The American Spectator : Playing You to the Bitter End

Text Size

Playing You to the Bitter End

By Peter Ferrara on 10.27.10 @ 6:08AM

And before he’s finished he’ll have Bernanke resume Carter-era inflation.

In July 1953, after President Eisenhower had been in office for just six months, the U.S. economy tumbled into recession. He didn’t barnstorm around the country talking about how President Truman had driven the economy into a ditch, and how it was such a struggle to get the economy out of the ditch. Somehow, by May 1954, just 10 months later, the economy was back in recovery mode, before Barack Obama was even born.

In April 1960, the American economy tumbled into recession again. There was no trillion dollar stimulus package producing record shattering deficits and national debt. Yet, somehow, in February 1961, just 10 months later, the economy was back in recovery mode, again before Barack Obama was even born. Spurred by the across the board Kennedy tax rate cuts, the economy boomed for a then record 106 months.

In December 1969, the U.S. economy cycled into recession once again, in President Nixon’s first year in office. Somehow, by November, 1970, just 11 months later, the economy was in recovery once again, even though Barack Obama was only 9 years old.

In November 1973, the worst recession of the entire postwar era up until then began. It took 16 months for the economy to recover, starting in March 1975. Over the next four quarters, the economy came roaring back, with real economic growth of 6.2%. For 1976, the unemployment rate was 7.7%.

“The Failed Economic Policies of the Past”

In July 1981, after President Reagan had been in office just six months, the economy fell into arguably a worse recession than in 1973-75. Yet President Reagan continued to back the strong dollar monetary policies of the Federal Reserve that slew the roaring inflation of the 1970s, caused by the same monetary policy strategy that current Fed Chairman Ben Bernanke just announced last week.

In just two years, over 1979 to 1980, prices had risen by 25%. The strict monetary policy Reagan supported cut the annual inflation rate in half by 1982, and in half again by 1983, to just 3.2%. Inflation has not been heard from since.

Reagan did not adopt a trillion dollar Keynesian stimulus spending package either. In his first year, he adopted instead the much vilified Reagan budget cuts that reduced federal spending by close to 5%. Barack Obama was in college at the time, palling around with Marxist Professors as he tells us in his autobiographies, no doubt joining in the condemnation of those budget cuts.

Moreover, instead of raising tax rates as President Obama is doing, Reagan cut tax rates sharply. Instead of enacting sweeping, costly, new regulatory burdens as President Obama is doing, Reagan dramatically slashed regulatory costs on the economy.

By November 1982, despite the continued, contractionary, monetary policies that eliminated the historic inflation, the economy recovered, after 16 months of recession. In the first four quarters of recovery, the economy roared back with 7.7% real growth. After that 16 month recession, unemployment fell every year for the rest of Reagan’s term, reaching 5.3% by 1989.

The economy continued to grow without interruption for a then peacetime record 92 months, shattering the previous peacetime record of 58 months by nearly three years. During this nearly eight-year recovery, the economy grew by almost one-third, the equivalent of adding the entire economy of West Germany, the third largest in the world at the time, to the U.S. economy. In 1984 alone, real economic growth boomed by 6.8%, the highest in 50 years. Nearly 20 million new jobs were created during the boom, increasing U.S. civilian employment by 20%.

In July 1990, the economy finally fell into recession again, probably because of the Bush/Democrat, tax-raising budget deal. Yet, even without a trillion dollar stimulus package, and even though Barack Obama was still just teaching Saul Alinsky classes for ACORN, the economy recovered only eight months later in March 1991. The unemployment rate in 1991 was 6.8%.

The stock market boomed again starting on Election Day, 1994, with a Republican Congress taking power for the first time in 40 years. The economy continued to grow without recession for 10 full years, until March 2001, just two months after President Bush II took office. Bush did not barnstorm the country telling voters that President Clinton had driven the economy into a ditch, nor did he adopt a trillion dollar stimulus spending package. Instead, he led enactment of the Bush tax cuts, what President Obama calls the failed policies of the past, and the recession ended in eight months, by November 2001, despite the detrimental economic effects of 9/11.

Despite Bush’s “failed economic policies of the past,” the economy continued to grow for another 73 months. After the rate cuts were all fully implemented in 2003, the economy created 7.8 million new jobs and the unemployment rate fell from over 6% to 4.4%. In response to the rate cuts, business investment spending, which had declined for nine straight quarters, reversed and increased 6.7% per quarter. That is where the jobs came from. Manufacturing output soared to its highest level in 20 years. The stock market revived, creating almost $7 trillion in new shareholder wealth. From 2003 to 2007, the S&P 500 almost doubled.

The End of Prosperity

Page: 1 2 >

About the Author

Peter Ferrara is Director of Entitlement and Budget Policy at the Heartland Institute, General Counsel of the American Civil Rights Union, Senior Fellow at the National Center for Policy Analysis, and Senior Policy Advisor on Entitlements and Budget Policy at the National Tax Limitation Foundation. He served in the White House Office of Policy Development under President Reagan, and as Associate Deputy Attorney General of the United States under President George H.W. Bush.

Letter to the Editor View all comments (87) | Leave a comment Leave a comment

Bill Hussein O'Stalin| 10.27.10 @ 6:41AM

In an amazing twist of fate, Obama's racist anti-American spiritual leader may have defined the end game, "The chickens are coming home to roost."

The forces put into effect by the Obama financial team, some of who were hatched during the Bush administration, will only serve to further hasten the downward spiral of the economy.

