Weeks Before 2008 Crash, Herman Cain Said the Economy Was Surging

Oct 09 2011 Published by under Uncategorized

2008: The "recession" is imaginary!

 

Herman Cain (or “Herb”/”Herm” as Sarah Palin calls him) is running for President based on the notion that as the owner of Godfather’s Pizza chains he knows how to make the economy work again.

However, Mr Cain said the economy was in fine shape on September 1, 2008, just weeks before the bottom fell out in the Stock Market Crash of 2008. Mr Cain wrote an article ironically titled “Economic Growth Surges, but Democrats Ignore the Truth Again.” Yes, this is the man the Republicans see as a fiscal savior.

While the Democrats had their week of unchallenged propaganda about their party – how perfect it is and how terrible the Republicans are – the latest good news about the economy and the average adjusted gross income went unnoticed….

As a reminder, we still have not had a recession since 2001, using the standard definition of a recession as two consecutive quarters of negative GDP growth. But don’t tell the Democrats and the mainstream media. You might disrupt their imaginary recession….

Rhetorical exaggerations, hyperbole and platitudes are expected as part of national political party show-and-tell time, but the public deserves that they at least tell the truth…..

The supposed failure of Bush’s economic policies has been a constant theme of the Democrats since the 2006 elections, when the Democrats regained control of the House and Senate by convincing enough of the voters that the economic sky was falling, and that the war in Iraq could not be won. Based on all of their convention speeches, they plan to continue those themes right through Election Day on November 4.

Ah. Yes. The Great “Imaginary Recession” that Republicans were selling right up until doomsday, right before they held us up for all of our money to save the very institutions their policy of deregulation (along with willing Democrats) allowed to be “too big to fail”.  Well, there you go. Herman Cain, the Godfather of Economics, telling us all that everything was rosy in 2008 and not to worry. In fact, he closed with a confident, “Sen. Joe Biden declared in his vice-presidential acceptance speech that “John McCain thinks that during the Bush years we’ve made great progress economically, I think it’s been abysmal!” Great progress or abysmal, you make the call. ”

Indeed we will, Herb. As writer Tom Woods points out, the following happened weeks after Cain made this challenge:

– Fannie Mae and Freddie Mac were taken over by the U.S. government (Sept. 7);
– Merrill Lynch was sold to Bank of America;
– Lehman Brothers declared bankruptcy;
– The Fed bailed out AIG;
– Washington Mutual was sold to JP MorganChase;
– Treasury Secretary Paulson said the economy was so bad that $700 billion must be spent on bailouts immediately; otherwise, warned Ben Bernanke, “we may not have an economy on Monday.”

Yesterday, October 8th, a young man approached Cain at a book signing to ask him to explain his comments that all was rosy in 2008.

  uploaded this video:

He wrote: “Went to a book signing and asked Cain a question: “You were the federal reserve chairman in Kansas City and up until one week before the housing bubble collapse in ’08 you were calling the economy great, the housing bubble ‘a fairy tale’ and mocking those warning of the housing bubble as ignorant, gullible and uninformed.”  At that point security grabbed me and dragged me away while I was asking , “How will you be any different as president?”

Ah, now, easy there fella, you know Republicans don’t trust cameras or people with questions. They’re used to Fox News where no one ever asks them anything remotely challenging, so it’s borderline cruel to confront Cain on his own words. Words that paint him out to be as clueless as John McCain, George W. Bush, and dare I say it, Sarah Palin (hey, it’s not my fault they ran her as Vice President) when it comes to economics.

How are we feeling now about Herman’s “9 9 9″ solution to our economic woes? Cain suggested a specific tax reform he called 9 9 9. (Republicans love slogans.) According to Politfact, “The plan would eliminate the current tax system all together, replacing it with a 9 percent personal income tax, a 9 percent corporate income tax and a 9 percent national sales tax….Cain, in his Wall Street Journal opinion piece, said the plan was designed to be revenue-neutral initially but that revenues would increase as the economy grows. “These measures would free up capital, spur production, and incentivize risk-taking, thereby fueling the economy and creating jobs.”

Revenue neutral? Remind me again how revenue neutral works in a real business. And that’s assuming the Government is supposed to run like a business, which in point of fact, it is not. It is specifically designed to handle matters that were thought best left out of the private sector. But let’s just play the Republican game that Government should be run like a business.

I’d love for Herman Cain to explain to me how he ran Godfather’s Pizza with “neutral revenues.” Seriously. Because in business accounting, you want to generate revenue, in fact you must in order to stay afloat. How does running the country like a business fit in with how a real business should be run — Do Republicans starve their businesses of revenue and just pray that they don’t go under?

Maybe that explains the entire 2008 Republican denial of a recession and their relentless, heartless mocking of anyone who dared to suggest that in fact, the economy was not “surging” and nor was the housing bubble a “fairy tale.”

People who are this good at denial are not doing reality, and that’s not acceptable for a President. Herman Cain’s idea of an economic “surge” is right up there with Republicans crowing about the Sarah Palin “bump”. We all know how both of those predictions of wild success turned out. Since Cain didn’t believe that we had a housing bubble or a recession in 2008 right up until the days before the collapse, you have to ask yourself, what other fairy tales does he have in store for us?

 

h/t Tom Woods (a Ron Paul supporter who makes sense)

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