President B. Hussein is desperate. He has started to play the “catastrophe” card to sell his economic non-stimulus spending spree plan. No one doubts, now with three squishy Republicans-In-Name-Only (RINOs) on board, that he will get his way; but the way he got it will come back and haunt him.
He is using the exact tactics that he railed against during the campaign. Fear. Liberals are used to playing the on fear in just about any election. Every four years they scare the elderly claiming conservatives are going to take away Social Security, They scare the welfare class that conservatives might require them to work for their keep, you know, actually produce something besides babies and votes!
B. Hussein is now doing the same thing. He tells is that we must accept his pork-parade disguised as a ‘stimulus’ bill or risk a “national catastrophe.”
So much for “Change!”
Everyone agrees that some kind of fiscal stimulus might help the economy, and that running budget deficits is appropriate in a recession. The stage was thus set for the popular President to forge a bipartisan consensus that combined ideas from both parties. A major cut in the corporate tax favored by Republicans could have been added to Democratic public works spending for a quick political triumph that might have done at least some economic good.
Instead, B. Hussein chose to let that colossal jewel of ignorance, Nancy Pelosi (d) Speaker of the House of Reprobates, write the bill. She, and her minions, did what comes naturally for liberals: They dusted off every item on a forty year liberal wish-list, changed the dates and called it a work of genius. This ‘wish-list’ is chocked full of things that would never see the light of day if they had to stand on their own merit, but shoved down the nation’s throat as part of an “emergency” action, just might get through. This thing is 90% social policy, and maybe 10% economic policy. It is designed to support incomes through the transfer of the money you earn to those who choose not to work, rather than grow incomes through job creation.
Speaking to a House Democratic retreat on Thursday night, Mr. B. Hussein took on those critics (people like you and me) "So then you get the argument, well, this is not a stimulus bill, this is a spending bill. What do you think a stimulus is? (Laughter and applause.) That's the whole point. No, seriously. (Laughter.) That's the point. (Applause.)"
So there it is: Mr. B. Hussein is now endorsing a sort of reductionist Keynesianism that argues that any government spending is an economic stimulus. This is so manifestly false that we doubt Mr. Obama really believes it; and if he does, he is more dangerous than we have feared. He has to know that it matters what the government spends the money on, as well as how it is financed. A dollar doled out in jobless benefits may well be spent by the worker who receives it. That $1 of spending will count as economic activity and add to GDP.
But that same dollar can't be conjured out of thin air. The government has to take that dollar away from someone else -- either in higher taxes, or by issuing new debt in the form of a bond. The person who is taxed or buys the bond will have $1 less to spend. If the beneficiary of that $1 spends it on something less productive than the taxed American or the lender would have, then the net impact on growth will be negative.
Some Democrats claim these transfer payments are stimulating because they go mainly to poor people, who immediately spend the money. Tax cuts for business or for incomes across the board won't work, they add, because those tax cuts go disproportionately to "the rich," who will save the money. But a saved $1 doesn't vanish from the economy, unless it is stuffed into a mattress. It enters the financial system, where it is lent to others; or it is invested in the stock market as capital for businesses; or it is invested in entirely new businesses, which are the real drivers of job creation and prosperity. Yet Mr. Obama, on Thursday, dismissed any such tax cuts as "the same tired arguments and worn ideas that helped to create this crisis." That's rhetoric for a campaign, not for a President hoping to rally bipartisan support.
This thing is going to be a disaster of galactic proportions.
