How Obama killed Keynesian economics
Since the Roosevelt era, it has been long assumed that Keynesian economics, basically Govt. spending on a huge scale, cured the Great Depression. It has been a long used mantra of the Democratic Party because their motivations were spending and redistribution. Those who know a bit more about economics will clarify that it was not spending that ended the Great Depression, but rather World War II.
Think about it–suppose you were to borrow a large sum of money via multiple credit cards. You then took that money, and rather than spend it on your own small business, were to squander it on comic books and snack foods. Sure, this will help the manufacturers of said items in the short term. But what happens when the credit runs out? Well….shhh…don’t tell the President, but it means you are broke. And while you might still want to buy comics and junk food, you are penniless. To the Keynesian the solution is to try and open up new credit cards and spend freely, hoping that at some point a miracle will happen and you will be hired by Hostess. The truth of the matter is, you are simply moving money around, and aquiring debt in the process. Eventually, your credit runs out and you are worse off than before.
If most people instead took their own money, and perhaps had a tax cut to increase the amount of money they actually had (after all, Govt is a sink hole where money goes to die) and invested it in a small business, and hired some employees, your chances of increasing your money personally increases. Of course, employed people and businesses also pay more taxes than the unemployed, so the amount of money going to the Govt naturally increases as well.
The falsity of Keynesian economics is one perpetuated by ivory-tower thinkers who have never run a business of their own. President Barack Obama is in that group. These people have a hard time fully understanding the basics of how things run, and how Capitalism increases economic activity, and how Government and taxation spoils economic activity. They think the “money tree” is debt, but it is actually small and large business that produces money via production of goods and services. Naturally, when a dollar is produced via business, that business in turn may reinvest a portion of that money on employees, expansion, or retooling. Govt spends the same money on more employee benefits with a zero sum gain.
The election of Barack Obama has exposed Leftism for what it is: basically a “pie in the sky” belief in false principles that don’t work in the real world. The President has done something that the Conservatives have had little luck in promoting, basically the falsehood of Governement as savior. Mr Obama has instead shown Government spending and taxation, and Keynesianism for what it is—the destroyer of nations.
I found it laughable that during the G8/G20 summits that the President seemed to be a man alone. European leaders, who are struggling with long-term Socialist and Keynesian principles basically told him to “go blow” as he talked about the need for spending Trillions more on so-called “Stimulus”. At the same time one might also have been scared by Obama’s stance, as it made clear his complete incompetence and shallow intellect. This man, who was to be the glory of Leftism, may instead prove to be it’s inevitable destroyer. His blind loyalty to ideology, his lack of introspection and self-correction, these are the qualities of a Dictator.
The President, if he were as brilliant as he thinks he is, would understand that slavery is a bitter pill to swallow. It takes time and a good portion of honey (provided by the media) to slowly lull the uninformed masses to bear the yoke. Instead, this foolish man has rushed out and spoken of his unlimited power, grabbed the American citizen by the wrist, and struggles to lock on the cuffs, while shouting, “You are acting…stupidly!”.
The shockwaves of this will linger for generations. And it will be spoken of in History books, about the grand dictatorial vision of a small man with oratory capability who tried to ruin the greatest nation on Earth to prove a “theory”, Keynesianism, and failed.