Obamanomics = Sisyphian Economics. When the economy seems to be going up it falls back down and loses ground by the laws of economic gravity. The law that no government can spend, borrow and tax its way out of economic difficulty. A government that takes this course must inevitably fail and crash to the ground. The Keynesian Sisyphians of Japan and their 20 year recession is proof of this. With trillions
Yesterday's "good" economic news on jobs and Obama's upbeat town hall meeting at Schnecksville, Pennsylvania masked the grim realties of a deteriorating economy.
As Larry Kudlow said last night on CNBC "Capital drives capitalism." And capital is being driven out of the country by the economic uncertainties created by Obama's misguided deficit policies and legislative priorities (job killing, growth crushing healthcare reform, Cap & Trade, etc.,) requiring massive taxation or Bernanke caused inflation.
Obama, Pelosi, Reid and the Dems are destroying America's standing as the financial capital of the world. Because of the lunatic big government statist agenda driving the economy toward bigger deficits and national bankruptcy overseas investors see America as too risky for their funds. "Compare this," said Kudlow, "to the 1980s and 90s when the economy was sucking in capital from all over the world." The supply side tax cuts of the Reagan and Clinton years and the confidence that was inspired in the business and investment communities turned America into the investment Mecca of the world. Obama, the anti-Reagan, anti-supply side, anti-business regressive is taking our country backwards and turning us into an economic wasteland-or banana republic as Warren Buffet warned
see. Foolishly believing that prosperity comes from growing government, and that spending and spreading wealth is more important than its creation, Obama and the Dems are perilously and depressingly driving investment capital out of and away from this country killing any chance of a recovery.
November's poor showing in retail Thanksgiving sales is prelude to a dismal Xmas season*. This is due to the continuing contraction of consumer credit which will result in the closing of more small businesses after the holidays adding significantly to the unemployment rolls. The reason for Obama's useless Job Summit in Orlando and town hall meetings is to deceive consumers into believing that his policies are working and prosperity's around the corner; that they should dig into their piggy banks and spend, spend, spend to spur economic growth and job creation. But Obama is a fraud and speaks without conviction and inspires confidence in no one.
*Retail sales did rebound in November due to stores slashing prices and offering deep discounts. We are in the second week of the holiday season and sales are dismal and will likely stay that way unless consumers are offered November type discounts (added 12-11).
But it gets worse: to avoid insolvency state and local governments across the nation will be following the example of the business community in cutting costs and overhead and laying off government workers. This will cut up to one million jobs from the public sector over the next 12 to 18 months deepening the unemployment quagmire.
The Fed program of low interest rates and the $8K first time buyer tax credit for home buyers will be over next year; this will dramatically hurt the housing market with declining sales and home values. Moreover, noncommercial construction continued to drop in November with the loss of 27,000 construction jobs. All this in spite of Obama's fiscal stimulus spending on infrastructure. FDR employed millions Americans for public works projects and it coiuldn't prevent the collapse of 1937 and the loss of millions of jobs in the private sector.
At yesterday's town hall meeting we heard a very desperate president blaming the lack of job creation on businesses too fearful to expand because of his anti-growth policies; and berating banks and lending institutions for their restrictive loan practices to small and mid size businesses saying, and I quote" That they have a community responsibility to give out loans*." Community responsibility? Where have we heard that before? Remember Carter's Community Reinvestment Act and its rigorous enforcement by the Clinton Justice Department forcing banks to do "the responsible community thing" and issue risky loans to uncreditworthy minority borrowers? This is what triggered the sub prime lending spree-supported by Obama and the Dems-that collapsed the global financial market. Incredible as it is Obama wants banks to return to these same ruinous practices to provide the economic stimulus his policies are failing to achieve. It shows how bankrupt he is of ideas.
In fact, there's legislation in Congress supported by Pelosi, Frank, the Black Caucus, etc., to expand the CRA, as if it hasn't done enough damage, and continue the perilous practice of high risk lending. Obama and the Dems want to give the insanity of bad loans another chance; they are willing to risk another explosive financial bubble and meltdown just to save their political butts. Recklessness thy name is Democrat!
*In October Obama said: ''It's time for those banks to fulfill. their responsibility to help ensure a wider recovery, a more secure system, and more broadly shared prosperity." It's not the duty of banks to ensure broadly shared prosperity, to spread the wealth or give prosperity away. This shows how radical and insane the president is and that he's learned nothing from the financial catastrophe of last year. It appears that Obama is helplessly and hopelessly trapped in an ACORN mentality and state of mind and can't grow out of it. He is the Alinsky community organizer unto death which is why his presidential destiny is a tragic one.
Speaking of bubbles the next one to burst is likely to be Obama's revolution in green technologies. With growing skepticism over man made global warming spreading like a plague the unprofitable government subsidized Green Economy* is destined to fail and collapse into ruin going the way of Enron-the crooked bankrupted energy company that invented the crazy idea of carbon credits and the Cap and Trade save the earth scam**.
*100 billion wasted dollars in government investments
**Government subsidies have started more green projects than economic resources can support. See Peter Schwieizer; Architects of Ruin
There are other signs warning that the worst is yet to come and that the president is being false about the progress that he's making in reviving the economy. If John McCain were president today the liberal media, leftist blagosphere and Democrats on the Hill would be howling about the MCCAIN DEPRESSION comparing McCain to Herbert Hoover (John McHoover) and calling for a new New Deal. With the economy expected to stay flat for years it is certain that McCain would have been a failed one term president with Obama returning to defeat him in a hope and change landslide in 2012. Luck was with McCain when he lost in 2008. And luck is with America that Obama is president now instead of 2013 when he would have had an even bigger left leaning Democrat majority in Congress to implement his "mandate" for fundamental, foundational socialistic change.
Eleven months in office and Obama, the "New FDR," remains the Great Depressor depressing economic activity with his regressive tax, spend, entitlement policies-and prolonging the recession which in reality is a depression as 30 million people are out of work or underemployed. Obama can smile, lie and fake optimism all he wants but he cannot escape the laws of economic reality and the epic catastrophe he's creating with his destructive left-wing policies.
Postscipt: The Failed McCain Presidency
If McCain had defeated Obama in 08 the economy would not have revived in his first term. Spending hawk that he is McCain would have vetoed practically every useless and wasteful Democrat stimulus bill to jump start the economy with the Dems killing every one of his tax cutting proposals*. At best McCain may have seen an anemic recovery by the end of his first term, not enough to save his presidency in 2012 with Obama promising jobs, jobs, jobs by the millions to a public more hungry for change than it was last year. In short, the ruinous, destructive Obama presidency was inevitable and we will be a chastened, better educated and more enlightened people after his four punishing years**. See my piece on National Shock Treatment here .
*Supply-side McCain tax cuts would have been blasted by the liberal media as the failed policies of the past that caused the financial collapse and recession. McCain would have gathered very little public support for his plans, and the economy would have remained flat for years.
**Paraphrasing D*ck Morris: We are passing through a painful and much needed learning experience.