The Onus of Promoting an "Ownership Society," and Business Week Predictions

As I was going through my old collection of business magazines, I came across the following articles from Business Week:

A Prescription For Health-Care Reform (9/20/2004). Glenn Hubbard wrote that "An "Ownership Society" agenda has taken center stage in President George W. Bush's agenda for a second term, with proposals for Personal Accounts in Social Security, expanded incentives to save for retirement, and Personal Reemployment Accounts to aid workers in finding a new job. But a central plank of this agenda, and one that can be enhanced to improve markets for health care, is already law: the Health Savings Accounts (HSAs) passed in the recent Medicare reform." Nearly four years later, none of the three proposals put forth by Dr. Hubbard have seen the light of the day; in fact they have been dead for a while. It is rather scary to think of the consequences if people had put their "Personal Accounts" funds into the equity market as it was reaching a top, only to see the sharp downturn due to the credit crisis.

The September 20, 2004 Business Week issue had an article on tax code titled "What A "Fairer" Tax Code Might Look Like: A reelected Bush may rework the existing system -- or try for a consumption tax. " It says that "President George W. Bush has the tax code back in his sights -- but this time he's not just talking about tax cuts. In his Sept. 2 speech to the Republican National Convention and on the stump since, he has called for making the tax system "fairer, simpler, and more pro-growth" than the current 'complicated mess.' "
Another rosy forecast for a second Bush term. This forecast proved to be very taxing.

America's Stark Fiscal Choice. Another article in the same issue says that "While President Bush's soaring campaign rhetoric promises Americans that they can have it all -- new and expanded tax credits for private health, savings, and retirement accounts plus big permanent tax cuts -- the reality is beginning to bite. The cost of these ambitious plans, on top of committed expenditures for the new Medicare drug benefit, the war in Iraq, homeland security, agriculture, energy, highways, education, and more, will add trillions of dollars to a federal budget deficit already spinning out of control. Responsible Republicans are beginning to say that Bush must make a choice between his radical plan to change Social Security, health care, and savings programs and making his first-term tax cuts permanent. The wise choice would be to go with entitlement reform. America is facing a severe crisis as its health-care system cracks and the baby boomers approach retirement. "

The "business" publications like BW and WSJ painted such a rosy forecast of the Bush second term- however the results speak for themselves. Perhaps the greatest disaster Bush's eight years have wreaked is the creation and destruction of hopes and dreams in millions of people, both in the U.S. and abroad- especially that of home ownership. Prudent progress towards it was derailed by the financial innovators, the Fed, and the Government.