Undecided Voters: Economic Issues

The better choice on each issue is in the left column, indicated by a (D) for Democrat, (R) for Republican, or (N) for neither.

(D) DEFICITS AND DEBT: Which party has shown an ability to end deficit spending and produce surpluses? Reagan made drastic tax cuts for the rich in 1981 and 1986, and tripled the debt. Bill Clinton’s budget in 1993 was passed by Democrats, without a single Republican vote, and it led to surpluses. Little Bush cut tax rates again, started an optional war in Iraq, and failed to request taxes for it. He just handed a great recession to Obama. While right-wing Republicans control the House, and promise to spend more on the military, they stubbornly refuse to tax for it. There’s no reason to believe they are capable of managing the debt.

(D) TAXES IN GENERAL: Which party is more likely to implement fair tax policies that may correct the deficit and debt. Romney said he would not raise taxes. (1-8-12). He stated a desire to lower them even further. (1-16-12). He said we only need taxes for the military, nothing else. (1-7-12) With these extreme positions, he would never get close to correcting deficits and debt.

(D) TAXES: CAPITAL GAINS, DIVIDENDS AND INTEREST: Which party has the better position on taxes as to capital gains, corporate dividends, and interest income? Romney repeatedly said during the Republican debates he wanted to completely eliminate taxes on capital gains, dividends, and interest (9-7-11) (9-12-11) (9-22-11) (12-10-11) (1-16-12) He later said he would limit his plan to incomes of less than $200,000. (1-23-12) In either event, it’s unfair to people who pay taxes on earned income. His policies would either raise taxes on the Middle Class, or make the deficit and debt worse. He never explained how he would make up for the lost revenues.

(D) TAXES: PAYROLL: Which party is more likely to promote tax cuts for regular workers? Romney was dismissive of Obama’s ongoing payroll tax cuts, as he called them a band-aid (12-10-11)

(D) TAXES: CORPORATE: Romney advocated lowering the highest corporate tax rate from 35% to 25%. (11-9-11). This new loss of revenue would have to be made up by the Middle Class.

(D) TAXES: RETIREES & THOSE WITH SMALL INCOMES: Although everyone pays sales taxes, gas taxes, real estate taxes (as a part of rent), as well as other excise taxes, Romney said everyone (poor, elderly, etc.) should pay income taxes. (9-7-11).

(D) TAX RETURNS AND HIDDEN WEALTH: Why didn’t Romney disclose more personal income tax returns? Romney promised to release “multiple years.” (1-19-12). In the end, however, he only showed us two years. We don’t know if he is hiding something, or telling the truth. Gingrich said Romney lives in a world of Swiss and Cayman Island bank accounts (1-26-12)

(D) BUDGET, NATIONAL DEBT, MILITARY SPENDING: Romney said we need to stop spending like we have for the past 40 years. (1-8-12). He was critical about leaving debt to the next generation. (11-9-11). He claimed he would cut spending, but he didn’t explain how (11-9-11), except by saying he would ban earmarks. (2-22-12). Romney promises not to cut wasteful military spending, of any kind. (10-11-11). He wants 350 million for the F-22, more aircraft carriers, more Navy cruisers, more Air Force bombers, and more troops. (11-22-11). He would increase Navy shipbuilding each year from 9 to 15, and would add 100,000 troops. (12-15-11) (1-23-12) (2-22-12). He makes the case for the other side, saying Obama is shrinking the military (1-7-12) Romney thinks our Navy is smaller than it was in 1917, and our air force is smaller than it was in 1947. (1-16-12) (1-23-12).

(D) JOBS: Which party would be better for promoting jobs? Obama inherited a recession where unemployment reached over 10% in 2009. It is now down to 7.9% and the trend has been in the right direction the past three years. Romney incorrectly argued no jobs were created from the job stimulus bill (10-11-11) He said Obama’s polices worsened the job situation, which is obviously a false claim (1-7-12). Romney argues the government doesn’t create jobs (12-15-11), the private sector does (12-10-11), but then inconsistently blames Obama for not creating jobs.

(D) LABOR: Which party is more likely to protect the rights of working people? The National Labor Relations Board (NLRB) insures fairness between organized labor and management. Romney said he would curtail the NLRB (12-10-11), and would promote anti-union “right to work” laws throughout the U.S. (1-8-12) He repeatedly showed hostility towards the NLRB, by saying it was filled with “labor stooges” (1-8-12) (1-19-12).

(D) MINIMUM WAGE: Do you think Romney would ever promote an increase in the minimum wage? In one word: no.

(D) MANUFACTURING: Which party appears to be more interested in saving American manufacturing? The Republicans clearly opposed loans help GM and Chrysler get through the Great Recession. Over fierce opposition, Obama helped them. Had they gone through bankruptcy, the nation would now be reeling from the economic ripple effects. Obama took a gamble and succeeded.  Romney said funds should not have been used to bail out GM and Chrysler (10-11-11) Romney again said the auto bailout was wrong; they should have gone bankrupt. (11-9-11).

(D) AGRICULTURE: Romney would end farm subsidies as he said to let the markets work. (1-23-12). What he is actually promoting is a localized depression in Midwestern small towns.

(D) TRANSPORTATION/MASS TRANSIT: In one debate, Romney advocated improving the infrastructure, by rebuilding bridges, roads, rail beds and air transport systems. We can’t criticize him for that, but we should not forget his party harbors the likes of Gov. Walker of Wisconsin and Gov. Scott of Florida, who blocked mass transit proposals. So on transit, it appears the Republican Party will not help America enter the 21^st Century.

(D) ENERGY: Who has the better energy policy? Romney wants energy security and independence by using our own resources (10-18-11 (1-7-12) (1-19-12) That’s a nice idea, but energy resources are fungible and are sold on world markets, so no nation controls them. Romney put emphasis on developing coal, oil, gas, and nuclear (9-7-11)(1-16-12) He’d give more permits for natural gas and oil drills. (12-15-11). He does not discuss solar or wind, but why not? Since Obama includes all energy resources, his policy is better.

(N) ANTITRUST: Has either candidate advocated antitrust lawsuits to break up companies too big to fail? No. Antitrust was a Republican idea in 1890, and prosecutions are now needed to break up the concentrations of power in the hands of a few.

(D) FEDERAL RESERVE: Romney claims Federal Reserve chair Bernanke pumped too much money into the economy (9-7-11), and he would discharge him. (10-11-11). He said Congress should have Fed oversight, but no control over the currency. (9-12-11). Since Romney is opposed to priming the pump through Monetary Policy, how would he have stimulated it?

