.

Why don't you examine the relative budgetary gaps of the Nordic and other socialist countries before blowing smoke out of your ass at us...

[Xkwisetly Paneful]

Sure and they can thank commodity prices just like Canada and Australia but thanks for playing,

the government spending just hasn't caught up yet but as sure as the sun rises they will.

Talk about blowing smoke.

[Flakmeister]

Yeah, France, Sweden and Germany are rolling in resource dough...

[Xkwisetly Paneful]

Sweden's taxes are not nearly as onerous as the rest anymore since they realized the flight of wealth that accompanies taxation repression.

Congrats France is debatable and Germany is managing to support all of Europe but of course they are near the bottom like Sweden-

just give it a chance, they can't backstop all of Europe forever either. The others government spending just hasn't caught up yet, US taxpayers bailing out French and German banks sure helped. I own mortgages in Spain, I wonder if when they got tits up if they Spanish will bail me out?

[Xkwisetly Paneful]

European Banks Dominated Use of Fed's Commercial-Paper Program Amid Crisis
By Christopher Condon and Bradley Keoun - Dec 1, 2010 6:55 PM ET
inShare.More
Business ExchangeBuzz up!DiggPrint Email . UBS, Switzerland’s largest bank, was the biggest borrower from the Commercial Paper Funding Facility, tapping the program 11 times for $74.5 billion. Photographer: Ian Waldie/Bloomberg
The U.S. subsidiaries of European financial institutions, led by Zurich-based UBS AG and Brussels- based Dexia SA, were some of the largest users of a government program to provide emergency short-term funding to companies during the credit crisis.

Six European banks were among the top 11 companies that sold the most debt overall -- a combined $274.1 billion -- to the Commercial Paper Funding Facility. UBS sold $74.5 billion, the most of any of the borrowers, according to data made public today by the Federal Reserve. The largest U.S.-based user was insurer American International Group Inc., at $60.2 billion.

The $74.5 billion represents total sales by UBS over the life of the program. The bank’s CPFF borrowings peaked at $37.2 billion, an amount the company rolled over, or re-sold at maturity, once, according to Karina Byrne, a UBS spokeswoman. Other companies also rolled over debt in the program.

Byrne said the bank’s tapping the Fed fund “should be seen in the context of our overall desire to maintain flexibility and diversification in our funding sources, even during the crisis.” She said the company’s use of all the central bank programs “was relatively modest.”

The CPFF was the only Fed effort during the crisis that lent directly to non-financial companies, including Harley- Davidson Inc. in Milwaukee. None of the debt purchased defaulted, and the Fed earned $6.1 billion in interest income and usage fees through CPFF, according to the central bank.

Dexia’s $53.5 Billion

The Fed released the details to meet disclosure requirements in the Dodd-Frank financial-oversight law signed by President Barack Obama in July. The central bank has never before revealed transaction-level aspects of its lending.

Dexia tapped CPFF for $53.5 billion. Other European users included Barclays Plc in London at $38.8 billion; Royal Bank of Scotland Group Plc at $38.5 billion; and Paris-based Natixis at $27 billion.

“Given the importance of Natixis in the U.S., it was, for us, natural that we participate in this program like all the banks,” said Victoria Eideliman, a spokeswoman for Natixis, in a phone interview. “When we participated, the liquidity situation was very tense.”

The Fed listed borrowing for Paris-based BNP Paribas at $41.8 billion, which includes funding to Fortis Bank, which joined the French company in 2009.

Extra Liquidity

“BNP Paribas Fortis has not needed any extra liquidity assistance from any Federal Reserve program for almost one year,” the company said in a statement.

RBS has repaid the Fed with interest, said Michael Strachan, a spokesman for the bank. Mark Lane of Barclays declined to comment. Ulrike Pommee of Dexia didn’t return a message.

The Fed started the special fund on Oct. 27, 2008, to unlock the flow of commercial paper, short-term notes companies sell to raise cash for day-to-day expenses such as payroll and rent. The market -- at the time was valued at $1.4 trillion -- had seized up after the Sept. 15 bankruptcy of investment bank Lehman Brothers Holdings Inc. and the subsequent run by investors on money market funds, the largest collective buyers of commercial paper.

