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Wednesday, November 25, 2009

Where is the economic growth going to come from?

With the news that last quarter's economic growth has been downgraded from 3.5% to 2.8%, we can start to ask (or continue to ask) what is going to turn things around? What specific policies have the Democrats proposed that will encourage actual growth instead of increasing the uncertainty that businessmen must face as they make economic decisions. The WSJ writes,
The panicked Democrats' biggest problem is that Congress and the President have erected the biggest overhang of economic policy uncertainty that anyone can remember.

One big difference between Washington and private markets is that politicians think everything they do is free-standing. Markets, however, combine all the potential costs of Washington's policies and then decide whether to invest, or not. Consider what private decision-makers see in their future:

A 2,074-page, trillion-dollar health-care bill to redesign 17% of the U.S. economy. A carbon tax—cap and trade—that remains an Obama priority ahead of the Copenhagen climate summit next month. A falling dollar and gyrating commodity prices, with no idea where those prices will go next.

Democratic liberals are talking about an income tax surcharge to pay for any commitment in Afghanistan. Card check, to expand unionization of the private economy, remains a priority. Domestic discretionary spending in fiscal 2010 is set to rise at 12.1%, with inflation near zero.

Nurturing a fragile economic recovery into a durable expansion requires policies that restore public confidence and reassure investors, risk-takers and employers. The Democratic agenda is doing precisely the opposite, which is how you get subpar growth and fewer new jobs.
Why would any businessman decide to expand his company and hire new workers when he's facing the uncertainty of these questions?


Stan said...

I talk to small business owners all the time. They are petrified. I hope BO-zo and his clowns are only shockingly stupid about the damage they are doing. The alternative explanation is worse.

Bachbone said...

Stan, they can't all be stupid. Obama and his merry band of progressive ideologues know exactly what they are doing. It's the useful idiot GOP RINOs like Senators Collins, Snowe, Graham, McCain and a fair number of GOP RINO congressmen who haven't a clue yet as to what Obama & Co. are aiming to do. The voting public, at least, is beginning to catch on.

6p00e008da0c2f8834 said...

I agree with Bachbone - calling the Administration and Congress stupid plays into their hands.


Rick Caird said...

I suspect this chart pretty well explains the whole problem. Business and the economy are more foreign to these guys than Japanese protocol.


Bachbone said...

Rick, even granting that a cabinet with private sector experience would be helpful, anyone with a smattering of knowledge, or a willingness to do some Googling (and every MOC has a huge staff to do that for her/him!), about the utter and complete failure of employing these exact "fixes" in the past would know not to try them again. Bernanke, we were told, is an expert on the Great Depression, so he certainly should know what is being done is the mark of a schizophrenic off medication.

So Cal Jim said...

I believe Obama and his fellow Marxists know exactly what they're doing. They're intentionally wrecking our economy to create a "crisis" necessary to justify permanently taking more power from the private sector. All of their economic meddling is designed to cripple private enterprise.

For instance, take the Stimulus that was so damn necessary to "rescue" our economy. It was supposed to jump-start our economy by creating all kinds of jobs, thereby putting money back in circulation. But it's now clear that the only thing that was jump-started was more government control over our money and our lives.

So what was it really for? It certainly wasn't jobs because about the only jobs created belong to fictitious people in fictitious congressional districts. And since "jobs" haven't been created and money isn't circulating, the great big, inescapable question becomes, where in the hell did all the money go? The people in charge say, "Gosh, we don't know." Bullshit! My bet is that much of it has been laundered to Leftist NGOs like ACORN. No doubt a lot of it has gone to pay off union bosses (and probably Chicago crime bosses too).

If the money trail is ever allowed to be properly investigated, the American people will be shocked and angry. Therefore, the Dems (and probably quite a few Repubs, too) will never let that happen.