(D) BANK BAILOUTS: At one point, Romney said he didn’t want to save the Wall Street banks, as Bush did (2-22-12). It appears he would have just let the system collapse, but if that had happened, we’d be in a deep depression right now.

(D) WALL STREET: Romney correctly pointed out the derivatives market was not regulated (1-23-12), but he failed to promote a regulation of it. He instead criticized those occupying Wall Street, by saying they were engaged in dangerous class warfare (10-18-11).

(D) HOUSING: Romney supported the Troubled Asset Relief Program (TARP) (10-11-11) (10-18-11) He accused Fannie and Freddie of offering mortgages to people who can’t afford them (1-26-12). He opposed the Dodd-Frank law, claiming it makes it harder for banks to make loans (1-7-12)(1-8-12).  He said the government should not stop the banks from foreclosing (10-18-11). He claimed Obama was holding off the foreclosure process, and argued we must let the market work (11-9-11) His non-solution solution is to block-grant housing vouchers (2-22-12).

(D) VULTURE CAPITALIST: If Romney wins, he’ll be the first President with a vulture capitalist background. He claims to have successfully operated businesses (12-15-11), but he was really a Bain investor, who just made money for himself and his partners. Gingrich accused him of profiting by stripping American businesses of assets,  bankrupting companies, and laying off workers (1-7-12) Romney said they had to be downsized (1-7-12) Gingrich said Romney’s Bain looted companies and left people unemployed (1-8-12). Gingrich said he was engaged in vulture capitalism. (1-16-12). In an interesting contradiction, while discussing tax returns, Romney said his income came from a blind trust. He said the money I earn: “is not made by me.” (1-26-12).

Currency: No Return to Gold Standard

During the Republican debates, Congressman Ron Paul went off the deep end as to the currency, advocating a return to the “gold standard.” As Newt Gingrich suggested forming a commission to look into bringing it back, Herman Cain argued the nation needed to focus on the “sound money” virtues of gold and silver.

None of these Republicans however could possibly have been serious about the currency. While there are potential problems in the uncontrolled printing of money, based on nothing more than a faith in the strength of the Federal Reserve, returning to gold or silver to back up the currency, is certainly no answer.

The principle problem with gold and silver is their quantities are finite, and as the population grows faster than the metal supply, money becomes scarce, adversely affecting economic expansion.

During the Presidency of Andrew Jackson, the population grew at a rate far greater than the available precious metal supply, causing many to advocate paper money. Jackson, however, was hostile to the idea, and insisted on remaining with gold and silver. When he ordered federal agents to accept only gold or silver for the sale of public lands, banks were already down to only 1 gold dollar in reserve, for every 10 paper dollars, and his 1836 decree triggered an inflationary spike in prices and interest rates, and caused the value of the dollar to drop.

The inadequate supply of currency arose again when President Lincoln had to circulate paper Greenbacks to pay for the Civil War. Since the Treasury had been selling gold to anyone who wanted to buy it, by the time Grant took office in 1869, the money supply was depleted. When Congress proposed a bill to add a paper currency, Grant vetoed it, triggering the Panic of 1873. The Greenback Party (1874-89) emerged to push for a paper currency.

While President Hayes continued to allow the exchange of gold coins for the paper Greenbacks issued during the Civil War, he wanted more silver and paper money, but there was not enough gold to back it up, so he vetoed a bill that would have required the Treasury to coin certain quantities of silver each month.

The mint finally started increasing the supply of silver coins, under the Silver Act of 1893, signed into law by President Harrison. As the price for silver fell, currency manipulators quickly exchanged it for gold, and drained our gold reserves.

A Special Session of Congress was called to repeal the Silver Act as soon as President Cleveland took office in 1893, but he refused to abandon the gold standard, and gold reserves continued falling, leading to the Financial Panic of 1893, and a farm depression.

When William Jennings Bryant proposed the free coinage of silver, President William McKinley again played it safe by defending the gold standard. He signed the Gold Standard Act of 1900, strictly limiting paper money redemption to gold.

It was not until 1934, during the Great Depression, and the administration of Franklin Roosevelt, when we finally moved off the gold standard, by replacing it with the full faith and credit of the Federal Reserve Bank. The final nail in the gold standard coffin came in 1971, when Republican Richard Nixon completely cancelled the right to convert dollars to gold.

The gold standard is dead. It died 78 years ago. While there is a risk of printing too much paper money at the Federal Reserve, the solution is not to return to gold, the answer is to intelligently monitor the quantity of paper currency printed, and insure that the value of the Dollar is not diminished in the process.

Republican Debate: Florida (1-23-12)

FOREIGN POLICY: Paul said Gingrich would have to change his foreign policy to gain his support. He believes it is not the role of the federal government to be the policeman of the world.

AFGHAN: Romney thinks the War in Afghanistan can be ended, not by talking to the Taliban, but by beating them.

CUBA: Paul opposes a military overthrow of Cuba. We propped up Castro for 40 years, Paul said, by imposing sanctions, which gave him the ability to blame everything on the U.S. He reminded everyone he was drafted in 1962 at the height of the Cold War, but it’s not 1962 anymore and the Cold War is over. We now talk to Russia, China, and Vietnam and have trade with them, so why not Cuba? Romney thinks it is dangerous to open travel with Cuba now, but if Castro died, he would work with a new Cuban leader to move them in an open direction. Gingrich favors aggressively overthrowing the Cuban regime. He accused Obama of being infatuated with the Arab Spring, but ignoring a Cuban Spring. Santorum tried to distinguish Cuba from China, by saying the Cuban island is only 90 miles away. He would continue sanctions against Cuba. He would wait until the Castro brothers died. He believes jihadists and Iranians are excited to establish a platform 90 miles off our coast in Cuba, Venezuela, or Nicaragua.

IRAN: Paul does not think Iran will close the Straits of Hormuz, because they need them open as much as we do. He said it is our blockade that would make Iran close the Straits. A blockade is the act of war, he said, and closing the Straits would be retaliation. Americans certainly do not want a hot war in Iran right now. He asked, what would we do if someone blockaded the Gulf of Mexico? Romney said we need opens seas and if Iran shut down the Straits of Hormuz, it would be an act of war. Gingrich said America has no appetite for war, but we didn’t have one when Pearl Harbor was bombed or the World Trade Center was destroyed either. He accused Obama of cancelling a military exercise with Israel, so as not to be provocative. Santorum said Obama does not see the threat Iran poses, not just to Israel, but the entire world. He argued they held hostages, attacked our ships and embassies, and made improvised explosive devices (IEDs) to harm our troops.

