US economic policy

Earlier this week in the Financial Times there was an interesting opinion piece projecting the economic plan of the Bush administration. The author says Bush will pursue privitatization of social security, make permanent the tax cuts, and impose limits on malpractice claims and class-action suits. The goal will not be to strengthen the economy, but to provide benefits to key Republican supporters and to undermine Democrats. He says "the 'Bush II' agenda will not be constrained by bipartisanship, fiscal discipline or even economic reality, because the ultimate motivation is not economic but ideological - to shrink government and weaken Democratic opposition. The three big economic initiatives promised by Mr Bush should therefore be seen for the political thrusts they are." In conclusing, he sees a risk that the US economy suffer an extended decline, like the British economy in the 1960s and 1970s and Japan in the 1990s.

The author is Adam Posen, senior fellow at the Institute for International Economics in Washington DC.

Here's a link to the article.
The economics of a second term
By Adam Posen
Published in FT.com: November 9 2004 02:00 | Last updated: November 9 2004 02:00