Donald Lambro’s column digs into some bad economic news from the Congressional Budget Office this week — news that was largely missed as the media focused on the State of the Union address.
The CBO is forecasting a continuation of economic weakness and high unemployment for the next couple of years. Lambro also cites economist Art Laffer who says that 2011 will bring a train wreck as we’re blasted by increasing taxes. If Obama gets his way and forces through still more ruinous programs like cap and trade, the consequences will be worse yet.
When the economy tanked in the early 30s, the clueless Herbert Hoover made the same sorts of blunders Obama is making. As a result, people concluded that free-market capitalism was the villain simply because Hoover was a Republican and Republicans are supposedly die-hard free market advocates. Hoover in fact was no such thing and had he listened to his Treasury Secretary, Andrew Mellon and cut taxes and government spending, the Great Depression would have just been another small recession. But merely because of a party label, millions of voters drew (and were led to) the conclusion that capitalism had failed. Hoover was kicked out and we got FDR, who made matters worse.
The current economic disaster is occurring on the watch of a proud anti-market leftist. Maybe the people will draw the right conclusion this time: the problem is not capitalism, but rather government meddling with it.