MILITARY: Romney believes we are shrinking our Navy. He again repeated the ridiculous assertion that it is now smaller than at any time since 1917. He wants to increase shipbuilding from 9 ships a year to 15. He wants a carrier in the Gulf. We need to be so strong, he said, so they could never defeat us.

SPACE: Romney thinks space exploration should be a priority for science and military development. Gingrich wants a series of space stations built. He wants to offer prizes for going into orbit.

ENGLISH LANGUAGE: Gingrich was asked: Why is it alright to court votes using Spanish TV ads, but not ok for government to serve people using it? Gingrich said there are 86 languages in Miami-Dade County, and 200 in Chicago. We need a central language to unify the country. Romney said Mass allowed teachers to teach in their native languages, and students ended up not speaking English very well. He pushed English language emersion. People must learn English, he said, to be successful in the U.S. Paul said for national business, we need one language, but states should be allowed to accommodate local needs.

IMMIGRATION: Gingrich favors allowing aliens to earn citizenship through military service. Romney favors self-deportation, which is what he thinks they will do if they do not have proper employment documents. Santorum said people are returning home now, because there are no jobs. He speculates they steal Social Security numbers to get work. Someone who came here illegally, he said, is continually breaking our laws. If you want to come to America, respect our laws, Santorum said.

JOBS: Romney again claimed to help create thousands of jobs at Staples, Bright Horizons, the Sports Authority, and Steel Dynamics. Gingrich was asked why the Bush tax cuts have not created jobs. He speculated things would have been worse.

OLYMPICS: Someone please tell Romney to stop mentioning his work on the Olympics, as if it was some great achievement. Who cares if he was in charge of the Olympics? It’s not important.

VULTURE CAPITALISM: Santorum said there is constructive capitalism and destructive capitalism.

FINANCE: Santorum asked Romney and Gingrich why they supported the Wall Street bailout if they believe in capitalism. Why not let destructive capitalism work, he asked? He said financial institutions should have been allowed to go bankrupt. Why prop them up through government? Romney said the derivatives market was not being regulated. Gingrich said Dodd-Frank allowed the biggest banks to get even bigger. He said regulators are walking into banks and telling them not to lend money.

FED: To placate Ron Paul, Gingrich discussed the formation of a commission to bring back the gold standard.

AGRICULTURAL SUBSIDIES: Gingrich was asked if he would do away with subsidies for the sugar industry, and get rid of import quotas that protect them. He said the industry was real good at protecting themselves. Romney would eliminate subsidies and let the markets work properly.

ENERGY: Santorum was asked if off-shore oil drilling was worth it. He believes it is essential to build the Keystone Pipeline and gain oil from domestic sources. Pipelines are safer than off-shore.

ENVIRONMENT: Paul would continue federal financing to protect the Everglades. Santorum said Romney believed in global warming enough to sign a cap on CO2 emissions in Mass.

HOUSING: Paul said interest rates were kept too low for too long. He said he introduced legislation 10 years before the bubble burst to end the line of credit to Freddie and Fannie. The Community Reinvestment Act forced banks to make even more risky loans. Our policy has been to try to keep home prices up, but they should be allowed to fall. We have to liquidate the debt, Paul said. They should have gone bankrupt, and the bad debt would have been wiped off the books. As long as we keep the debt on the books, we are not going to grow. Gingrich told Republicans in July 2008 to deny Freddie Mac any money, because they needed reform. Romney accused Gingrich of failing to speak out against what Freddie Mac was doing. Santorum was asked about the 40% of homeowners in Florida whose homes are underwater and the 53% whose homes are worth less today than before the crisis. He was asked if it was too easy to own a home. He said the Democrats fought a reform of Freddie Mac and Fannie Mae. He said we have to let capitalism work and allow banks to realize their losses. He would allow homeowners a tax deduction for their losses. Romney thinks Dodd-Frank makes it harder for banks to renegotiate mortgages and is killing the residential home market.

LOBBYING: Romney said Gingrich was paid 1.6 million by the chief lobbyist of Freddie Mac to influence Congress. He received $25,000 per month, or $300,000 a year, for services for Freddie Mac. Gingrich said he was paid for consulting, not lobbying. Romney reminded Gingrich he first said he was paid to be a historian. Gingrich said his share for three offices was $35,000. Romney said Gingrich spent 15 years on K Street influence peddling. Romney reminded viewers 84 ethics charges were filed against Gingrich and 88% of the Republicans in the House voted to reprimand him, causing him to resign in disgrace in 1998.

HEALTH CARE: Gingrich said he always favored a stronger Medicare program and favored Medicare Part D. The government would not pay for insulin, but they would cover kidney dialysis. They would not pay for Lipitor, but would cover open heart surgery. It was a terrible way to run Medicare, he said. Santorum said Romney’s health care plan in Mass was the basis for Obamacare, and Gingrich supported the individual mandate for 20 years. Romney said his health care plan, chosen by the people in Mass, is the one the Constitution allows us to have. He then said he opposes a federal mandate.

BUDGET: Gingrich thinks he balanced four federal budgets in the 1990s. He apparently forgot that they came about because Bill Clinton was President, and a democratically controlled Senate voted, without any Republican support, to make it happen.

TAXES: Romney said he paid a lot of taxes and not a penny more than required. He wants to eliminate taxes on interest, dividends and capital gains for those earning less than $200,000. He wants the highest corporate income tax lowered to 25%.  Gingrich called his 15% flat tax proposal a “Romney Tax.” He wants everyone to pay the level paid by Romney. In an inconsistent way, he said he would lower capital gains taxes to zero. Romney responded saying his tax liability would have been zero in that case. Romney refused to follow his father’s example of releasing 12 years of tax returns.

LIFE SUPPORT/DEATH: Santorum was asked if government should get involved in disputes like the 2005 case between the spouse of Terri Shaivo and her parents over removing feeding tubes. Non-lawyer Santorum admitted he asked a “federal” judge to get involved, when such situations are almost always ruled upon in state courts. Non-lawyer Gingrich also argued in favor of federal court intervention, where it clearly does not belong.  Paul correctly said the decision should be made at the state level.

