Obama Will Only Make Things Worse
By: Craig Chamberlain
President Obama, whatever his strong points, isn’t an economist. It’s called the “dismal science” for a reason and it results in many people being ignorant of the basic tenets of how an economy operates. So far President Obama hasn’t shown much in the way of economic aptitude. He’s either getting bad advice(after all his secretary of the treasury can’t even figure out how to pay his taxes) or he’s deliberately running the economy into the ground so that the government can take more of it over.
The Banking industry has largely been nationalized, and many in Congress are talking about a “temporary” nationalization of the entire industry. Nationalizations aren’t temporary. The governments destroy whatever industry they take over and only privatize it when they have wrung all the wealth out of it, and it is run so badly that they can’t afford to control it any more. The collapse of the credit market, brought about by too much regulation(not too little) in the form of forcing banks to make loans to people who had absolutely no right to one, brought about a recession. In a total overreaction, and a statist desire to “do something” the government has taken hundreds of billions of dollars from honest hardworking taxpayers and given it to every left wing special interest group they could think of( ACORN, your check is in the mail). So Obamaonics believes that the best way to get out of debt is to keep spending.
That’s just the pork laden stimulus bill that will go down in history as one of the worst pieces of legislation in the history of the republic. Now let’s talk about the budget that our dear leader wants. Ok, let’s bear in mind we’re in a recession. When an economy is in such a state it’s imperative that things get back up and running, that business gets going, that investments come pouring in. The way to do that is to make things easier. President Obama, however, has decided to take a different approach.
Instead of adhering to the principles of the free market, or as they should be called reality based economics, the President is going to make things harder. Under the pretense of cutting the deficit in half, the tax cuts instituted by President Bush are going to lapse. Now that should come as no surprise. The Democratic party, especially the Democratic party of the last 60 years, has reacted to tax cuts the way the wicked witch of the west reacted to a bucket of room temperature water. So, the thirteen dollar a week tax cut that the Obama administration is so proud of is going to be wiped out by tax hikes. So with less money in your paycheck there is going to be less money for you to spend.
Even more egregious is the increase in the capital gains tax. Now, in classical Democratic class warfare rhetoric, they are insisting that this tax- like all the others- only effects the mysterious and ever changing group they call “the rich”. The capital gains tax is the tax paid for earnings on investments. The United States has one of the highest corporate taxes, and capital gains taxes, in the industrialized world. People invest to make money, when the government is taking more of your money, people don’t invest as much. It’s as simple as that. High taxes act as discouragement, when the taxes on investments are high we shouldn’t expect a high level of investment. And it takes a high level of investment to keep our economy going. We can’t afford to discourage economic activity, yet that is precisely what the Obama administration is doing.
Now, like every other administration that has come before them, the Obama administration is bragging that is is cutting government spending. Except that this is a crude accounting trick. Even with the spending “cuts” the size of the government never gets any smaller. Why is this? Because whenever congress goes through with new spending and increases the size of government it becomes the new baseline for all future budgets, the basement if you will, and no government will go below that. It was President Benjamin Harrison that took us over one billion dollars, and the government never went below that again, it was President Bush that took us over a trillion dollars, and we’ll never go below that again. No matter how much a budget might get cut here or there the size of leviathan just keeps growing.
Even though the size and scope of the federal government isn’t going to get any smaller, there is one area that the President is going to cut. If you guessed defense pat yourself on the back. By some estimates the defense budget will be cut by as much as 10% one can argue the wisdom of raising taxes in the middle of a recession. One cannot argue the wisdom of cutting efense while you’re at war, because there is no wisdom in it. Defense cuts will leave our troops underfunded, and without the best weapons. Things like the missile defense system, the F-22, and money for Iraq and Afghanistan will not be there.
Not only is President Obama weakening the economy he is putting the country in serious danger. Let’s hope the voters remember that, and understand what needs to be done the next time they go to the polls.