A drop to 11,383 in the Dow is still way ahead of March 2009 — though it’ll probably get worse.
I have been reading about fiscal policy under Ronald Reagan in my father’s splendid book, Presidential Economics. What I have learned or re-learned is that Reagan was confronted with a giant problem in his 1980 campaign.
The problem was budget deficits from the Johnson/Nixon/Ford/Carter years along with high inflation and a stubbornly high unemployment rate.
The conventional economic advice called for raising taxes or monetary restraint to lower the inflation. But the problem there was that those measures would almost surely also generate higher unemployment.
Along came what my father calls “the economics of joy,” which was supply-side economics. This promised that lowering taxes would create so much more labor in the economy and so much higher productivity that employment would grow, output would grow, and everything would be taken care of without having more unemployment. Also, the supply-siders said that lower taxes would raise output so much that the budget deficit would disappear as higher economic output generated more tax revenue at lower rates.
My father does some math to show that the supply-siders’ hoped-for addition to hours worked would have been basically impossible on a scale sufficient to balance the budget or offset the lower tax rates. There just were not enough hours in a year to do it.
However, Presidents are not supposed to delve into small details and so Mr. Reagan thought that the supply-siders were right and he got a major tax cut passed.
The result was worse unemployment and larger deficits.
However, Ronald Reagan was a highly intelligent, adaptive President. He raised taxes, signaled his intention to raise them enough to keep the budget deficit under control, and the economy revived magnificently. Alas, the deficit problem was very far from being solved.
Anyway, I was reading about all of this when my wife burst into the room (at about midnight) and said our son, the recent father, had an allergy problem and she had to drive over to his apartment to bring him some medicine. I asked why he, a strong 23 year old, did not come over to get it himself and she said he was tired from caring for his baby.
So, off we went in the midnight hour to bring our son his medicine. Yes, I went with her.
I felt sort of queasy about it. But I thought that if this happened to Peter Flanigan, a gentleman and a hero, he would not let his wife go out in a big city at midnight by herself (although our son lives in a fine neighborhood about five minutes from us). So, I went out with her and soon we were done with our errand.
But the transition from taking in data about economic policy to taking medicine to our son seemed a bit sudden.
A spectacular visit to Malibu. I gardened in my pitiful way, heaping Miracle-Gro on the jacarandas and then watering them. No matter what I do, those trees do not get the magnificent blue blossoms I love so much — while the jacarandas I do not fertilize do get them. However, the ones I fertilize have grown amazingly tall, and that’s nice.
I filed and read more about economics. Then I lay down in my bed, minus my Brigid, the love of my life. It was lonely. When I awoke, it was dark except that when my eyes adjusted to the lack of daylight, I could see millions of stars and a glowing, immense half moon. The stars in Malibu are far brighter even than the ones in Idaho. I will have to ask Wlady how the stars are in Santa Barbara.
Frankly, I am getting old and tired and cannot handle all of the homes I have much longer. Maybe I will sell them all and just live with my big wifey in the one in Malibu. No swimming pool, but we can get one put in. Then it would be perfect.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?