Ron Paul: Why Voters Support Him

While the inside the beltway crowd cannot understand why Ron Paul finished a close third in Iowa, and now second in New Hampshire, if they had been listening, they would have heard his anti-war, anti-torture message, his willingness to cut military spending, his pledge to withdraw from Iraq and Afghanistan, his promise to avoid conflict with Iran, his hostility towards corporate welfare, deficit spending, his defense of liberty, and personal freedom, and scorn for wasteful projects, like the war on drugs.

FOREIGN POLICY: Paul clearly receives his popularity from his foreign policy. He said: we need to stop our wars. It angers foreigners when we occupy their lands. We were attacked on 911, he explained, because we had troops in Saudi Arabia. We are disliked because we have done nothing to stop the abuse against the Palestinians. We have 900 bases around the globe in 150 nations. Paul asked why we keep troops in Korea, Japan, or Germany. We have more weapons than all other nations combined–enough to blow up the world 20 to 25 times. He said we have to stop trying to be the policeman of the world.

WAR ON TERROR: He said the war on terror is like the war on drugs. It’s a pretend war. No formal declaration of war was ever made. Terrorism is only a tactic, he said. Others may want to bomb us, because we bomb them, not because of what we believe.

LIBERTY: As to profiling, Paul asked what if a person looked like the white Oklahoma City bomber, Timothy McVeigh? As to the Patriot Act, our Founders warned not to sacrifice liberty for security, Paul said, something our government now does too willingly. We should not give up freedom for a police state.

TORTURE: Paul correctly argued torture is illegal under U.S. and international law. Water-boarding is torture, he said in no uncertain terms. It’s uncivilized and immoral. We should not give up so easily on the rule of law, he said, as he pointed out over 300 terrorists were convicted in civilian courts and sent to prison.

MILITARY BUDGET: Paul said there is a lot of waste in the military and we can no longer afford to be the world’s policeman. Our new embassy in Baghdad alone is costing 1 billion. He courageously said the military budget must be on the table and offered to cut billions from their overseas spending. He accused others of just talking about reducing proposed increases.

FOREIGN AID: Paul would also cut all foreign assistance, including aid for Israel, since the Constitution does not authorize it. We gave military aid to an Egyptian dictator and got nothing.

AFGHANISTAN: He would clearly withdraw from Afghanistan now, and would save billions. He said the U.S. should withdraw from Afghanistan, because that’s where the Soviet Union was brought down. He predicted the same may happen to us.

IRAN: Paul does not pander or say things he thinks the audience wants to hear. He explained Iran wants to build nuclear weapons, because they have well-armed neighbors who already have the bomb, and for them, it is a matter of self-defense. He was not afraid to say Iran is no credible threat to the U.S. He warned the imposition of sanctions against Iran would provoke yet another war. He said it is not worth going to war against Iran to prevent them from gaining nuclear weapons. What is going on right now with Iran is the same propaganda used in the build-up to the Iraq War. He would not support an unprovoked unilateral attack by Israel upon Iran. He asked: why are we flying drones over Iran? While we don’t want to see Iran with nuclear weapons, he said it’s dangerous to declare war on 1.2 billion Muslims.

SYRIA: Paul would stay out of Syria. The Syrians need to deal with Syria, he said. We would only get in trouble if we got involved. We should simply support self-determination.

IRAQ: He would complete the withdrawal from Iraq, reminding us we still have 17,000 contractors on the ground over there.

ISRAEL: Paul asked: why should we commit our kids and our money to endlessly aid Israel?

CORPORATE WELFARE: Paul accused both parties of bailing out big corporations and Wall Street speculators, who ripped off regular people in the derivatives market. He would deny government aid to private enterprise.

HOUSING: Paul said Freddie Mac and Fannie Mae caused overbuilding and distortions, and government needs to get out of housing. Easy credit built too many houses and caused a bubble, he argues, which eventually burst, and now we are going through a correction, that is costing Middle Class people their homes. If money was to be given out, Paul said, it should have gone to those who lost their mortgages, not the banks. He said government sponsored enterprises received excessive credit from the Fed under the Community Reinvestment Act, and the housing debt must now be liquidated, as we are just prolonging the agony.

BUDGET/DEBT: Paul said nobody cares about the national debt, but it is a burden on the economy. Our financial condition is actually the biggest single threat to national security, he said.  Unnecessary wars have added to our deficits, and yet we are not cutting anything; it’s just talk. They only nibble away at baseline budgeting. They get hysterical on the Hill, because their budgets are not going up as rapidly as they want. The budget is out of control, because of earmarks. Paul said he would eliminate five departments and cut 1 billion in spending from the federal budget in his first year.

SOCIAL SECURITY: Paul said the Social Security Trust Fund should not have been used to fight wars.

DRUG WAR: Paul argued the war on drugs is a total failure, which should be handled like alcohol.

THE FED: Paul does not believe the Fed Reserve should set interest rates or decide how much money should be in circulation. He would return the gold standard. He said the Fed set interest rates well below market levels and keeping them low only distorts the economy. He does not believe they stimulate economic activity. He said Greenspan kept them too low for too long. He criticized the ability of banks get loans at zero percent, a practice which cheats the elderly of interest income they could earn from CDs. He was concerned the Fed sent five billion overseas to bail out foreign banks, and wants the Fed audited.

HEALTH CARE: Paul correctly said the insurance and drug companies will love the individual mandate. He wants more market competition in medicine. He supports medical savings accounts and would let people opt out of the health care plan.

 

Republican Debate: Michigan (11-9-11)

The Republicans debated in Michigan on Nov. 9, 2011:

CHINA TRADE: Romney would sue China in the WTO, because he said they are unfairly cheating, and not playing by the rules, as they engage in predatory manipulations of their currency, and make Chinese goods artificially low-priced. Huntsman warned randomly slapping tariffs on Chinese goods would trigger a trade war, which is not a good idea, since China would do the same to our exports. Santorum called tariffs a tax on “you.”

EURO CRISIS: As to Europe, Romney said they should take care of their own problems. What is happening in Italy and Greece, he said, is where we are headed if we don’t change. When asked about U.S. contributions to the IMF used to help the Euro Zone, he said the U.S. must focus of our own deficits. Huntsman warned if we do not get on top of our debt, we will soon look like Europe. Cain said there was not a lot we could do about Italy, because they were already beyond the point of return.

OCCUPY WALL STREET: Huntsman wants to be the President of the 99% as well as the 1%. He agreed we should not bail out corporations, because we spent trillions with nothing to show for it. He disagreed with the anti-capitalism message some made.

