Response to Mr. Sherman's Letter

I'd like to take the time to rebut a letter that was received from Mr. Sherman about a previous column of mine. First, stating that Mr. Reagan's administration could not affect our current economy, but later stating that he was responsible for the downward trends we experienced after his administration is somewhat hypocritical. A good trend or a bad trend can begin years prior to the actual results being seen. Any study of the economy will show that there are long-term effects with the economy that can go back decades in time. You, in fact, make your entire argument based off the idea that decreasing the deficit will be good in the long run. If we were to do this now, during the Bush administration, the effects of that decision might not be seen until he is out of office. Who deserves the credit then for those decisions? It would fall upon Mr. Bush if that were the case, not the president at that time.

You also blatantly misstate something in your argument. I quote, "But to credit Reagan for a robust economy ten years after he left office…" There is a fundamental flaw with your argument. The ten-year figure places the booming economy starting at 1998, yet the upward trends began in 1991. This would change the figure from ten years after he left office to a mere three years. Even if I were to move the date to 1993 where you seem to place the upward trend starting at it would still be a mere five years. The ten-year figure is completely inaccurate.

Lastly, your argument that Reagan's economy couldn't have possibly succeeded because of the debt we accumulated is flawed because the debt was never, nor ever will be, the sole or major indicator of such a thing. There are numerous factors involved. In addition, pinning the entire economic success of the 90s on a single event as you seemingly did was ridiculous. For example, success of the tech sectors may possibly have been the major reason for the success we enjoyed and it had nothing to do with the government.

I also have to disagree with your belief that we should nix the tax cut in favor of paying off the debt. First of all, paying off the debt will not help alleviate the current problem in the least. Actually, it will end up making the situation far worse, as paying off the debt in the last few years has led to a massive increase in the amount of private debt. Also, much of the debt is held within the bonds many people own, which will be taxed when paid off. At a time like this, taking more money out of the economy is going to have disastrous effects.

Paying off the debt is something we should do when we have a stable economy. At this time, we simply don't. So, while I would agree with you under different circumstances, the current dilemma will be more helped by a tax cut. Both measures are good in the long run, however we should use each one properly, and at the moment the tax cut is the more proper remedy.