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Worse, the Fed and the administration are out of tools to help. Interest rates are already at zero. Fiscal stimulus — the deficit — already consumes 40 percent of our total government outlays. The Fed is printing money at a ferocious rate under its qualitative easing (QE-2) program. What is left to do?
Only dramatic cuts in the federal deficit, a rollback of regulations that cripple small and community banks, a cancellation of future tax increase plans, a big reduction in federal spending, repeal of Obamacare, freeing manufacturing from the prospect of carbon taxation and unleashing our domestic energy potential can solve our problems. But Obama is not about to undo his legacy of disaster for the American people.
And then there is the longer-term oil and gasoline crisis. Instability in the Middle East is going to mount, not recede. The chances of disruption in Saudi oil supplies and the possibility of an overthrow of the regime (triggered by the best efforts of Iran) will continue to force prices upward. The drag on the economy and the rising consumer discontent in the United States spell further problems for the Obama presidency.
As the Rev. Jeremiah Wright said — outrageously and wrongly — about 9-11, “The chickens are coming home to roost.” The policies of this administration — the disastrous overspending, the irresponsible borrowing, the social experimentation — all are magnifying and amplifying the impact of the recession. Relief is not going to come anytime soon.
Instead, the true legacy of the Obama years is likely to be stagflation and an entire decade wiped out by his policies, budget and program. Long after he is gone in 2013, we will still be repairing the damage of his terrible decisions.
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