Right Change: Beyond the “Blunder”

Nearly four days later and the political world is still whirring over President Obama’s remarks on the economy Friday, where he declared to the nation that the “private sector is doing just fine.” These words have been slapped across headlines and campaign videos since then, and rightfully so. However, the rest of what was said at the press conference cannot be swept under the rug.

The thesis of this statement was not that the private sector is doing fine, rather that the real problem this country has is shrinking government. In an article from last Friday, The Wall Street Journal writes:

“It's true that government spending is part of GDP, and spending more can boost reported GDP for a time. But the lesson of the stimulus—which spent hundreds of billions of dollars in aid to the states—is that this boost is temporary and fades when the spending ends.

The fair if depressing takeaway from Mr. Obama's press conference is that he continues to believe, despite three and a half years of failure, that more government spending is the key to faster growth and that government really doesn't need to reform. This is how you get a jobless rate above 8% for 40 months and the weakest economic recovery in 60 years.”

That last sentence may even prove to be an understatement, as not everyone sees this as economic recovery at all. John Hussman of Hussman Funds makes the claim that this is an economic recession for which excuses are being constantly made. Hussman says:

“We expect this [recession] to become increasingly evident in the coming months, but through a constant process of denial in which every deterioration is dismissed as transitory, and every positive outlier is celebrated as a resumption of growth.”

He claims that the reason for this “aftershock” is that the issues that lead to the initial crash of the economy were never corrected or adjusted. Could this be due to the fact that our nation’s leader has politically biased and time-proven incorrect notions of how to bolster the economy? If the Presidents statements on Friday were simply a “gaffe” as they are being called, we are relieved. But if he truly does stand behind his remarks, we sincerely hope he wakes up soon. 

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