RIP to a Statesman Who Told the Truth

Lloyd Bentsen died today. Of course, he's remembered as Michael Dukakis' vice-presidential running mate, but he was also President Clinton's Treasury Secretary who helped right the economic ship in the 1990s and move us toward historic surpluses. This is his legacy.

People of course remember his takedown of Dan Quayle in the 1988 VP debate, the famous "You're no Jack Kennedy." It's a great line (and I'm amazed how many people in the audience CHEERED at it... what a different world. You can't cheer in debates now. God forbid an audience shows they've been paying attention). But Night Owl at Kos looks at another quote from that evening:

BROKAW: Senator Bentsen, you were a businessman before you entered the U.S. Senate. Let me offer you an inventory if I may: Lower interest rates, lower unemployment, lower inflation and an arms control deal with the Soviet Union. Now two guys come through your door at your business and say, "We'd like you to change," without offering a lot of specifics. Why would you accept their deal?
BENTSEN: You know, if you let me write $200 billion worth of hot checks every year, I could give you an illusion of prosperity, too. (Laughter and applause) This is an administration that has more than doubled the national debt, and they've done that in less than eight years. They have taken this country from the No. 1 lender nation in the world to the No. 1 debtor nation in the world. And the interest on that debt next year, on this Reagan-Bush debt of our nation, is going to be $640 for every man, woman, and child in America because of this kind of a credit-card mentality. So we go out and we try to sell our securities every week, and hope that the foreigners will buy them. And they do buy them. But every time they do, we lose some of our economic independence for the future. Now they've turned around and they've bought 10 percent of the manufacturing base of this country. They bought 20 percent of the banks. They own 46 percent of the commercial real estate in Los Angeles. They are buying America on the cheap. Now, when we have other countries that can't manage their economy down in Central and South America, we send down the American ambassador, we send down the International Monetary Fund, and we tell them what they can buy and what they can sell and how to run their economies. The ultimate irony would be to have that happen to us, because foreigners finally quit buying our securities.

Bentsen got across in one paragraph (actually, in one line) what the Democrats have been trying to articulate for five years: that borrow and spend is the worst of all possible worlds. And none of this has changed: in fact under Bush II the deficit has skyrocketed, we've still sold America on the cheap to the highest bidder, and we're still in peril of foreigners who stop buying our securities.

Of course people are resistant to this talk: look at the culture we have in America. It's all "you can have your cake and eat it too." Republicans have a worldview that anything is possible and reality is just a bunch of "haters." That kind of fantasyland has a strong pull... until the crash comes. We're seeing in many ways a slow-motion recession, where conditions are analogous to the stock market crash of 1987.

A report by Barclays Capital says the run-up to the 1987 crash was characterised by a widening US current-account deficit, weak dollar, fears of rising inflation, a fading boom in American house prices, and the appointment of a new chairman of the Federal Reserve Board.

All have been happening in recent months, with market nerves on edge last week over fears of higher inflation and a tumbling dollar, and the perception of mixed messages on interest rates from Ben Bernanke, the new Fed chairman.

Bentsen was a great example of how you can tell the truth in politics, and we have a lot to learn from him.