In the 1980s, when Ronald Reagan was President of the United States, I graduated from college with an economics major, got a job with a big company, got married, left my job, and became a young mom.
We bought our first house before the real estate boom, then sold it and built a bigger one during the boom.
Ronald Reagan famously cut taxes, but at the same time, he was unable to get Congress to restrain spending. He insisted on increased spending for defense, which was very good for BIW, and Maine. To get that, he had to sign budgets with lots of pork added by Democrats. The deficit ballooned.
By the time we were getting ready to close on our new home, interest rates had climbed high enough to cool off the real estate boom. The lot we bought was originally under contract by another buyer, but they dropped out when they couldn't get an interest rate below 10. Yes 10.
Fortunately for us, we were selling two properties at the time and had a really big down payment. We had to borrow only a third of the value of the real estate, and we were able to get an interest rate of 8.25%, yielding affordable monthly payments.
To this day, I associate the combination of tax cuts and spending hikes with spiraling interest rates. At this point in my life, I am a saver, not a borrower, so high interest rates might help my personal finances. But for the vast majority of Americans, that is not the case.
This article by Robert Tracinski speaks to my unease over what's happening with the federal budget.
I can only hope that McConnell, Ryan and company have a wicked smart strategy for using their majority to pass some legislation to undo some of the harm that's being done.
Now, like Sisyphus, just as they were about to reach their goal, Republicans have let it slip out of their hands and roll back to the default state of bipartisan support for Big Government.
Tracinski also criticizes the Republicans who are promoting or embracing the idea of a new paid family leave benefit, to be funded through the Social Security system. He's right: this is Big Government all over again. Even if it were true that people taking the leave would be just using their own money (it isn't true: every cent workers and employers pay in to SS is immediately transferred to current retirees), no one mentions the burden on employers who may have to hire someone to do the work not being done by the worker on leave. If they want to do that, yippee, let them. If they can't afford to do it, they shouldn't be forced to.