In effect, the Obama administration has no desire to save the economy, only put on a happy face until the government runs health care. Through their health care dictatorship they will control everything else, including food portions, air quality and you.

As the effects of the health care plan continue to jell companies are secretly planning to dump their health care plans, and some companies have already received before the election waivers from the evil effects of Obamacare. After the elections those waivers will disappear.

The Obama EPA head Lisa Jackson is on a vendetta course against corporate America working for the demise of the business community as fast as she can.

Next week's election may change the future but one has to wonder if it can be changed at this point. The downward purposeful spiral put into motion by Obama, Pelosi and Reid will be hard to correct.

All one has to do is look at information being leaked by the Fiscal Commission to see that there will be few if any meaningful spending cuts, while many taxes will be raised.

These collective forces are gathering to unleash an economic maelstrom on America which will affect the entire globe.

If an immediate freeze on federal hiring and a mandatory 1% cut annualy for all federal agencies for the next 10 years isn't implemented I doubt if the forces of Obama can be slowed or stopped. It isn't that drastic but it would work if it's done in concert with eliminating federal agencies that aren't needed, and there many who fit that bill.

The Department of Energy was created by Carter and not only hasn't produced any energy, the employees of that agency do everything they can to stop energy production in this country. It would be a fitting start just to hammer that agency down.

But is there the political will to bring about real change in D.C.? Are there enough politicians with America's best interest at heart to start a real overhaul of government?

Starting next Tuesday we'll find out. In the meantime don't underestimate how much damage a lame duck Congress can do.

Shamus| 10.27.10 @ 10:22AM

Lisa Jackson needs to be impeached. She's breaking the law.

Tomas| 10.27.10 @ 4:00PM

"The downward purposeful spiral put into motion by Obama, Pelosi and Reid will be hard to correct."

We've been on that downward spiral since FDR. It is so ingrained into every generation by the time of LBJ's presidency, the collective memory had been scoured of any knowledge of proper government.

Correcting this has been a lost cause for decades, particularly when parents and grandparents know no better.

Collective amnesia?

No. Collective brainwashing.

Who is John Galt, indeed.

Lesser Weevil| 10.27.10 @ 8:46PM

Very well said, Bill.

old white guy| 10.29.10 @ 5:03PM

if you don't fix it in 2010 you will have to invoke the second amendment after 2012.

Tim*| 10.27.10 @ 6:49AM

Th Alinskiite Socialist Obama is willing to continue High Unemployment & sacrifice The U.S. Economy & Free Market to pursue His Health Scam , Cap &Trade; and Other Ruling Class Subserviations & Suppressions of We ,The Great Unwashed.

Rise Up In Rebellion!

The Tea Party Rebellion Now Escalates For November 2nd.

davelnaf| 10.27.10 @ 7:50AM

Hardly a day goes by that Obama does not say something that illuminates his awfulness as president. Speaking on some Hispanic radio program he referred to the people of Arizona and anyone who wants to control the borders as “enemies” of Latinos. If this doesn’t help the fence sitters make up their minds nothing will.

RacerJim| 10.27.10 @ 10:48AM

Campaigning for Democrats in Rhode Island, Obama said: "We don't mind the Republicans joining us. They can come for the ride, but they gotta sit in back." Yet another example of Obama's long-standing hatred for whites.

Stephanie| 10.27.10 @ 12:50PM

Yeah Jim, I never heard a peep about how this smells of a racist statement. It smacked me right in the face!

Stan Redmond| 10.27.10 @ 4:53PM

Where does Obama keep his white half? Under the bus with grandma or in the back of the bus?

Chef Brian | 10.30.10 @ 6:03PM

you are too much Stan! Maybe he keeps it in the lock box with his birth certificate!

Keith| 10.27.10 @ 7:56AM

"All is going as planned", said the evil Dark Lord. The ultimate goal is a United States financially unable, or unwilling, to spend the resources required to maintain our ability to influence global events.

Big Tony| 10.27.10 @ 8:08AM

The government changed the way it calculated inflation in 1983 so that inflation would seem to have been tamed. While inflation has not been as bad as it was during the Cater years omitting the fact that the inflation calculation was changed and in the same year the writer says inflation has not been heard from since amounts to a half truth and makes an otherwise good article seem less than honest. It also nullifies the argument in my estimation. I realize this is an opinion piece but it seems to me the writer is a guilty as Obama in believing or hoping people will forget the facts.

Ned| 10.27.10 @ 11:27AM

If you're on here, Big T, elaborate please. What was the change that was made?

Chalkdust| 10.27.10 @ 2:17PM

Big Tony
As I remember it, housing was removed from the cost of living index for calculating social security yearly raises. Since older,retired Americans seldom buy new houses, this was considered a reasonable alterative to raising SSN check-off on working Americans paychecks.
Calling that a retooling of the economic inflation calculation for the entire nation is.....is a big fib.

Shamus| 10.27.10 @ 4:23PM

Nixon thought inflation numbers were getting too high, so he ordered his accountants to leave food and energy prices out of the calculation.

Big Tony| 10.27.10 @ 6:28PM

In January of 1983, the monthly CPI report from the Bureau of Labor Statistics (BLS) showed a change in calculation for housing costs. Prior to that date, the cost-of-housing calculation was based upon home-ownership expenses such as mortgages, property taxes, utilities and home repairs. In January of 1983, however, this calculation was shifted to a rental-equivalence method. There wasn’t any formal announcement of this change, only a footnote in the BLS report.

