The Global Economic Crisis and The New President

Thursday, November 06, 2008

The president-elect faces the global economic crisis, and New York Times business editor Marcus Mabry and author/Atlantic Monthly editor Reihan Salam offer their thoughts on where to go from here.


Marcus Mabry and Reihan Salam

Comments [48]

Myriam F. from Ithaca, NY

Yes, government has problems, but it is necessary. Without government AND taxes no society is possible, and no business is possible. I really want to encourage everyone to get over this tax argument, and begin thinking about what we all CAN AND MUST do for our country.


We ALL need to give! we all will need to sacrifice--and yes, that means that some people will be paying higher taxes, most of all, people with high incomes who have benefited disproportionately from the country's growing economy for the past 28 years. This is patriotism in action!

Let's build the bridges, the new energy system, the 21st century internet technology, the healthcare system, and education that we all need.

Nov. 06 2008 10:35 PM
Myriam F. from Ithaca, NY

Hello Brian,

I just heard your radio ad/comment about tomorrow's show regarding the necessary tax increases in the US. "Is this a new American value"? Yes, a resounding YES! YES! I believe many of the Warren Buffets, Bill Gates and Hollywood millionaires of this country do recognize that the money MUST come from those who are most fortunate, from themselves. They know this! They have always known this. And guess what? They and everyone else want a first-rate, twentyfirst century country that works.

I keep hearing negative comments in the media about taxes, taxes, taxes. How do people think a government works? A government works with funds provided by the public! Those who own more pay more, and those who own less, pay less. The regressive attitude that my money is "only mine" is shortsighted and frankly ignorant. This narrow attitude is the result of the disastrous antigovernment bashing of the right since the 1980s. They kept cutting and cutting taxes, and now, guess what? We have a funding problem for government. (States like VA and NY are good examples of such disastrous, consistent tax cuts.)

Nov. 06 2008 10:34 PM
Stacie from Harrison, NY

I'd like to add my voice in agreement with Alexis' comments and the comments of those who supported her. I and many others in this suburban area were strong Obama supporters despite knowing that our taxes could go up under an Obama administration. Other of your commentators have summarized why that is so.

I think Mr. Salam got it completely wrong in suggesting that people in the "investor class" were generally not aware that their vote for Obama might well result in their own taxes being raised.

Nov. 06 2008 05:55 PM
Janis from long island

found this very interesting...hope that Obama will appoint Howard Dean to a position of prominence...perhaps in the Department of Health, Education, and Welfare? He's bright and he doesn't "attack" his opponents...just works for change and progress.

Nov. 06 2008 11:18 AM
Lisa Cunningham from UWS NYC

The states should confer CIVIL UNIONS. ONLY. To every American citizen over 18 who wishes one, gay or straight.

The civilly unified can then turn around and get MARRIED in their church of choice. (or not) We are to worship and convene in any way we choose.

Let's encourage clearer separation of church and state.

Nov. 06 2008 11:17 AM
Ian from New Jersey

What is the WSJ article they are referring to?

Nov. 06 2008 11:15 AM
Eve from Manhattan

Good for Alexis!

I earn $85k. I not only voted for Obama, I campaigned for him for 6 straight weekends in rural Pa. Try spending a few hours talking to firefighters and cops who are living in a trailerpark because they're so poorly paid, a farm family whose 401(k) was wiped out, a young couple with 2 kids making $32k and with no health insurance, a nice small-town street with 3 foreclosed houses...

Yeah, I think it's fine if I pay more taxes, as long as my money doesn't go to windfall profits for undertaxed oil industries and Wall Street bonuses. I have confidence that Obama won't do that. It's long overdue. Will I hurt financially? In the short term, sure. We all will, given the mess that's coming. As it happens, I am probably going to lose my job, but mine was still unquestionably the right vote. (Not to mention that most Americans do *not* vote purely on their personal economic gains. Try canvassing sometime: you'll see.)

I had to laugh when I heard my salary range has me in the "investor class." My "investments" are my pension 401(k), into which I've been paying for years, because I work in a field that does not offer traditional pensions. Seriously, does that make me a member of the investor class? Do blue-collar union members with the same amount of money in their 401(k)s also now count as the investor class? If so, who's *not* in that class?

Maybe it's time to rethink what to call all of us who were forced to tie our retirement security to Wall Street?

Nov. 06 2008 11:07 AM
Ilya W from NJ

I wanted to comment on the Alexis Philosophy. I know many people who fall into that category and I think you missed an important point in your summary.

