The Practical Philosopher's Blog

Using the practical application of timeless wisdom to address modern issues

Obama Declares War on Economic Growth

Larry Kudlow dispenses some gems of economic wisdom in analysing Obama’s ‘State of the Economy’ address that the President recently gave. First, he recognizes the what a whole-scale blast of Socialism will do to our free market economy:

Let me be very clear on the economics of President Obama’s State of the Union speech and his budget. He is declaring war on investors, entrepreneurs, small businesses, large corporations, and private-equity and venture-capital funds.

Those of us that have are students of history and current events have seen the effects of total collectivism on the Soviet Union and the strangled growth of not-so-economic-powerhouse of the EU. Kudlow recognizes this same objective outcome:

Study after study over the past several decades has shown how countries that spend more produce less, while nations that tax less produce more. Obama is doing it wrong on both counts.

Now we hear that, despite the damage to our economic recovery that the Democrat spending bill will do, Obama is intent on further shackling us with the universal growth killer of a cap-and-trade scheme. This will hurt everyone, especially those that those that work in ‘eco-incorrect’ industries (pretty much all of them):

And as far as middle-class tax cuts are concerned, Obama’s cap-and-trade program will be a huge across-the-board tax increase on blue-collar workers, including unionized workers. Industrial production is plunging, but new carbon taxes will prevent production from ever recovering. While the country wants more fuel and power, cap-and-trade will deliver less.

As I’ve noted in past posts, this is a massive lurch toward socialism/collectivism and an attempt make a dynamic US free market economy into a low/no growth model similar to the EU. Kudlow sees the same:

Essentially, the Obama economic policies represent a major Democratic party relapse into Great Society social spending and taxing. It is a return to the LBJ/Nixon era, and a move away from the Reagan/Clinton period.

Read the Kudlow article in its entirety: http://www.cnbc.com/id/29434104

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