The Change We Got: Bush’s Big Spending, Now on Steroids
Rather than making a clean break with Bush's failed economic policies, Obama is doubling down on them.
March 27, 2009 - 12:00 am
To put it politely, this is sheer madness. Those of us rooted in reality, however, look on with eager anticipation — for if Obama proves us wrong, he will have defied not only the laws of politics and economics, but those of science and physics as well. It will, in short, prove to be the most amazing thing any leader, of any country, in any period of time, has ever done, ever. At first, that seems like a high bar to achieve for a 40-something law professor from Chicago. But then one recalls those nifty “progress” posters and one’s doubts are immediately put to ease.
During the campaign, and in the period after the election and before the inauguration, Obama’s supporters articulated what they believed would be Obama’s historic position and relevance. They believed the Bush-to-Obama transition would be reminiscent of the Carter-to-Reagan change, where an unsuccessful administration, widely perceived as a failure, would be followed by a saving-grace leader, who in time is vindicated by history. According to this vision, Bush was to be the Republicans’ Jimmy Carter and Obama the Democrats’ Ronald Reagan.
But here’s the catch: Reagan broke sharply from Carter’s worst policies. Obama is intensifying Bush’s.
And wherever Obama is, in fact, breaking from Bush, he’s breaking in the entirely wrong direction. As ABC’s Jake Tapper explained, Obama has proposed $989 billion in new taxes, most of which will be on individuals. Obama will let the Bush tax cuts expire and will hike the capital gains tax on the “rich,” which will cost the rest of the country $636 billion over ten years. On businesses, Obama will repeal LIFO, the expense of drilling costs, eliminate advanced earned income tax credits, rescind the manufacturing tax deduction for oil and natural gas companies, and more, which will cost the entire country an estimated $353 billion.
This rise in spending is without parallel. As Tim Reid phrased it, “A keen poker player, Mr. Obama is gambling not only his own presidency, but the future well-being of the country. If he pulls it off, they might find room for him on Mount Rushmore. If he fails, he could bankrupt the world’s largest economy.”
Think about it: when going through tough financial times, do individuals save their money — or do they spend more than at any other time in their lives? They save, of course. Then why should governments abide by another standard? Why shouldn’t this logic be applied on a macro-level?
President Obama insists now is not the time to “do nothing.” But rather than “doing something” and focusing on the task at hand — the housing collapse and the financial sector — Obama has instead used this recession to advance his own political agenda by radically Europeanizing (read: “change”) the energy industry, the health care system, and the education system. Charles Krauthammer calls this what it is: deception. He goes on, stating:
As an explanation of our current economic difficulties, this is total fantasy. As a cure for rapidly growing joblessness, a massive destruction of wealth, a deepening worldwide recession, this is perhaps the greatest non sequitur ever foisted upon the American people.
At the very center of our economic near-depression is a credit bubble, a housing collapse, and a systemic failure of the entire banking system. One can come up with a host of causes. …
The list is long. But the list of causes of the collapse of the financial system does not include the absence of universal health care, let alone of computerized medical records. Nor the absence of an industry-killing cap-and-trade carbon levy.
Imagine a similarly absurd hypothetical scenario: Social Security collapses and Obama says we need to septuple or octuple our spending for NASA, implying space exploration will fix Social Security. Crazy, right? Well, welcome to President Obama’s economic recovery plan. It’s as if Obama thinks we’re all idiots and equally detached from real-world actuality.
Despite Obama’s best efforts, the economy will rebound in due time. That’s the nature of the beast. Yet it will be then, at the very beginning of recovery, that the pain from Obama’s frivolous spending will truly be felt. In the last five months, the geniuses in Washington have nearly tripled our money supply. Needless to say, during a recession, nothing else really grows, let alone doubles or triples.
But in one or two years’ time, things will begin to recuperate. It will only be then that all of this money, naturally, hits the market — all at the same time. The inescapable effect will be devastating hyperinflation. This will cause even greater unemployment at home, and considering the interconnectivity of the global economy, even greater economic downturns around the world. The only way to get out of double-digit inflation is to endure another recession. When this happens, the sad part will be that this all could have been avoided if only we stuck with, and continued to believe in, classically American economic principles.
And to think that all of those starry-eyed first-time voters went into the voting booth and thought their ballots would bring about a clean break from the “failed policies of the last eight years.” What a pity it is that the misplaced but sincere idealism of 2008 will invariably become the widespread cynicism and disparagement of tomorrow.