1. Many high-earners knew full well that the Obama tax plan might not provide any great tax benefit for their families

2. They gladly supported and voted for Obama

3. If we are in an economy where bailing out investment banks is required, then all bets are off. If that means that those earning over a certain amount are going to contribute more taxes - so be it.

4. The point I think you missed is that even if Alexis's household taxes will not be improved... she, and many others are hoping that the entire economy may improve and in turn - so will her overall situation. This tax plan, in my opinion, is likely to mean more consumer spending and ultimately a healthier economy. Are we not willing to forgo a short term tax cut for the long term health of the economy? I think your guest was assuming voters are not only ill informed but also short sighted.

Nov. 06 2008 11:02 AM
Joe from Manhattan

My wife and I earn well above the dividing line for the Obama tax increases and were fully aware and willing to pay more taxes by supporting Barack Obama. I do not consider myself a "socialist" but I am socially responsible and consider the concept of "sharing the wealth" an essential component to an advanced civilized society.
I found the failed "Joe the Plumber" argument put forth by McCain/Palin banal, bizarre and insulting.

Nov. 06 2008 10:58 AM
mc from Brooklyn

Kent #12,
Who's hating? I voted for him. I don't feel like I lost.

Nov. 06 2008 10:58 AM
rylee from nyc

Surprise, no free lunch. The pie is only so big and the slices have been disproportionately
skewed in favor of the elite, moneyed interests. La De Dah has been the mantra too long. WE need a reset, and O is the one to work it. I hope the disgruntled "haves" and whiny "want mores" (ie.not the poor and disenfrancised)who are resisting the effects of change will get with it. A. This is Global B. Everyone will feel it C.It will take longer and require more resources than anyone is understanding. We elected CHANGE, so get with it.

Nov. 06 2008 10:55 AM
Phoebe from NJ

To [10]: I agree with you. The mandate is to run with the campaign promises which are (IMHO) center-left. The fact that many independents and conservatives crossed to vote for President Elect Obama is partly a judgement on his message of hope and change, but also a rejection of Bush/conservative low-tax, big-government corruption which has not improved lives.

My economic interests will be slightly compromised by Obama's taxation issues, but I still cover all my basic needs and believe the country will be better served by an improvement in public services. Also, the divisive and hateful rhetoric of the far-right mean I could never vote for a Republican out of conscience even though I would be ahead economically.

Nov. 06 2008 10:54 AM
Dan Winckler from Brooklyn

At a conference last week at The New School, Bob Kerrey called for the federal government to borrow a trillion dollars to inject into the economy to prevent what he described as a slide from a recession into a depression, saying that the feds are the only non-over-leveraged institution around now.

I didn't get this comment in in time for today's show but it would be interesting to hear this addressed.

Nov. 06 2008 10:51 AM
NB from Manhattan

Given my household income my taxes will almost certainly go up. But I agree with Alexis, if at least some of that money is put to good use making this a better country I can live it. Besides, I'm not as concerned with how much I pay in taxes next year as I am with how much I pay in my lifetime. If we don't commit to a responsible economic policy our national debt will force us into incredibly high taxes later.

Nov. 06 2008 10:50 AM
Internet Infrastructure, Obama

22/kc agree

Nov. 06 2008 10:50 AM
Rick from Manhattan

Salam's response to the man who commented that consumers' income needed to be supported for a consumer driven recovery was just gibberish.

Nov. 06 2008 10:49 AM
Internet Infrastructure, Obama

one thing that would improve my life/business/lives of entrepreneurs --

treat internet infrastructure same as roadway infrastructure (as in korea/japan etc) I am so sick of being limited by bad verizon dsl and now their "fios" infrastructure --

i realized i get more dead time waiting for crappy verizon infrastructure problems than I do w commuter delays! not to mention limits of where we can live b/c of this infrastructure. for example we could never move to our remote country place solely b/c of this issue.

a slice of cash going to cars (for example) would bump up to at least 50% of japan's internet infrastructure

Nov. 06 2008 10:49 AM
Hugh from Crown Heights

First, $75,000 is equivalent to about $35,000 or $40,000 in a place like Detroit.

Second, Reihan Salam has a nice argument for the Great Depression being a good thing. He's the first person I've heard argue that profligate waste is justified by the spin-offs.

