Barack Obama relentlessly references the handiwork of George Bush to alibi the weak economy. But if deeds should measure who governs, the Democrats deserve the boot.
The economy is burdened by huge federal deficits, trade imbalances with China, and horrendous problems at the banks, and the Democrats’ fingerprints are all over those problems.
Democrats claim the Bush tax cuts and two wars caused Washington’s fiscal mess but the facts tell another story.
In 2007, when the Democrats took control of Congress, federal spending, with wars going in Iraq and Afghanistan, was 19.6 percent of GDP, and the federal deficit was a manageable $161 billion. For 2011 with the recession over, the Obama Administration projects spending at 25.1 percent of GDP, and with the Bush tax cuts repealed for the richest families, a $1.3 trillion deficit.
The President and Speaker promised temporary stimulus spending to jump start the economy but indulged in massive permanent new entitlements and armies of regulators Americans simply don’t want. That’s why, despite squirrelly views on social issues, Tea Party candidates threaten Democratic incumbents.
The Great Recession was caused by huge trade imbalances with China, which destroys American jobs, and a culture of entitlement on Wall Street that defines good banking practices as anything generating big bonuses, the public be damned.
President Bill Clinton negotiated China’s entry into the World Trade Organization but gave the Middle Kingdom a pass on currency manipulation and other mercantilist practices. Now, those shenanigans have created a $250 billion bilateral trade deficit and encourage other Asian economies to follow suit, stealing 2.5 million manufacturing jobs.
President Obama has warned China the United States has options if it won’t stop manipulating its currency, but he doesn’t act. He is more concerned about his standing among international leaders.
Despite European recognition of the China problem, EU allies refuse to support Mr. Obama’s diplomatic efforts. Worried to keep his Noble medal shinny, the President sacrifices American workers on the altar of global governance.
The banks were deregulated by President Clinton, including repeal of Glass-Steagall. That permitted institutions making loans with federally guaranteed deposits to merge with Wall Street casinos that recklessly trade and hoist doggy securities on investors to pay executives unconscionable bonuses.
Obama-Pelosi bank reforms added more inept regulators but too big to fail Wall Street banks are bigger than ever. Monopolizing the CD market, those behemoths are driving down rates the elderly receive on savings and paying themselves over $140 billion in salaries and bonuses this year.
Now, big banks face charges of fraud and mammoth civil judgments for filing false titles and foreclosure documents that threaten to freeze up the housing market.
Meanwhile, small and medium sized businesses can’t get loans from Main Street banks, which are being squeezed out of business by the Federal Deposit Insurance Corporation and federally subsidized Wall Street competitors.
It’s raw politics. Wall Street contributes heavily to Democrats, while Main Street bankers tend to be Republicans.
The Republican Pledge to America offers few solutions but on their record, Democrats simply don’t deserve the Speaker’s gavel.
Disclosure: No positions