Excerpted from WSJ, “The Obama Economy”, March 3, 2009
As 2009 opened, three weeks before Barack Obama took office, the Dow Jones Industrial Average closed at 9034 on January 2, its highest level since the autumn panic. Yesterday the Dow fell another 4.24% to 6763, for an overall decline of 25% in two months and to its lowest level since 1997. The dismaying message here is that President Obama’s policies have become part of the economy’s problem.
It’s become clear that Mr. Obama’s policies are slowing, if not stopping, what would otherwise be the normal process of economic recovery. From punishing business to squandering scarce national public resources, Team Obama is creating more uncertainty and less confidence — and thus a longer period of recession or subpar growth.
In the last two months … the economy has received no great new outside shock.
What is new is the unveiling of Mr. Obama’s agenda and his approach to governance.
One negative revelation has been the way he has chosen to spend his scarce resources on income transfers rather than growth promotion. Most of his “stimulus” spending was devoted to social programs, rather than public works, and nearly all of the tax cuts were devoted to income maintenance rather than to improving incentives to work or invest.
The market has notably plunged since Mr. Obama introduced his budget last week, and that should be no surprise. The document was a declaration of hostility toward capitalists across the economy.
His assault on business and investors is delaying a recovery and ensuring that the expansion will be weaker than it should be when it finally does arrive. The result has been a capital strike.
Full article:
http://online.wsj.com/article/SB123604419092515347.html
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