‘Enormous Jolt’

During the initial week of the program’s operation, the amount of outstanding commercial paper rose for the first time in seven weeks. That provided “an enormous jolt of not just liquidity but stimulus to the economy,” Tom Sowanick, chief investment officer at Clearbrook Financial LLC in Princeton, New Jersey, said in an Oct. 30, 2008, Bloomberg Television interview.

Harley-Davidson participated in the CPFF program to help fund its consumer-finance unit, which supplies loans and insurance to its dealers and customers, Bob Klein, a spokesman, said in an interview.

Fed data also show funds went to Caterpillar Financial Services. The leasing arm is the guarantor of commercial paper issued by about 20 dealers, said Jim Dugan, a spokesman for Peoria, Illinois-based Caterpillar Inc., the world’s largest maker of construction and mining equipment.

“This is very different than other corporate entities” that took funds, Dugan said.

Administered by the Federal Reserve Bank of New York, the fund purchased approximately $740 billion of debt over its life, according to Fed data. Holdings peaked at $350 billion in the week ended Jan. 22, 2009.

Cheaper Financing

The Fed bought 90-day debt at rates below those demanded by private investors, initially paying 1.88 percent for unsecured and 3.88 percent for asset-backed commercial paper. The rates were 1.15 percent and 3.15 percent, respectively, when the fund expired on Feb. 1.

Commercial paper, usually an unsecured promissory note maturing in one to 270 days, can provide cheaper financing than a line of credit from a bank. Maturities average 30 days, according to the Fed. Financial institutions typically issue collateralized, or asset-backed, commercial paper.

There was $1.05 trillion in outstanding commercial paper, not seasonally adjusted, in the U.S. as of Nov. 17, according to central bank data.

To contact the reporters on this story: Christopher Condon in Boston at [e-mail]; Bradley Keoun in New York at [e-mail].

To contact the editor responsible for this story: John Voskuhl at [e-mail]

[Flakmeister]

  Forgot to add, Denmark and Finland...

Yes, it is a shit show...

I will say that having lived of 2 of the countries in question and the US for a number years, if I was a poor schlub, the *last* place I want to be is here.

[Lord Koos]

http://www.truth-out.org/from-morning-america-nightmare-main-street68274

[Dr. Porkchop]

My eyes glaze over when an article talks about leftwing this or rightwing that. It is a distraction. The media commentates the political play by play like a sports announcer. In the end the score is always predetermined, they are the Globtrotters, spinning balls and throwing buckets of confetti at us, the dazed and confused Generals. In the end we always lose.

The only thing I focus on these days is buying gold, preparing for the worst, and learning new licks on the guitar.

[notadouche]

Probably the best advice ever given.

[CH1]

I second that!

[razorthin]

Just plopped down only 249 fiatscos for my new Ibanez AEL20.

Sweet instrument.

[Hedgetard55]

Farrell = libtard moron red diaper doper baby who can't think his way out of a paper bag. Fuck him. He lowers the quality of ZH with every article he gets printed here.

[PD Quig]

Word. There has only been one president that wasn't bought and paid for since the first days of the first central bank: Andrew Jackson.

Farell is a moron, and from the looks of it above, his inanity is contagious.

[baby_BLYTHE]

I love Michael Savage!

[zebra]

found bears alive.

amazing.

[TooBearish]

Tyler - please stop giving this old fool airtime on ZH, leave it on MV chrissake - you are supposed to stand alone with incisive insights rather than this kind of blather - Regeanomics notwithstanding FUk it

[sellstop]

Find the best book on Reagan here.

http://ghickeyblog.blogspot.com

gh

[KickIce]

The country has been running deficits since LBJs "broke" society as a tremendous amount of entitlements were fixed into the annual budget.

Yeah, Reagan's "deficits don't matter" policy created another shell game and resulted in another kick the can down the road admin.  Tought sledding with the hands dealt by LBJ and Carter.

One of the founder's stated the republic will end when politicians can buy the people with their own money.  (Paraphrase)

[falak pema]

Vietnam war and Great society...started it...Nixon's war effort worsened it...But Reagan cut taxes and increased defense spending...That sent the deficits to another quantum level than the earlier period...As 'supply side de-regulation' changed the corporate mantra...the US was ready to do the 'double splits' like at no time in its history since WW2.