The changes made in the 1990's are here on this link:

http://www.financialsensearchi...../0624.html

Sufice it to say if 1982 calculation methods were used today the inflation rate for 2009 would be above
not the 1.1% regularly quoted

Big Tony| 10.27.10 @ 6:32PM

something happen to the paste I made

The last sentence should have read: the inflation rate for 2009 would be above 10% not the 1.1% regularly quoted

R Martin| 10.27.10 @ 8:21AM

As Mr. Ferrara has clearly indicated, there is no reason to give up on the future. A supply side policy of low taxes, tight money and a strong dollar will work again as it has so many times in the past. There will certainly be some new members of congress committed to implementing such a policy, but I must admit to some unease that Republican leadership headed by Boehner and McConnell are good enough to get the job done. I'd rather see Paul Ryan and Jim DeMint in those jobs.

A more immediate concern is how well and how quickly Geithner and Bernanke address the looming mortgage foreclosure crisis. Left to fester in the hands of lawyers and judges, this crisis will cast a pall on housing, banks and the economy in general. When the recovery does begin our country is going to need a strong and credible finance industry to sustain it. Are the Fed and the Treasury up to the job?

Maxwell| 10.27.10 @ 8:49AM

R Martin, totally agree that Paul Ryan and Jim DeMint are the ones I'd like to see too. As for your question if the Feb and Treasury are up to the job, well, that has as much chance to happen as Lori coming home tonight and telling me, your new Harley Fat Boy and Ducati are in the garage.

bluecollarbytes| 10.27.10 @ 8:30AM

Peter Ferrara- "Somehow America was never going to recover from this recession without President Obama and his magic pixie dust."

Obama Might claim that those other recoveries were false- simply parts of our long shameful history. Didn't Reagan's recovery 'happen on the backs of the oppressed' (which just so happens to consist of every Democrat special self-interest group) ?

PS re: Big Tony- inflation.....If I understand what inflation is, it goes on continually....at least on the ground where I live and work. I question the value of inflation figures when prices go up year after year, on the ground....

cindy| 10.27.10 @ 11:31AM

The article did not compare the 1992 methods of Bill Clinton being helped by Dem monopoly to raise taxes(retroactively!) and Jimmy Carter's reign of terror. I know you are being facetious about "on the backs of the oppressed" because African Americans fared better as a group coming up out of poverty than anyone in the Reagan years- a fact no Dem will ever admit to!

jrjr| 10.27.10 @ 5:04PM

Please quit dragging Peanut Head Carter through the pie sty - while he was President I was able to get a CD with a 14% rate. Isn't 14% more than a .75 % that now available? Like Carter who brought his pals from Georgia to help, Obama brought anyone who had not spent time in prison but had screwed everyone in the past.

Big Tony| 10.27.10 @ 8:40AM

This article did get me interested in researching inflation. And in the process I see the government continued to tinker with the inflation calculation measurement in the 90's as well Also that the GDP is adjusted for inflation so that if the inflation number calculated by the goverment are below actual inflation then the GDP is announced to be higher than it actually is. So not only are the inflation numbers fudged to seem lower than they actually are the GDP number are now also higher than would otherwise be the case.
It all goes back to the old saying figures don't lie but liars sure can figure.

John hescott| 10.27.10 @ 9:10AM

@ Big Tony's 1st post:

You lie! The only thing that has been changed has been the way the unemployment figures are calculated. Obama's "Team" adjusted all of the factors downward to keep the "official unemployment rate" under 10%. We all know the real number is in the high teens, but without adjusting the mathematical factors, real unemployment as calculated under George W. Bush's presidency, would have been 10% or higher since March 2009. The inflation rate has everything to do with being off the gold standard, and letting the Federal Reserve (a private bank by the way and in my view totally unconstitutional) print our money with nothing backing it except our government's good graces with the world community. China could bankrupt us in less than a week if they dumped all of their securities on the world market all at once. What was the main cause of Obama winning the election? For those who forget what they had for breakfast, it was the bank meltdown in late September 2008. What happened? Some mysterious overseas forces withdrew $750 billion dollars in "hard assets" (read real money and not just some electronic check) in a 90 minute period from the U.S. banks. It was all done to influence the election - which it did. I suspect but can't prove that George Soros and some of his other foreign billionaire buddies were behind the scheme. Wake up America! You are being lied to by idiots like Tony and their ignorant water-carrying band of leftists. If you really want to know what is going on, read "The Creature From Jekyll Island, A Second Look At The Federal Reserve", by G. Edward Griffin. You will then see that the liberal multi-millionaires & billionaires, the Democratic (Socialist) party, and the unwashed masses of the ignorant, are leading us into slavery. Check it out. It may be one of the most important books ever written and that ALL Americans should read. Tony's argument in his first post doesn't disprove the fact that when you stop the printing presses and creating money out of nothing, inflation is brought under control. It is as simple as that. As for Big Tony's second post, do some more research and read the book I just cited. Then we can have an intelligent conversation about our monetary system.

Warrior | 10.27.10 @ 12:00PM

Using the same calculation methods from the Depression era, today we are actually around 21% unemployment. Not to start the Ron Paul discussion again, but he needs to be listened to when he wants the Fed ivestigated/audited.

SpiralArchitect| 10.27.10 @ 5:28PM

Instead of showing a nifty quote or three...

Here is a link to several ncie ones:

http://www.jesus-is-savior.com/Evils in Government/Federal Reserve Scam/quotes_on_the_federal_reserve.htm

Josh | 10.28.10 @ 2:31PM

O brother...you might be right on a lot of points, but that particular website is far from reliable.

