Post 9/11 is it still the economy stupid?

In 1992, Bill Clinton beat George H. Bush and became the first Democrat to occupy the White House in more than a decade. Bush was a popular president who had just orchestrated a victory in Desert Storm with relatively few American battle casualties. Nevertheless, the economy back home was weakening and he violated his campaign pledge of "no new taxes, read my lips!" Clinton was able to capitalize on this situation with a constant drumbeat about the weak economy and his prescription for the future. After Clinton's election, the country enjoyed an economic expansion related to investments in new technologies that enhanced worker productivity with personal computers and the Internet. Clinton also worked with the Congress to control spending. This was partially achieved through the "peace dividend" after the Cold War was over that allowed for a reduction in defense spending. The net result was budget surplus during the late 1990's that was passed off to the current administration of George W. Bush. The economic future looked bright, in fact so bright, that Bush pushed through enormous tax cuts that mostly favored high income and high net worth individuals.

Then came 9/11 in 2001. It was no doubt one of the darkest days of American History. But the consequences were much more far reaching than the tragedy of almost 3,000 dead Americans and the collapse of the twin towers. In the aftermath, President Bush made a series of decisions that would balloon spending and our national debt. He launched two wars, created a Department of Homeland Security, and set up the TSA employing thousands of new government workers to screen travelers at US airports. To support the wars, he let no bid contracts to companies like Haliburton, Kellog Brown and Root, and Blackwater for billions of dollars. Making matters worse, the war spending was off budget as it continues to be until the present day. The Congress also passed legislation for a costly drug program for seniors, a multi-billion dollar fence on the Mexican border, and increase in the size of the military. Now with another economic downturn they have authorized the Treasury to conduct some of the largest bail outs in history to support failing financial firms and prop up the anemic housing and credit markets. With the value of the dollar falling and a widening trade deficit linked to the skyrocketing price of oil, some expert observers conclude that this is the worst financial situation that the country has faced since the Great Depression.

So now we are at a crossroads with an election that will likely determine the future economic health of the nation for years to come. So once again "it's the economy stupid!" Only this time it is the economy and much more. It's our dependence on foreign oil, rising energy costs, rising health care costs, unsustainable and growing entitlement programs, and a drain of $10 Billion per month to support the War on Terror. These are all monumental problems in their own right, but unfortunately they are all inextricably linked to the economy. Our economy will not return to health unless we can solve this big problems too. That's why the choice we make in selecting the next president will be critical. Voters should be wary of simple solutions and campaign slogans that convey simple fixes. These are complex problems that will require smart people with strong political instincts to resolve them. We will need someone who can rally the American people and force Congressional leaders to do things that they have not shown the courage or willingness to do, even something as simple as extending tax credits for alternative energy while we are paying exorbitant prices for fossil fuels. We must faced the realities and make some hard choices. The next president will simply not be able to offer tax cuts, tighten up on a few earmark programs, and hope for the best. He will need to address these underlying problems while he crafts targeted stimulus and tax relief to support innovation on health care and the search for alternative sources of sustainable energy. We need to extricate ourselves from costly war and change course from a largely ineffective foreign policy.

We can no longer do business as usual and expect a different result. If we fail to make these changes now, the window of opportunity will close. Our debts will continue to grow and the value of the US Dollar will continue to decline. We will not be able to compete in the world economy with the rising economic powers of Europe, Asia and even South America. We will further transfer our wealth to the Middle East and perhaps Russia to support our addiction on oil. It will not be sufficient to simply "drill baby drill" either offshore or in Alaska. So listen carefully to what the candidates are offering and don't be fooled by the simple campaign sound bites.

As we remember the 9/11 tragedy and express our grief for the victims, let's not forget the consequences beyond just the attacks themselves. In 2001 President Bush squandered the chance to work together with the world and inspire our nation to pull together to address these difficult problems. The massive and largely unnecessary military response was equally tragic. What we needed then and what we urgently need now are smart solutions to tough problems. We don't need more tough talk and knee jerk solutions. Now more than ever, we need to put aside party and special interests and put America First.