[Huck T]

Where was this jackass in '87?

[JR]

Nearly every president over the past 100 years - from Wilson to Obama - has presided over an administration that has allowed the Fed to expand its powers.

Reaganomics’ most positive attribute was its emphasis on individual economic freedom…lower taxes for greater personal opportunity. At least this was one major stroke against the concept of Keynesian social central planning.

America’s central bank was established in 1913. Now the entire world is merging into one central bank - the Fed/IMF,  backstopped by the American economy (or what’s left of it).

Unless Bernanke solves his problem of the destruction of the purchasing power of sound money and ceases immediately the confiscation and transfer of the wealth of the nation to a banking cartel that cannot produce value, the American people are going to rebel.  The people are awakening to the realization that when economic freedom is destroyed, so is political freedom.  Diverting their attention to a deceased president will only impress those who are blindly partisan.  And this distraction misses the entire core of the problem, namely the takeover of America’s financial center by private bankers.

In 1943, just before the United Kingdom’s pound sterling lost its status as the world’s reserve currency, a body of influential citizens pleaded for monetary reform; their object was an honest National Money System  for England with the prerogative over the issue of money by the “community of each nation.”

The letter, signed by 32 prominent spokesmen in Great Britain, concluded:

“The issue and destruction of money by the money-lenders is not a service, but a weapon which can be and has been used to perpetuate poverty amidst abundance, which renders individuals and nations powerless to protect themselves, and which may even be perverted to serve vast designs for the complete subjugation of the human race to tyranny, exploitation and the powers of darkness and evil.”

As unemployment continues to plague our nation, Ron Paul wrote in January:

“The Fed is not a small business or a manufacturer that creates value or increases productivity to sustain real job growth.  It literally destroys value by printing more money, and distributing it through sweetheart deals to well connected banks and investment houses to prevent them from going bankrupt as they should.  Instead, they survive to malinvest another day while their executives enjoy jackpot bonuses.”

[baconator3000]

Karl Denniger is a moron

[baby_BLYTHE]

Amen. he banned me for simply disagreeing.

[Founders Keeper]

Is it just me, or does this article sound like the childish rantings of an old Jimmy Carter 1980 campaign staffer?

A rather weak ZH article. Sorry, TD.

True, there is lots of blame to go around for the economic/financial disaster of today. But, if I were to list the top 10 culprits, I don't think Ronald Reagan or Reaganomics would make the list.

(I'm not a BIG Ronald Reagan fan. His deficit spending, defense spending, and foreign policy in Central America put him left of the Tea Party. Nevertheless, Reagan had important strengths that revived a demoralized American public.)

[baconator3000]

i junked u 

[Founders Keeper]

At least you have the courage of your convictions. That is respectable.

Best wishes, good Sir/Madam.

[JW n FL]

Reagan was a Union Buster...

Reagan FUCKED over the Vets...

Reagan made popular financial engineering on a scale never before seen...

[CH1]

Agreed, this is Blue/Red bullshit: My team rocks, your team sucks!

Ho hum... where are the adults?

[Almost Solvent]

Adults?

You mean those born prior to the end of WWII (i.e. pre-baby boomers) that are dying at the rate of thousands per day?

There are no adults out there. If there were, they would marching on town hall, state capital, and DC right NOW, not waiting for the lights to go dark first.

Instead, you'll only get people in the streets if the TeeVee or Internets goes dark, or the price of gas hits $10.

[rich_wicks]

Please stop calling FASCISM "capitalism".

[JW n FL]

we do Not! live in an "ism".. we live in a police state.. that is as corupt as the beltway.. or to, too stupid to be able to catch the real felons.

There are stupid over paid meter maids, FED's and Local both that would bust me for printing a picture of a group of congressional districts and adding a bullseye or optic over lay to the pictures.. they would say I was a threat... but when Palin does it, its just her expressing her 1st amendment rights.. that is what is wrong with our Country.. and while busting me for doing the same thing as Palin.. if I brought it up, they would say that shes not thier job, I am thier job...

WELL MY QUESTION IS!!! whos job is it to bust these fucking Politicians who are fucking our Country over?

