The economy is skidding, and President Obama is fresh out of “progressive” fixes.
To create the appearance of action, the President promotes education, even though millions of recent graduates are working at venues like Starbucks, and taps the strategic petroleum reserve, when stalling growth has already pushed down gas prices for six consecutive weeks.
His economic strategy to fire up growth and create jobs failed, Mr. Obama’s political strategy is to convince Americans high unemployment, high taxes, high health care costs, and a sinking standard of living is the best any president could do.
Now, the “bipartisan” Congressional Budget Office has bought into the hoax.
Its long-term assessment of the federal budget concludes, if the President’s health care reforms stay intact and the additional taxes he wants are implemented, the national debt will grow from 69 percent of GDP in 2011 to a manageable 84 percent in 2035; however, if taxes are kept at their current levels and important provisions of recent health care act are relaxed, the debt would jump to an unsustainable 187 percent of GDP.
As the Republicans can’t seem to come up with spending cuts that do little more than dent the problem—they are proposing $200 billion a year when federal spending after inflation is up $1 trillion since 2007—more taxes must be needed to maintain the roads, national defense, and the ever expanding army of bureaucrats that appear unable to curb new fraud on Wall Street.
Fortunately, the future need not be so grim. Either it has to be a lot better than the CBO projects, or the economy is headed over a cliff. I have a bit more faith in my country than the dismal scientists who work on Capitol Hill.
Through 2017, the CBO analysis assumes annual GDP growth cannot exceed 3.3 percent, and afterwards, growth will slow to only about 2.1 percent for several decades. That is much less potential economic growth, and a tepid 2.1 percent pace is too slow to sustain for long—either the economy grows faster or it falls apart altogether.