Intelligent Design| 10.27.10 @ 9:25AM

And since the Demo-Socialists took control of Congress in January 2007, the national debt has increased 58%, from approximately $8.6 trillion to $$13.6 trillion. It's as if they are determined to destroy our country from within.

Obama is repeating FDR's pig-headed mistakes from the 1930's. He is: 1) increasing taxes; 2) increasing government spending; 3) increasing regulation and interference with the free market; and 4) due to a crisis of confidence, causing businesses to hold cash instead of expanding and hiring.

By allowing the Bush tax cuts to expire, Obama and his Demo-Socialist lame duck Congress will put the economy in reverse, increase unemployment, increase home foreclosures, and ironically, decrease actual tax revenues. It's as if the Demo-Socialists were Islamic extremists, but instead of bombing and physically killing American citizens they are hell-bent on killing the economy. All that matters to them is their obsolete and stupid political ideology.

WL| 10.27.10 @ 9:25AM

This man is a turncoat (if he ever was on our side....)...NOTHING else can explain it...We can talk about failed policies...etc etc etc..

But it is all just conjecture...When a mole is in power... NOTHING he does will benefit the country...because he is there for one reason and one reason only..to...ATTACK...US.

Figure that out folks...might take you a while...but think it out...and you'll see it. It'll all make sense then.

WE HAVE TO SEND THE CONSERVATIVES...and the republicans....to the house in overwhelming numbers....to limit the damage and act like a pack of wasps swarming this administration...heckling and badgering them at every turn...(NO, it's not what our side usually does...but the AINT YOUR AVERAGE ADMINISTRATION)

THEN VOTE HIM OUT.

That is the ONLY WAY to stop the damage...

If this group of Conservatives and republicans fail...then our "electorate" will follow him again and he will be back for round two in 2012...then the damage will be too deep...if it ain't already...

RacerJim| 10.27.10 @ 10:56AM

It may indeed be too deep already. The military Judge presiding over LTC Lakin's Courts Martial recently ruled that LTC Lakin's "Chain of Command" ends at the Pentagon, therefore he cannot request or present evidence regarding Obama's eligibility.

RW&B| 10.27.10 @ 9:26PM

That was the result of the ruling, but the reasoning was quite different. You can read it at http://www.scribd.com/doc/3712.....udge-Lind.

And before you start arguing with it, note that, according to WorldNetDaily, LTC Lakin's new lawyer (the esteemed Neal Puckett) has declared that Judge Lind “rendered the proper legal ruling ... She was right on the facts and right on the law.”

Rmm| 10.27.10 @ 9:39AM

The question that concerns me the most is why does anyone stick with policy that clearly is not working and in fact, is doing more harm than good.
With the Obama team, this is by design and has little to do with chance. One has to give serious thought about why this is happening and just what is their end-game.
I just read that this Economic Commission formed by Obama has placed the mortgage interest deduction on the table, in search of more revenue.
They are asking for big trouble if they whack us with that one.

WayneH| 10.27.10 @ 10:01AM

Just as Hayek pointed out in The Road to Serfdom, the big government socialist system is where the most evil thugs thrive. Witness: Mussolini, Mao, Stalin, and now Obama. What a nightmare! Hopefully enough Americans are waking up. Good luck neighbors for as you go, so goes the neighborhood.

WayneH| 10.27.10 @ 10:02AM

Did I forget to mention Hitler?

hunter| 10.27.10 @ 10:13AM

You forgot the most recent correlation to Robert Mugabe the emperor for life, white hating, president of Zimbabwe. That has nationalized the white farms, took over banks, industry and is causing geniocide of the white farmers.

WayneH| 10.27.10 @ 10:29AM

Yes, a thorough list might be quite long. It's interesting that what all these thugs have in common, in addition to their thirst for power, is that ugly look of anger. As the 2008 elections neared, my wife and I watched in amazement that so few "commentators" pointed it out.

JuliaHope| 10.27.10 @ 10:46AM

If Republicans take the House and Senate they will have control of the impeachment process. If the economy really hits the fan hard in 2011, which it likely will due to many factors all converging at once, and the American people are ready to march on DC with guns in hand, I wonder if the Republicans will start impeachment hearings to settle us down.

idalily| 10.27.10 @ 12:13PM

NO, NO, NO. The worst thing we can do is seek revenge by impeachment proceedings! Fixing things is what all reasonable Americans want and what our country needs. Not endless hearings about Obama and his cabal. Unless some serious evidence (ala Watergate tapes) comes forth, impeachment proceedings or any other investigations will only deflect energy and political capital away from solving our fiscal crisis. Can we stop this sort of talk now, please?

PS: I do think the Fed needs to be audited. That's an investigation that needs doing right now. Other than that, NO.

WayneH| 10.27.10 @ 12:34PM

I agree completely with both the auditing of the Fed and the waste of time and energy of impeachment - unless of course new evidence of a conspiracy to actively damage the country comes to light - as it may well do. So far the immense damage can reasonably be argued to be the result of all sorts of factors even though most patrons of this site know full well that it is the incredible incompetence and idealogical fervor of this current band of despots that is to blame.

The Big E| 10.27.10 @ 3:58PM

Article II, Section 4

"The President . . . shall be removed from Office on Impeachment for, and Conviction of, Treason, Bribery, or other high Crimes and Misdemeanors."

Hmmmmm. Where do we start?

