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  • Morning Bell: The Definition of Economic Insanity

    In January 2008, the United States economy employed 138.1 million people and the unemployment rate stood at 4.9%. But the powers in Washington thought deficit spending could boost a slowing economy, so Speaker Nancy Pelosi (D-CA) passed and President George Bush signed a $168 billion economic stimulus bill made up of temporary tax cuts and increased mortgage grantees for Fannie Mae and Freddie Mac. By January 2009 that economic stimulus worked so well that the U.S. economy had lost 3.5 million jobs and the unemployment rate stood at 7.6%. Again the powers in Washington thought deficit spending was the answer, so Speaker Nancy Pelosi and newly minted President Barack Obama dialed up $787 billion in temporary tax cuts and permanent spending increases. Ten months later, the U.S. economy has now shed another 3.59 million jobs and the unemployment rate stand at 10%.

    Undeterred by the complete failure of their past job creation efforts, leading leftist luminaries are again calling on the liberal majorities in Congress and President Obama to approve billions more in government spending for a third stimulus. Yesterday, President Obama hosted a “jobs summit” where academics, union leaders, and select big business leaders made their pitch for government largess. Among the ideas reported: Teamsters leader James Hoffa called for higher barriers to trade, President Obama insisted that all future aid to states go to preserving government jobs and not tax cuts, and others pushed to bring the “success” of Cash for Clunkers to a new Cash for Caulkers program.

    These “new” ideas will fail for the same reason the past two government stimulus plans failed: governments do not create jobs. Only the private sector in pursuit of opportunity can create jobs on net. The best we can hope from government is that it keeps to a minimum the jobs it prevents and the income and wealth it destroys. President Obama does not understand this. At yesterday’s summit, Obama lamented the lack of job creation: “There’s a lot of money on the sidelines in the private sector. They are still nervous about whether they want to go ahead and take the risks that are inherent in a free market system.”

    Wrong. Businesses aren’t nervous about “the risks that are inherent in a free market system,” they are nervous about the risks inherent in a government regulation dominated economy. Fred P. Lampropoulos, founder and chief of Merit Medical Systems Inc., told the President that businesses were uncertain about investment because “there’s such an aggressive legislative agenda that businesspeople don’t really know what they ought to do.” That uncertainty, he added, “is really what’s holding back the jobs.”

    Quick Hits:

    • New data from the International Council of Shopping Centers shows November sales fell 0.3 percent in November from a year ago.
    • An economist at the Office of Management and Budget has raised questions about the Environmental Protection Agency’s assumption that new regulations do not impose higher costs on coal-fired power plants.
    • Last night, Russian Prime Minister Vladimir Putin gave his strongest signal yet that he plans to return to Russia’s presidency, telling millions of TV viewers that he will consider running in 2012.
    • Even though the American Medical Association offered qualified support for the Senate health care bill this week, many other medical groups are unqualified in their opposition including the California, Texas, and Florida Medical Associations.
    • In light of new emails showing the data behind the hockey stick graph was manipulated, two members of the Academy of Motion Picture Arts and Sciences are demanding Al Gore give back his Academy award.
    Posted in Ongoing Priorities [slideshow_deploy]

    39 Responses to Morning Bell: The Definition of Economic Insanity

    1. Ed, ohio says:

      as a small business owner, I have no confidence in making investments for growth, acquisitions, or increasing payroll/headcount. The degree of new rules, regulations, taxes, surcharges, et al that are being pushed through Congress scare me more than taking a well calculated buisness risk, along with the many banks I use that no longer are lending capital. How can anyone plan future investments with all the new legislation being discussed?? Thus, I am trying to delever all debt, cut headcount, cut expenses, cut capex spend, and remain defensive until 2012.

    2. John Holshouser, Nas says:

      Can Albert Gore be sued in a class-action suit for Fraud Against the American Public? If no, why not? If yes, where are the lawyers? This is a serious question.

    3. Robert Turner,WA says:

      The comment "Obama dosen't understand this" is out of touch with reality. Obama knows only too well what he is doing. In order to overthrow a government you must first destroy its economy.

      Communist Manifesto lesson #1.

