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Spendthrift U.S. Consumers Caused Global Recession

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  • Spendthrift U.S. Consumers Caused Global Recession

    http://www2.canada.com/saskatoonstar...tml?id=1382932

    Spendthrift U.S. consumers caused global recession: Harper
    David Akin, Canwest News Service
    Published: Thursday, March 12, 2009

    OTTAWA - Prime Minister Stephen Harper said the global recession was caused by American consumers and investors who believed in the "unconservative" idea that they could borrow without consequences.

    In a speech Thursday night to a group of supporters attending a fundraising dinner for a conservative think-tank, Harper delivered a frank diagnosis of the world's economic problems, took a swipe at U.S. President Barack Obama's stimulus plan, and suggested the federal courts and bureaucracy was filled with Liberals who did not share his Conservative government's agenda.

    "Imagine how many Liberal insiders and ideologues would now be in the Senate, the courts and countless other federal institutions and agencies - I should say, how many more," Harper said to the laughter of the mostly conservative crowd of about 300.

    "Imagine what a carbon tax would be doing to our economy in the middle of this global recession."

    The group had gathered to kick off a three-day conference organized by the Manning Institute for Democracy, a think-tank headed by Preston Manning, the Reform Party founder and one of Harper's first political bosses.

    Manning set up the group to bring together Canadian small-c conservatives, some of whom have criticized the Harper government for an economic stimulus plan that, to their eyes, is too liberal.

    But in his speech, Harper gave a passionate defence of conservatism in what has become an era of big-spending, big government.

    "We are in a global recession principally - and we have to face this - because a lot of people on Wall Street, because of a lot of people in the private sector more generally - homeowners or consumers - pushed or bought into a very unconservative idea: That they could live beyond their means," Harper said.

    "Regulators may have failed to prevent it but, in the end, it was a failure of the private sector to live according to the values we as conservatives know to be true."

    But Harper suggested that volatile mix of cheap and easy-to-get credit, along with consumers and investors who failed to consider their long-term financial health, did not infect Canada in the same way.

    "Thankfully, Canadians, among few nations in the Western world, did not embrace this idea so recklessly," Harper said.

    "Our banks upheld prudent lending standards. Our regulators maintained sufficient but not excessive oversight. Our consumers exercised more restraint and our government made affordable tax reductions, tax reductions that did not drive us into a long-term deficit."

    Some conservatives, though, say Harper should have lowered taxes and run a deficit-free budget as the best cure for the economy.

    Conservatives lit up the blogosphere this week with complaints that Harper, in speeches last week, quoted liberal economist John Maynard Keynes.

    Indeed, Harper himself used to be a harsh critic of Keynes's central idea, which was that governments should go into deficit in bad times and run surpluses in good times to keep an economy on an even keel.

    In his 1991 thesis to earn a master's degree in economics, Harper argued that "Keynesian fiscal policy is subject to the influence of political parameters that lessen its effectiveness as a stabilization tool."

    In other words, Harper argued that Keynes was wrong.

    But beginning last fall, Harper changed his mind in response to the rapidity and depth of the global recession and, as a result, brought in a budget with one of the biggest deficits in decades.

    "We are, as Conservatives, in response to massive failure in the marketplace, are using the public role of government to act. When billions, maybe trillions of private capital, is sitting on the sidelines because of fear, pessimism and panic, the government must step in to restore confidence, protect citizens and to stimulate the economy," Harper said.

    Harper also took several shots at his political opponents, what he called "that toxic coalition brew of Liberals, socialists and separatists. You know, I always wished they would do that and (former Liberal leader Stephane) Dion finally did it."

    He said his government's spending decisions are being made for the long-term benefit of the country and that any deficits will be temporary.

    "Don't let anybody tell you (the opposition) would have done the same things," Harper said. "They would not have brought in any tax reductions at all."

    And Harper seemed to criticize Obama's fiscal stimulus plan, which raises taxes on those earning more than $250,000 a year. He suggested Canada's Liberals would have done the same.

    "(The opposition) didn't tell you the taxes they would raise - and we're seeing that in the States now. Their spending plans would have been permanent, not temporary, that spending would have gone mainly to left-wing special interest groups . . . not hard-working Canadian families and communities."

    Nonetheless, Harper conceded that, as a conservative, he believes governments have an important and central role.

    "Conservatives don't believe big government - the welfare state - is the solution to all problems. We didn't believe it before the recession. We're not about to start believing it now. But neither can conservatives believe today that the marketplace - that which I call Wall Street - is the solution to all problems."

    Harper told the group that his version of conservatism is summed up "in three Fs: freedom, family and faith."

    He said individual freedom is vital but it must be tempered by family and faith.

    In Harper's mind, faith has less to do with a particular religion and more to do with morals, he said.

    "Faith in all its forms teaches . . . that there is a right and wrong beyond mere opinion or desire. Most importantly, it teaches us that freedom is not an end in itself, that how freedom is exercised matters as much as freedom itself."

  • #2
    Lostinoz,

    The Cannuck "Conservatives" have it all backwards. U.S. consumers never could get away with thinking that they could live beyond their means if government didn't force banks to make out mortgages to people who couldn't pay them off, nor could consumers get away with living beyond their means if it weren't for a Welfare State that would bail them out if the little snook-ums got in over their heads. Nor could banks and other financial institutions get away with going along with this hideous facade if it weren't for the extension of easy money and credit by the Federal Reserve.

