You thought Obama would stop at the ones he’s told already?
Almost a week since the dreaded sequester went into effect, and look out your window. To quote President Obama the day after Obamacare was passed, the sun is still shining, the birds are still chirping, and the earth is still spinning on its axis.
Of course, Obamacare still does not go into effect for another year now. But the sequester has already been in effect for five days. Unlike the sequester, when Obamacare goes into effect, it will kill people.
Everybody knows by now that President Obama was telling a lot of tall tales to stop the sequester from cutting even 1% of federal spending, not from current levels of spending, but from the increase in spending this year. That should make clear Democrat policy is to oppose any cut in federal spending.
But the sequester debate also clarified President Obama’s economic policy. If you listened carefully to what Obama was saying, you would see that Democrat economic policy holds that it is government spending that drives economic growth and prosperity. If that should sound nuts to you, that’s because it is. I don’t want to appear to make the notion sound respectable. But that is the reality that we have to deal with.
And we are not talking here about government infrastructure spending, national defense, or even education spending, all of which can have positive economic growth effects, when done right and effectively, education spending longer term, infrastructure and national defense more immediately. We are talking here about general government spending on everything, which is what the sequester was about.
What Obama and the Democrats were saying repeatedly during the sequester debate is that the government spending cuts would hurt the economy, but increasing taxes would not!
That is right, they said repeatedly the sequester spending cuts would hurt the economy today, but that could be avoided if we would follow their recommendations and increase taxes instead. In fact, the alternative Democrat sequester bill that barely failed in the Senate would have increased capital gains and dividends tax rates again, on top of the January increases from Obamacare and the expiration of the Bush tax cuts. America would then suffer with the fourth highest capital gains tax rate in the world, to go with Obama’s highest corporate tax rate in the world (except for the socialist one party state of Cameroon).
Yes, America is rapidly becoming the world’s leading socialist state. Everyone else, including former communist/socialist powers such as China, Russia, and India, are turning to the Reaganomics we here in America have so stupidly abandoned. If you want to move to Argentina, stay put. Argentina is coming to you. If you want a booming capitalist country following the policies of Reaganomics, move to formerly socialist Canada.
The Democrat-proposed further tax increases are not even good Keynesian economics. Even Keynesian economics says raising taxes hurts economic growth. Their explanation of that is all wrong, focusing on the reduction in so-called “aggregate demand,” rather than incentives. But at least the Keynesians got the policy right.
It is true that Keynesian economics supports the idea that increased government spending, deficits and debt is what sparks recovery and renewed economic growth. That is core Democrat policy, and what you are voting for every time you vote Democrat. But there is no more discredited idea in economic history (except for outright Marxism), both intellectually and in practice.
Keynesian support for increased government spending to boost the economy fails to consider that government has to get the money to spend from somewhere, either increased taxes, increased borrowing, or inflation. And all of that takes an equal amount out of the economy, leaving no net increase in demand. In fact, when the negative economic effects of the increased taxes, borrowing, or inflation are considered, the net result is a contractionary drag on the economy. That is why Keynesian economics has never worked. Obama’s nearly $1 trillion so-called “stimulus” in 2009 just proved that yet again.
Indeed, the entire Keynesian focus on “demand” is misconceived, because demand is insatiable, and can never be inadequate in a market economy. If demand for any good or service is insufficient for the supply, in a market economy the price of the good or service will just decline, until demand equals supply. Keynesian economics survives only because it supports what Democrats want to do, which is increase government spending, deficits, and debt. See, e.g., Paul Krugman.
The obscured truth that our very dumbed down country right now can’t get is that economic growth is the ultimate determinant of revenues, and deficits. Follow pro-growth policies, and you get booming revenues and disappearing deficits. But that is so yesterday for America, which thinks now with rapidly declining Europe that pro-growth policies are “unfair.” (What is fair about plummeting middle class incomes, soaring poverty, and persistent high unemployment?) This in the formerly richest, most prosperous nation in the history of the world. Good job, Progressives, you have your fundamental transformation of America (into Argentina).
The Coming Crash of 2013
I have long been on record as predicting renewed, double dip recession for 2013, just as happened during the depression. The full story on that can be found in my short book published in 2011 by Encounter Books, Obama and the Crash of 2013, and my long 2011 book published by HarperCollins, America’s Ticking Bankruptcy Bomb.
That is because all of Obama’s policies are so anti-growth — increasing tax rates, especially on capital investment that is the foundation for jobs and rising wages, increasing regulation, easy money with a weak dollar, and increased government spending, deficits and debt.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?