By Tom Quiner
For nearly six years, Keynesian economics has been put to the test.
The Obama administration has used “stimulus spending” with a profligacy that would even make Franklin Roosevelt blush. And yet it hasn’t worked.
Economic growth lags way behind typical economic recoveries. Same with the unemployment rate.
What is particularly damning is the employment rate which hovers around the abysmal levels of those sorry Carter years.
Public opinion polling overwhelmingly states that America is on the wrong track, despite the full implementation of Obamanomics, complete with tax increases on the most productive, highest corporate taxes in the world, trillion dollar “shovel-ready” stimulus bills, and a geometric explosion of government regulations in the guise of Dodd-Frank and Obamacare.
Everything a liberal drools for in a Marxist candy store has been put to the test. And failed.
That brings me to Hillary Clinton, the presumptive Democratic nominee for President in 2016. In a campaign stop for one of her liberal allies, Clinton sneered that:
“Don’t let anybody tell you that it’s corporations and businesses that create jobs. You know that old theory — trickle-down economics. That has been tried, that has failed. It has failed rather spectacularly.”
I would like to emphasize the verb ‘sneered.’ Ms. Clinton made the statement with derision, targeting in particular the Ronald Reagan years when liberals invoked the term ‘trickle down’ to describe an economic strategy known as ‘supply side economics.’
Her condescension suggests that Obamanomics has produced more jobs than Reaganomics. Remember, the Obama/Clinton model suggests that government creates jobs; the Reagan model boldly states that the private sector creates the jobs when you get “government off their back.”
The data not only supports the Reagan model, it utterly rebukes the Clinton/Obama model. The Texas Public Policy Foundation crunched the numbers and compares the results, and they are damning if you are a liberal:
“After adjusting for differences in the population in each period using the percentage of the adult population who are employed, it is possible to compare the actual employment under Obama and the projections from the November 1982 to May 1987 recovery under Reagan.
During each of these 54-month expansions, actual monthly net job gains averaged 240,000, or about 13 million total, in the 1980s and only 79,000 in the current recovery. If the period after June 2009 had the same gains as in the 1980s, adjusted average job gains would be an outstanding 340,000 per month.
There would be a total of 14.4 million more people employed over this period and 12.7 million more employed than when the recession started, reaching pre-recession employment by September 2010 — something the actual recovery has failed to do.”
To summarize: the ‘trickle down’ approach so reviled by Ms. Clinton produced net job gains of 240,000 per month compared to the Clinton/Obama results of a tepid 79,000 jobs gained per month.
Supply side economics worked. Keynesian economics failed.
Ms. Clinton’s sneer gained full force when she said that what her husband brought to Washington was “arithmetic.” And simple “arithmetic” reveals the success of the very approach she reviles.
The pushback to her transparently false statement led to predictable back pedaling by Clinton, something she is getting good at:
“Our economy grows when businesses and entrepreneurs create good-paying jobs here in America and workers and families are empowered to build from the bottom up and the middle out — not when we hand out tax breaks for corporations that outsource jobs or stash their profits overseas.”
For the record, when corporate tax rates were lower, they didn’t feel a need to leave America. Liberals simply don’t understand the global economy.
Reagan did. He seemed to understand “arithmetic” better than the Clintons and the Obamas.