President Obama, Recession, And The Horror of Government Stimulus

By: Scott Nelson
Staff Writer

Recessions are a good thing.

I’ll say that again; Recessions are a good thing.

President Obama wants to end the recession quickly. But American President’s don’t get to make that decision, that’s the whole point to a recession. And you wouldn’t want them to if they could.

You see, a recession tells you what you’re doing well, and it tells you what you’re doing poorly. It shakes out corruption and inefficiency, gets rid of poor segments of the economy and strengthens good segments.

It forces you to change your behavior when you don’t want to, and even when you kick and scream against it (as President Obama is doing right now).

It’s why America is Great, and it’s why Communism historically fails. The Communists didn’t have the benefit of recessions to tell them what they were doing well and what they were doing poorly, so poor segments of the economy continued to grow until the weight of their mismanagement and inefficiency caused the entire system to collapse. Did you think Communism failed because Reagan told Gorbachev to “Tear down that Wall?”; no.

That’s the fundamental difference between a Capitalist system like ours and a Command system like Communism. Recessions, and Government intervention (like the kind proposed by President Obama).

Believe me, you don’t want President Obama to meddle with the economy. It will sort itself out on its own, far better than he could ever hope to do himself. Think Post Office, think DMV, think any other government program you’ve ever run across. They’re simply not equipped to act rationally or competently in the economic sphere.

That’s the secret. Ask an economist. They’ll tell you that Government intervention will kick us out of a recession quicker than if you did nothing and let it sort itself out on its own. BUT, the problem is that in the long run, Government intervention leaves us less well off in terms of FUTURE growth than if you had left it alone and let it sort itself out.

Even a Keynesian will agree with that statement.

Think of a scale from one to ten, with one being bad and ten being good. If you leave the recession alone, our economy will be at an 8 five to ten years from now. If you intervene (aka President Obama’s stimulus plan), you’ll kick start the economy today, but five to ten years from now we’ll be at a 4.

That’s why Government leaders like President Obama want to intervene. It looks good TODAY, and they don’t care what happens 5-10 years from now because they’ll be out of office then.

American’s need to wake up. If you think your problems will all be magically solved by any one person, even if that one person is as charismatic and talented as President Obama; then you seriously misunderstand the world in which you live.

Work hard and save, pay down your credit cards, go back to school if necessary. You may have to become a 3-car family instead of a 5-car family. But believe me, recessions are nothing new, they’re nothing to get scared about, and they won’t stop occurring.

But then, we wouldn’t want them to…

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February 10, 2009 | Filed Under Barack Obama, Economics, Government Intervention, Recession, Stimulus | Leave a Comment 

Democratic Convention Madness…

By: Scott Nelson
Staff Writer

The eyes of the world turn today to the Democratic Convention in Denver to watch Barack Obama’s next step in his bid for the United States Presidency.

There’s a burning questions on the minds of all of us here at the Global Affairs Council; will the Clintons hijack the convention?

Senator Obama was forced to grant many concessions to Hillary Clinton, giving both her and husband, former President Bill Clinton, key prime time speaking slots on Monday and Wednesday as well as allowing the Clintons to show a video on the life of Hillary. Further, on Thursday Clinton delegates will be allowed to make a “symbolic” role call vote for Senator Clinton’s nomination.

We see several possible outcomes.

Outcome One: the Clintons will successfully hijack the convention. Senator Obama hasn’t won anything yet, and with his recent slide in the polls against Senator McCain, delegates that had previously agreed to support Senator Obama could realistically switch their support to Mrs. Clinton; giving her the nomination.

Outcome Two: The Clintons will disrupt the convention enough to cast further doubts on Senator Obama’s leadership and weaken him enough to give Senator McCain the strength to win the general election. Under this strategy a refortified Senator Clinton will sweep in four years from now to run again against aging incumbent McCain.

Outcome Three: Everyone will play nice and Senator Obama will waltz out of the convention with a clear mandate and solid party nomination.

Of the three outcomes, we here at the Global Affairs Council tend to lean towards outcome number two. But one thing is for sure; if history tells us anything it is that nothing is impossible at a party convention.

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August 25, 2008 | Filed Under U.S. Presidential Election | Leave a Comment 

The Russian / Georgian War

By John Alexander
Executive Director

Russia’s attack on Georgia signals a shift in the balance of power within the region and perhaps throughout the world that will have significant implications on all of Europe as well as the United States and China.

BACKGROUND:

On August 7th, 2008 troops from the Republic of Georgia invaded territory held by South Ossetia, a breakaway region of Georgia that had declared its independence back in the early 1990’s. That independence had not been diplomatically acknowledged by the United Nations, who still saw South Ossetia as a part of Georgia.

On August 8th, Russian troops entered South Ossetia, citing a kind of informal alliance between the two “countries”. By August 10th, Russia had secured their position in South Ossetia and begin to eyeball Georgia proper, which they then invaded the next day.

ANALYSIS:

This raises several obvious questions to us here at the Global Affairs Council. Why did Georgia invade South Ossetia in the first place? How was Russia able to react so quickly and effectively? Did Russia lure Georgia in so that the could use the “invasion” as a pretext to invade themselves? Why did this happen now, when the eyes of the world are turned to the Olympics in Beijing? Will the United States react, or will they be unable to stop Russia?

Bogged down with the wars in Afghanistan and Iraq, contemplating another action in Iran, and facing a Presidential election that will soon sweep the current administration out of office, the United States is seemingly overdrawn and unable to answer the situation in Georgia.

This action seems to re-establish Russia’s military might after its crushing defeat during the fall of the former Soviet Union and is seen as an attempt to re-establish Russia’s sphere of influence and signal to the world a comeback of Russian power under the rule of Vladimir Putin.

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August 21, 2008 | Filed Under Russia | Leave a Comment 

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