This op-ed by Peter Ferrara in the WSJ is excellent and points to the fact that, despite the rhetoric, Obama's porkulus bill is guided more by partisan ideology than it is by "what works."
Reaganomics vs. ObamanomicsThe first indicator that this was the case was the following statement by Barry: "I won."
The current president wants higher taxes, more regulation, more spending and loose money.
By PETER FERRARA
In his inaugural address, President Barack Obama said, "The question we ask today is not whether our government is too big or too small, but whether it works -- whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified." Or as administration spokeswoman Stephanie Cutter said in January, the touchstone is, "What will have the biggest and most immediate impact on creating private sector jobs and strengthening the middle class? We're guided by what works, not by any ideology or special interests."
Unfortunately, this rhetoric is not true. Mr. Obama's economic policy is following not what has been proven to work but liberal ideology.
The best way to understand this is to compare what's being proposed now with what Ronald Reagan accomplished. In 1980, amid a seriously dysfunctional economy, Reagan campaigned for president on an economic recovery program with four specific components.
The first was across-the-board reductions in tax rates to provide incentives for saving, investment, entrepreneurship and work. The second component was deregulation to remove unnecessary costs on the economy. [...]
Third was the control of government spending. In 1981, Reagan forced through Congress not only his famed, historic tax cuts, but also a package of budget cuts close to 5% of the federal budget -- equivalent to roughly $150 billion today.[...]
The fourth component of the Reagan recovery plan was tight, anti-inflation monetary policy, which was spectacularly successful. Inflation was cut in half to 6.2% in 1982 from 13.2% in 1980, and cut in half again to 3.2% in 1983.
It would seem that Obama thinks that the opposite of these 4 policy positions will produce results similar to those during the Reagan administration.
I expect they'll have the effect of Carter's policies .... squared.
We know such policies work because they turned around in just two years an economy far worse than today's. We were suffering from multiyear, double-digit inflation, double-digit unemployment, double-digit interest rates, declining incomes, and rising poverty. In fact, what we suffer with today is not the worst economy since the Great Depression, but the worst economy since Jimmy Carter -- the last time liberals were dominant politically and intellectually.
The Obama administration's economic policies do not include any of the four Reagan components. In fact, the stimulus plan is the greatest increase in government spending in the history of the planet.
And I'd like to comment on Barry's ridiculous assertion that he was handed a $1 trillion deficit, therefore criticizing him for doubling the deficit is inappropriate.
What are you smoking, Barry?!?
Eight years of irresponsible spending (much of it bipartisan) does not mean that even more irresponsible (and partisan) spending is warranted.
Meanwhile, the Fed is furiously reinflating, sowing more havoc down the line. Mr. Obama is still promising future increases in tax rates by letting the Bush tax cuts lapse, because for ideological reasons he thinks even current rates are too low. And instead of deregulating for more energy production, he is still promising massive increases in regulatory barriers -- through global warming cap-and-trade legislation -- to increased production from proven energy sources to serve an extreme environmentalist ideology.Those that forget (or ignore) history are doomed to repeat it.
This is why America seems so hopeless right now, and so depressed. We are stuck going in exactly the wrong direction on economic policy because of currently dominant ideological fashions.
A natural economic recovery will begin sometime this year, not because of the president's policies, but because soon this will be the longest recession since World War II. However, thanks to the administration's retrograde policies -- cut from the cloth of the 1970s and even the 1930s -- the recovery will not be what it should be. Rather, unemployment will remain too high, and inflation will resurge, recreating the disastrous economic results we suffered the last time Keynesian policies were dominant
Given the scope of the porkulus bill and the general malaise (a word not uttered since Carter) among average consumers, business leaders, etc, I am not as optimistic as Ferrara that the economy will recover sometime this year.
I don't expect to see an actual recovery until sometime in 2010, assuming that any negative economic results this year are not met with even more ridiculous economic policies.
ARC: St Wendeler