President Obama's self-congratulatory "economic recovery" is way too little, way too late. By historical standards for the American economy, we should be in the second year now of a booming economic recovery. Instead the economy is still struggling to get off the ground, and what is booming instead is prices and inflation.
If you listen to what President Obama is saying in his reelection campaign, which is already underway in his town hall tour across America, the reason for this is clear. President Obama does not understand the basics of economics. What he says repeatedly is that increased government spending is the foundation of economic recovery and growth. But the economic reality is that incentives for increased production are the foundation for recovery and booming growth.
As a result, what we are witnessing is a historical reenactment of the 1970s, if not the 1930s, with the same throwback economic policies that caused the dismal economic downward spiral of those years. But this is not all that President Obama doesn't understand. He also doesn't understand the budget, taxes, business, the energy and oil markets, and even health care.
Consequently, the American people will continue to suffer high unemployment, rising inflation, soaring gas prices, falling real wages and incomes, record poverty, and ultimately worse. That is until this tragically unqualified President who has spent his entire life cloistered in the fever swamps of the far left is replaced by new leadership that will restore the American Dream.
Facebook Fallacies
On April 20, President Obama took his reelection campaign to a town hall at the corporate headquarters of Facebook in Palo Alto. Facebook founder Mark Zuckerberg began with a question on the budget, asking "what specifically do you think we can cut"¦?"
Obama responded by saying first let me explain why the problem is Bush's fault. (Get the transcript if you don't believe me.) This from the President whose own 2012 budget projects that after just one term of office he will have run up more national debt in four years than all prior Presidents combined, from George Washington to George Bush. A President who in that same budget proposed a fourth straight budget deficit of over a trillion dollars, including a record deficit for this year of $1,645 billion, when the highest previously in American history was $458 billion.
If President Obama didn't want those deficits, he could have proposed spending cuts 2 years ago. Instead he enacted an utterly failed, trillion dollar, government spending stimulus package. And despite his misdirection rhetoric, he continues to oppose any serious spending cuts to this day. The real cause of the record deficits and debt is that President Obama increased federal spending by 28% in his first two years alone. And in his 2012 budget he proposed to increase federal spending by another 57% by 2021.
Professor Obama told the Facebook audience that the deficits arose because "we had a massive tax cut that wasn't offset by cuts in spending." But from 2001 when the first round of the Bush tax cuts were adopted until 2007, federal revenues increased by almost 30%. From 2003 when the Bush tax cuts were completed until 2007, federal revenues soared by 44%.
Obama's excuse for his runaway spending is that it was necessary to counter the recession. So he is both blaming Bush for the deficits and taking credit for them in promoting recovery. At the Facebook town hall, Obama further advanced his theory that government spending is the foundation for economic growth and recovery, saying, "If all we're doing is spending cuts and we're not discriminating about it, if we're using a machete rather than a scalpel and we're cutting things that create jobs, then the deficit could actually get worse because we could slip back into a recession."
But it is obvious to everyone but Obama and his hypnotized true believers, party apologists, and bought and paid for special interests that his government spending has failed to produce a timely and robust recovery. That is because President Obama's Keynesian theory that increased government spending and deficits promote economic recovery and growth was proven fully and finally wrong to everyone who was awake over 30 years ago.
President Obama persisted at the Facebook town hall, however, explaining that his spending spree will promote recovery and growth because then "we can still"¦invest in high speed rail" and, "We can still invest in something called ARPA-E, which is like DARPA except just focused on energy, so that we can figure out what are the next breakthrough technologies that can help to reduce our reliance on fossil fuels."
Spoken like a true central planning neo-socialist, for it is not the government's role, nor does the government even have the capability, to figure out what the next breakthrough technology is to reduce our reliance on fossil fuels. America has always enjoyed the world's highest standard of living precisely because we leave decisions like that to the competitive marketplace, not government bureaucrats. And no we are not going to create a booming recovery by wasting still more tens of billions of taxpayer funds on "high speed rail," which is a souped-up version of the mass transit boondoggles that have long proven so adept at wasting taxpayer funds without advancing any economic growth.