BANKS: Huntsman is concerned about “too big to fail” and wants a proper size for banks. We must address the problem of banks too big to fail, because they are setting us up long-term disaster. He said six institutions have 9.4 trillion or 60 to 65% of our GDP with implied taxpayer guarantees of protection, which is unfair to taxpayers. They need to be “right-sized.” The banks need to pay to take the risk away from taxpayers. Cain wants to get regulators off the backs of the banks.

FEDERAL RESERVE: Gingrich would fire the Fed Chair Ben Bernanke, and would audit the Fed with a complete disclosure so we know who was bailed out and why. Paul said the Fed is engaged in price-fixing by setting interest rates well below market levels. We are cheating the elderly of interest income they could earn on their CDs, as banks get loans at zero percent.

HOUSING: What about the 25% who owe more to the bank than their house is worth? Gingrich said “short sales” need to be easier. He thinks the banks profit more from foreclosing than by doing “short sales.” He thinks unemployment is keeping housing from coming back. Romney said holding off the foreclosure process, like the president has done, won’t work. The government cannot buy up all the homes in America. Fannie Mae and Freddie Mac gave loans to people who could not afford to pay them back. We won’t see home prices return, unless we let the market work. Bachmann said at the time of the meltdown, 50% of homes were financed by Freddie and Fannie, and now its 90%, and yet they want another 7 billion. Cain would make Freddie and Fannie private entities. Paul said the housing debt has to be liquidated, as we are just prolonging the housing bubble agony. Fannie Mae and Freddie Mac just keep demanding more money, Paul said.

CORPORATIONS: Romney said it is not a choice between job creation and maximizing profits. Profits help expand businesses and cause them to hire people, he said. Profitable enterprises hire people. He accused the Democrats of not liking business. Perry wants the market and private sector to make decisions. He would let consumers choose winners and losers. He said if a company is too big to fail, it is too big.

LABOR: Cain said the NLRB should not be telling Boeing what to do in South Carolina.

REGULATIONS: Perry said regulations are killing America, and we need to pull back on them. If it kills jobs, do away with it, he said. He would eliminate three agencies, Commerce, Education, but he could not remember the third, until someone prompted him to say EPA. But then he recanted, and said not the EPA. He later said he was trying to remember the Energy Dept.

AUTO BAILOUT: Romney said the auto bailout was wrong, adding they should have gone through a managed bankruptcy. He opposed giving GM to the UAW, and Chrysler to Fiat. Huntsman did not think the 68 billion dollar auto bailout was a good use of taxpayer money. He said Americans are sick and tired of bailouts.

ENERGY: Huntsman wants energy independence. Bachmann said we need to legalize American energy. Santorum wants to produce energy in this country. He wants to cut all the subsidies, and let the market work. He does not favor incentives to get energy businesses going.

HEALTH: Huntsman said we need to address health care cost containment with the 50 governors. He would not have a costly mandate. Half of health care spending is nonsense, he said. We have to get cost out of the system. Patients need to be empowered. We need truly affordable insurance. Paul supports medical savings accounts and would allow opt-outs from Obamacare. We need market forces in medicine, he said. Perry said if Medicare were run by the states, it would save a ton of money. Romney would let the states do their own programs, but thinks individuals must have insurance. Health care has to work more like a market, where people have a stake cost. The malpractice system is nuts, he said, and should be taken over by the federal government. He said government is playing too heavy a role, and patients need to have a stake in cost. He was asked about providing subsidies for those who cannot afford health insurance. Gingrich would turn health care over to the states for experimentation. Bachmann said health care is too expensive. She said Obama promised we would save $2,500 per year in premiums. We need to end the insurance monopoly in every state and allow a free market. Santorum wants the government out of the health care business, and replace it with a consumer driven market.

SOCIAL SECURITY: Gingrich said President Johnson put Social Security into the general budget, and politicians now hide behind it. The money is there and available and the country ought to pay the debt it owes to those who put it there. Bachmann opposes an extension of the payroll tax cut, because it is blowing a hole in the Trust Fund. Perry talked about going to some kind of vague blended price and wage program.

EDUCATION: Paul said there is no authority in the Constitution for the federal government to be involved in education. He would get rid of student loans. Gingrich was asked about student loans and the fact they cannot be wiped out in bankruptcy. Perry said we have to control college Boards of Regents.

SPENDING AND DEBT: Romney said we cannot continue to pass massive debts to the next generation. Romney wants to cut spending. Paul said spending is taxing. He would cut 1 trillion from five departments in his first year. Bachmann said Washington receives 2.2 trillion but spends 3.7 trillion.

TAXES: Bachmann believes taxes cause jobs to leave the U.S. We have the 2^nd highest corporate tax rate in the world, she said. If state and federal rates are combined, she claimed we have a 40% corporate rate. Capital went to places where rates were falling. We have to lower our rates. Santorum was asked if his proposed zero tax on manufacturing would be flatter, simpler, or fairer. He said he was not picking winners and losers. He said the government made us uncompetitive, and we need to compete on taxes. Perry proposed a 20% flat tax on personal and corporate incomes. Cain would throw out the current tax code. We need something simple, since complexity is costing 430 billion a year. He wants all treated the same, without winners or losers. Romney was asked why he was holding on to the progressive income tax. He said he wanted flatter rates.  He wants special breaks removed. He would reduce the corporate rate from 35% to 25%. Bachman said there is something wrong with the income tax when only 53% pay it, and 47% do not. She wants everyone to pay something. Huntsman wants to phase out loopholes, deductions, corporate welfare, and subsidies. He would lower rates.

HARASSMENT: Cain said he was being tried in the court of public opinion based on unfounded sexual harassment accusations. Voters don’t care about the character assassination, he said. Romney would not say if a CEO like Cain could be kept.

Gingrich Sees Problems, But No Solutions

FOREIGN POLICY: Former House Speaker Newt Gingrich often points out what is wrong, but offers no solutions. He said Obama was mistaken to intervene in Libya against Gaddafi. He thinks Greece should not belong to the European Union, but offers no answer to the Euro Crisis. He expressed concern over trade with China, but stated no Free Trade alternative. He worries about civil war in Mexico, but has no suggestions. He named North Korea and Iran as threats, but said nothing of what he would do. He predicted a more dangerous Pakistan, but did not say how to divert it. He said Reagan was wrong to trade arms for hostages, but did not say what he would have done. He wants loyalty oaths.

FOREIGN AID: Newt came up with a bad idea to replace direct foreign aid to developing countries with a system of bribery conditioned upon whether or not their votes in the UN are consistent with ours. His approach would force nations to choose between receiving aid, or exercising free and democratic votes.

