Just wanted to make a few quick remarks in reaction to the Republican presidential debate last night. It saddens me to have to make these comments, and I really don’t want to be negative all the time, but I’d imagine that some of the audience takes the candidates’ remarks at face value. Thankfully, the CNBC moderators did a nice job calling them on things and following up, but the format only allows so much of it.
First, one of the most interesting things going on in the GOP right now (and no, it's not new) is the fact that so many of the candidates want to flatten the tax rate in America (or have a flat tax altogether). This basically means that, whether one makes $20,000 or $200,000,000 per year, they all pay the same rate in federal taxes. Ask yourself: should a single mother, struggling to work and raise her kids have to pay the same proportion of her income to the government as the hedge fund manager on Wall Street? For the past 100 years the country has said no, that isn’t fair. But now, the GOP is starting to think that—despite the increasing, and astounding income disparity in the country; also see Jon Stewart here—maybe that would be okay after all. Perry and Cain have largely been the ones calling for this type of tax system, but the whole party seems to be coalescing behind it. It boggles the mind.
The second point I wanted to make was regarding Ron Paul and the insanity of most of his economic policies. You might have heard him rail last night against low interest rates and that it would be better if this were determined by the market. Maria Baritromo (who’s dubbed the Money Honey), to her credit, called him on it, asking him whether it would help the economy if people had to pay more interest on their mortgages, car loans, and credit cards right now. He dodged, of course, but she was right and that’s exactly what would happen if interest rates went up. Ron Paul apparently doesn’t realize that most people in the country are paying interest instead of earning it, because he went on to bemoan the plight of senior citizens, who now can’t as easily live off of their portfolios due to low interest rates. According to this (and his claim is crazy anyway), senior citizens are doing just fine, thank you. The government has coddled that part of the population for way too long, as I’ll detail in a future post.
I’m surprised to still be shocked by the kind of policies that are being promoted at these debates, but they do indeed seem to be getting crazier. What are the two main economic threads running through the country right now? People have too much debt to spend much money (hence the continued malaise), and income disparity is at an all time high (hence Occupy Wall Street). What do Ron Paul, Rick Perry, and Herman Cain suggest? Make peoples’ debt more expensive and provide tax cuts for the wealthy. This should be enough to help people decide against voting for these three candidates. In future posts, I’ll discuss who's still viable, their policies, and some of the differences between Huntsman and Romney.