President Obama then thoroughly mischaracterized the differences between him and House Budget Committee Chairman Paul Ryan over the budget and taxes. Obama told the Facebook audience, "So what his budget proposal does is not only hold income tax flat, he actually wants to further reduce taxes for the wealthy, further reduce taxes for corporations, not pay for those, and in order to make the numbers work, cut 70 percent of our clean energy budget, cut 25 percent out of our education budget, cut transportation budgets by a third."
There he goes again with his idea that increased government spending on "clean energy" would enhance economic growth. But saddling the economy with high cost, unreliable energy, and burdening it with an entire energy industry that can survive only on corporate welfare, is only going to tank the economy rather than promote recovery and growth.
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Peter Ferrara is Director of Policy for the Carleson Center for Public Policy and a Senior Fellow for the Heartland Institute. He served in the White House Office of Policy Development under President Reagan, and as Associate Deputy Attorney General of the United States under the first President Bush. He is the author of America's Ticking Bankruptcy Bomb: How the Looming Debt Crisis Threatens the American Dream, and How to Turn the Tide Before It Is Too Late, forthcoming from HarperCollins.
I think he does know what he's doing; he's bringing down capitalism and he's doing it on purpose.
Absolutely correct Kitty. Anyone who doesn't acknowledge this is blind or a fool.
Even if everything you write is correct, remember how Bush signed on to it all right before he left office, and though such is now ancient history the candidate you run next year will be yet ANOTHER temporizer; so you are conservatives in that sense- pouring old wine into new wine skins.
... or is it new wine into old wineskins? whichever it is, the woodsman said to the scarecrow lying in shreds on the ground, that's you all over.
Here we goooo.... ole' Brooks.. employing the same old tired worn out Slave Party mantra... it's Bush's Fault. Ignore Nazi Pelosi, Harry-the-war-is-lost-Reid had MAJORITIES in BOTH Houses since JAN. 2007!!!! How bout that Brooks?!? Or do you just simply chose to ignore Das Messiah's debt accumulates to being more than every President before him combined!! Really Brooks... how can you be so obtuse?
While openly acknowledging my obtusest with your comment, please explain how Obama's "debt accumulates to being more than every President before him combined." Given that the accumulated debt prior to Obama was over $10 trillion and the present accumulated debt is about $14 trillion.
President Bush's last budget was hit with the recession and its attendent drop in revenues (esp capital gains). But, it must also be remembered that Bush enacted his own "stimulus" plan, which added $200 billion to his defecit. His final year saw the defecit go from $280 billion (2007) to $450 billion (2008-09). Bush increased the debt from $7 trillion to $9 trillion.
Obama's first budget included $870 billion stimulus, as well as increases in about every department. He also extended unemployment benefits 3 different times. In 2 years the President has borrowed more than Bush did in 8 ($2 trillion for Bush, almost $5 trillion for Obama). If the trend continues, Obama will have matched in 4 years what it took this nation 230 years. By 2013, Obama will have borrowed almost $8 trillion.
Brooks stick to something you know about foreskins, not wine skins.
The massive trade deficits of the Bush years left us in debt to the tune of $1.5 trillion to foreign lenders.
This is the root of the economic fiasco we find ourselves in now.
Time to face the facts.
The trade deficit doesn't mean we're in debt to foreign investors; it simply means they have a claim on some of our assets. Our trade deficit, as long as it's not financed by printing money, is essentially a self-correcting mechanism that reflects the supply and demand of the dollar.
Alan Brooks: "Conservative principles may be the correct way to run the country, but Republican leaders have not been enacting conservative policy." Do I have that right, AB?
"it is obvious to everyone but Obama and his hypnotized true believers, party apologists, and bought and paid for special interests"
Brooks?? Which of above categories describes you most aptly?
"Alan Brooks: 'Conservative principles may be the correct way to run the country, but Republican leaders have not been enacting conservative policy.' Do I have that right, AB?"
