09.09.2011 0

Obama’s story of America

By Bill Wilson — For Barack Obama, economic prosperity for 14 million Americans seeking a job is just a matter of borrowing a few more dollars, and printing yet more money. And of course, paying your fair share — by Obama’s rules.

It is Obama’s “story of America,” where the only solution for government’s unsustainable spending is to reach into your pocket, and the only way to grow the economy is to put it on the charge card.

Which is the same old story.

During the longest period of sustained high unemployment since the Great Depression, is now the time to raise taxes on job creators? And at a time when the nation is already steeped in a $14.7 trillion debt that cannot repaid, is another $447 billion of “stimulus” the answer?

This is more of the same, and is precisely the recipe to turn the United States — into Europe, where merely funding government through more borrowing is tearing society to pieces. There, painful tax increases are thought to replace governments’ tepid efforts to control spending, too.

Specifically, Obama’s speech to a joint session of Congress called for raising taxes on capital. He claims the hike is at the behest of billionaire Warren Buffett.

Even if it is, when you want less of something you tax it. So, there will be less investment, further squeezing the balance sheets of businesses large and small. That in turn will increase the cost of doing business in America, resulting in yet more jobs being shipped overseas.

As for his plan to fork over hundreds of billions of dollars to balance state and local government budgets — again — that will only put off the day of reckoning yet again for politicians. How?

Obama is merely incentivizing profligate states like California and Illinois to resist spending cuts — and wait for a bailout. Kind of like Greece. . Or Italy.

In principle, his call for an infrastructure bank could be worth looking at, but only if all such spending was specifically exempt from Davis-Bacon union wage guarantees, and is accompanied by off-setting spending reductions elsewhere in the bloated budget.

Otherwise, it will just be a payoff to Obama’s Big Labor political allies in the midst of the worst sovereign debt crisis in history.

Obama has no plan to grow the economy. He only has a plan to grow the government — in the hopes that it will trickle into the real economy.

But he already tried that. The results are in.

While the debt grows at 10 percent, the economy only grows at 1 percent. After trillions of dollars of fiscal and monetary “stimulus,” unemployment remains above 9 percent.

Why will more of the same work now? We are already caught in a trap, which more spending — and raising taxes — will not lift us out of. Government is only taking money away from the private economy. From creating real jobs.

The money lent to the government — there are over $2 trillion in treasuries sales every year — could be invested into equities of American companies. Instead, that capital is lent to the government to pay off the nation’s creditors, and ever increasing health care spending, unemployment benefits, food stamps, and other social welfare.

Government has become a parasite that can only take from producers to sustain itself — harming production in the process. The only way the economy will grow again is to foster domestic production, not by starving it. Obama’s few hat-tips in this direction will not achieve the goal. Business is not going to make long term decisions based on temporary relief.

The one sure thing that would come from the Obama proposal is deeper debt and a nation — states, the unemployed, and an increasing number of zombie businesses — tethered tighter on the government leash.

Bill Wilson is the President of Americans for Limited Government. You can follow Bill on Twitter at @BillWilsonALG.

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