David Boaz: Roosevelt v. Reagan on CNBC

We could all use less Keynes and more Hayek

Dick Armey writes in the WSJ:


It's clear why Keynes's popularity endures in Congress. Intellectual cover for a spending spree will always be appreciated there. But it's harder to see any justification for the perverse form of fiscal child abuse that heaps massive debts on future generations...

Of course, despite Mr. Obama's campaign promises to adhere to "Pay As You Go" budgeting, no one seems terribly worried about paying for what will likely be a trillion-dollar stimulus package. What everyone should agree on is that the money has to come from somewhere, either through higher taxes, borrowing or printing...

If the government borrows the money for the stimulus, then it will either have to print money later or raise taxes to pay it back. If the government raises taxes to pay for the stimulus, it will, in effect, be robbing Peter to pay Paul. If the government prints the money, it will increase inflation, which will decrease the value of the dollar. That would, in effect, rob Paul to pay Paul back with devalued currency...

Taking money out of the private economy -- either through taxes or inflation -- and spending it in a way that doesn't offset the loss of money with real economic gains is worse than doing nothing...

There is no way around it; this stimulus bomb is going to create inflation like nobody's business and it will do little to move the economy forward.

What the stimulus package will really cost

The Congressional Budget Office estimates that the proposed stimulus package making its way through the halls of our government would actually cost $1.2 trillion. Ouch! As if we needed to add to an ever increasing deficit and therefore kill the American Dollar.

Obama is Bush on Steriods!!

I have always found it quite curious that liberals hated Bush so much yet in many ways he acted (as far as government growth is concerned) like a classic big government liberal---expanding the sheer scope of the federal government and its budget. The size of government grew under his auspices to unprecedented levels. And guess what? The Obama administration is set on making government bigger than even the Bush administration. Watch the video below for Dan Mitchell's explanation:

Obama and the Democrats use a crisis to implement their economic plan

Eat your heart out Naomi Klein. Here is an excerpt from Obama's speech today at George Mason University. George Mason must have been spinning in his grave:

It is true that we cannot depend on government alone to create jobs or long-term growth, but at this particular moment, only government can provide the short-term boost necessary to lift us from a recession this deep and severe. Only government can break the vicious cycles that are crippling our economy – where a lack of spending leads to lost jobs which leads to even less spending; where an inability to lend and borrow stops growth and leads to even less credit.

To finally spark the creation of a clean energy economy, we will double the production of alternative energy in the next three years. We will modernize more than 75% of federal buildings and improve the energy efficiency of two million American homes, saving consumers and taxpayers billions on our energy bills. In the process, we will put Americans to work in new jobs that pay well and can’t be outsourced – jobs building solar panels and wind turbines; constructing fuel-efficient cars and buildings; and developing the new energy technologies that will lead to even more jobs, more savings, and a cleaner, safer planet in the bargain.

To improve the quality of our health care while lowering its cost, we will make the immediate investments necessary to ensure that within five years, all of America’s medical records are computerized. This will cut waste, eliminate red tape, and reduce the need to repeat expensive medical tests. But it just won’t save billions of dollars and thousands of jobs – it will save lives by reducing the deadly but preventable medical errors that pervade our health care system.

Finally, this recovery and reinvestment plan will provide immediate relief to states, workers, and families who are bearing the brunt of this recession. To get people spending again, 95% of working families will receive a $1,000 tax cut – the first stage of a middle-class tax cut that I promised during the campaign and will include in our next budget. To help Americans who have lost their jobs and can’t find new ones, we’ll continue the bipartisan extensions of unemployment insurance and health care coverage to help them through this crisis. Government at every level will have to tighten its belt, but we’ll help struggling states avoid harmful budget cuts, as long as they take responsibility and use the money to maintain essential services like police, fire, education, and health care.

Comment: My first thought after listening to this speech was how much is it going to cost and how long is it going to take to pay for it? With the "Boomer" generation getting ready to retire in great numbers over the next several years or so, social security and Medicare are going to be put to the test. Adding the so-called "Recovery and Reinvestment plan" and the myraid of other government implemented plans Obama spoke of during this speech may end up just as similiar government plans did during the Great Depression.

The Road to Serfdom

Prof. Thomas E. Woods explores the reason why the Great Depression lasted for as long as it did: Interventionist economics. We may be on the road to serfdom today because the federal government is adopting similiar policies to those implemented during the 1930's in order to dig the economy out of its current woes.



HT: Liberty Pen

And the rumba line just gets a little longer

Now commercial real estate developers are asking the government for financial assistance. The line for a taxpayer handout just keeps getting longer, folks. As predicted, a bad precedent was set when the Feds decided to bailout Wall Street.

Herbert Hoover and the New Deal

Thomas DiLorenzo, Phd. in Economics at Loyola, lectures on Herbert Hoover and the myth that free-market capitalism was the cause of the Great Depression.

HT: Liberty Pen

We are all Keynesians Now

A second stimulus package is gaining support in Congress even though the first one did little to spur the economy. Expect this same sort of Keynesianism to be at the fore of American economic politics for some time.