      Give the devil his credit he knows exactly what he is doing.

    4. Jeff, Scottsdale, AZ says:

      I can't possibly fault what's written here except to differ that Obama "…doesn't understand this."

      I would submit that his understanding of it is at least clear, but he simply believes – as any good Marxist — that free enterprise capitalism and private property is immoral. I believe that it's the intent of the President and the brilliant thinkers with which he has staffed his administration, to destroy the American economy and replace it with a socialist "economy", if that's not an oxymoron. How many times have we heard him say that it's his intent to "redistribute" wealth? He wishes to abase our nation and most of its people, a fact which is evident in his behavior with relations both foreign and domestic. If it was our collective intent to redistribute wealth and tear the heart out of the economy, what better way to accomplish it than what is being done now (building on the groundwork laid by predecessors)? If I had no other reason to believe he and the Democrats are purposely wrecking our economy, for that reason alone I would doubt that there's any lack of understanding on the part of the President. He and his wife simply despise America.

    5. Mary, Chicago, IL says:

      The administration doesn't want to understand, they just want to push their leftwing agenda through as quickly as possible. They know EXACTLY what they're doing. Redistribution of the wealth is Obama's only aim as POTUS. Once he accomplishes the total destruction of our culture he'll lose all interest in governing and just party with the Mrs. At the taxpayers' expense of course.

    6. Rhonda, Texas says:

      It's so sad and frustrating that this President and Congress is trying to ruin our country. He cannot be so stupid it has to be intentional. Every plan they have get's more stupid and absolutely out of touch with what is right. He doesn't know how to do anything but campaign and be a community organizer and has surrounded himself with a cabinet that is just as bad. We have to wake up and vote them OUT!!!

    7. Ron Derry NH says:

      There are two modes of government influence peddling in this country;

      One is to back the industrialists, the economic engines of building, making and producing that fund everything else.

      Then there is the Money lending institutes; those that make money off the risks that others take, consuming value and surviving off the efforts and speculation of others.

      When government doesn't favor either side and allows the strengths and issues of each side to be played out in the market place we have success.

      When the governmment , like now, favors the money, its lenders and its securing of value by imposed support to sustain the wealth and protect the lenders, you have stagnation and collapse of forward progress and the risk takers who would make the profits to fuel a recovery.

      The left will frequently say what is right and then impose laws that do the opposite. The economy needed stimulation; DEBT isn't stimulation but more burden. They are unwise and immature at business knowledge and how money moves in an economy. They should have allowed the market place to decide who survived and gave the economic strength to the consumers wisdom.

      The Democrats aren't wise enough to figure it out because they have never been workers, or risk takers with their own skin in the game. they are also locked to an agenda that believes in restricting and controlling private enterprise. They back the investors, bankers and their elite group of lawyers who survive off the controlling of monetary gains by that elite group.

      Their message is always well thought out and directed at the sympathies of society but their route aim is oppression, control and mandated order upon the peasantry so their elite financial gains may be secured by law and doctrine to protect their game, financiers and lawyers. The Dems insure a controlled path to their people by mandated doctrine even if it defies freedom of enterprise.

      They have chosen a path AGAINST industry, its profits, its risks and its ability to sustain and create growth, why is anyone surprised at the results of their methodology??

      America can't recover without work, production and profits of the movement of money to and from the people to the industrious of our society and will most assuredly collapse if they don't realize the folly of this Marxist approach and blind desire to pay off the bankers and lenders whose risks and profits were their own to lose or gain.

      The American citizenship should never been made to suffer the consequences of bad laws, bad banking and the wishful thinking of leftist agenda's that weigh heavily upon the moral fiber of our country at a cost to millions so a few well spoken idealists can cleanse their guilt of not protecting American workers.

      It takes work and productivity to create value….it is that simple. Perhaps too simple for the Pelosi, Reid and Obama's of our time.

      Simple put; if you take out a loan you loose the value of the interest and the only way to out pace that is with profitability at a rate faster then the loans interest. Bankers therefore are part of the feeder groups, as is government that burden the financial growth as well as are part of the necessary movement of progress.

