AS the Democratic National Convention started, many wondered how President Barack Obama and his fellow Democrats would address the most pressing issue of the day — the hobbled economy and lack of jobs. For the most part, Democrats merely shrugged.
Former President Bill Clinton declared, “No president — not me, not any of my predecessors — no one could have fully repaired all the damage that he found in just four years.” That certainly set the bar low. In plain English, Clinton said you should have no expectation of economic growth under this president, but vote for Obama anyway.
Obama did little better. He claimed, “I won't pretend the path I'm offering is quick or easy,” then endorsed “the kind of bold, persistent experimentation that Franklin Roosevelt pursued during the only crisis worse than this one.”
Citing FDR as a model for economic thinking is hardly encouraging. Roosevelt was a successful politician with unsuccessful economic policies. Dr. Burton Folsom, professor of history at Hillsdale College, notes unemployment never dropped below 14 percent and averaged over 17 percent under the New Deal. Research conducted by two UCLA economists concluded that FDR's policies actually prolonged the Great Depression by seven years.
FDR's policies exempted certain industries from antitrust prosecution, discouraging competition and encouraging collusion. The troubling wedding of big government and big business has echoes in Obama's bailout of General Motors, which the president thinks is a selling point for his economic platform.
In reality, the federal government would lose around $25 billion if it sold its GM stock today. GM has been losing market share and its stock price has fallen even as the broader Dow Jones industrial average has risen. Obama's bailout may have temporarily benefitted his union allies, but that came at the expense of working families who pay taxes.
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