Al Adab| 10.27.10 @ 5:22PM

Can you say, President Biden? The possibility of President Gore was the reason the Senate failed to convict President Clinton hands down. Sometimes political calculation trumps justice.

skip| 10.27.10 @ 6:42PM

Surely no one can disagree that Biden is the smart one in this administration?

Jobe| 10.27.10 @ 10:57AM

I am forced to conclude that those who are obama supporters will never change their minds. They have bought too deeply into the media sponsored obama myth. They have invested so much into this worthless one world socialist that to give up their support is to admit their own gullibility and incompetence. They are prisoners of their own egoes. Those who wait for them to come to their senses will have a long wait.

Ned| 10.27.10 @ 11:44AM

Unsurprisingly, many of those "educated" in government controlled schools haven't the brain-power nor the curiosity to challenge the bilge he's selling. They have hooked their future to the leftist lie, and consider it a personal affront when told their ideas and policies are incorrect - hence the personal attack as their preferred response to confrontation. After all, since it's all about how you "feel" about an issue, having someone state that your “feelings” are wrong (e.g. stupid) is an affront, so your "counter-attack" is justified.

BTW, haven't seen anyone mention here that inflation is a modern phenomenon, created entirely by government. Since government can operate on a longer time-scale than a person or family, and since government can just print money to pay it’s debts, it makes inflation very attractive. Borrow $1B today, but effectively only pay back $900M after adjusting for inflation. Government creates the debt, then creates the inflation to devalue the debt, and pays the debt off with dollars it printed for the purpose. Now THAT is a Ponzi scheme.

Nunya| 10.27.10 @ 1:13PM

Ned, you are exactly correct. One cannot have inflation if they don't have the ability to "create" money out of nothing. The "Fed" has a great scheme going--create "money" by printing it, then sell it to the US Treasury with interest. It's a great gig if you can get it.

The unfortunate part is that the "Fed" is nothing but a private bank, which means that We the People are the ones who pay for it--with interest. Thomas Jefferson was against a central bank for EXACTLY this reason, and Andrew Jackson's proudest accomplishment was killing The Second Bank of the United States--the precursor to the abomination we now have.

Unfortunately, Obozo has no concept of how profits work, nor any sense of economics, nor any business sense whatsoever. He and his communist buddies still think the government should run everything, and then dole out whatever is left to we "comrades". He's an idiot, and a traitor to this country. Those who support him are the same.

Ken (Old Texican)| 10.27.10 @ 11:41AM

Mr. Ferrara,

Thank you once again for a splendid history lesson.

My personal concern is that the Jihadists have temporarily backed off, seeing our country being gutted from inside Washington DC.

I have come to believe that they are awaiting their moment, though. If the Republicans take the House...and perform, our economy will come roaring back.
I believe the Jihadists will try to strike ...hard... before that rebound can get into full gear.

I also watch over my shoulder as Israel prepares a preemptive strike on Iran to preserve their country this fall and winter. They really don't have a choice when it gets right down to it, do they?

Question:
Can a majority in Congress declare war, without the blessings of the President?

That is one of the questions I wrestle with in my new book, "Texas Said No!" (to Sharia Law).
www.texassaidno.com

Another question I address is: when, (not if), will a Republican House file an indictment on the President and corrupt judges and begin investigations?
(Uh, a House indictment to you folks in Rio Linda is "Articles of Impeachment".)
Mr. Ferrara,
Our socio/political contract with our citizenry is going to be sorely tested these next months.
(See US Declaration of Independence/ Constitution)

George S| 10.27.10 @ 5:26PM

Congress can declare war without the president, but Congress cannot appoint a commander in chief of the military to execute the war -- the Constitution leaves that to the President.

Impeachment... the House will file articles of impeachment against judges or the President when they have sufficient evidence of a crime. Considering Obama did not initiate legislation, there can be no impeachment against a president for unconstitutional laws (GWB would have been tried once he signed McCain-Feingold). Now, those czars are another story. This is an area of jurisdiction -- what powers do these czars have and what recourse do the citizens have against those powers? Are they regulatory powers? Only the Congress have been delegated those powers. Are they executive powers? Then only the powers the Constitution gives the President can be delegated to the czars. So this now becomes a Due Process question: what process is given to citizens when a pay czar makes a decision that is both regulated and enforced by the Executive branch? That is how to tackle the problem -- with the Constitution. This way, there can be no political motives ascribed to the Congress.

prestonsbrooks| 10.27.10 @ 11:47AM

Oblowme has no intention whatsoever of aiding an economic recovery. His prescription is Communism for all, no middle class, no upward mobility, nothing of positive value to the human race at all. His meme is Totalitarianism. Can the camps and gas chambers be far behind for those who refuse to acknowledge his Satanic Majesty?

Nunya| 10.27.10 @ 1:22PM

Preston, awesome name for our POTUS!! :-)

As you your question, unfortunately most of the idiots on the left don't understand that it's THEIR policies that lead to the camps and gas chambers. Collectivism (which includes Socialism, Communism, Naziism, and Fascism) is a path that ultimately leads to government control of everything, which leads to one or more persons in power who will forcefully submit those who oppose him or her to "re-education" or worse.

History has shown this to be true, yet those on the left are either stupid, or they plan to be one of the persons in power.

