Check out Chap Petersen's report from today's Warner-Gilmore debate in Tysons Corner.
First, the ongoing Wall Street meltdown plays to Mark Warner's strengths. He knows business. He knows the capital markets. He is well-acquainted with the uses and abuses of the U.S. banking system. Warner set the pace on these issues and Gilmore was mainly copying his answers.[...]
Four, Gilmore tirelessly tried to state that Mark Warner and Barack Obama would raise taxes. But he never acknowledged that his fiscal policies would lead to greater deficits and U.S. dependency on foreign credit -- the exact policy that has caused our financial woes. This cycle of madness has to stop!
I agree, Chap, this "cycle of madness" DOES have to stop. And that includes the "madness" of electing people who drive your state into the ditch. Personally, I tend to prefer people who figure out how to get us OUT of the ditch. :)
Gilmore Fails to Provide Leadership or Answers on Economic CrisisGOP Senate Candidate Flubs Question on Wall Street Meltdown
FAIRFAX - U.S. Senate candidate Jim Gilmore repeated more of the same desperate partisan attacks during Thursday's debate with Mark Warner before the Fairfax County Chamber of Commerce, and demonstrated a fundamental lack of understanding and inability to grasp the economic problems facing Americans.Gilmore repeatedly blamed the current meltdown in the financial services industry on rising oil costs, even though it has been widely attributed to problems that first became apparent last fall with certain practices of the mortgage lending industry. When pressed for specifics on how to resolve the current financial challenges facing this country, Gilmore stumbled and failed to articulate a coherent fiscal plan.
"And then when you have companies that operate business plans that put too much leverage in place, which means too much borrowing, there has to be some reporting that shows that companies should not be in a position to do that," Gilmore said. "They have to be in a position to report and reporting makes people do the right things."
Gilmore largely ignored the role of reckless subprime lenders, and never acknowledged that he continues to serve as chairman of Everquest Financial Ltd., a subsidiary set up by discredited executives of Bear Stearns to offload what the New York Times called "toxic" subprime mortgage loans. An Everquest IPO was described by TIME Magazine as the "second worst business deal" of 2007. Gilmore's latest financial disclosure forms reveal he has been paid almost $400,000 for his continuing leadership role with Everquest Financial Ltd.
Jared Leopold, Communications Director for the Democratic Party of Virginia's Coordinated Campaign, said the debate showed a dramatic contrast in the two candidates' knowledge and understanding of current market conditions.
"Today's debate highlighted the critical differences between these candidates," Leopold said. "Mark Warner presented a solid record of strong fiscal management, while Jim Gilmore spent his time trying to cover up for his record of fiscal mismanagement. In these difficult economic times, we need honest and responsible fiscal leadership. That's why Democrats, Independents and Republicans are lining up behind Mark Warner's Senate campaign."
In response to Gilmore's answers, the Democratic Party of Virginia released a video Thursday called "Running Well?" which highlights Gilmore's defense of George Bush's failed economic policies. The video is available at: www.youtube.com/watch?v=m4KnLBBXy5I
Also during today's debate, Gilmore repeatedly attempted to deflect and deny responsibility for the fiscal mess that he left behind when he left office in 2002. In his last year as Governor, Gilmore told Virginia residents and lawmakers that the state faced a revenue shortfall of approximately $800 million. His wildly inaccurate revenue forecasts and budget gimmicks hid a shortfall that actually topped $3.8 billion.
"We need a Senator who understands how to balance a budget and put our economy back on track in a fiscally responsible manner," Leopold said. "Jim Gilmore failed the economic test today, just like he failed in his management of state budgets as Governor."
###The full transcript of Gilmore's economic answer is below.
GAIL PENNYBACKER: With that said, Mr. Gilmore, can you give us some specifics, some details about how you're going to stop the landslide that's happening in the economy with, as Mr. Warner called it, the crisis on Wall Street, the great crisis in our economy. What are your ideas?
GILMORE: Those are the specifics. We have to do something right now to put proper regulations in place. We have to have a proper authority in place that is designated that understands it has a responsibility to do this kind of oversight. And then when you have companies that operate business plans that put too much leverage in place, which means too much borrowing, there has to be some reporting that shows that companies should not be in a position to do that. They have to be in a position to report and reporting makes people do the right things. Second of all, we ought to have lending practices that are ethical. You can't bring people in in order just to make commissions and lead them to think that they're going to be in a position--if they get into financial trouble the community, that they're going to be able to make these kind of payments. With arms, with nothing down, with no proof of what income's going to be, a hope and a prayer and a dream. And the policy has been to put people into housing, but government's policy has been, but that's led people to put things into a place where they shouldn't be. And finally, and most important is this, we have to have a policy that stands up for regular people out there. These are the people who are in trouble right now. The ones right now whose jobs are in jeopardy, the ones who are out there who go to work every week, putting $100 a tank of gas in their cars and they tell me sometimes they're working second jobs just so they can get to their jobs and pay gasoline prices. This is why we have to have a forward-looking energy plan, one that is comprehensive, complete, and maintains all the options open to us including renewable resources, including opportunities to do things with conservation, but we've got to be a in a position to drill for oil and that's another place that Barack Obama and Mark Warner won't go and I will.
Nor are foreign creditors necessarily bad. When you are running a deficit, foreign credit saves you from a lot worse trouble. Treasuries being the gold standard of safety backed by the full faith and credit of the USG is valuable asset. The U.S. has a near zero savings rate, thus to pay for our deficit we have to rely on foreigners to buy USG debt. If there wasn't a steady line of foreigners standing by to buy our debt (high demand), we'd have to offer our debt at a higher interest rate, thus increasing our cost of borrowing (more of our budget would go to paying interest on our debt, not on other options such as defense or domestic spending). Being a place where folks want to invest in is not a bad thing. Being a place were folks don't want to invest is the worst, just look at the housing market right now - all sellers and no buyers hurts the seller. We're sellers of debt so we need buyers on the other end of the transaction or else we get hurt.