Reply from Congressman Emanuel Cleaver concerning OrphanWorksActof 2008

[Matthew Copple]

On 8/12/08 4:40 PM, "Jeffrey Watts" <jeffrey.w.watts at gmail.com> wrote:

> On Tue, Aug 12, 2008 at 4:30 PM, Jon Pruente <jdpruente at gmail.com> wrote:

>> How did the tax cuts (that have brought more revenue to the treasury)
>> ruined the economy and done anything to the war?  Oh, we are in a
>> recession, is that the current economy scare line?  Is that it,
>> because just a week or so ago I heard that we had nearly 2% growth in
>> the last quarter.  A recession is defined as 2 consecutive quarters of
>> *negative* growth.
>> 
> 
> You obviously live in a different country than I do, sir.  In my country
> milk and other basic foods have doubled in price, gasoline is through the
> roof, my house lost value, my neighbors have been foreclosed on, the deficit
> and debt are at historical highs, and inflation is the highest in almost
> thirty years.

Your grammar is excellent, your grasp of economics less so.

Nearly twenty years ago, while I was a freshman at the University of
Missouri, my Econ 101 professor discussed a phenomenon known as "the
business cycle." Supply and demand are not static; changes in one often lag
the other. When the two are not in sync, we tend to get cycles of inflation
(demand outstripping supply) or deflation (supply outstrips demand).

Anyone born before 1980 is probably fairly familiar with the business cycle,
since many of our parents ended up unemployed during a particularly nasty
recession in the early 80's. Regrettably, those who entered the work force
in the new millenium grew up under the false assumption that ever-increasing
productivity, combined with a massive money supply, guaranteed that the
business cycle would never again raise its bloody axe, and we would all be
guaranteed good jobs forever.

> 
> I guess in your country everything is peachy, all due to the excellent work
> of George Bush and co.

Since you are very much into critiquing the work of others, let's analyze
your logic. Last I checked, the Constitution of the United States granted
Congress, not the President, the power of the purse. I know some are
concerned about the power of the Presidency, but I do believe that when it
comes to the national fisc, that responsibility still rests with the House
and the Senate. Therefore, our budget deficit is the direct responsibility
of 535 men and women. The President is not blameless; he could have vetoed
the irresponsible spending which has plagued us since the New Deal. But in
the end, it is the responsibility of the legislative branch, not the
executive, to set the nation's fiscal priorities and fund them
appropriately.

Congress has chosen not to do so, under both Democrat and Republican
control. 

The President is free to expound on what he thinks tax and budget policy
should be. However, he has very little control over how that money is spent;
traditionally, the national budget is rather explicit in how pieces of the
fiscal pie are divvied up between departments. The President can move some
money around, but generally, Senators and Representatives tend to be
suspicious of Presidents who take money from Account A and move it to
Account B without a hearing and permission from a committee chair, so they
generally write the language to be as restrictive as possible.

While the government's spending patterns have a discernible effect on the
economy, most of the really important money movement is done by groups over
which the President has no control. The Federal Reserve System is
politically independent; so are Fannie Mae and Freddie Mac, which help fund
the credit markets through their mortgage activities.

While the government has a discernible effect, as I mentioned above, that
effect is rather small when compared to the real drivers of the American
economy -- you and me. The new car, the burger at McDonalds, the choice to
purchase groceries at Aldi or Price Chopper, all effect our economy far more
than tax policy (which again, is a Congressional issue, not a Presidential
one) or monetary policy (which is set by an independent Federal Reserve, the
President). Our decisions are somewhat influenced by government
interference, but in general, we don't consider the overnight discount rate
when we choose to spend money; we consider the local effects of supply and
demand. The Invisible Hand, not George Bush (or Bill Clinton, or Obama, or
McCain, or Hillary, or Reagan) is responsible for our economic situation,
and Congress is responsible for the government's poor fiscal record,
assisted gleefully by an equally irresponsible President who does not
understand what the word "VETO" means.

The conclusion is that a ham sandwich could be President of the U.S., and
the business cycle would continue, your taxes would be about the same as
they are now, and the deficit would be just as great.

If you want a balanced budget, demand one from your Congressman/woman. I
guarantee Obama and McCain won't give you one, no matter how many platitudes
they deliver on the subject.

Matthew Copple