FEDERAL RESERVE: Newt was correct to demand a release of all Fed documents, and an audit of the agency, as he suggested they have too much power, deal with billions in secret, and fail to explain why they bail out one group over another.

HOUSING CRISIS: Gingrich correctly said the Countrywide lobbyists made it too easy to buy a home during the past decade, but neglected to discuss a solution to the current housing crisis.

LABOR: Gingrich showed a lack of fitness for the White House as he suggested dismantling the National Labor Relations Board. Newt wants paychecks instead of food stamps, which is fine, but failed to explain where jobs would come from. His idea to make the unemployed get job training would depend on the details.

IMMIGRATION: Newt’s plea to “secure the borders” sounds the same as other Republicans, but he skips over implementation. It’s fine to suggest a modern visa program, to require U.S. History in schools, and to establish English as our official language, but it is doubtful Newt would actually go ahead and force employers to verify the Social Security numbers of job applicants.

HEALTH CARE: Like other Republicans, Newt would repeal the new health care law, and just like them, he offers no answers to the health care and health insurance crisis. He was critical of the insurance mandate imposed in Massachusetts, but failed to suggest any regulations to control health care costs or insurance premiums. Newt makes simplistic attacks on Medicare by referring to abusers as “crooks,” but throws the baby out with the bath water, as he thinks young workers should have a right to choose, code for destroying the system as we know it.

ENERGY: Gingrich wants a safe way of taking care of nuclear waste, but he fails to explain how that is even possible.

TAXES: Gingrich appeared to be heading somewhere when he said GE paid no income taxes, but then he failed to suggest a solution to corporate tax avoidance. He instead pushed the discredited idea of eliminating Capital Gains Taxes.

EDUCATION: Gingrich would divert badly needed public tax dollars to religious schools by expanding Pell Grants for K-12.

NO SOLUTIONS NEWT: Gingrich offered no solutions to our trade deficits with China, violence in neighboring Mexico, or the Euro Crisis. He seeks to bribe votes in the UN. He has no answers for the Housing Crisis. He would make life harder for working people by dismantling the NLRB. He had no realistic solution to the flow of illegal immigrants. He stated no answer to the galloping cost of health care, and health insurance premiums. He wants to destroy Medicare as we know it. He appears willing to use nuclear power, but has no solution for nuclear waste. He would help bankrupt the federal treasury by giving capital gains taxes away, and by diverting public funds to religious schools. With answers like those suggested by Newt, who needs problems?

Republican Debate New Hamp (10-11-11)

The Republican candidates met in New Hampshire on Oct. 11, 2011 to debate economic issues.

INTERNATIONAL TRADE: Romney said we have been run over by China for 20 years, and he would issue an Executive Order identifying them as a currency manipulator, and then prosecute them in the WTO.  He did not want a trade war, but did not want to let them use us either. Huntsman worried if we apply penalties, we will get the same in return, because we also manipulate our currency, and a trade war would hurt our agricultural exporters.

EURO CRISIS: Gingrich said the Greek economy should not be using the Euro-Zone Currency. Ron Paul uncovered the Federal Reserve sent 5 billion overseas to bail out foreign banks.

DEFENSE SPENDING: Romney will not cut defense spending.

BANKING: If the economies of the entire world were collapsing, Romney would take action. He said we need to prevent a contagion from affecting U.S. banks. President Bush had to take action to keep all banks from closing. Santorum opposed the bailout of the Wall Street banks, and the creation of the Troubled Asset Relief Program (TARP), which Romney, Huntsman, Perry, and Cain supported. Bachmann said the banks cannot grow, because they are being required to comply with new rules. Cain thought the Wall Street protesters should target the government.

FEDERAL RESERVE: Gingrich said the fix has been in since the Bush Administration. Newt said Paulsen, Bernanke, and Geithner are not smart, and he would fire Bernanke and Geithner over the crisis. He singled out Bernanke for spending billions bailing out one group, over another. He said it is wrong for one man to have that kind of secret power. He wants all Fed documents released, so we can better prepare for the next crisis. Romney would also discharge Bernanke. Cain had no objection to a Fed audit. Paul called the Fed the engine of inflation and the source of recessions.

INTEREST RATES: Paul said Greenspan kept interest rates too low for too long. Easy credit caused a bubble and then it burst and now we need a correction. We should not have someone at the Fed deciding what interest rates should be, or how much money we should have. We should go back to the gold standard, Paul said. Because the Fed is setting artificially low interest rates, Bachmann blamed the financial meltdown on the government.

HOUSING: We built too many houses, Paul said, and then the Wall Street speculators got bailed out, but the Middle Class lost homes. Freddie Mac and Fannie Mae caused overbuilding and distortions, and the government must get out of housing. Bachmann said the government pushed housing goals, as Freddie and Fannie put mortgages in a difficult place. Gingrich said the easy ability to buy homes is where we went wrong the last decade. He blamed the Countryside deal on the lobbyists for Freddie Mac.

JOBS: Romney said funds should not have been used to bail out GM and Chrysler. The NLRB should not be telling Boeing it cannot build in a non-union state. He said we borrowed 800 billion for a job stimulus, but didn’t see any jobs. Huntsman would regain our industrial base by lowering taxes and lessening regulations. Santorum said we are uncompetitive, and must reduce corporate taxes from 35% to zero on those who invest in plant and equipment in this country. Perry wants our manufacturing back.

ENERGY: Perry would repeal regulations that interfere with the energy industry. He would put 1.2 million people to work in the industry, so the U.S. can become energy independent. It was wrong, he said, for Obama to invest in Solyndra, a solar energy firm. When asked about doing the same in Texas, he said his legislature had oversight and created 54,000 jobs. Santorum would drill in Pennsylvania, saying it is a gas capital.

HEALTH CARE: Romney said Americans are not satisfied with the status quo. Although he would repeal Obamacare, he asked, what are we going to replace it with? In Mass, he dealt with the 8% who were uninsured. He said Perry has one million uninsured kids in Texas, while Mass has less than 1%. Romney said Obama’s plan raises taxes and spends trillions. Huntsman wants a health care solution that works in the market. He warned the IRS is already gearing up with 19,500 employees to administer the insurance mandate. Santorum would repeal Obamacare, but not by waivers. He would repeal the taxes and spending for it, so the insurance mandate would have no teeth.

