A Four Year Stress Test

So, here we go: Into the next four years. It will be, as I read elsewhere, a four year stress test of liberal government. Those who voted for Obama are going to discover what it means to get what they want.

Obamacare will go into effect, and as a result, millions working nearly full time will be reduced in hours to half time. They didn’t have employer provided health insurance before and they won’t now. They will, however, be required to get coverage. Many will be forced to take a second part time job; if one can be found. Many more will be forced on to government assistance beginning a life of government dependency.

The national debt will continue to rise and the Fed, left with no other options, will continue to monetize the debt by quantitative easing; printing money. The result will be rising inflation. When the government monetizes its debt, it prints money to pay its creditors. That, of course, reduces the value of savings and paychecks. It is essentially a transfer of value from citizens to pay public debt. Inflation taxes people with no income at all. Inflation taxes the poor at at a greater level than the wealthy who can purchase hard assets to avoid it. Inflation is the most insidious, regressive tax ever employed in America. It will be a heavy burden on those who supported this president.

Economic uncertainty will grow. Businesses will become very conservative as they wait for rule making for Obamacare and other federal programs. Investments will be stalled. Business plans put on hold. Hiring frozen. The economy will remain destabilized.

When government provides a stable environment over a long-term planning period it instills the confidence investors and entrepreneurs. The result is economic growth, wealth creation and job creation. The opposite is also true. A government that destabilizes the business environment by making constant changes, imposing thousands of new regulations, experiments with economic policy and demands transformative change chills investment, stunts growth and stymies job creation. The Obama Administration is a textbook study in economic destabilization and the result will likely be a slide back into recession. People still working will soon be lining up for the dole.

Complex and costly new regulations, skyrocketing prices, a chilled business environment, tight money and growing joblessness. Maybe, just maybe, at the end of the next four years of horror, people will, once again, look to policies promoting free markets and free minds for America.

We will be ready to retrain them.

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14 Responses to A Four Year Stress Test

  1. DarthJay says:

    I have come to this same conclusion. It’s funny, I was having an argument with one of my liberal friends the other day and we made a wager as to the effects of a second Obama term. I outlined almost exactly what you said here. I have no doubt I’ll win the wager and that he won’t have the extra cash to pay me my winnings. :)

  2. messup says:

    1807 and 1929…same situation, same causes…government excessive spending.

    1929 to 1939=Great Depression. Hoover, then FDR did:
    1)Higher wages (Obama likewise)
    2)Public works(Obama stimulus)
    3)2 to 3 million unemployed
    4)Coordination b/t business and government. (Obama’s Business Czar)

    Today, there are:
    1)4.3 million on welfare
    2)47 million on food stamps (SNAP)
    3)5.6 million unemployed.
    4) 1 in 5 children, are “poor”
    5)21 million american children received lo-cost help
    6) 1/2 of single moms kids live in poverty
    7)US has highest rate of poverty in developed world.

    Credit card use (or some form of debt):
    2011= $48 billion in new debt
    424% more than in 2010
    577% more than in 2009

    You judge the future!!!Pray. Amen.

  3. James says:

    Darthjay, why do you have a liberal friend?

  4. Greg B says:

    How do we retrain ONE HUNDRED AND FIFTY MILLION idiots?
    When this administration’s policies fail, and they will, the takers will howl ever louder more.
    And the “leadership” (cough cough) in the GOP are, for the most part, so emasculated, so desperate to keep what little power and privilege they have left, they will sell us down the river in a heartbeat.
    I know, Repubs are a means to an end. But I think that means is coming to an end.

  5. DarthJay says:

    @James – I work in Advertising. Like Hollywood, there’s lots of ‘em in the biz. :)

  6. notamobster says:

    James – :-)

    Greg B – I think the Republican Party may sell us out and go the way of “conservative” parties in Europe. If that happens, it may be time to form a viable 3rd party.

    I guess what I’m saying is ‘depending on their actions, that means may indeed be coming to an end’.

  7. marty says:

    “The Obama Administration is a textbook study in economic destabilization and the result will likely be a slide back into recession.”

    I wasn’t aware that we had climbed out of recession. Oh, wait – the government says we have, and MSNBC says we have, and the NYT says we have, so [silly me] I guess we have.

  8. R.D. Walker says:

    Well, a the textbook definition of a recession is that the economy recedes. That means negative growth. The growth has been anemic as hell, but it hasn’t been negative since 2009.

  9. Greg B says:

    As much as a viable 3rd party appeals to me. One that values freedom. I doubt we’ll see it successful in our lifetimes.
    The commies have been chipping away for decades, I expect it will take decades to undo the damage. Unless there is a DRASTIC shift back to a moral and virtuous populace.
    And I’m not really talking about matters of sex or vice. That is what it is. I may not agree with it but, there you are.
    I’m talking about righteousness of spirit. Of soul. Of pride. Of everything that makes Americans the greatest citizens of the Earth.
    And I think that is the important distinction.
    “We are CITIZENS. Not subjects.”
    I’m pretty sure I read that here on the Revo sometime in the past. (Sorry. I stole that phrase immediately)
    Ok now I’ve gotten into the rambling. I really need to write things down before I start typing.

  10. xenicalman says:

    RD:

    You are right on point and this quote from Thomas Sowell brings it home:
    “It is self-destructive for any society to create a situation where a baby who is born into the world today automatically has pre-existing grievances against another baby born at the same time, because of what their ancestors did centuries ago. It is hard enough to solve our own problems, without trying to solve our ancestors problems”.
    I would add that government could be added as an entity adjacent to the word “ancestors”.

  11. marty says:

    I would suggest that growth in the last 3-4 years has been much less than anemic, as in negative. The “official” govt. stats give a much rosier GDP figure, to support Obama’s “green shoots” and “recovery summers”. Only if inflation is running at 2% or so can the proclaimed GDP growth be true. Using a true inflation rate of 9% (shadowstats.com), we find that the GDP deflator will pull the GDP sharply into negative territory.

  12. notamobster says:

    The problem, Marty, is that we live in a period of fungible values. Wholly accepted, are bogus metrics which don’t accurately reflect true economic indicators. Look at unemployment. GDP is the same. When our govt doesn’t like the results, they just change the metric until the result is favorable.

    Unfortunately, the mainstream view is that GDP has grown, because they use the new metrics. Shitty, but it’s reality.

    It won’t do anything to stop the ironclad laws of economics from having their way, but it will provide cover for politicians.

  13. marty says:

    A stark but true assessment, Mr. notamobster.

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