John F Kennedy Addresses the Current Economic Dilemma

Very little is said these days about the economic opinions and actions of one of the great Democrats, John F Kennedy.  Popular commentary dwells on the fluff of his Camelot days, a term invented by Theodore White in the few days after Kennedy's funeral, and one still hears of the supposed Kennedy plan to withdraw troops from Viet Nam, both post-mortem, since refuted.  From the savvy "Let us continue …" campaign strategy of Lyndon Johnson after the assassination, including the 'Goldwater will use the bomb' spot, to the present day, Democrats use the Kennedy administration as a Golden Age of American democracy.

But with our current catastrophic economic policy, with massive debt getting larger and the only plan being to make it larger still, Kennedy is not the source that Democrats rely on to make their point about larger government being the panacea for all social ills.

Neil Cavuto unearthed the following exchange in an audio segment.  It exists today as an outtake from an NBC News interview with Kennedy on 9 September 1963, just over two months from the day that he would be assassinated, by the iconic Chet Huntley and David Brinkley.  (The relevant portion in the video is between 7:00 and 9:30.)  Compare Kennedy's take on a major across-the-board tax cut, a move opposed by his own party, and compare it to today's eat-the-rich tax policy of Obama:

Brinkley: Mr President, Harry Truman was out for his walk this morning and he said he did not think we should have a tax cut until we get the budget balanced, and the other day Senator Humphrey was saying in the Senate that what the American people think is true is often more important than what actually is true.  What, in view of that, what do you think about cutting taxes while the budget is still in deficit? 

Kennedy: The reason the government is in deficit is because you've got more than 4 million people unemployed, and because for the last 5 years you've had rather sluggish growth, much slower than any other Western country.

I'm in favor of a tax cut because I'm concerned that if we don't get the tax cut that we are going to have an increase in unemployment and that we may move into a period of economic downturn.

            We had a recession in '58, a recession in 1960.  We've done pretty well since then, but we still have over 4 million unemployed.  And I think this tax cut can give the stimulus to our economy over the next 2 or 3 years.  I think it will provide for greater national wealth.  I think it will reduce unemployment.  I think it will strengthen our gold position.  So I think that the proposal we've made is responsible and in the best interests of the country. 

Huntley: The affirmative economic response to Britain's tax cut seemed to be almost immediate.  Would it be as immediate in this country, do you think? 

Kennedy: I think it would be.  Interestingly enough, the British came forward with their tax cut in April, passed it within a month.  They have experienced economic benefits from it.  Unemployment's been substantially reduced.

            They have a larger deficit than we do.  Yet the only criticism was that it wasn't enough.  Every… nearly every economist has supported us.  I think it's in the best economic interests of the country, unless this country just wants to drag along, have 5 or 6 million people unemployed, have profits reduced, have economic prospects… have our budget unbalanced by a much larger proportion.  The largest unbalanced budget in the history of this country was in 1958 because of the recession -- $12.5 billion.

            The fact of the matter is that, of course, government expenditures do go up in every administration, but the country's wealth goes up.  President Eisenhower spent $185 billion more than President Truman.  But the country was much wealthier.  It is much wealthier now than it was in the last year of President Eisenhower's administration.

I think our economic situation can be very good.  I think what we have proposed is a responsible answer to a problem which has been part of our economic life for 5 or 6 years, and that is slack, failure to grow sufficiently, relatively high unemployment.  And if you put that together with the fact that we have to find 35,000 new jobs a week, I think the situation in this country calls for a tax reduction this year.  [pauses in original]

Times have changed from the early 1960s, certainly.  Kennedy cites the public concern with the unemployment rate, which at the time of the interview was at 5.4%, compared to 7.4% now.  If the economy had to grow by 35,000 jobs per week then, it must grow, using the same calculations, by 75,000 jobs now.  A 1963 dollar is worth $7.55 now.  There are more variables to compare, but that will give you a start.