Nov. 06 2008 10:46 AM
Janis from long island

I seem to remember Rahm Emmanuel scorning the fifty-state approach of Howard Dean...I seem to remember the DC operatives trying to stop him from becoming chief of the Democratic Party.

So...Rahm Emmanuel is NOT a good choice, in my mind, since it was Dean's strategy that won the House in 2006, and the presidency in 2008. What does Emmanuel bring to the table?

Nov. 06 2008 10:46 AM
Shlomo Greenwald from Brooklyn

I LOVE Reihan Salam!!
Wow a fantastically artistic and smart conservative financial voice

Nov. 06 2008 10:45 AM
Kate from NYC

Regasrding Alexis's comment: What about peoplel ike me, who are willing to vote against their eceonomic interestsi n the short-term, but feel that they are at the same time voting FOR their ecoenomic interests in the long-term, becuase they feel that social and government programs WORK and are cost-effective in the long term?

Nov. 06 2008 10:45 AM
Peter from Flatbush, Brooklyn

Its becoming increasingly clear theat President Obama is going to a pragmatic progressive. He isnt as left as I would like him, but i think he is the right man for the job. Our nation needs pragmatic leaders who will lean to the left, but not be driven strictly by ideology.

Nov. 06 2008 10:45 AM
Kent from Brooklyn

Brian come out of the closet already, we know you have secret Neoconservative tendencies.

Nov. 06 2008 10:45 AM

well done, alexis.

Nov. 06 2008 10:45 AM
Daniel W. from Jackson Heights

Title of Reihan Salam's next book:
What's the Matter with Scarsdale?

Nov. 06 2008 10:44 AM
Susan from Kingston, New York

I think that we should be listening to this woman from the investor class! She reflects what most people of this class think. Don't dismiss her opinion. We will pay more taxes as long as it improves the lives of others not as fortunate as themselves. Wake up!

Nov. 06 2008 10:44 AM
Josh from Brooklyn

The rich actually pay less taxes then everyone else. Just ask Warren Buffet (he admitted it on Charlie Rose). They pay no payroll tax beyond 102,000. They pay no payroll tax on investment income. Under Republican Eisenhower, the top rate was 91%, and with deductions they still only paid 54% of their income on taxes. With the tax rate here at 36% and deductions, imagine how much they really pay. don't forget, they only pay 36% of their income after 200,000 or so. They pay the same rate as everone else on the amount of money they earn before then.

Nov. 06 2008 10:43 AM
KC from NYC

Well, I'm glad there's at least a caller willing to call this guy out on his glib, elitist lunacy. ...If there isn't going to be a guest to do that, I mean.

Nov. 06 2008 10:43 AM
Joe Corrao from Brooklyn

Wow this caller (Alexis) should get aradio show....sounded informed AND concerned...good job

Nov. 06 2008 10:43 AM

there may be a problem with supply side economics.... however, there have been economic bubbles for at least as long as there has been economics.

Nov. 06 2008 10:42 AM
KC from NYC

Wow. The subprime scheme was good for the people currently losing their homes?

Could we have a rebuttal to that OUTRAGEOUS statement, please?

Nov. 06 2008 10:40 AM
Dylan from Astoria

Rahm Emmanuel would be a terrible chief of staff and a really, really lame beginning to the Obama administration. H
He has been wrong about all the new Democratic movements in the country, was against Howard Dean's 50 state strategy, against Obama's candidacy and really is stuck in the Clinton centrist agenda.
How could he be helpful for coalition building in the administration?
Leave him in the Congress to deal with Blue Dog Democrats. he will be much more valuable there.

Nov. 06 2008 10:39 AM
Joe Corrao from Brooklyn

Sacrafice? he talked Hope and Change...hope ain't sacrafice

Nov. 06 2008 10:38 AM
Voter from Brooklyn

On stimulus packages… Why is it governments responsibility to spend money on industrial R and D? Why do free-market capitalist want a “socialist” hand out? So now, not only do we continue to privatize profits and make risk the responsibility of the taxpayers… you are proposing the taxpayers help create more profit for companies by funding their R and D for them. Outrageous!

Let them spend their profit on R and D, not advertising and bonuses.

Nov. 06 2008 10:38 AM
dc from brooklyn

Tax the rich, tax 'em hard. If they don't like it they can step aside. The corporate "leaders" do everything in their power to keep down the middle class and lower classes through pay structure, tax structure, fees, wage suppression, job flight, et. al. What are they going to do, hoard all the money? They already are. Leave the country? Where else would they want to live-- France, Russia, Bangkok, Rome, London, Caracas, Rio? No. They want to live here and they want it to by nice & they want to bleed us dry. They can't have it all. The nation is collapsing under the weight of all the money that has risen to the top.
We need to get real in this country.

