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Tags: Obamacare | regulations | Republican | Democrat

USA Today: Don't Blame Overregulation for Sluggish Economy

By    |   Friday, 26 July 2013 08:10 AM

While Republicans like to criticize government regulations, such as the new banking rules and Obamacare, record corporate profits and an ever-rising stock market shoots down that argument, says the USA Today editorial board.

In fact, U.S.-based corporations earned $1.8 trillion after taxes last year, a record amount in terms of dollars and as a percentage of the economy.

In short, blaming overregulation is "a lot of bull," the editorial states.

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Regulation critics are more concerned about corporations than the plight of workers, the newspaper charges.

Real reasons for the slow recovery include poor economies overseas; increasing productivity, which lets companies hire few workers; and consumers paying down debts instead of spending more.

Another reason is shrinking government spending. The federal government is cutting spending because of the 2011 and 2013 budget deals and automatic, across-the-board cuts of sequester.

In addition, since December 2009, 629,000 government jobs have been cut, mostly at the state and local level.

Without government spending cuts, the unemployment rate would have fallen to 6.5 percent. Instead, it's at 7.6 percent.

Republicans must abandon their threats of government shutdowns and defaults, the newspaper says, while Democrats should recognize that the government cannot continue spending recklessly. And both sides should compromise on taxes, spending and entitlements.

Chances for such a grand bargain seem low. President Obama is rehashing populist campaign themes, while Republicans seem bent on destructive cuts.

"If the White House and Congress can't agree on ways to help nurse the economy back to health," the paper says, "they should at least follow the medical oath and, first, do no harm."

Other commentators have pointed out that large banks had huge record profits even though they have been complaining for over a year about new regulations from the Dodd-Frank Act.

For instance, Goldman Sachs reported earnings of $1.86 billion for the second quarter, a 100 percent increase over a year ago.

"It's part of a glaring long-term trend since the crisis," writes Mark Gongloff at The Huffington Post. "Banks have been repeatedly smashing profit records — despite a sluggish economy, sluggish deal making, lower risk-taking and an onslaught of new rules that they complain about endlessly."

Robbed: Secret ‘Financial War’ Will Wipe Out Your Wealth, Warns Pentagon Adviser

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FinanceNews
While Republicans like to criticize government regulations, such as the new banking rules and Obamacare, record corporate profits and an ever-rising stock market shoots down that argument, says the USA Today editorial board.
Obamacare,regulations,Republican,Democrat
382
2013-10-26
Friday, 26 July 2013 08:10 AM
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