“A second depression is no longer a possibility”

These were the words that most struck me as particularly spurious when President Obama crowed about the success of his stimulus plan on the anniversary of its enactment. While it’s unclear whether he was referring to 1929 or 2008 as being the “first” depression, what is clear is that a second, much deeper recession is just around the corner and this one will be the direct result of Mr. Obama’s policies.

---

In the Democrats’ quest for the fundamental transformation of America, the legislative initiatives that have been floated have resulted in a near complete cessation of growth among small businesses in America. That’s because the legislation they are attempting to enact will have grave financial consequences, particularly for small businesses, which is the backbone of America’s economy. Questions such as how much will healthcare add to the tax burden of businesses and how will a cap and trade bill affect the costs of doing business have all but stopped any plans for growth among American businesses. Why would any business person want to lay in new employees without first knowing what impact the Democrats’ ambitious healthcare initiative will have on their bottom line? Similarly, the President’s promise that cap and trade legislation will increase both the cost of living as well as the cost of doing business, has put a chill on new business activity, given that the administration is unable to say just how much of an increase is in store. While the administration has privately conceded that the cap and trade legislation being contemplated will cost the average family of four an additional $150 per month, there is no guessing how much the legislation would add to the cost of doing business. Added to this climate of uncertainty is the President’s insistence that the government can spend it way out of a recession using borrowed money. With the national debt approaching 100% of GDP, it is only a matter of time before the U.S. will default on its loan payments, which will set off a massive economic crisis much worse than the bursting of the housing bubble.

Double-digit inflation, high interest rates and a devalued U.S. dollar

Double-digit inflation, high interest rates and a devalued U.S. dollar will form the perfect storm that could irrevocably damage the economy. This trifecta of economic woes could make the Great Depression of 1929 look like a minor hiccup, resulting in food shortages, unemployment of staggering proportions, civil unrest and a loss of sovereignty, as America’s creditors demand repayment. The American people are beginning to understand just what’s at stake here and have made themselves heard in recent elections, notably in Virginia, New Jersey and Massachusetts. As well, the Tea Party movement is gathering momentum and showing itself to be a powerful force in demanding that their elected representatives act responsibly. And still the President and the Democrats’ leadership appear to believe that they are right and the American people are wrong in their insistence that America needs to be “transformed”. America’s elected officials appear to have forgotten their purpose and are enjoying a particular reality all of their own, separate and apart from that of the rest of the country. This critique applies to both the Democrats as well as the Republicans as both parties have demonstrated they can’t be trusted to look after the nation’s best interest before looking after their own. And neither party is particularly adept at simple arithmetic. Democrats in particular seem to have a really big problem with numbers, given all the pronouncements they make about jobs. Whether it’s Nancy Pelosi warning that the U.S. economy would lose 500 million jobs if the stimulus were not enacted, or Obama talking about America’s 57 states, or David Axelrod claiming 2 million jobs created in the last year, they’re all numbers that are demonstrably false. The coming collapse of the U.S. economy appears to be so imminent that we’re seeing commercials for gold and non-hybrid survival seeds on television. The President’s boastful assertion that “a second depression is no longer a possibility” will come back to haunt him sooner than he thinks.