April 14, 2009
Are You Better Off Today?By Richard N. Weltz
In his closing remarks during the final presidential debate of 1980, Ronald Reagan famously asked the American people: "Are you better off now than you were four years ago?"
Things are moving a more rapid clip, so perhaps it would be appropriate today to ask if we are better off today than we before control of Congress changed hands in the last two years of the Bush administration and a new president was inaugurated last January.
One common measure of economic well-being is the unemployment rate. During the first seven years of George W. Bush's presidency, 2001 - 2007, the rates were, respectively: 4.7, 5.8, 6.0, 5.5, 5.1, 4.6, and 4.6 -- all in the low/normal range historically speaking. By the last quarter of 2008, the unemployment rate had crept up to a still tolerable 6.9 percent; but by March 2009, it stood at a whopping 8.5 percent. Better off?
Another helpful measure of how well our economy is doing -- or not -- is the GDP (Gross Domestic Product), both as to size and the rate at which it grows or shrinks. For the eight years of Bush the Younger's administration, GDP increased nicely each year, as per the US Department of Commerce, BEA, in billions of dollars:
2001 10,128.0 2005 12,421.9
2002 10,469.6 2006 13,178.4
2003 10,960.9 2007 13,807.5
2004 11,685.9 2008 14,264.6
As of March 2009, however, the GDP forecast for the year, on an annualized basis of only 14,218.0 billion dollars, a noticeable reversal of the steady growth trend experienced during the Bush years. Reports The Economist, "Real GDP is forecast to contract by 3.1% in 2009 as the financial crisis and the housing downturn take their toll on domestic demand."
Then, of course, there is the matter of the budget deficit, which places a debt burden on us all that, if excessive, can only be paid down via either massive inflation or extraordinarily high taxes.
Although budget deficits occurred in seven of the eight Bush years, they remained relatively modest, especially in relation to GDP, spanning a range of $157.8 billion to $454.6 billion - this last including a term end "bail-out" appropriation by the Democrat controlled Congress. Even including a one-year spike, when the deficit ran to $412.7 billion, due mostly to war-related expenditures, it was held to manageable levels.
Under the Obama-Reid-Pelosi "stimulus" strategy, the budget deficit for 2009 is projected by the Congressional Budget Office to reach an enormous 1.371 trillion dollars. That's trillion with a "t" -- an enormous increase, due entirely to stimulus-related expenditures, which will take decades of high taxes to pay back.
Significantly increased direct and indirect taxes, whether through rate hikes or smoke and mirror dodges like decreasing deductions, are in the works already.
Oh, and don't forget that the Dow Jones was at 9,325 last October, just before the election, and had dropped to 8058 yesterday.
If you are a retiree or otherwise dependent on dividend and/or interest income with which to pay your living expenses, I don't have to remind you that this administration has forced a number of large corporations to drop dividend rates to a few pennies and is working hard to pressure others to stiff the holders of their preferred stocks and debt securities. Feeling better off?
Keeping America Capitalist
Most of us understand that state control of a nation's economy, whether under a socialist or communist régime has proven repeatedly to be a sure way not to prosper and progress in either wealth or liberty of the general citizenship. This lesson has been amply taught in the USSR, Eastern Europe, Cuba, China, and elsewhere.
But Rick Moran points out in his American Thinker article that:
Reading the lead story in a recent New York Times article, as well as other newspaper accounts over the past few days, we realize that it's not only banks, but insurance companies, automobile manufacturers, and other corporate entities to whom the Obama administration wants to dictate staffing, compensation, finance, product design, marketing, etc. It would be fair to call this by its right name, socialism; and if it makes anyone feel better off, he doesn't understand economics or the lessons of history.
The Bush years saw a rebuilding of our military, which had been severely weakened during two Clinton terms; but we are once again facing significant cuts in the amount devoted to keeping the nation strong and safe, as noted in this report:
From myriad news reports, we know that this means good-bye to the F-22 fighters needed to maintain air superiority over potential enemies, a reduction in the number of naval vessels needed to maintain control of the seas, foot-dragging (if not an absolute halt) to an anti-missile defense deployment in Poland and the Czech Republic, refusal to replace and update out nuclear warheads to contemporary standards, halting further deployment of Alaska-based interceptors designed to shoot down North Korean ICBMs, and a host of other steps that will weaken our capacity as the world's only remaining military superpower.
On several other vital national security issues, it is also appropriate to ask if we are better off now when our new president has made it abundantly clear that North Korea will receive no meaningful pressure from us, nor will Iran. Both have been clearly signaled that they can proceed with whatever nefarious programs they have for missiles and weaponry without fearing anything more than words -- not even over the kidnapping of American citizens.
From the question of deployment of missile defenses in Eastern Europe to that of dealing with the Somali pirates, Obama has made it clear that words, not actions, are his strategy -- one that has repeatedly failed to protect our country's interests either in direct contacts or through feckless organizations such as the UN. Are we better off security-wise with a snake charmer, all hat and no cattle, than with a president who was willing to call out the troops?
Within the few months he's been in office, Obama has:
The Obama trip to Turkey and other continental countries was, in effect, a turkey, as aptly described by Amir Taheri in his New York Post column -- worth a read. Obama's abject failure on his tour was also well-described by columnist Gerald Warner in the UK's Daily Telegraph, in which the writer named him as "President Pantywaist" and referred to him as the "new surrender monkey on the block."
On my behalf, and yours, Obama denigrated our country and moved from place to place eating humble pie as he went. Says columnist Charles Krauthammer:
So, are we better off with a president who is cheered abroad like a rock star but cannot get anyone to lift a finger to do the US even the smallest favor -- or with one who was disliked as a "cowboy," but took on the American responsibility as the world's superpower "policeman" and managed to put together a Coalition of the Willing consisting of four dozen other nations, large and small, who joined with us to remove Saddam Hussein as a menacing threat to the West as well as his own region?
The economy, keeping American free-market capitalism, our national security vis à vis those who would do us harm, and our stature among nations - are we better off now than before Obama took office? Not at all, I think.