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John's Blog

John's conservative blog

Is the US economy on the "road to hell?"

Wednesday, March 25, 2009

EU presidency: US economic plans 'a road to hell'

Czech Prime Minister Mirek Topolanek, whose country holds the European Union presidency thinks so. His comments on this issue made before the European Parliament are a very good read. He is saying what many American economists including liberal economist and Nobel laureate Paul Krugman are saying, that we cannot spend our way out of this recession. We are piling up debt after debt to the point that our national debt will be at it's highest as a percentage of GNP since World War II. And yes, Obama did inherit this mess, but just using that as a perennial excuse does not cut it anymore.

The American people elected Obama to get our economy back on track, not to make excuses for why we are in this mess in the first place. Yes, it makes sense to look back at the genesis of this crisis so that we can learn from it and try to make sure that it doesn't happen again, but somewhere along the line, and that time has come now, we have got to move from the blame mode to the solutions mode, and so far Obama and his economic team have come up lacking.

You can't just print three trillion dollars worth of new currency without triggering massive inflation, unless there are matching cuts in spending, and far from cutting spending, Obama, showing his true liberal colors, is embracing virtually every liberal spending program that the Democrats in Congress tried to pass but couldn't during the past several administrations.

We are back to a familiar mime. Government is the only entity that can solve problems, thus it is necessary to create one federal government program after another as we chase illusive solutions to problems that just seem to get worse, not better.

The lessons of history have apparently been lost upon Obama and company. Economies have always been cyclical and they always will be. You cannot repeal the economic cycle. Yes, this is a deeper recession than most, but eventually demand will start to outstrip supply and the economy will come back, unless of course the government gets in the way, in which case the inevitable recovery will be weaker and slower than it might have been.

Mr. Obama, let our economy do it's magic without interference from you. Let those so-called toxic assets work their way through the system. Let those who made bad financial decisions and took on mortgages that they could not afford learn their lesson and start over. And let the financial institutions that made those bad loans go under if they will, to be replaced by others who will rush into the market to take their place as the housing market inevitably rebounds. The housing market is already showing signs of coming back, and that is before any of Obama's expensive boondoggles have had time to kick in yet. Our economy can and will fix itself if only the government will stay out of the way and let it.
posted by John, 9:34 AM

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