Saturday, February 28, 2009

If you didn't notice what happened in the first 4 weeks, Pt. 1

So everyone everywhere on the globe is unhappy with their economy, and no matter who or what party is in charge, they get blamed. There are strikes in Greece and mutinies in Bangladesh, and Cincinnati, Ohio is planning an old fashioned tea party to revolt against the stimulus plan--because where‘s the representation if no one read the bill?

The Socialist, Marxist and Capitalist economies are all in trouble. Why blame Obama, president for four weeks, instead Bush president for 8 years? Well, Bush was a Republican, but not a Conservative. Obama is a Democrat, but not a liberal. At least not as we've come to think of them. He's a socialist/marxist, and all you need to do is read what he has said in the past, what he has written, and look who his friends are and who financed the campaign. Or listen to his vague statements last Tuesday night. The program he proposed and got passed--the $780+ billion-- will amount to over $3 trillion by the time the debt is paid, and no president has matched that, not in 8 years, and certainly not 4 weeks, and he has promised more to come.

You may have your money in cash or CDs right now, but unless it's in the cookie jar, I doubt that yours is any safer than being in stocks, bonds or real estate market. And yes, the banks have been nationalized--that's what the "bailout" is. "We the people" now own the big banks--and not as stockholders. That's why they are being forced into foolish business decisions by Obama to rewrite all those bad mortgages--60% of which will fail within 6 months (Oh! those nasty predatory lenders--with gun to the head they loaned money to bad risks). That's why they have to cap salaries--and maybe yours or your industry will be next. And yes, the auto industry is nationalized too--that's why they are going to produce more "green" cars which don't make a profit. Now the government can also tell you to stop driving your “pre-green” car, even if you can’t afford a $35,000 hybrid. That way “we the people” can sell more new cars. See how nicely it works together when “we workers” own the means of production? And yes, when "children" are covered through age 28 in families earning $80,000 year, that is nationalized health care, and it doesn't touch the poor, because those new "children" were already eligible through parents' employers, and the poor were eligible under Medicaid. It's just one more way to put private insurers and private doctors out of business. The government simply needs to redefine “children” and “poverty.”

It's better to compare Bush with Clinton--and Bush was actually a bigger spender on Human Resources (welfare state, education, entitlements, etc.) than Clinton about a 2.75% annual growth during his years compared to 1.41% for Clinton. Bush lost the support of both the RINOs who always voted with the Democrats (in power since 2006). And he lost the support of the libertarians and conservatives, unhappy with the course of the war (people like Barr and Pat Buchanan).

A year ago, unemployment was 4.5% and the Dow at 14,000. Housing had been in trouble since August 2007, but mainly only that sector supported by government loans--maybe 2% of all mortgages, and that got worse. What happened Sept. 15, 2008 we may never know--I've read some "conspiracy theories" like 550 billion taken out of the economy in a few hours, and the government acted to stop it. Some say it was George Soros, some say it was the Chinese who own our debt. That totally changed the election campaign. From the beginning of Oct. 2008, Obama was the Man, and the markets, who don't vote for either party but hate instability, began to plunge and haven't stopped.

If you didn't notice what happened in the first 4 weeks,Pt. 2

Nobody wants to invest in our economy while Obama continues to threaten to raise taxes on the most productive segment that already pays 95% of the taxes, the so-called rich--those two income families that shelled out $100,000 to buy an education or business or law practice or medical clinic and are expecting to be paid for their efforts. Those "rich" families like mine who invested in businesses with our 403b and 401k giving up other things when younger.

I think the federal government--whether Bush with the Democratic Congress or Obama with the Democratic congress--needed to back off in 2008 and 2009 and let those companies in debt, banks and insurance companies included, struggle and die or merge and be bought out. President Bush failed his party and became President Hoover overnight--but he really stopped governing in October and turned everything over to Treasury and the incoming Obama administration. Hoover had 3 years of throwing money at the problem 1929-1932, Bush didn't. Then FDR continued socializing industries and the courts for another 12 years, until WWII pulled us out of it. Hoover is blamed and Roosevelt acclaimed. Baffles me. Allowing the economy to come back on its own is what happened in 1999-2000 during the last bear market. Jump starting it with tax cuts for tax payers, not tax takers, is what got it going again after 9/11.

Now, Bush did his share of "nationalizing"--like the drug benefit plan, developed with Ted Kennedy, certainly took us further down that road, and the NCLB which exerted even more federal control over local schools (also with Ted Kennedy) is another example. Both these money burners lost him tremendous support among conservative Republicans. The drug plan has just made us more dependent on less safe drugs made in India and China, and has resulted in huge profits for the drug companies. Again, these companies don't care which party is in office--they can succeed with either because the regulations and laws always work in their favor (they help create them with their lobbyists) because they kill the smaller businesses and competition. In fact, they love the Democrats because they are more likely to impose regulations whether it's on mythical global warming or the broadcasting industry or lead in toys.

No president ever spent more money on education than Bush, and although I think he was right to care about the " child left behind" all he did was make the unions and academics mad--leaving kids behind had always been their field of expertise--raising another generation of victims. Some studies show that NCLB made progress, but I suspect it's more "wealth transfer" only it's with grades and achievement at the expense of the better students, and eventually our country.

It may take years to show up, but I don't think Bush did churches any favors with the "faith based initiatives," because it has made churches more dependent on government grants, and Obama plans to tighten the screws on any mention or appearance of religion in those grants (a campaign promise he'll probably keep). Some of that had already happened under Bush and Clinton--I know 30 years ago we used to put religious literature in every bag of groceries at the food pantry. That doesn't happen today, but the food pantry is about 90% government funded--local, state and federal--10% by the churches.

American businessmen aren't stupid; they know how to make money. There are no business men in this administration and it shows. There would never be a Google or Microsoft or a Dodge Caravan if the Barney Franks and Nancy Pelosis of Congress had been in charge of the business plans. But they're more than happy to take over once someone else has figured out how to make money, and then Amtrak it. You can do that when the government is in charge.


Anonymous said...

This 2003 article clearly shows what a disaster dog and pony show the Hoover/FDR team was. Really looks like the final weeks of Bush and the early weeks of Obama but spread over a longer period.
"The tax increases of the 1930s coincided with large deficits and economic stagnation. While the monetary and trade policy mistakes of the 1930s are now widely
understood, the tax policy mistakes are less appreciated."

P Diddy said...

I have to agree with you on your thoughts about both administrations. I too am not very happy with the way things are going right now.

Great blog!

Cute Backgrounds

Soapbox Jill said...

You are so right about Bush. I got a churning feeling in the pit of my stomach every time I heard things like when he started giving "refund" checks to people who didn't pay taxes. And, of course, the comment about having to abandon capitalism in order to save it (when buying up bank shares last fall). THANKS for your detailed analysis.

Daniel said...

If you or your readers would like to help pressure Congress to actually read the bills they pass, please check out, then sign the petition and call or write your Members of Congress in your own words.

Everyone benefits when Congress takes the time to know what it is doing.

Norma said...

Excellent suggestion Daniel!

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