Whos job is it to bust Wall Street becuase they have weakened our Country to the point of it being a National Security Risk... who does that fucking job? becuase that guy sucks and should be fired and a new guy hired yesterday to catch up on the work load blown off by the last guy.. who was chatting with the SEC people about who has the best porn sites to watch all day at work.

There is no law for them, just us.

[CH1]

Please stop calling FASCISM "capitalism.

Nah, that makes them feel powerful. A slam word to beat the other side with!

Truth? Not an issue.

[fearsomepirate]

What the does Federal Reserve Policy have to do with the President?  Sure, he has sway, but the POTUS and the Chairman of the Fed are not the same person, and they are often at odds.  I thought this website would be above the "all things are caused by the POTUS" theory of economics.  Inflation in the 1970s was mostly Art Burns.  Killing it in the 1980s was mostly Paul Volcker.  Bringing it back is thanks mainly to Greenspan and Bernanke.

Also, let's operate with facts.  Manufacturing output in the 1980s was higher than in the 1970s, and higher still in the 1990s, and even higher in the last decade.  The supposed "evisceration of our manufacturing base" is not a reduction in US manufacturing output (since that is demonstrably false), but a reduction in the number of union factory jobs, as though the health of an industry is measured by labor consumed rather than wealth produced.  It's propaganda, not fact.  Perhaps you didn't notice, but our agricultural output is much, much higher than the 19th century, yet there are a fraction as many agricultural jobs.  We call this "increasing productivity" in economics, and it is an unqualified good thing, because it frees up resources to do other things. 

[RKDS]

Then explain why finding American products is such a fucking uphill struggle.

[freedmon]

When will we stop with these misconceptions? There was no great moderation under Reagan. Instead there was a massive increase in inequality, the S&L crisis, and the 1987 market crash.

The longest period of uninterrupted prosperity in US history is from the end of WWII through 1970, and was the result of the New Deal economic regulations that put restraints on the financial sector and prevented excessive concentration of wealth. Reagan and his handlers worked hard to destroy it.

[CH1]

Equality doesn't exist in nature. It is only obtained by force and theft.

Focus on crime and coercion. Those are the basics that matter.

[falak pema]

90% of the population prefers false equality to real coercion. For obvious reasons. They are the weak. That's the whole point of 'nation state' civilization, "we the people" mantra. And end of 'divine right' kings and 'vertical' feudalism. We are now heading out of civilization back to the jungle. Period. But it may be in the order of civilization change. One dies here, another is born there. They all head towards the rights of many against the natural order of the few. That's inevitable. It's even in the Bible...the meek shall inherit the earth...so go eat bananas in your jungle.

[The Pop In]

"The illusion of freedom will continue as long as it's profitable to continue the illusion. At the point where the illusion becomes too expensive to maintain, they will just take down the scenery, they will pull back the curtains, they will move the tables and chairs out of the way, and you will see the brick wall at the back of the theatre." Frank Zappa, 1977

[purple99]

when are you yanks going to stop taking it up the backside and do something ?

[Salah]

Reagan wanted to end the big government scam, but Democrats controlling Congress wouldn't let him, nor allow him to spend the money his way.  Then Treasury Secretary Donald Regan (remember? ex-Merrill CEO asshole) crafted their basic scheme: eliminate the Federal withholdings tax on foreign purchases of US Treasury bonds, creating another source of govt revenue.  Irish socialists can't blame Volker for that one.  We created & sold so many bonds they became a commodity, and trade as such today.

[Lazane]

All this blame game is a distraction, the banksters have been dealing the cards since 1913, and they do an excellent job deflecting blame onto the politicians of the day. The genie came out of the bottle by repealing Glass Steagall and was only accomplished through all out banksters assault of political pressures and internal muck raking of a president clamoring for some measure of a legacy. 

[neutrinoman]

The short answer, is of course no.

The origins of our current problems lie in the mid-90s, the era of false "globalization" built on an overvalued dollar, artificially cheap interest rates, inflated tax revenues, and the rise of the publicly-traded, heavily leveraged giant investment banks.  The most recent and largest partial deregulation of high-risk investment activity took place in the 90s, not the 80s.

The 80s and the early 90s still had the combination of loose fiscal policy and tight monetary policy not conducive to financial speculation.  People have a hard time wrapping their heads around the reality: the rise of this huge, imbalanced casino happened under a Democratic president.