Citizens starting to see the light
Here is a perspective from the Wall Street Journal that we can shorten and simplify for easy reading here.
Our last steep recession was in 1981-82 coming as Reagan took over from Carter and began his campaign to lower taxes and get government off our backs. That recession came to an end following the dismal final quarter of 1982 when our GDP grew at only .3 percent. Over the following year the quarterly growth rates soared to five, nine, eight and eight respectively.
Now let’s see what we got from the current administration’s trillions in public debt: Third and fourth quarters of 2009 at 1.6 and five, followed by the First and Second quarters of 2010 at 3.7 and 1.6 respectively. In other words, after two years of government bailouts, take-overs, stimulus packages and pilings on of federal regulations all of which the party in power assured was the right recipe for success, we are back this summer to where we were about this time in 2009 at 1.6 percent GDP growth.
A favorite trope of the left is “yes, but Bush was so terrible we inherited a recession that could have been much worse without the stimulus, etc.” Is that so? Is there any evidence to support such a self-serving argument? The fact is that corporate America is sitting on an estimated two trillion in cash that they are hoarding necessarily until they can figure out what lies ahead in terms of higher employment costs, higher taxes, more regulations and the capitalism bashing that passes for useful dialogue in Washington. They were able to make profits during this horrible “Bush recession” by acting prudently in the face of the odds that the new president with a complicit congress was about to pull out all the left’s agenda stops. Had they been mistaken and pleasantly surprised by a Reagan-like Obama, might we have come quickly out of an otherwise relatively shallow recession?
A couple of years ago chatting with a pal, both of us lawyers, he told me that I must be one of the intelligent Republicans and said he could not understand why I was not a Democrat. Apparently an intelligent Republican is an aberration. I responded that (in college) I had majored in economics. A sufficient answer I thought. I might have said more, but I knew it was useless then to try to persuade him that there is a limit to how highly humanitarian our government policies can be; that we sometimes need to prioritize our mercies or risk creating more needs for mercy. He may be starting to see a different light today as so many of our people are suffering unemployment and newfound poverty. Polls are now showing an encouraging swing back to the conservative principles of Ronald Reagan and the economics of Milton Friedman. Intelligence is in no short supply on the right and the light is dawning across America.
Dave Finch lives in Penn Valley.
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