WASHINGTON -- The Obama economy is looking bleaker than ever. All recessions end, but this one's going to last a lot longer than most because America remains overtaxed, overregulated and drowning in unfathomable debt.
We had the capacity to grow our way out of the 2008 recession within two years with the right growth policies. But President Obama and the Democrat-run Congress pursued impotent, anti-growth fiscal policies that drove spending to unprecedented levels at a time when the recession had sandbagged tax revenues.
That forced the government to sharply increase borrowing, which is devouring the lion's share of our economy's income.
When cooler heads, some within his own administration, were urging him to concentrate on the economy, he focused on a massive new government health-care entitlement program. That's now in the process of running up a mountain of future bills -- and crippling anti-job-creating regulations -- on an economy struggling to climb out of one of severest recessions since the Great Depression.
When a recession hits and incomes fall, Americans instinctively tighten their belts, reduce spending, pay off credit cards and sock money away in savings in case things get worse. But Obama and his party did just the opposite. They expanded government, raised spending and burdened the economy with $3 trillion in higher debt.
The Obama crew lived in a separate reality of their own making, believing their exaggerated rhetoric that the economy was moving "in the right direction." But as the economy grew weaker, revenues fell, budget deficits rose, and the unemployment rate climbed into the 9 percent range.
If anyone in the West Wing thought that the economy was coming back, he was yanked into reality Tuesday when the Federal Reserve Board said the economy was growing so slowly, it decided to keep its ultra-low interest rates where they were for two more years.
Previously, the Fed said it was keeping interest rates low for an unspecified "extended period." But the Fed now says the economy has entered dangerous territory and that things aren't going to get much better until at least mid-2013.
The Fed acknowledges what government data have shown for the past six months, that "economic growth so far this year has been considerably slower," raising fears it is tilting into yet another recession.
After $1 trillion in stimulus spending, which has all but been spent, the economy is falling backward again.
"Indicators suggest a deterioration in overall labor market conditions in recent months. Household spending has flattened out, investment in nonresidential structures is still weak and the housing sector remains depressed," the Fed said.