Rep. Steve King: McCain Was Right When He Said The Fundamentals Of The Economy Are Strong

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"Rep. Steve King: McCain Was Right When He Said The Fundamentals Of The Economy Are Strong"

king.jpgEarlier this month, on the same day that two of Wall Street’s major banking institutions collapsed, Sen. John McCain (R-AZ) told a Florida crowd that he “still” believes “the fundamentals of our economy are strong.” Since then, Congress has worked with the White House to put together bailout legislation for the financial system, but it failed to pass the House yesterday.

Speaking to Rep. Steve King (R-IA) today about his vote against the bailout legislation, right-wing radio host Mike Gallagher argued that the financial situation isn’t “as bad” as people say because “we live in an era of exaggeration.” When Gallagher asked King if he agreed, King said that he did because he thinks “the fundamentals of the economy are sound” like McCain said:

GALLAGHER: But I would maintain that none of this is as bad as the pundits and some of the prognosticators have said it is. Would you agree with that?

KING: Well, I would agree from an economic standpoint. When John McCain said the fundamentals of our economy are sound, really, our unemployment is fairly low.

GALLAGHER: Right.

KING: And that’s one of the indicators. We are, our trade deficit has diminished some, it’s way too much yet it’s diminished some. People out there have jobs, they’re working, the economy’s flowing.

Listen here:

In fact, the fundamentals of the economy, as defined by economic experts, are not strong. Though King claims that “unemployment is fairly low,” the reality is that the unemployment rate is at a five-year high. King also says “people out there have jobs,” but this ignores the fact that the U.S. lost a total of 605,000 jobs in the first eight months of 2008.

As Center for American Progress Senior Fellow Christian Weller notes, America’s “employment growth has been the weakest since the Great Depression.”

Transcript:

GALLAGHER: Congressman, I have a theory too that I want to try, I want to bounce off you for a moment. We live in an era of exaggeration. You know, with the media coverage of different issues and the media hype and the intense way we delve into issues, the truth of the matter is, even with as bleak and as dire as this economic condition is, the sky isn’t falling. The market is going to return. What Paulson is going to have to realize is that the world he’s in now is a lot different than the wheeling and dealing Goldman Sachs world where he made his fortune. But I would maintain that none of this is as bad as the pundits and some of the prognosticators have said it is. Would you agree with that?

KING: Well, I would agree from an economic standpoint. When John McCain said the fundamentals of our economy are sound, really, our unemployment is fairly low.

GALLAGHER: Right.

KING: And that’s one of the indicators. We are, our trade deficit has diminished some, it’s way too much yet it’s diminished some. People out there have jobs, they’re working, the economy’s flowing. This is just simply a crisis of capital that’s brought about by lack of confidence and because of the mark-to-market component of this that requires these lending institutions to mark their balance sheets down if they don’t have a market.

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