What on Earth do conservative principles mean in the year 2011?? since you apparently have an academic background, or at least a good working knowledge of both economic and social conservatism, YOU tell US what is going on. Since January 20th, 2001-- the day Bush was inaugurated-- it has been curiouser and curiouser. Naturally, you can go back to LBJ to realize when it started, however 1/20/'01 was when the mirror-image quality of anti-conservative conservative reality began to intrude. Coincidence? Bush had nothing whatsoever to do with it? ditto his desire to set up a Kennedyesque dynasty? My conscience is clear, I never voted for anyone named Bush, though I did vote GOP in the '80s because Carter was such a squishy illiberal. Obama? I did not vote for him in '08, but will vote for him next year. Because without Reagan the Republican Party is TOAST-- his generation is moribund; the Goldwaters, WFBs, and all the rest, are at that great conservative seminar in the sky.
"Alan Brooks: 'Conservative principles may be the correct way to run the country, but Republican leaders have not been enacting conservative policy.' Do I have that right, AB?"
What on Earth do conservative principles mean in the year 2011?? since you apparently have an academic background, or at least a good working knowledge of both economic and social conservatism, YOU tell US what is going on. Since January 20th, 2001-- the day Bush was inaugurated-- it has been curiouser and curiouser. Naturally, you can go back to LBJ to realize when it started, however 1/20/'01 was when the mirror-image quality of anti-conservative conservative reality began to intrude. Coincidence? Bush had nothing whatsoever to do with it? ditto his desire to set up a Kennedyesque dynasty? My conscience is clear, I never voted for anyone named Bush, though I did vote GOP in the '80s because Carter was such a squishy illiberal. Obama? I did not vote for him in '08, but will vote for him next year. Because without Reagan the Republican Party is TOAST-- his generation is moribund; the Goldwaters, WFBs, and all the rest, are at that great conservative seminar in the sky.
"Obama? I did not vote for him in '08, but will vote for him next year. Because without Reagan the Republican Party is TOAST-- his generation is moribund; the Goldwaters, WFBs, and all the rest, are at that great conservative seminar in the sky."
Well, that logic makes perfect sense!!
(Forgive me, however, if I lost some point you were trying to make)
Bush overspent. Reasonable people can disagree about Iraq/afghanistan. I'm not going to spend much energy defending GWB. But do you even pay attention to the Debt/Deficit data?? If you vote for Obama in 2012 there are 2 possibilites: you wish harm on this nation, or you are ignorant of the facts.
"If you vote for Obama in 2012 there are 2 possibilites: you wish harm on this nation, or you are ignorant of the facts."
Obama being re-elected will if nothing else be a prod to you to elect a better Republican in 2016-- and it is pretty certain you will elect a Republican in '16. You were overconfident with both Bushes; it had something to do with Bush 41 having been Reagan's veep. But by 2016 you will not be overconfident.
Brooks, quit playing games. You try to present yourself as some iconoclast/contrarian who's only goal is to make controversial posts, but in reality your too gutless to tell us what you really stand for.
I stand for nothing, I am a liberal, I unthinkingly go with the flow because it is easier than make decisions. Better to live as muslim slave than to defend america.
I suggest to go back to the spending limits of the last fiscal year our budget was actually balanced (1999-2000). That would leave us with spending at $1.8 trillion.
Honestly, you sound like a three year old. "He did it first. He started it."
For heaven sakes, the blame game is old. We are here at this moment, and there's no going back. What's done is done to be terse.
But this President lives in the la-la land of should be and want to be...not in reality. It's quite apparent that he's in love with himself and his ideas...even if they have failed over and over.
I don't want a king to make the decisions. If one reads the job description of the President according to the Constitution, it's easy to see that Obama (and many before him) have a sense of their own importance and little reality of the balance of powers. Executive orders and signings have made a mockery of Congress, the sovereignty of the states, and the will of the electorate.
If the American people no longer want a republic, then there are steps to change our government by amendment. It is not within the lawful power of the President to appoint himself Dictator or King, even though Obama has been abundantly clear that point really ticks him off.
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