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Townhall
Finance...
A
Reagan Moment
By Larry Kudlow
No
sooner had President Barack Obama
shocked the political world with a gloomy economic forecast --
projecting 9.1
percent unemployment for this year and a re-election-killing 9 percent
for 2012
-- than the dismal August jobs report arrived showing no gain in
non-farm
payrolls. That’s right, no gain at all. Private jobs increased a scant
17,000,
while hours worked and wages actually declined. Obama’s economic
policies have
failed.
Are
we on the front end of yet another
recession? This report alone suggests that we could be, although other
data
points disagree. But on the eve of President Obama’s so-called jobs
speech,
there’s a much bigger question here: Has the U.S. entered into
long-term
economic decline?
As
a quintessential optimist who
believes in American exceptionalism, I don’t even want to raise this
issue. But
the data tell me that I must.
For
example, over the past 10 years,
the U.S. has actually lost jobs on a net basis. In August 2001,
non-farm
payrolls calculated by the Bureau of Labor Statistics stood at 132
million.
Through August 2011, payrolls stand at 131.1 million.
In
fits and starts, a 4 percent
unemployment rate has moved up to some kind of permanent 9 percent
plateau.
Following the Bush tax cuts of 2003, 8 million new jobs were created.
But in
the aftermath of the financial meltdown, those jobs have disappeared.
The
so-called Obama recovery over the past two years has made no dent in
this
gloomy picture.
And
through this whole period, our
economy has barely grown at a sub-par 1.6 percent yearly rate for real
gross
domestic product.
Meanwhile,
the stock market -- perhaps
the best measure of our wealth and well-being -- has been essentially
flat for
the past decade. And while the free enterprise private sector has
barely
muddled along, the government has grown fat.
During
the Bush years, the federal
government increased from 18 percent of GDP to 21 percent. The debt
went up
$2.5 trillion, from roughly 32 percent of GDP to 40 percent. And now,
during
the Obama period, spending has moved even higher, to at least 24
percent of the
economy, while total federal debt has ballooned to nearly 100 percent
of GDP.t’s almost a mirror image -- the
expansion of the public sector and the decline of the private sector.
This is
completely inimical to the American peacetime experience. And it forces
us to
think seriously about whether we are losing our world economic
leadership. Are
we? And if so, does this loss of economic leadership threaten our
national
security and foreign policy stature?
Read
the rest of the column at
Townhall Finance
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