Nov. 06 2008 10:38 AM
Robert from NYC

I can't believe Brian, you think Europeans see the term Socialism as tabu, curse, something to avoid. Europeans are proud of their social democratic tradition especially since WWII and that's obvious in the way they live. Does it have problems? Yeah. But it seems the system works in spite of the problems and when the problems get out of hand they do something about it. The sit back and let it work itself out is an American way of thinking and it's out of tune with how our "partners" in Europe live and think.

Nov. 06 2008 10:37 AM
Joe Corrao from Brooklyn

whoa...someone talking about economic reality...a 1st for BL show

Nov. 06 2008 10:34 AM
Kent from Brooklyn

Oh stop hating mc !!! you lost ha ha ha

Nov. 06 2008 10:32 AM
mc from Brooklyn

It looks like - from some of the above comments that it is dawning on people that Obama is a centrist, not a left-winger. All of the "Socialist" charges had me cracking up. Look at his record, folks. There really should not be any surprises.

Nov. 06 2008 10:28 AM
MichaelB from UWS Manhattan

To Phoebe from NJ [3], The "Mandate" you refer to is not based on who voted for the candidate (although I would disagree even with your implication that only left-of-center types voted for Obama; he had a great deal of support from the center and even disaffected conservatives -- certainly from independents.) The "mandate" is to do what the candidate has been saying all along what he would do. It seems to me that Obama has been centrist in his rhetoric, but the left in imposing a rockstar status on the man and with all the rah-rah frenzy, only heard what it wanted to hear. That's now what Obama has been saying.

I do agree however, that he will change the tax dynamic, pushing more of the tax burden onto higher earners. And I agree with that change.

Nov. 06 2008 10:27 AM
KC from NYC

Why is a centrist journalist representing the "left" in this discussion, while an avowed conservative ideologue represents the "right"? I know simply admitting the fact that the vast majority of the industrialized world prefers democratic socialist governance is enough to get you labeled a "liberal" in the mainstream media, but I don't get it. I find this method of setting up a "debate" extremely problematic and a little...insidious?

Nov. 06 2008 10:25 AM

any true capitalist will surely find a way to get a piece of that $700 billion!

It's all about the Money, baby.

Nov. 06 2008 10:21 AM

I heard Arthur Laffer -- creator of the Laffer curve -- say that if maximizing tax revenue is the primary aim of tax policy, then tax rates on the rich should be low and flat (flat meaning limited or no deductions). The rich, he argues, will always have resources (i.e., money, lawyers) to mitigate effects of high tax rates with lots of deductions. He adds that high tax rates on the low and middle-income earners will maximize tax receipts because those people do not have the aforementioned resources.

Nov. 06 2008 10:21 AM
J.C. from Minneapolis

I don't understand this obsession against any sort of tax rise whatsoever. So long as the government is funneling money back into the economy, so what? If the economy is so dependent on consumer spending, why can't government become the consumer who's doing the spending? What difference does it make if I spent $1 or if the government spends $1? It's still $1 in the business's cash register.

We've done the anti-tax path for 8 years. The results have not been happy ones. I'm all for paying more federal income tax to have more government spending on things like, say, infrastructure. It'll prime the economic pump. I'm getting real tired of these nightmarish scenarios about taxes that Republicans keep peddling.

Nov. 06 2008 10:19 AM
Sara from UWS

What they don’t mention much yet is that Rahm Israel Emanuel is a staunch supporter of Israel in the likes of Lieberman, which on the face of this decision looks really bad if Obama was to usher in new and fair policy toward the Israel and Palestinian conflict.

Nov. 06 2008 10:19 AM
Phoebe from NJ

The media and pundits seems to be pushing a centrist message now, when the mandate is otherwise. Taxing very high income earners will not disincentivize them, and America will still give opportunity to earn high incomes. Obama's mandate is to help out those who are not high income with healthcare, education, infrastructure etc. Go Obama!

Nov. 06 2008 10:17 AM
Joe Corrao from Brooklyn

no chance...

Nov. 06 2008 10:08 AM

Any chance of a New Deal?

Nov. 06 2008 07:39 AM

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