Indeed, the dirty reality is that Keynesian policy works as a double whammy against fiscal sanity. It involves government's spending money it doesn't have, which, by definition, increases the deficit and debt. And it also increases the deficit by smothering the private sector and deterring real economic growth. There is no appreciable "multiplier effect" from monies that are spent by government fiat, as opposed to those spent in response to true market forces, including real consumer demand -- as opposed to government (SET ITAL) command (END ITAL).
We saw the devastating impact of reckless Keynesian policies during the Great Depression, and we're witnessing them again today. As long as Obama is married to his redistributionist profligacy, we cannot reduce the deficit. And it's even worse when you consider that Obama wants to raise taxes on the primary generators of economic growth, small businesses, during a slow economic period.
With his signature audacity, Obama told town hall attendees their taxes haven't gone up in his administration. Puleeze! Obamacare, anyone -- for starters? He also said Republicans haven't been honest with voters about what needs to be done to revive the economy. "We can't pretend that there are shortcuts," he said.
Sorry, but he's the one being dishonest. The Bush years saw robust economic growth until the last year of Bush's second term. The policies that led to the subprime collapse, the recession and the skyrocketing deficit in his final year were brought upon mostly by liberal Democrats hellbent on demonstrating their "compassion" for people by insisting on loans to people who couldn't repay them and cynically resisting President Bush's efforts to rein in Fannie and Freddie.
President Reagan didn't continue to blame Jimmy Carter for his malaise-ridden economy during his term. He didn't implement policies that didn't work after promising they would and then whine that it would "take 10 years to get out of this mess because it took us 10 years to get into this mess." He passed tax cuts that launched an unprecedented period of peacetime growth -- and not at the expense of federal revenues, as has been falsely alleged.
I don't expect President Obama to come clean with the American people or to ever accept responsibility for his disastrous policies, much less to voluntarily change course, but it's gratifying to see that people, including some of his supporters, are finally onto him.
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