      At the moment they don't know their places and are sucking the life out of America.

      So simple a non Ivy league graduate could understand it. The parasite must not have the power to kill the host. Industry is that Host as is the American consumer.

    8. E. D., Texas says:

      My husband and I had already started the process of opening a medical supply business Oct '08 we had incorporated, rented a store front, worked out contracts with vendors, utilities were on and we were working out the final details to open our doors when the Obama administration took office. We decided to hold off on opening for a few months just to see what this administration had planned for our country. By June we decided that to open the business at this time would just be too risky due to all the legislative craziness that's going on in Washington.

      We have already invested several thousand dollars just in initial start-up and now it's all on hold indefinitely. We still desire to open our business but Washington has made the small business environment far to hostile and uncertain for it to be a wise move at this time.

      My father and brother run a small business together. They have talked about increasing the number of employees they currently have and expanding the business. This would allow my 60+ year old father to not have to do as much of the physical labor involved in their business. However, the hostile legislation in Washington has caused them to put any thoughts of expansion on hold indefinitely.

      My husbands parents are also small business owners and had been working on expanding their family run businesses. Their expansion would have provided many jobs, including new construction, for the rural community they work in but again the crazy legislation that's being proposed in Washington and whole-heartedly supported by Pres. Obama has caused them to place those plans on hold and even consider getting out of the businesses they already have.

      We are not afraid to step out into the uncertain waters of private enterprise. We are just afraid to step into those waters when Washington seems hell bent on stamping out any chance of our "Mom & Pop" operations being able to flourish on any level. With the president's penchant for Socialism it would be foolish think that the future our free market system is on solid ground. THIS is what has made the private sector hesitate to invest and build.

    9. Ozzy6900, CT says:

      The solution is simple:

      1. Get the Federal Government OUT of the Business world.

      2. If a business falls on it's face, it's time for that business to fold.

      3. Provide tax CUTS to business so they can relax and operate.

      4. Let Wall Street run the way it was designed to run – on its own!

      5. Stop handing out money to Foreign Countries left and right.

      6. Stop creating money robbing, social programs that do nothing more than hand out cash for nothing.

      7. Provide tax cuts to the People so there is money to spend on products.

      8. Stop the "Global Warming" BS and stick to things that we can REALLY take care of.

      9. Drill our own oil!

      10. Refine our own oil!

    10. Daniel Kuehn, Virgin says:

      Hasn't Heritage ever heard of the concept of a counterfactual?

      Geez guys – come on.

    11. Ben C, Ann Arbor says:

      Fred P. Lampropoulos is exactly correct. I am a small business person and I am not going to expand the business until I know what direction Congress is headed. If it continues on the current tract I will not expand nor hire again – only replace essential postions. In addition, I will not purchase equipment until it is absolutely essential. Howard Dean has stated that "we can be both capitalists and socialists." He is mistaken. They are contradictory philosophies. If in the next election cycle sanity returns I will then consider spending and expanding – but not until then.

    12. Richard Cancemi, Arl says:

      Either the people in charge in Washington are truly ignorant (which the majority are) OR they are Marxists who are doing everything they can to bring the System down (which I believe) OR they are both!

      Very naive? or very evil?

    13. Deirdre Kevorkian says:

      If you understand the Cloward-Piven Strategy then what Obama, Pelosi and Reid are all doing makes complete sense. The "American Thinker" has some very good articles on how this strategy recommends overwhelming government bureaucracy with entitlement programs so as to cause a collapse in the welfare system. This would then create a political and economic collapse causing the way in which America is governed.

    14. Leith Wood, Virginia says:

      What a setup meeting on jobs yesterday by Obama. No Chamber of Commerce included in a meaningful discussion of jobs. A total farce. He has no use for free enterprise and the capitalist system. Unless the answer is more government control, it's out.

    15. Tim H. Carrollton,Ga says:

      Our nation will not get better if we don't first turn back to Jehovah God.Then we will have the power on our side to right the wrongs being done to our country today. We "must" be willing to elect those who truly love this country and "all" of it's "citizens" no matter the color or group.Or what financial stance each person might be in.We must unite against looking at what our neighbors have or don't have, but to love our neighbor and wish them all the sucess their skills bring them.Jealousy is mean and unkind and that's a big factor of what's wrong with America today.If we can unite together because we are "Americans" and nothing else,we "cannot" be defeeted by any outside foe or enemy!! God Bless America.

