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Author: cocomurph1 Big gold star, 5000 posts Old School Fool Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 1947221  
Subject: THE WIZARD Of The UNITED STATES Date: 3/12/2004 1:59 AM
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For as long as I can remember (from the 1950 election until now ), Presidential Election years have been chock full of statements, promises and analyses ad nauseum about “the economy of President X”.

From interest rates to trade deficits, from the stock market to job creation, from unemployment rates to household debt, GDP, etc. etc., … the experts and media pundits talk forever on the topic….”.it's the President's economy, stupid !”….be it bad or good.

Having read what seems like the 50,000th PA post about the “Bush economy”, or the jobs that Bush “ created or lost”…… and having heard an equal number of such comments on TV,…… and remembering the same phrase having been applied to every President before Bush,…. got me to thinking (Please! No comments about smelling something burning ;-).

When it comes to the economy, The President of the United States is the most over-rated position I can think of.

It IS the President's economy, stupid!….. not because the President is REALLY primarily responsible for it, but because we accept oversimplified answers for a very complex issue.

When it comes to something as large and complex as the US economy ( which is linked ever tighter to the world economy ), do you really think that the President is the prime mover? He can propose laws, but can't pass them. He can appoint judges, but they are there for life and can be unpredictable. The Fed?…..same thought, although not for life.
The “bully pulpit”?…well, maybe sometimes, but “Whip Inflation Now” comes to mind.

So on the one hand we have one man and the bully pulpit and some appointive powers, with a MAXIMUM tenure of 8 years ( but we talk about “his economy” after 3 years).

On the other hand we have Congress who passes all laws and who has powerful members that have served for up to half a century……..Judges who can impact the economy significantly by allowing/disallowing a given law and who serve for life……The Fed?… well most of my investment experience is covered by two words…Volcker and Greenspan….and rates and money supply DO count!

Let's not forget the other” little” macro-economic trends brought about by technological and social changes , some of which take decades to complete……and how about all those other “ Presidents/leaders” in other countries and their impact on the US economy?

I could go on, but I hope you get my point….given the relatively limited tenure and specific economic duties assigned to the President, his REAL impact is highly over-rated versus other longer-tenured and more powerful economic forces…which he can influence, but NOT control.

When it comes to the US economy, The President is like The Wizard of OZ!

He is the “man at the top”…the one we focus on.

He seems to be the one in control.

But if you really” look behind the curtain” of reality, you'll see far greater forces at work, most of whom are beyond his control.


Over-simplification? Maybe.

But you give me control of the Congress over 40 years, and you can have a new President of your choice every 8 years.

I know who will have a more lasting effect on the economy…good and bad…heck, just look at our tax laws as a single powerful example…..Presidents come and go, but the absurd complexity of our tax system is a constant.

OK! End of rant!

Regards to all!

Murph
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