The presidential candidates are avoiding key economic issues that will have the most important long-term effects while arguing over the Bush administration’s policy in Iraq, two speakers said at an Arizona State University forum Tuesday on the upcoming election’s implications for the economy.
L. William Seidman, former dean of the business school at ASU, said the candidates are not clearly stating the importance of defending America’s oil interests in the Middle East. Robert E. Mittelstaedt Jr., the current business school dean, said they need to talk more about long-term economic problems such as Social Security, health care costs, energy costs and the national debt.
But Jason Furman, director of economic policy for the John Kerry campaign, said the Democratic Party’s candidate has developed strategies to deal with the major economic woes facing the country including the budget deficit, shortage of investment and high health care costs.
The three spoke at a meeting of the Economic Club of Phoenix, a part of the W.P. Carey School of Business, one day before the final presidential debate at ASU’s Gammage Auditorium.
While the two political parties have been debating U.S. policy in the Middle East, almost none of the talk has focused on the importance of maintaining the nation’s oil lifeline to that region, Seidman said.
Seidman, a commentator for the CNBC-TV cable network, said one of the major reasons the Bush administration went into Iraq was because of concerns that Saudi Arabia’s vast oil wealth could fall into the hands of Saddam Hussein. But administration officials refuse to use that as a justification because they believe voters would react negatively, he said.
"I think that underrates people," he said. "People understand what oil means. . . . We’re at the mercy of Middle Eastern oil."
Seidman said the U.S. economy would "go out of business" within months if Osama bin Laden or another Western enemy seized control of Saudi Arabia.
"We’re talking about our existence," he said.
While the political debate centers on the Middle East, Mittelstaedt said the U.S. is in danger of European-style economic stagnation because the government is not dealing with problems at home such as deficits and high costs for energy and health care.
"High debt, retirement obligations we can’t meet, increasing entitlements, health care costs out of control . . . You know what that equals if this goes on? Germany," he said, referring to Europe’s largest economy, which has experienced notoriously slow growth.
Furman said Kerry hopes to energize the U.S. economy by reducing the federal budget deficit and providing tax incentives for businesses to invest in the U.S. instead of overseas. He also said Kerry would reduce health care costs by having the federal government cover catastrophic medical bills, allowing reimportation of cheaper prescription drugs from Canada and malpractice reform.
No speakers at the forum directly represented the Bush camp, but Seidman, a longtime adviser to past GOP presidents, questioned if Kerry’s tax-the-rich strategy to raise more revenue would work.
"It’s hard to believe that we can cure the country by taxing only people who make over $200,000 a year," he said.