PJ Media

It is inevitable that the economy will suffer for a long time due to the spendthrift approach by the Democrats and the ridiculous TARP spending Bush II advocated.

My experience tells me there will be a recovery of sorts starting late this year. It will initially show some signs of strength, the economy has shrunk quite a bit and for a long time now. After it starts inflation will begin to take off. Bernanke will have to push the prime up quickly because of the trillions of dollars the government has flooded onto the market.

When that occurs the recovery will stall. This is an entirely avoidable result, but not if you play your fiscal and monetary hand as Bush, and now Obama, have chosen to play it, with the active complicity of the Dems in Congress.

I don’t know if the resulting stagflation will amount to a national tragedy, but prosperous, productive Americans are not going to like it and are going to look for an alternative way out. This inevitability will occur entirly on the Dems watch as they control both the legislative and executive branches of the Federal government and most state governments as well. There are a few Dems who understand the danger here, Kent Conrad and Ben Nelson come to mind. The rest don’t really understand economic theory or are wedded exclusively to their interpretation of a Keynesian approach. Historically, that approach has led to purgatory, at best.

Pastor, a smart Liberal would see that an expanding private sector provides tax revenue for “do goodism”. Sweden and Norway have adjusted their welfare states and attempted to create more room for private capitol to fund their “utopias”. That ain’t happening in the US as Obama is executing the Clement Atlee playbook to a T. He will reap similar economic performance. American voters kicked Obama’s tires and liked what they saw on the used car lot. They are not going to be happy as the car keeps breaking down.