DAVID THOMPSON| 10.27.10 @ 12:04PM

Great article, Mr. Ferrara. I have no doubt that with the shackles taken off, the American economy would come roaring back with a vengeance due to pent up demand and unused productive capacity. We need to return to proven ecomomic policy as you suggest, but we need more than that. Reagan's brilliance was that he brought optimism and love of the American people to the bully pulpit that helped us "stay the course" as he righted the ship. Remember when that was the phrase used in the '82 mid-terms? I believe we can get the right policies back in place (though no small feat), but who is going to play the role of cheerleader/adult/trusted captain? The American people won't wait another two years for that, and if the economy continues to flounder, perhaps the public will turn back to Obama, and then we truly are finished. The leadership of the House and Senate are going to have to lead with courage and eloquence as never before. I hope they realize the stakes for the Republican party and more importantly, for the nation.

rdman| 10.27.10 @ 12:16PM

This may be off-topic, but I don’t care…

On October 26, 2010, I watched Nova’s documentary on the rescue of the Chilean miners.

I watched Plan B, the American innovative prototype drill head smash through 1000+ feet of hardened rock and enter dead-on into the collapsed mine cavity. I saw the faces of faith and hope as the brave trapped miners looked up the shaft to freedom while the people on the surface leaped for joy and celebrated the success of an impossible task.

It brought tears to my eyes. It reminded me of the construction of the Panama Canal, Golden Gate Bridge and Hoover Dam, the landing on the moon and the hundreds of other impossible construction, technical, scientific and humanitarian projects accomplished by Americans and shared with all peoples of the world.

I remember President Kennedy’s Berlin Wall speech, “Ich bin ein Berliner.” I remember President Reagan emphatically state with eloquent simplicity, “Mr. Gorbachev, tear down this wall.”

This is who we are, Obama. This is the innovation and ingenuity, the genius, the exceptionalism, the faith and humanity, the spirit and soul of Americans, Obama.

Obama, you can take your failed ideologies, your apologies and bowing, your lies, corruption and subversive, your arrogance, condescension and hatred of our magnificent country and SHOVE IT!! Resign and get the hell out of our White House… you are no longer welcome!!!

Ken (OLd Texican)| 10.27.10 @ 12:22PM

rdman,

I'm with you, bud. Well spoken.

Nunya| 10.27.10 @ 1:26PM

rdman: Amen.

Deborah D | 10.27.10 @ 3:42PM

Bless you, sir. I felt exactly the same way after I read -- it was an American company in PA responsible for the drill bit, another PA company responsible for using the drill bit. We brought Americans into Chili to do whatever. It also made me proud that three countries we helped long ago (Germany, Japan and S. Korea) brought their own expertise to make life livable down in that dark mine shaft. Then there was another American company (from MD, I want to say) that sent socks to the miners that eat bacteria...to save their feet. So many amazing things worked together...brought to you by capitalism, innovation, American-can-do spirit. But, did Obama come out and praise the American spirit? If he did, I certainly didn't hear it. When Americans can use something to lift their spirits, he spits on us. That's our poor excuse of a president.

daddio| 10.28.10 @ 2:52PM

Funny how American involvement was never mentioned much by the media...

Shamus| 10.27.10 @ 4:29PM

Kennedy’s translation was a bit off in his Berlin Wall speech. What he actually wound up saying was that he was a jelly doughnut. But that was okay. They knew what he meant.

RCV| 10.27.10 @ 7:24PM

It was a great lesson in the dangers of a little knowledge of a foreign language. Kind of like going to Copenhagen and saying, "I am a Danish."

Perusha| 10.27.10 @ 1:26PM

As usual, a wonderful and truthful article by Mr. Ferrara.

I just read all the comments, here, and looked for anyone---including Mr. Ferrara---mentioning the most vital truth about inflation: and, came up empty.

Inflation is TAXATION! Remember back in the day, as 1979 brought wild rises in the price of gold? It was all over the news, on the clear thinking Right side of the economic-political spectrum, that inflation was the most evil and pernicious form of---

HIDDEN taxation.

What ever happened to no taxation without representation?

Workers should have to pay their income taxes in ONE lump sum, without the evil creation of “withholding taxes” connivance, on April 15th. Then, they’d feel the PAIN such a taking is!

Well, inflation is a tax that is even worse, because there is no “withholding” scheme necessary---the Fed and Congress + the President are in cahoots, enabled, of course by the go-along-to-get-along Judiciary (simply the elite members of the ruling lawyer class), play dumb as they, minute by minute, tax us all.

Talk about a Ponzi rip-off!!!

Reagan nailed it, with his “Trust, but verify” stance about the wicked USSR.

How about the wicked Power Elite ruling the USA?

There’s been WAY TOO MUCH trust, and very little, if any, verify, for WAY TOO LONG!

Also, a most radical idea, which I’m sure could never come to fruition---abolish ALL taxes, and simply admit the inflation = taxation truth: set a limit on the percentage of government, and run the printing presses, and let the people adjust, daily.

Silly idea, huh? But, in TRUTH, a lot of the actual taxation IS by the inflation path.

Who pays the piper, calls the tune. There is no free lunch.

Ah---memories! I recall Robert Ringer, and one of his libertarian books, “Looking Out for Number One”. We are, indeed, reliving those hyperinflationary times, I believe, soon enough to see quite an adequate amount of unavoidable and painful adjustments, for the mass of unsophisticated people. Buy gold.

Nunya| 10.27.10 @ 1:29PM

Perusha, you are correct.

The only thing I would add is buy silver--I believe based on historical prices that it's undervalued right now, and it's a lot cheaper than gold.

Ken (Old Texican)| 10.27.10 @ 1:41PM

precious metals, (gold, silver, etc.), are for starting up a new freedom. (working capital).