    16. Robert Ivy, Dawsonvi says:

      I'm so stimulated now, I can hardly stand to see another stimulus. We will all be brain dead with another stimulus package.

    17. Robert Ivy, Dawsonvi says:

      Who is behind this all out assault on the capitalist system? We have no one in so called leadership who is interested in preserving our great heritage.

    18. Norma Link, Lakewood says:

      I agree they are trying to ruin our economy and redistribute the wealth. In the house healthcare bill there is a mandate that we must give the Fed. access to our checking account and we must give them all our financial information. Why is that? For the redistribution of wealth, of course.

      I am a retired oncology(cancer) nurse and I am really angry because the Senate approved all cuts to Medicare including cuts to funding Hospice care. Are you aware that it is illegal for elderly people to contract or agree to pay for medical services that are denied by Medicare? That is a government intervention into our lives that was passed by the people who thought Medicare was a good idea. Why not give old people an entitlement? After all they vote don't they? I hope they remember that.

    19. jim toledo says:

      It's obvious that the inmates have finally taken over the aslyum. We have a Presdient that needs to ask people what he has to do to stimulate the economy? Are you kidding, a jobs summit. He's the President and he doesn't know, or the people around him don't know, what to do? Haven't we seen the negative consequences of the government just spreading money around; the stimulus was a miserable failure. Maybe we just didn't stimulate enough? Not.

    20. Jonathan Seid, Willi says:

      This administration's behavior toward economic problems will be the most lasting impression on voters over the next 3- years.

      It is up to the Minority Party to take advantage of this opportunity and lead the political dialog to impress upon voters that less taxation and less government intervention in business will create jobs and wealth.

      Unless this occurs and the speaker is passionate, accurate and fair, we will probably continue the Socialist's expansion of this Administration for another 7-years.

    21. Bob R Geologist, Tuc says:

      How much longer can our nation tolerate an obvious enemy of our system of goverment to remain in the White House? And, a plurality of deluded Democrats in our legislative bodies? And, an international organization that hates us housed in New York City? Talk about termites in the woodwork, no wonder the USA is beset with crises! As if that is not enough trouble, there is Obama's first love, Cap and Trade, a confiscatory hidden tax, ostensibly to save the world from a problem that only exists in the warped brains of our Global Warmers, who have been relying on a group of renegade scientists (CRU), that have ben caught cooking the books,(world temperature data), that the world weather science relies on. Onward Copenhagen, rah rah rah!

    22. Pingback: Obamanomics - Cash for Caulkers | The Lonely Conservative

    23. Jim U.- New Haven says:

      Hey, Ken Jarvis!!! Cat got your tongue(fingers)??? Read the above cotributions and then tell me that you still believe in Obama.

    24. jim sardis,ms says:

      Having worked all my life in manufacturing management and now retired,it is obvious to me that the current administration is radical left extremists with nothing but an agenda to destroy capitalism and install big government socialistic control of everything through the unions and other corrupt activist groups. What is amazing,is all the billions being generated and given to select financial institutions to make billions while not loaning to any private enterprise.all the elite are getting wealthy at the expense of the taxpayer. Sadly,the congress is so corrupt that even the republicans could not stop or slow it down.What happens next? Who will pay for all these socialist programs when all the wealthy have hidden their wealth to keep from paying for them? This as well as other groups are exposing the truth but will it reach enough voters to correct the problem before it is past being saved? We all know that liberals don't use their wealth to support their agendas.

    25. jim smith says:

      The fact that most of us know what he is doing to destroy our economy doesn't make him smart, is ample testimony to the value (but not the personal integrity) of running a shadow political campaign.

      I can hardly wait for unemployment to go under 9%. In a short, fifty word statement, Nobama will tell us how he invented jobs. The word "I" will only appear 38 times.

