With federal deficits and borrowing sucking over $3 trillion out of the economy in President Obama’s first two years, no wonder small and medium businesses can’t get loans and capital to create jobs. On top of that, President Obama’s regulatory tsunami and next year’s tax supernova are creating capital flight out of the United States, creating jobs overseas in the newly emerging economies instead.
President Obama’s June 2 speech at Carnegie Mellon University in Pittsburgh, reflected again in his Oval Office speech last night, provided a foundational statement for his economic policies, explaining how he thinks they have worked so far, and how they will bring back prosperity in the rest of his term. Both speeches reveal a man who quite expressly thinks economic growth and prosperity are created by more government spending, higher taxes, and more regulation, and who can’t imagine how anyone else could think differently.
In Pittsburgh, President Obama expressly credited the TARP bailouts of the financial sector, the federal bailout of the auto industry, and his trillion dollars in so-called stimulus spending for ending the recession and restoring economic growth. But this column explained last week that what we are experiencing is a natural, cyclical economic recovery that has been delayed and stunted by Obama’s outdated, counterproductive policies reaching back almost 100 years to the 1930s.
The average recession since World War II has been 10 months and the previously longest since then has been 16 months. But now, 30 months after the recession officially began in December 2007, unemployment remains stuck at nearly 10%, and the National Bureau of Economic Research, the official scorekeeper on the matter, says it can’t yet determine that the recession is over. Economic growth is less than half what it should be coming out of a recession this steep, and now there is talk we may be peering down the roller coaster into a double-dip recession.
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