MEDICARE: Gingrich was asked: Are the last two years of life under Medicare wasteful spending? He did not want death panels. Bachmann warned Part B for hospitals will be broke in nine years. She thinks Obama would push people out of Medicare into Obamacare, and 15 political appointees will make major decisions for 300 million Americans. Perry says Medicare needs to be block-granted to the states.

BUDGET & DEBT: Cain wants revenues to equal spending. Perry would propose a Balanced Budget Amendment, because we raise taxes, but never get spending reductions. Paul said the debt is a burden on the economy. Bachmann opposed increases in the Debt Ceiling, because she did not want to give Obama another 2.4 trillion. We spend 40% more than we take in, she said, and cut backs on spending would be only part of the answer. Romney said we cannot have more tax revenues, because that would kill jobs.

TAXES: Romney would not raise taxes. We don’t need Cain’s 999 tax plan, said Perry. The last thing Bachmann would do is let Congress impose a national sales tax, a suggested by Cain. Santorum said Cain’s plan would not pass, because no one supports a national sales tax. Huntsman would not do Cain’s tax plan, but instead something doable, like eliminating loopholes and deductions for individuals, as recommended by the bipartisan Simpson-Bowles Commission. Huntsman would also phase out corporate welfare and subsidies. He said he had a flat tax in Utah.

9-9-9 PLAN: Cain would throw out the entire tax code, including the progressive income tax, the capital gains tax, death taxes, and payroll taxes, and he would replace it with a 9-9-9 plan: 9% corporate business flat tax, 9% federal income tax, and 9% national sales tax. He was asked why Americans would be willing to pay more for bread and milk, under his new 9% national sales tax. He gave an incorrect answer, suggesting ordinary people are now paying 15.3%, when in fact they pay only 7.65%. He tried to suggest they would be save 6%. He thought people would have more for sales taxes, since they would pay less in payroll taxes. Cain also appeared ignorant of how Congress works, when he said he would ask them to require a 2/3rds vote before increasing any of his 999 taxes. He would need a Constitutional Amendment.

Republican Debate Tampa (9-12-11)

Since the Republicans debated less than a week ago, CNN hyped up this one by introducing the candidates like starting players in a sporting event, and a woman sang the National Anthem, as if a game was about to start. If tax dollars could have been wasted on flying jets overhead, they would have done that too. But the big opening did not save the debate from becoming the usual bashing of President Obama, filled with generalized political philosophy.

FOREIGN POLICY: Ron Paul said he was tired of all the militarism and waste associated with it. We have 900 bases around the globe in 130 nations, he said, and we cannot be the world’s policeman. It angers foreigners, Paul said, when we occupy their lands. Santorum accused Paul of blaming 911 on the U.S., while the former Senator seriously thought the hijackers only wanted to kill us because we stood for freedom. Paul had to educate Santorum, saying we were attacked on 911, because we had troops in Saudi Arabia, and allowed the Palestinians to be harmed, comments that triggered boos from an obviously uninformed audience. Perry declared it is time to bring the troops home, but contradicted himself saying, we needed to maintain a presence. Huntsman said it’s time to get out of Afghanistan. Gingrich was concerned with North Korea, trade with China, Iran, and a civil war in Mexico.

SOCIAL SECURITY: Ron Paul said Social Security retirement funds should not have been used to fight wars. Social Security is an essential program, Romney said, and taking funds from it for other purposes was criminal. Perry said it must be saved for seniors and transformed for future recipients, even though in his book he wrote it should not be a federal program. Cain wants young workers to have options. Bachmann said Medicare is bankrupt and retirement must be reformed. Gingrich said more than 70 billion of Medicare is paid to crooks, no changes should be made as to seniors, but young workers need a right to choose. Santorum said older voters just want truth. Huntsman claimed to have the answers.

PRESCRIPTION DRUGS: As to prescription drugs, Perry and Romney would not repeal the program which was started under George Bush. Paul said we first need other reforms, like stopping wars overseas. Bachmann said we cannot provide everything for everybody.

HEALTH CARE: Romney tried to distinguish the Massachusetts plan from the federal approach. He said patients do not know how much their care costs, and showed how out-of-touch he is with average people, as he advocated co-insurance payments, which most Americans unfortunately already have. When the candidates were asked if they want people with no health insurance to die, physician Ron Paul said no one was turned away when he was a doctor, as churches took care of them. Bachmann said we should not force people to buy insurance. Cain wanted Obamacare repealed, saying we need market reforms.

UNEMPLOYMENT & JOBS: Regarding employment, Huntsman said it is a tragedy affecting millions, and we need to create jobs through regulatory reform, repealing Obamacare, changes in the tax code, energy independence, and an end to corporate welfare. Romney put the audience to sleep as he rattled off seven things he would do as to taxes, trade, energy, the budget, and so on. Perry claimed Obama created zero jobs, and he should not spend money we do not have. Perry claimed to have created jobs in Texas, while the nation lost them. He thinks people will risk capital and create jobs, if regulations and taxes were lowered. Bachmann thinks more free trade will create jobs. Gingrich correctly said most jobs are created by the American people and not the government. Paul said we are wasting money overseas, noting it cost 1 billion to build an embassy in Baghdad. Huntsman claimed to have had the best managed state as he said we must create an environment favorable to business.

IMMIGRATION: Texas Gov. Perry, whose state has a 1,200 mile Mexican border, said the federal government must secure it, but it is not realistic to maintain a wall from Brownsville to El Paso. Perry, who opposes amnesty and the Dream Act, had to defend his decision to allow illegal aliens to receive in-state tuition, as the Tea Party audience booed. He said he wanted them in college instead of doing nothing on welfare. Former Utah Gov. Huntsman would secure the border, but gave Drivers Licenses to illegal aliens. Romney said build a fence, but enforce the law and give no tuition breaks or Drivers Licenses to illegal aliens. Santorum wants more fences and security, more legal immigration, and English spoken by everyone. Although Bachmann wants aliens to learn English and History, no one suggested she learn history. Huntsman said Homeland Security needed to be fixed.

FEDERAL RESERVE: Cain apparently served on the Kansas City Federal Reserve and said we need to focus on sound money. Bachmann would not re-appoint the Fed chair, saying he should not use his unlimited power to make loans to private businesses and foreign countries. Perry said we need a strong dollar and the Fed should not be used to cover up bad federal policies. Romney wants a strong currency, Fed oversight, but he did not want Congress in charge of the currency.