    26. Al Reasin says:

      Here is a link to the write up on Patriots Corner Club about our experience last Thursday and the video that was taken by two young men who came by. This shows what two old farts can do with a few hours and little money to fight back against this government's attack on our liberties.


      http://www.youtube.com/watch?v=7TYscAHwTLg –or- http://www.udonews.com/videos/1583/9-minutes-with

    27. Blair Franconia, NH says:

      Get rid of Obamacare and we'll be doing fine and dandy.

    28. Whicket Williams Kin says:

      Well the destruction of the greatest country on earth is proceeding on schedule Soon we will see the execution of the old, the handicapped, and the dissenters shortly after that, we will see the execution of everybody who is not exactly like the powers that be. hopefully the lord will return before they get to far down this road I wonder why nobody can see that this is exactly the same thing that happened in Germany? and Germany is smaller than Texas. with this happening in so large a country, the rest of the world banded together against it might not be able to stop it. but we will all be dead by that time.Where are the people who swore,"NEVER AGAIN" ?

    29. LeRoy Reed says:

      This all must stop, I't cant wait!!! We don't see what the Republicans are doing!!!!!!!?? The government is ruining our cuntry!! All they see is money in their pockets!! Obama is not LOOKING out for our best interest, just his own, trying to make us all socialists. He wants to rule the world!! He puts us down every chance he gets!! He must be stopped!!!! Don't find anything smart about him!! He is a stupid, stupid person.

    30. Pingback: Headlines Exposed 12.05.2009 — ExposeTheMedia.com

    31. gorio, calif. says:

      The statement by Dean that we can be capitalists AND socialists is revealing as that is exactly what is happening in the "enlightened" countries like China/Russia/Pakistan the problem with the "Dictatorship of the ruling class" is that there is NOTHING fair and equitable about it and it requires an iron economic and civil liberties grip by the "rulers". The high unemployment/crime/government regulation will eventually become

      routine as it is in China. No one in the Chineese government is

      even interested in documenting the causes of the 48,000 riots and murders needed to control their seething population every year. This is not surprising when the workers make the equivalent of a few dollars a day. The "rulers" in the US obviously think we have a long way to go before we can be properly "governed" and have little interest in the unemployment numbers or health of small business except to

      convince the 40% of non-taxpayers that they "care" about their

      sorry state so they will keep voting for them. How about a constitutional amendment that requires that all income tax schemes require an equal percentage of an individuals gross income be paid by each citizen and income from corpoations or other income producing entities be taxed at the same rate. When everyone has skin in the game few will tolerate waste.

    32. Marilyn Smith says:

      The End of the U.S. economic system is at hand. "Brick by brick" obination is ruining the county. So sad we can't stop them, even the next election won't undo the damage as more 'bought and paid for' politicians continue to fill their pockets.

    33. Drew Page, IL says:

      No business, large or small, is going to commit to hiring or rehiring unless and until they know what they are going to be charged in taxes. Between Cap & Trade, National Health Care, economic bailouts and rampant, runaway government spending, no one know what their tax rates are going to be.

    34. Ron Wilner, Newburgh says:

      Maybe we ought to insist that any Presidential Candidate, regardless of prestigious educational background, pass a basic economics test.

      Ron Wilner

      Founder and Creator of The Taboo Party

      Throw All Bums Out of Office

    35. Christopher Popham S says:

      As regards our economy, Mr. Turner of Wa. hits the

      nail on the head. In the summer of 2008,

      I predicted, with regret, that Mr. Obama would indeed rise to power and in short order begin to

      destroy America, starting with the economy. Sadly,

      for our once great nation, I was correct.

      It must be remembered that the membership of the AMA

      comprises a mere 17% of all doctors in America.

      Their influence is negligble; not even worth mentioning.

    36. Pingback: China More Powerful than the United States? | Conservative Principles Now

    37. David says:

      I am curious to the small business owners exactly which Obama/Congressional laws have passed this year that are hurting you?

    38. Al Reasin says:

      I get on blogs and what do I see but people just complaining; so where are the "I will stop yelling at my TV, get up off my couch and do something" statements. Because if you do nothing but complain, they win and you lose. Its that simple.

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