ec120bgt@sdcc3.UUCP (ANDREW VARE) (06/01/85)
In article <1340123@acf4.UUCP>, mms1646@acf4.UUCP (Michael M. Sykora) writes: > >/* ec120bgt@sdcc3.UUCP (ANDREW VARE) / 9:32 pm May 25, 1985 */ > > > 1) It was divined, because there was no way in hell he could > > have been elected on political merits alone . . . > > No way he could have been elected on political merit? What other kind of > merit could one be ELECTED on? Reagan was elected to his first term on an economic platform that lacked what most call "merit". His supply-sidisms basically held that, if we reduce taxes, real tax revenues will INCREASE. This is only true at a Laffer value "t" such that t>t*, or a marginal tax rate of around 60%. AND WE BELIEVED THE GUY. Real revenues did NOT increase, basically because only a small portion of that extra income which the policy gave back to the public was used for investment or savings. It went to consumption. And since this is taxed at a rate much less than our income, and regressively so, the poor took it in the pocketbook much harder than the rich, or institutions. So "merit" did it lack! Mike, also note I mentioned the word "alone". This qualifies the statement by basically realizing that a platform is central to a politician's electability, but other factors, like money and endorsements and age and race and sex and religion yacht club memberships and his golf game and his media image and his previous track record (who, me? facetious? sarcastic?). The bulk of American voters vote not on the long run effects of policy (read: good policy) but on the short run gains coming to THEM PERSONALLY. Like the business world where corporations are run according to short run profits, in order to keep stock prices up and discourage take-overs, American politics are about as farsighted as a ostrich with its head stuck in the ground. Politicians see large, black voids when you say "five years from now..." or "the long run benefits are substantially greater than these costs we incur for three years or so...". ANDREW T. VARE
mms1646@acf4.UUCP (Michael M. Sykora) (06/05/85)
>/* ec120bgt@sdcc3.UUCP (ANDREW VARE) / 11:25 pm May 31, 1985 */ >> No way he could have been elected on political merit? What other kind of >> merit could one be ELECTED on? >Reagan was elected to his first term on an economic platform that >lacked what most call "merit". I was interpreting the word "political" to mean electoral. This was probably a mistake. I apologize. I did not intend to make any judgements as to the merits os Reagan's policies. > . . . Like the business world >where corporations are run according to short run profits, in order >to keep stock prices up and discourage take-overs, American politics >are about as farsighted as a ostrich with its head stuck in the >ground. As I understand it, the theoretical price of a stock is the value of its future earnings discounted to the present. One would therefore think that in order to keep stock prices up, corporate directors would have to consider both long term and short term returns. The weightings of these returns are determined by the rate of interest and rate of inflation, both of which are essentially controlled by government. Maybe government management of the money supply is providing businesses with an incentive to concentrate on the short term. >ANDREW T. VARE Mike Sykora