    I see it all the time as a cashier. Almost to a person, the customers who end up returning food items to my register that they can't afford to get are customers who draw EBT (the electronic equivalent of food stamps in NC) or customers on WIC (aid to Women Infants and Children.) Why should they have to count out in their heads what they can afford, if the State is providing the money? If they can't get it with their monthly portion of the dole, why should they care if they burden as cashier?

    These customers turn my counter into a dumping ground which I must sort out, take to Custmer Service, and place in proper bins, taking up my valuable time better spent elsewhere. And when items are perishable and cashiers don't have time to take them to their proper departments, guess who pays for it? Yep, you the customer who pays his or her own freight.

    :mad: :mad: :mad: :mad:

    Now you know why I say that EBT stands for "Eternally Burdening Taxpayers" and WIC stands for "Won't Insert Contraception."

    :D
    "Apocalypse is by no means inevitable." --Jim Rice.

    Comment


    • #3
      When I first moved to NC I wasnt making much. It was My wife, my son and me at the time. I was making 13 an hour and paying $500 a month so my family would have health care. so you can crunch the numbers and figure out that I we were just barely getting by. We made it though. We didnt qualify for anything and would accept it if we had. What i dont get is my fat a** inlaws were making $20 an hour had wic and free health insurance because they chose to have 3 kids. I am sick of paying for people who can work and chose not too or have 8 damn kids.

      Dave

      Comment


      • #4
        Unbound,

        Oh, I have seen that, too! It is frustrating to say the least!

        I don't take a whole lot of stock in what any politician says. It was late last night when I posted the article and did not go back and highlight the parts I thought were interesting. :D

        Did you notice that Harper flip-flopped on his view of Keynes? I find that most interesting. It seems having the ability to spend other people's money creates monsters. Well, I guess that is what you were pointing out with a lot of EBT and WIC users, but please don't get me wrong, I am glad the programs are there to help people who REALLY need the help, temporarily, however I do believe the system is widely abused, which is a shame. Instead of using the benefits as a temporary crutch, some have made it part of their income and feel it is their due.

        I "sort of" agree with you regarding the government enabling people to live beyond their means, however personal responsibility must play a part as well. Sure, it was easy to buy more house than one could afford, but common sense tells us that this does not necessarily make it the right thing to do. lol Maybe common sense has gone by the wayside? I don't know. :(

        Comment


        • #5
          Originally posted by oscar80 View Post
          When I first moved to NC I wasnt making much. It was My wife, my son and me at the time. I was making 13 an hour and paying $500 a month so my family would have health care. so you can crunch the numbers and figure out that I we were just barely getting by. We made it though. We didnt qualify for anything and would accept it if we had. What i dont get is my fat a** inlaws were making $20 an hour had wic and free health insurance because they chose to have 3 kids. I am sick of paying for people who can work and chose not too or have 8 damn kids.

          Dave
          Hi Dave,

          The area I highlighted in red above says it all. You did the right thing and for that, you have a right to be proud of your accomplishments! :) Unfortunately, those you describe who take advantage of the "system" will never know this pride. Whenever someone uses the system, they become a slave to it, though they cannot see this. However, it is very frustrating for those of us who have to pay, unwillingly, for these people who refuse to open their eyes because they have chosen the easy path which leads nowhere.

          Oz

          Comment


          • #6
            WIC, EBT, Section-8 housing, Public School Assistance programs, and the like are a constant drain on everyone. I believe taxes shouldn't be rated by your income, and I don't feel it's right to file for a tax refund. I also don't see the point in tax-deductions for businesses, or charitable donations.
            How about 10% tax for everyone. If you make $10,000 a year, you pay $1,000, 100,000, pay $10,000 and so on.
            If you want to contribute to a charitable cause, it should be out of the goodwill of your heart, and not as a tax relief. If you own a business, and want to buy a new vehicle for that business, great...but it shouldn't be a tax write-off. No refunds, no excess to pay at the end of the year. A straight up flat rate tax with no deductions. Then, you can start to eliminate the other 60-or so taxes we pay regularly on items we use in every day life. Finally, stop paying our government officials. They chose to take office because they wanted to better our way of life, not to earn a huge paycheck and reap the benefits of not ever having to work again after their term in office expires.
            "Reject the basic assumptions of civilization, especially the importance of material possessions." "The things you own end up owning you"-Tyler Durden

            Comment


            • #7
              Originally posted by Lostinoz View Post
              Unbound,

              Sure, it was easy to buy more house than one could afford, but common sense tells us that this does not necessarily make it the right thing to do. lol Maybe common sense has gone by the wayside? I don't know. :(
              It's morality that has gone by the wayside. What they do is stealing. I was taught that stealing is wrong. When we lived in NC and didn't have 2 nickels to rub together, I counted every penny so we could eat. We WERE eligible for some of the programs, I was told, but never even applied for them. We are more prepared for the coming depression because of those years.
              "If Howdy Doody runs against him, I'm voting for the puppet." - SkyOwl's Wife, 2012

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