Richard J Grant

Published in The Tennessean , Sunday, September 2, 2012 and in FORBES with archives . by Richard J. Grant To summarize the economic performances of American presidents, a well-known economic adviser once remarked, “I like principled conservatives and unprincipled liberals.” This, by way of introducing former president Bill Clinton who, in his recent convention speech, is widely believed to have boosted the reelection chances of President Barack Obama. But Clinton's greatest gift to Obama was placed under the tree almost 20 years ago. Clinton recognized the untapped potential in some Carter-era legislation, the Community Reinvestment Act (CRA), which would give his administration leverage over financial institutions to increase loans to members of key voting blocs despite their relatively poor credit ratings. The subprime market had always existed because the higher risks were balanced by higher fees and interest rates, but the CRA pressured banks to increase loans and to ho

Published in The Tennessean , Sunday, September 2, 2012 and in FORBES with  archive s . by Richard J. Grant From a political perspective, the best time for a new president to take office is either during or immediately after a recession. Given the pattern of political and business interaction over the past century, any new president is likely to inherit the politically induced economic imbalances bequeathed by previous presidents and congresses. Recessions are the painful but necessary corrections of those imbalances, when businesses readjust their production, processes, and workforces to better fit the demand for their products. In this, the Obama administration has two reasons to be thankful for their inheritance. Although Democrats already controlled the Congress in 2008, their opponents’ party held the White House when the recession hit. That eased their way to power and they entered office with the economy in the process of cleaning itself out. All they had to do was t

Published in The Tennessean , Sunday, September 2, 2012 and in FORBES with archives .    by Richard J Grant A politician who leads with compromise is like a prize fighter who leads with his chin. If you're in a real fight, you're not going to last long. Some months ago, “compromise” was one of most popular words in political discourse. But the calls for compromise were suspiciously unidirectional. We were treated to portrayals of President Ronald Reagan as “the great compromiser” who, despite his professed intention to reduce marginal tax rates, actually “raised taxes 11 times.” Clearly this was a call to conservatives and Republicans, in the name of a man for whom they had great respect, to follow his example and compromise with those who wish to raise tax rates, perhaps in return for spending cuts, in order to reduce the budget deficit. But should Reagan be remembered as a great compromiser? It is unlikely that the striking air traffic controllers or the Soviets woul