Facing what we are facing, .22 cartridges are the best barter investment.
You can feed your whole neighborhood with .22 cartridges.

Conservative Bob| 10.27.10 @ 4:10PM

I have thousands with that exact thought in mind.

Yosemeti Sam| 10.28.10 @ 5:52AM

And if ones personal armory of .22s is struck by a lucky shot and a firework display ensues - where does the owner of said hide?

IMO - anachronistic Alamo talk.

Jim Whittle| 10.27.10 @ 1:41PM

Nancy Pelosi is the Grandmother of the Recession.

David| 10.27.10 @ 2:07PM

Congress could probably declare war against a nation without the President's support, but the President is the Commander-in-Chief, who would have to order the military to fight. That's my thought on it.

I still believe that Bam Bam has an excellent chance to be re-elected. 47% of all voters still support him, he'll probably get an even bigger share of the Hispanic vote in 2012, 95+% of blacks support him, and once he makes Hillary his VP choice this time and moves Biden to Sec of State, I think he'll have a very good chance to win again. Too many bleeding hearts will not want to turn out the first black prez after one term.

And to Rush and some others who claim Hillary is going to make a primary challenge against Bam Bam, that is not going to happen. Recall the racial garbage thrown at the Clintons in the last primary. They haven't seen anything yet if she challenges him. Hillary could probably win the dem nomination, but would lose in a landslide in the general election. Blacks would be so angry with her for defeating the first black prez that very few of them would turn out to vote in the general election. That ensures certain defeat for not just Hilly, but any democrat who dare challenge Bam Bam.

irish19| 10.27.10 @ 11:49PM

zero would never make Shrillary his VP. Biden is his insurance policy against the "accidents" that seem to happen to those who cross the Clintons.

Al Adab| 10.27.10 @ 2:53PM

Watch out for the lame duck session. That promises to be a gotterdammerung of statist actions meant to cement this tyranny in our lives.

These people will stop at nothing to further their agenda. Voter fraud, lawsuits, government by executive fiat all will follow before we decide to rid ourselves of them.

Deborah D | 10.27.10 @ 3:48PM

They will need some Republicans to pass whatever they have planned. I know that Americans for Prosperity have been up to Maine to attempt to keep those two senators in line. If the wave is actually a tsunami, they might be too scared to go against it. We'll see, won't we.

Maddox| 10.27.10 @ 4:58PM

No, they will only need orders from the Czars and Departments heads to enact ridiculous regulations, require expensive permits, and only allow exemptions for their supporters.
I think, without strong counter action, we are royally screwed.

Al Adab| 10.27.10 @ 5:25PM

A distinct possibility is that the POTUS will attempt to "govern' (rule) by executive order and regulations promulgated by the agencies and Czars. Congress must eliminate the Czars as extra-constitutional and not authorized.

PJ| 10.27.10 @ 2:58PM

A question to you all: When does a recession turn into a depression?

Over by me, there are some smart money people starting to call this economic mess a depression.

NJ| 10.27.10 @ 3:41PM

Ah, the Reagan Myth again.

They always fail to note that after the failures of the initial Reagan tax cuts between 1981 and 82, Reagan went on to raise taxes no less than seven times between late 1982 and 1985. A sampling?

In 1982, the Tax Equity and Fiscal Responsibility Act, that rolled back about a third of his ‘81 tax cuts, raised corporate tax rates, and to a lesser extent income tax rates. Raised taxes by almost 1 percent of GDP, which at that time was the largest percentage in peacetime increase ever.

[The] 1982 gas tax increase. [The] 1983 Greenspan commission — we know so well; [fellow commission member Alice Rivlin] remembers — we all … raised payroll taxes for lower and middle income households to higher than they were before Reagan’s ‘81 tax cuts. Then there was the 1984 deficit reduction tax.

Those are the big four. Then there was the Railroad Retirement Revenue Act, Consolidated Omnibus Budget of ‘85… ‘85…’87 Continuing Resolution, Omnibus Budget Reconciliation Act of ‘87, that was $8.6 billion

Reagan tax cuts responsible for the recovered economy? I think not.

In 1982 Reagan went into the largest deficit spending in history.

Ken (Old Texican)| 10.27.10 @ 4:38PM

NJ,
We here call your post above "alternative History"
ie: fiction....to be kind.
Thanks anyway. We will take the real history.

fantum| 10.27.10 @ 4:36PM

YOU DEMOCRATS DECLARED THIS WAR ON AMERICA...

Now Americans are gonna shove it so far up your pooper it will require a surgeon to get it out (good luck finding one under ObamaCare)!

WE ARE BRINGING A TSUNAMI TO THE NOVEMBER 2ND ELECTIONS!

Democrats - The Party of Hate...
http://usataxpayer.org/url.asp?Show=75233528

AND NOVEMBER 2ND IS JUST THE FIRST WAVE!

Obama Urges Latinos to attack Americans!
http://www.youtube.com/watch?v=rAhwTQ784IY

DUMP "I the Obama." - RETURN TO "We the People!"

aware| 10.27.10 @ 5:11PM

Got it a little backwards, Peter. It isn't a president that runs the bankers, the bankers OWN presidents. Bush was stampeded when the bankers cracked their whips and so is the current figure head.

And by the way, listing other "recessions" and comparing them to this shows a complete misreading of what this really is. Others could be called cyclical, this is systemic and will continue to head fake the "experts" until complete collapse.

