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John Fund: Bush Veto Pen Ran Out of Ink

By Rick Pedraza   |   Tuesday, 20 Jan 2009 07:46 PM

Political journalist and Wall Street Journal columnist John Fund tells Newsmax TV he thinks President George Bush did many things well during his two terms in office but fell down partly because of the war in Iraq and for his decision to let Congress take control of the spending levers.

“Giving Congress control over spending without a check from the presidential veto pen is like giving teenagers car keys and a bottle of whiskey, then asking them to behave,” Fund says. “They’re not going to do it.”

[Editor's Note: Watch John Fund on the Bush Legacy - Go Here Now]

Fund also faults Bush for the easy credit policies that were in place during his administration and says the former president did nothing to stop the Federal Reserve from gushing out liquidity.

“That frankly fueled the financial and housing manias we saw,” Fund says, “and now we’re paying the price for those.”

Although Bush did try to regulate Fannie Mae and Freddie Mac during the financial mess the country spiraled into, Fund says, “I think he should have done even more. “

Fund does credit Bush, however, for keeping the homeland safe after the 9/11 attacks during his first year in office.

“For one thing, I was at 9/11 and the World Trade Center when it collapsed,” Fund explains. “My office was across the street. If you had told me the day after 9/11 that we would not have another terrorist attack on our homeland for the next seven and a half years, I would not have believed it. Most Americans would not have believed it.”

The Bush administration not only should take credit for that but also should get credit for the tax cuts that spurred the growth and investment the U.S. experienced from 2003 to 2007, Fund says.

Fund believes newly inaugurated President Barack Obama most likely will keep the Bush tax cuts intact for at least the first two years of his administration because of the nation’s economic strife.

“Obama has already said that raising taxes in the middle of a recession would not be a good idea,” he notes, although Nancy Pelosi, the Democratic speaker of the House, disagrees.

Fund suggests Obama may not capitulate to his liberal base, but rather will take a more pragmatic approach to the nation's problems.

“I think it’s unclear how far Obama wants to go,” Fund says about the socialist agenda some critics think Obama wants to implement. “We’ve already an enormous nationalization of much of our financial sector by the Bush administration. I think Barack Obama has probably figured out that didn’t go very well and that perhaps we need to reevaluate it.”

Fund does, however, believe there will be an enormous increase in spending during Obama’s term in office, especially in infrastructure.

“I’m not in favor of that, but I don’t think that fundamentally changes the very nature of our country. So we have to decide in the next few months whether the Barack Obama we elected is the liberal that he was when he voted in the Illinois State Senate and the United State Senate, or whether he’s going to be more pragmatic in recognizing the secret to his reelection is going to be to present a more moderate image and perhaps not move too quickly.

Fund points to the administrations of former Presidents Jimmy Carter and Bill Clinton, who both started out as Democratic presidents with a Democratic Congress, then let Congress run away with too much of its liberal agenda. He points to how both suffered humiliating mid-term defeats, one in 1978 for Carter and one in 1994 for Clinton.

On Obama’s Cabinet selections and the direction he intends to take the country, Fund believes the president "is not going to be a foreign policy president. He wants things to be, as much as possible, stable abroad. I think he’s going to continue many of the Bush policies while trying to extricate himself from Iraq to satisfy the entire world and his own party.

Fund says keeping Bush Defense Secretary Robert Gates on at the Pentagon will “signal continuity to our allies." In regard to the financial sector, Fund thinks Obama has made reassuring appointments of people who are known and respected in the financial community.

However, Fund does say there will be a very ambitious effort in the energy and environment departments to curb carbon emissions, which he believes is a danger because it can slow down the economy for very dubious and marginal benefits.

“I predict we will see offshore oil drilling in the next couple of years,” Fund says, reasoning that, because Obama will be proposing it, “the environmental community will have to swallow hard and accept it."

[Editor's Note: Watch John Fund on the Bush Legacy - Go Here Now]

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