"You've heard of mental depression; this is a mental recession," Gramm said, noting that growth has held up at about 1 percent despite all the publicity over losing jobs to India, China, illegal immigration, housing and credit problems and record oil prices. "We may have a recession; we haven't had one yet."
"We have sort of become a nation of whiners," he said. "You just hear this constant whining, complaining about a loss of competitiveness, America in decline" despite a major export boom that is the primary reason that growth continues in the economy, he said.
"We've never been more dominant; we've never had more natural advantages than we have today," he said. "We have benefited greatly" from the globalization of the economy in the last 30 years.
Mr. Gramm said the constant drubbing of the media on the economy's problems is one reason people have lost confidence. Various surveys show that consumer confidence has fallen precipitously this year to the lowest levels in two to three decades, with most analysts attributing that to record high gasoline prices over $4 a gallon and big drops in the value of homes, which are consumers' biggest assets.
"Misery sells newspapers," Mr. Gramm said. "Thank God the economy is not as bad as you read in the newspaper every day."
Phil Gramm is more than a little out of touch with reality, and Obama Blasted McCain for it.
"Today, one of [McCain's] top economic advisors, former Sen. Phil Gramm, said that we're merely in a 'mental recession,'" Obama told a crowd of about 2,800 today at a town hall meeting in Fairfax, Va.McCain Attempts Damage Control
"He didn't say this but I guess what he meant was that it's a figment of your imagination, these high gas prices. Sen. Gramm then deemed the United States, and I quote, 'a nation of whiners.' Ho! A nation of whiners. This comes after Sen. McCain recently admitted that his energy proposals for the gas tax holiday and the drilling will have mainly, quote, 'psychological benefits,'" Obama said.
Gramm showed lack of judgment making those statements even if he is dumb enough to believe what he said. McCain is attempting to control the damage.
McCain strongly disavowed the comments saying Phil Gramm "does not speak for me — I speak for me." "So I strongly disagree," McCain told reporters gathered for a press conference.Phil Graham handed Obama a nice present today. McCain now needs a new economic advisor. But the key point is that in attempting to control the damage, McCain was forced to admit Bush-E-Nomics is a failure.
Democrats immediately condemned the remarks as “callous” and quickly began working to divert widespread attention to them.
Obama campaign spokesman Bill Burton shot back: "[T]he American people know that our economic problems aren’t just in their heads. They don’t need psychological relief, they need real relief. And that’s what Barack Obama will provide as president."
The Democratic National Committee issued a statement titled, “Out of Touch Much, Phil.”
A McCain official said: “Phil Gramm’s comments are not representative of John McCain’s views. John McCain travels the country every day talking to Americans who are hurting, feeling pain at the pump and worrying about how they’ll pay their mortgage. That’s why he has a realistic plan to deliver immediate relief at the gas pump, grow our economy and put Americans back to work.”
Karen Finney, the Democratic National Committee’s communications director, said: “What John McCain, George Bush, Phil Gramm just don't understand is that the American people aren't whining about the state of the economy; they are suffering under the weight of it — the weight of eight years of Bush-enomics that John McCain and Phil Gramm have vowed to continue.
“How dare john McCain and his advisers so callously dismiss the challenges the American people face? No wonder voters feel John McCain is out of touch. He and his campaign don't even understand the everyday issues Americans are dealing with.”
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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