The National Debt Road Trip:
Paul Krugman, noted columnist for the New York Times, has come out in favor of another stimulus plan. The proverbial feather could knock me down. How can such a smart man be so wrong? I guess I shouldn’t be surprised. America’s intelligentsia of the 1920s and 1930s bought communism hook, line and sinker until Khrushchev fessed up about Stalin’s murderous reign. In fact, universities are still loaded with professors who continue to advocate Marxism, as long as it’s done right. We’re still waiting. The just departed Robert McNamara, hailed as one of the best and brightest, believed he could win a war of attrition in Vietnam. Average Americans were not surprised when we tired of the body bags first. And on it goes. Smart people, those who think and read and write in classrooms and paneled offices and acquire Ph.D.s, often fail to understand the real world. Not always, but too often.
Consider these sobering facts. America’s debt load is staggeringly huge. The interest alone will soon approach three-quarters of a trillion dollars each and every year, a colossal waste of resources. Worse, Obama’s own economic team has projected trillion dollar yearly deficits as far as the eye can see. Still worse, the twin chickens named Medicare and Social Security are about to roost as 76 million boomers age. The real kicker is the looming threat of rising interest rates. When they go up, as they must, servicing the national debt will likely prove impossible. Krugman’s desire for yet more debt is akin to pouring water on a drowning man.
Adding to the lunacy of Krugman’s position is the easily obtained fact that most of the $787 billion stimulus plan — the one that Krugman wants to add to – has not been spent. Considering America’s existing debt (why must we even say this?) arguing for more encumbrance before exhausting the original allocation is shear madness, borrowing and spending to no purpose whatsoever. Yet, there is a growing chorus of liberals who share Krugman’s views. If they prevail, the inmates will truly be running the asylum.
Part of Krugman’s argument is that FDR’s spending was too meager to end the Great Depression, a rare leftist admission of the New Deal’s failure. Now, says Krugman, Obama may repeat Roosevelt’s error if he doesn’t spend like a drunken sailor on steroids. In fact, Obama is following FDR’s disastrous example. Roosevelt dramatically raised taxes, killing the incentive to invest when the nation was desperate for more capital. FDR boasted that he would try anything and everything to improve the economy. In the event, his abrupt changes of policy pushed investors, who desire consistency and predictability above a good spouse, to the sidelines. Roosevelt continued the tariff battles begun under Hoover to disastrous effect. The growth of executive power in the 1930s shocked and frightened business leaders whose wholehearted participation in any recovery plan was vital but withheld. Little wonder the Great Depression was as bad in 1939 as it was in 1930. Tens of millions of Americans suffered needlessly.
Obama has or will repeat all of Roosevelt’s mistakes. His maniacal push to grow government and burden the American taxpayer with ever increasing debt can only lead to one outcome. Unemployment will continue to rise and payrolls will dwindle. Business expansion will be delayed or forgotten. A serious recession could easily become a second Great Depression if Obama’s economic advisors, in lock-step with Krugman, have their way. Now is the time to stop the madness. Cap and Trade, national healthcare, expanded welfare and universal “free” college tuition all must be rejected.
Government spending must be reduced along with taxes on business and commerce. Trade and manufacturing should be encouraged, not punished. All of America’s vast energy resources should be brought on-line. Pro-business polices worked for Grover Cleveland in 1893 and Ronald Reagan in 1982. They will work today. The private sector will lead America out of this mess, or we won’t get out at all.
Thank God that a recent Rasmussen poll shows Obama’s popularity in decline. Finally, a glimpse of citizen sanity. Let’s hope it’s not too late.
Posted by Jerry Pomeroy in Economics, Government Blunders, Obama Presidency, Taxation, Video