Saturday, June 02, 2012

Federal Stimulus Doesn't Help the Economy

Friday's economic reports were nothing short of disastrous.  Unemployment is back up to 8.2%, new jobs created last month were 50% below forecasts, auto sales dipped to low levels (after earlier improvements), and the stock market dropped to the lowest levels in 2012.

And many think it's going to get much worse.  Could we be looking at a double dip recession? A genuine world wide depression? I certainly hope not.

My point this morning is not to spread doom and gloom, but instead to point out that President Obama's policies of massive government spending and expanded welfare programs just haven't worked.  Washington policies and political party posturing have only made things much, much worse than they needed to be.

I've enlarged the chart beyond the normal size of my blog to insure it is readable.

The chart above, prepared by the non-partisan Comeback America Initiative shows President Obama has stimulated us more that any president in modern history.  Sadly it's mostly through out of control Federal Spending.

Federal spending was close to 20 percent of GDP during the Carter administration, dropped to 18 percent under Clinton, and is currently at an incredible 24 percent of GDP according to the Congressional Budget Office.  And now the economy is slip-sliding backwards.

If government spending worked, it would already be working.  It's difficult to spend more than the 24% of GDP Obama is spending today.  Especially since a great deal of it is borrowed money.

Candidate Romney's prescription for the government is significantly better than President Obama's.  Most importantly, Romney will cut back the amount of Federal interference in the economy.  I fear President's Obama's solution of ever increasing spending will destroy the nation and bring on a world wide depression.

In a future blog entry I'll explain why the "hot button" social issues like abortion or gun control should NOT affect your decision on a President.

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