Economic problems not black and white
I am writing to respond to some of the assertions made in the Viewpoint article “McCain has the upper hand on the economy (Sept. 30).” Mr. Pherson seems to have a couple points wrong in his claims that John McCain would more capably deal with the emergent Wall Street crisis. Perhaps your readers can make a more reasoned judgement in light of certain facts:
First, Barack Obama is not planning a Capital Gains hike on small business. In fact, he has announced that he will exempt small businesses from the Capital Gains entirely.
Second, Barack Obama’s tax regime will lower the tax burden on 95 percent of all families, repealing the top-heavy tax cuts enacted by George Bush and a Republican Congress.
Third, I want to address the particularly nasty bit of spin that has developed in the recent weeks concerning the Community Reinvestment Act, which was alluded to as the root cause of the recent credit collapse. The amount of sub-prime loans that were offered in the past six years far surpassed the amount mandated by the CRA, nor is the CRA responsible for the practices of securitization and extreme leverage (30 to 1, in some cases) that were responsible for the chain reaction of collapses we have been experiencing.
Now, I certainly don’t blame Mr. Pherson for returning to the ramparts of Free-Market ideology, but the record in this case is pretty clear: the recent financial calamity we are experiencing is the result of the self-fulfilling prophecy that Republican leadership has wrought.
When you have leaders that believe government cannot work, cannot regulate, then you will end up with a government that does not work, and lets the market run itself aground in panic.
Justin Runia
UC San Diego, class of 2000