18 March 2009

Obama Onanism

Fiscal stimulus: relief, but no lasting satisfaction.
Its almost organic. No wonder greenies love it so.

But to what should we apply this alluring and organically onomatopoeic label: "Obama Onanism"?

Obama himself and his imitators*, with their simply massive self congratulatory stimuli ? or
The Obamanics, who continuously spill their seed into such an empty vessel?
or
both?


What is it about modern democracies that allows all these ethically challenged moral high ground clambering Dear Leaders: Barack, Brownie* and Kevin* ; to get away with inflicting these massive expiatations of debt funded spending on their electorates, without regard to the long term consequences. Why aren't they called for being the wankers that they are by the fourth estate ?

Why are journalists in the mainstream media not holding these social democratic governments to account for this spectacular irresponsibility? (Ed: It could be because they don't want to. They enabled these populists institutionally in their publications in the first place and then voted for them personally. It would be to admit they were both wrong and unprofessional to now be seen to challenge the newly imposed political orthodoxy they themselves help create).

Veronique de Rugy in Reasononline adds an interesting perspective in her recent article "Stimulating Ourselves to Death". She indicates:

"Take the New Deal. According to the economists Christina Romer—chair of Obama’s Council of Economic Advisers—and David Romer, New Deal spending did not pull the economy out of recession. In a 1992 Journal of Economic History paper, the Romers examined the role that aggregate demand stimulus played in ending the Great Depression. They concluded: “A simple calculation indicates that nearly all of the observed recovery of the U.S. economy prior to 1942 was due to monetary expansion. Huge gold inflows in the mid- and late-1930s swelled the U.S. money stock and appear to have stimulated the economy by lowering real interest rates and encouraging investment spending and purchases of durable goods.”

In other words Obama's own economic advisers actually already know about the illusory benefits of fiscal stimulus. How then can they, with this certain knowledge, then indulge the USA in this onanistic orgy of government debt of such a staggeringly large magnitude that I have lost the ability to meaningfully comprehend the numbers anymore (how many noughts are there in a trillion again?).

So this huge descent into debt by western nations, not only looks spectacularly reckless. It is.

And the reason they seem to do this is so that they are seen to be doing something. Anything. It doesn't matter if it is poor policy provided it is electorally plausible. It's a weak version of their much favoured "precautionary principle". They do it "just in case" it will make a difference. It simply wouldn't do for a control freak to be seen to let the business cycle take its inevitable course to recovery. If you tamper with the natural business cycle process you inevitably muddy the causal connections and you cannot be held accountable because you can attribute the inevitable (if delayed) recovery to your interventions even though they did the most to prevent it occurring.

Remember these are the same folk who are even now simultaneously plotting potentially still greater impediments to whatever wealth generation might take place in future to pay off their spectacularly destructive and unnecessary debt. They have in place meticulously crafted vast legislative programmes to impose an even more recklessly improbable version of the "precautionary principle" on their nations: carbon taxes and carbon trading schemes.

I was going to launch into an anti AGW rant at this point, but you are saved. I am now going to do that in the next post. Since these economic illiterates currently running the free world seem not only to think expanding the government payroll is a valid form of economic stimulus, they also seem to have completely bought the ridiculous notion that creating vast regulatory make-work schemes for compliance officers and government officials to measure and tax industries' CO2 emissions, will create wealth, sustainable employment and bring us out of recession.

The lunatics truly are running the asylum. And at nearly the worst time imaginable.
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