TAXES: Cain would throw out the entire tax code and replace it with a flat 9% tax on businesses and sales. Santorum would attract manufacturing by relieving taxes on new manufacturers. When a young man asked how much of his paycheck he should be allowed to keep, Huntsman said the tax brackets should be 8%, 14%, and 22%. Gingrich wants people to keep more of what they earn, saying GE paid no taxes whatsoever. Romney actually thought he would help the Middle Class by eliminating taxes on dividends, interest, and capital gains.

ENERGY: Cain said energy independence requires the EPA to get out of the way. He would appoint those abused by the agency.

TORT REFORM: Perry showed deep hatred of trial lawyers, as he thought tort reform would actually make a difference federally. Cain wanted the loser of lawsuits to pay the winner’s costs, not realizing the insurance industry routinely opposes such proposals.

EXECUTIVE ORDERS: Paul said Executive Orders are only appropriate when moving troops and they should never be used to legislate. Perry admitted he used an Executive Order in Texas to require a vaccine, and he should have run it by the legislature. Bachmann accused him of issuing the order, because he received campaign contributions from a drug company. She and Santorum both said government should never force people to have vaccines.

Republican Debate California (9-7-11)

One year and two months before the 2012 election, Republicans gathered to attack President Obama again in yet another debate.

FOREIGN POLICY: Huntsman said bring the troops home so we can do nation-building here. Perry complimented Obama for keeping Guantanamo open and executing Bin Laden. Bachmann felt it was wrong for Obama to tell Israel to return to the 1967 borders. She opposed the Libyan operation, saying no American interest was involved, and we did not know the rebels. She wanted to disarm a potential Iranian nuclear threat. Santorum opposed isolationism and wants the U.S. to become a force for good.

JOBS: Although Republicans usually say the private sector and not the government creates them, Perry took credit for 1 million new ones in Texas. Romney also claimed he made new jobs, by understanding how the economy works in the private sector.

IMMIGRATION: Perry said the El Paso border was unsafe and federal border security support was needed. Romney wanted no amnesty, a fence, agents to secure it, and an elimination of the magnet caused by employers who hire illegal aliens. Gingrich wanted everyone, including Americans, to learn English and U.S. History. Bachmann said immigration worked through the 1950s, before the rules changed. Cain wants the federal immigration issue to be given to the states. Huntsman said two of his seven children were from India and China, and he saw the issue through their eyes. He wants legal immigration fixed. Paul said states should not be forced to provide benefits for illegal aliens.

BUDGET & FEDERAL RESERVE: Perry wants a Balanced Budget Amendment, saying the Keynesian approach is dead.  Romney said the Fed pumped too much money into the economy. Gingrich would fire Fed chair tomorrow and audit the agency.

TAXES: Cain came up with a wild proposal to increase sales taxes to 9%, even though it’s regressive and disproportionate as to the poor. He was questioned about a corporation that earned 14 billion, but paid no taxes. Hunstman would make no tax pledge Romney said all should pay taxes and wanted dividends tax free.

RETIREMENT: Romney said we must save Social Security, not abolish it. Perry said it was a Ponzi Scheme, wrong from the very beginning, and it needed change. It’s a lie, he said, to tell young people they will receive benefits some day. Cain wanted to set up private accounts with personal names on them.

HEALTH CARE: Romney said those without insurance simply went to emergency rooms, forcing taxpayers to pay. He promised waivers from the new law to states who wanted them. Perry was asked why 25% in Texas had no health insurance and ranked dead last. People don’t want mandates, he said, as he suggested Medicare block grants for the states. Bachmann claimed “Obamacare” regulations (which haven’t taken effect yet), are “killing jobs.” She said the law took over one-sixth of the economy and hard work is needed to repeal it. Cain said insurance mandates are unconstitutional. Gingrinch said they all want to repeal the law. Huntsman, out in front of the curve, asked how they would solve the issue once the existing law was repealed.

ENERGY POLICY: Romney suggested developing oil, gas and nuclear power. Huntsman said gas prices are determined in the market and government cannot dictate them. The true cost of gas, he said, includes government spending to keep the Persian Gulf sea lanes open. Bachmann said a gallon of gas was $1.79 when Obama took office and we needed energy jobs in America. She was asked to explain her suggestion to drill in the Everglades. Gingrich would drill in Alaska. Perry thought climate change was not science.

FEMA: Paul said it didn’t exist before 1979. He would let private airlines take over the TSA.

EDUCATION: Gingrich would give Pell Grants to kindergarten through 12^th grade. Huntsman said Republicans cannot be anti-science. On poverty, Santorum said he reduced it through welfare reform, and wanted to eliminate the dependency culture.

DEATH PENALTY: Perry received great applause from the partisan audience as he said Americans support capital punishment, and he slept well after executing more prisoners than any other state.

As to their fitness to serve, Huntsman, a former governor and ambassador, said he served 4 presidents: Reagan, Bush I, Bush II and Obama, and only he would be able to attract independents.

Low Interest Rates: Correct Fed Policy

The Board of Governors of the Federal Reserve correctly used Monetary Policy to try to turn the economy around, by keeping home mortgage interest rates at their lowest level in 40 years.

Congress created the Federal Reserve System with a Central Bank in 1913 to help prevent recessions and other economic downturns from turning into depressions. Since then, all National Banks have joined the system.

The Federal Reserve has the ability to set interest rates for loans to member banks. When the Fed sets low interest rates, members are able to make loans to the public at correspondingly low rates. The availability of cheap money theoretically allows the economy to expand, provided other factors line up correctly.

Low interest rates at the Fed also help the U.S. Government when short-term loans are needed. Since interest on these loans is later turned over to the U.S. Treasury, the Fed basically provides interest-free money to the government. The principal sums borrowed from the Fed are repaid by the government with money raised from publically sold Treasury Bonds. Interest on the bonds is paid by the U.S. Treasury, until the bondholders are satisfied.

The decision by the Fed to keep interest rates low helps the federal government in terms of the annual deficit and national debt, regional banks in allowing them to offer cheap money, and the public, by enabling them to borrow at relatively low rates.

If the Fed now raised interest rates, while the national economy is still struggling to get out of a deep recession, one consequence would be a contraction, and a worsening of the economic crisis. If the Fed imposed higher interest rates, they certainly would not help, and would likely make the housing crisis worse.

Currently, factors other than interest rates are keeping the housing market from expanding. The Fed should continue to keep interest rates low, until measurable improvements are seen in the housing industry, which unfortunately may take the better part of a decade, no matter who occupies the White House or the Congress.