Obama's Grand Economic Illusion

Monday, 30 Apr 2012 09:36 AM

By Lowell Ponte

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Behind the predictable thrust and parry of presidential candidates, President Barack Obama's operatives are quietly conjuring a grand illusion to help him win re-election this November.

"It's the economy, stupid," said Bill Clinton campaign operative James Carville in 1992, knowing that incumbent presidents usually win if the economy seems good, and lose if the economy appears bad.

President Barack Obama's problem is that the economy is very bad right now. If this election becomes a referendum on his failed economic policies, Mr. Obama is toast . . . hence all his distractions to bamboozle voters.

Meanwhile, the Obama campaign's behind-the-scenes propaganda effort is to massage government data and media coverage to create an illusion that the economy is improving.

Thanks to President Obama, "Osama bin Laden is dead, and General Motors is alive," said Vice President Joe Biden days ago, a slogan we will hear 10,000 times before Election Day.

Late last week the U.S. Department of Commerce reported that America's economy last quarter grew at an annual rate of 2.2 percent — which allows President Obama to claim we are not following parts of Europe into a double-dip recession.

Obama's comrades in the mainstream media proclaimed that this was good news. It was not, for several reasons.

This plunge from a purported 3.0 percent growth last quarter down to 2.2 percent is a disaster. Growth was already the slowest coming out of a recovery since World War II.

Our economy was supposedly accelerating down the runway and approaching lift-off to get prosperity airborne. It has instead plummeted to stall speed.

According to the stimulus ideas of late British economist John Maynard Keynes, beloved by Obama's economic advisers, America should be giddy with prosperity after expending $7.7 trillion in stimulus to pump up the economy.

Instead, we have the worst of both worlds — a stalling economy burdened with astronomical debt from borrowing 42 cents of every dollar our spendaholic government keeps spending — borrowing that adds $58,000 every second to our national debt.

We loaded our tanks with explosively inflationary fuel but are now more likely to crash and burn than to take off. Obama's response is to raise taxes by more than $2 trillion, but even Keynes warned NOT to raise taxes during a down economy.

Real inflation is now running at least 7.2 percent, devouring our growth and more. Subtract 7.2 from our claimed 2.2 percent growth and you discover that our real economy is shrinking by 5 percent per year.

Nearly 40 percent of our entire Gross Domestic Product is now federal, state, and local government spending. And 37 percent of what gets officially counted as "wages" are government checks going to 47 percent of American households.

Twice as many people now work for government than in all of manufacturing combined, and the federal workers Obama has been increasing by more than 10,000 each month are given an average of $126,000 each year in wages plus benefits, double the remuneration of heavily taxed private-sector workers.

One in five men age 25-54 are unemployed. By the unrigged methodology used prior to Obama's election, real unemployment today would be 10.9 percent, and combined real unemployment plus underemployment plus discouraged workers is somewhere around 18 percent.

Obama's "Misery Index" — if reportedly honestly — is at least five points worse than the combined inflation and unemployment that defeated President Jimmy Carter in 1980.

Yes, General Motors is alive, but it still owes many billions to American taxpayers. GM is more successful overseas than here, and is investing $1.5 billion in new manufacturing facilities in Mexico and Brazil. Obama bailed GM out because the United Auto Workers pour millions each election into Democratic political coffers.

As for this week's one-year anniversary of killing terrorist mastermind Osama bin Laden, Obama as a longtime liberal eager to redistribute military budgets to social programs merely made a win-win decision.

If our military strike on bin Laden succeeded, then President Obama could take credit and play the hero in his re-election campaign. If it failed, as happened with President Jimmy Carter's Iran hostage rescue mission, then Obama's media comrades would blame our "incompetent, overfunded" military.

Will America be fooled again by his illusions?

Lowell Ponte is co-author, with Craig R. Smith, of "Crashing the Dollar: How to Survive a Global Currency Collapse"; "The Inflation Deception: Six Ways Government Tricks Us . . . And Seven Ways to Stop It"; and "Re-Making Money: Ways to Restore America's Optimistic Golden Age." For a limited time, you can get a free copy of "The Inflation Deception" by calling 800-630-1494. Read more reports from Lowell Ponte — Click Here Now.





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