Obama Must Know His Spending Yields Bankruptcy, Not Growth

by David Limbaugh at townhall.com

…Could we all agree that we are doomed as a nation if President Barack Obama continues his deficit spending at unprecedented levels? Can you think of any reason, then, to justify this spending? Oh, our president says it's to jump-start the economy? Sorry, that dog won't hunt. So what's his real motive?…

Wake up, you Obama holdouts. Obama either is too ideologically blind to understand that his spending elixir isn't working and won't work or doesn't care because his primary goals are a) to redistribute and redirect that money from people who have earned it to people and projects he prefers to have the money and b) to direct the money into organizations and projects that will enhance his and his party's chances for re-election (a slush fund).

Listen. This is not just our ordinary back-and-forth political debate, in which Republicans advocate supply-side tax cuts and liberals advocate their class-warfare wealth- and achievement-punishing confiscatory tax packages. We're way beyond the ordinary parameters of American politics, where the swinging pendulum generally assures liberalism won't march too far forward…..

Obama's stimulus strategy is based on Keynesian economic theory, which holds that an economic recession characterized by demand's falling below supply can be corrected through government spending. Keynesian models assume that government spending adds money to the economy, so it almost doesn't matter where the money is spent; it will stimulate economic growth.

Not so fast, says Riedl. "Congress does not have a vault of money waiting to be distributed," he says. (Now that's the understatement of the new year). "Every dollar Congress injects into the economy must first be taxed or borrowed out of the economy. No new spending power is created. It is merely redistributed from one group of people to another." (Hint: Obama knows that!)  Read more…