The "jobs created" by the Bush tax cuts were illusion created by monetary manipulation and easy credit expansion which hid, for a while, the steady deterioration of real wealth caused by fiat currency and the inflationary death wish of the central bankers. There is no avoiding the crash caused by credit expansion. But can make villains look like heroes temporarily, as witnessed currently.

This has been ongoing for long before we were even born and will end in total collapse, because we just won't take the cure, like not wanting to lose your arm when gangrene sets in. Credit induced bubbles only hide this and make people think they are "rich" as they are dragged to the poor house.

"Booms" not preceded by periods of deferred consumption(real savings) are malinvestments that are eventually shown to be what they are....FAKE.

Are there any classical economists(not monaterists[Freidmanites, supply siders, etc]) writing for this site? You could sure use some if you want to be credible on economic issues.

The truth is much more important than rank partisanship.

Pat| 10.27.10 @ 5:19PM

As a former community organizer, and a very good one, Barack Obama brought a wealth of inexperience to the presidency. As a young CO in Chicago, Obama acquired much practical experience shaking down the local banks; “persuading” them with gentle lawsuits to give mortgage loans to “his” people. So, once elected, he was confident Wall St. and the national banking industry could be fixed and he’d be the one to do it. Not trusting this wealth of inexperience, the Democratic National Committee gave Obama and his hand picked White House minions some simple advice. “Blame everything on Bush”, they counseled. “But, in a few months, when the economy starts to improve, take all the credit for fixing it”. Good advice and Obama’s people have followed it religiously for the past 2 years.

But, two months ago, Obama’s handlers got very nervous and sent the Democratic National Committee an urgent email as follows: “We followed your advice to the letter, we blamed Bush for everything. But what happens if the economy doesn't improve? Should we take all the credit for that?”. The Democratic Party strategists immediately replied: “No, of course not, you idiots. You should blame it on the American public. If they had responded properly to your plans, things would have improved in a jiffy”.

So, President Obama has been blaming us recently, we’re just not smart like he is and maybe we don’t deserve all that he’s done for us. And we’ve gravely disappointed the President like we did 2 years ago when he was running for office. Back then, we were too concerned with our “guns” and our “bibles” Obama said and maybe Monday Night Football as well. So, the current problem, according to the President, is that we’re all just scared, the public’s mood is one of fear and that’s really why things aren’t improving. So, there you have it, we’re gun-toting, bible-reading, fraidy cats who are too wussy and “girly men” to help the President fix the economy.

Democratic Party candidates running for office are upset with this brilliant strategy – somehow their idea of support from the President wasn’t to go around the country insulting the voters just before an election. But Obama’s handlers have stuck to their guns, they've told the candidates to quit whining and work harder. In turn, the candidates have told Obama’s handlers to engage in anatomically impossible sexual acts.

Quite a tiff has resulted which us “timid” voters now watch with amusement from the sidelines. In fact, when the White House recently called on a friendly Democrat in the House to request support for pending legislation, the Honorable Representative from a state which won’t be mentioned simply smiled and said: “Barack who?”

Jeff Perren | 10.27.10 @ 8:11PM

Superb article from start to finish. And so fact-filled with unassailable data, one can't help but wonder what Progressives would say in response.

Knowing them as I do, though, I'm sure they'd have some story to make black appear white, up appear down, and Democrats appear the saviors of America.

GBinPA| 10.27.10 @ 10:03PM

This is a great article. I have been debating with myself whether Obama is stupid or he means to ruin the country. I vacillate back and forth, but I am slowly coming over to the stupid side. I don't think he's nearly as bright as George W, and if he is, why can't we see his grades? I have lived through good presidents and bad, but Obama is even worse than Carter. Carter was clueless, but Obama is both clueless and arrogant.

Bread and Circuses| 10.28.10 @ 12:58AM

Why bother to analyze Obama. He is a smokescreen hiding the depradations of George Sauron ("Lord of the Rings") and his international billionaire cabal, the likes of which have been chipping away at American sovereignty for decades and will go on doing so as long as there is power-lust in mens' hearts and rich prizes such as the USA to tempt them. Obama can be defeated or impeached and Soros could die of old age, and others of their ilk will continue the fight. The constitution is our one and only mighty sword against the totalitarians of whatever "ism" are laying seige to our "shining city on the hill" at any given time. We have allowed the integrity of our constitution to be incrementally eroded along with other founding instruments and principles that made this country the superb historical anomaly it is (was?). The fault is not only with witless, craven conservative politicians, but also the citizens who have joined the pols in accommodating our culture to the cheap sentimentalism of multi-culty/social justice "magic beans." The question is how are we going to make good people unserstand that liberty has to be defendedon all legal and cultural fronts at all times or we will revert to the servitude which was the common condition of our ancestors?

Bread and Circuses| 10.28.10 @ 12:58AM

Tenn Slim| 10.28.10 @ 9:06AM

Folks, the article succintly relates the problem. We have elected a flim flam artist of note. His Czars, Lefitst advisors, Soros court operatives, all kowtow to the Man.
Indeed, we reap exactly what we sow.
Now. Elections 2010, 2012 will most likely start the Tsunmai of reversal change. Will We the People emerge as political savvy folks, or will we be charmed once again in serfdom?
That is the question of this era.

Dernon Ruton| 10.28.10 @ 9:07AM

My three reactions to the article: (i) great recap of recession-recovery cycles; (ii) a modicum of respect for Harvard has been restored to me; (iii) what a delectably ominous and understated last sentence.

jacky | 3.30.11 @ 4:31AM

Superb article from start to finish.