Bringing to mind the story Abraham Lincoln used to tell about a young man who killed his father and mother and then begged that the court would have mercy on a poor orphan, President Obama now seeks to pose as a deficit hawk:
“President Barack Obama, calling current deficit spending “unsustainable,” warned of skyrocketing interest rates for consumers if the U.S. continues to finance government by borrowing from other countries.
We can’t keep on just borrowing from China,” Obama said at a town-hall meeting in Rio Rancho, New Mexico, outside Albuquerque. “We have to pay interest on that debt, and that means we are mortgaging our children’s future with more and more debt.”
Holders of U.S. debt will eventually “get tired” of buying it, causing interest rates on everything from auto loans to home mortgages to increase, Obama said. “It will have a dampening effect on our economy.”
I have a wee problem taking any of this seriously of course. It is rather like the town drunk giving a temperance lecture or the town madam giving a heart-felt speech in favor of chastity. The reaction of much of the blogosphere echoes my skepticism.
“Exactly who is it that is spending like a drunken sailor with no end in sight. Exactly who is it that is looking to bailout ever private corporation, bank and auto company in an effort to put the hands of government into everything? PresidentObama, who is responsible for the record $1.84 trillion deficit?”
“In five years, Obama’s deficitswill be greater than the 43 presidents before him, combined. These aren’t Reagan’s and Bush’s deficits. Obummer is making them look small in comparison.
Last year’s budgets deficit (2008) was $455 billion. This year under Obummer: $1,800,000,000,000, or quadruple the worst annual budget in the history of the United States. This is math. It doesn’t matter which party you are protecting, these numbers have to scare you if you know anything about economics.
The almost certain predictable future:
1) Massive Tax Increases (not just on wealthy, because there is not enough of them. You could take 100% of their income and it wouldn’t pay these deficits).
2) Hyper/Jimmy Carter style inflation. Remember 18% mortgage rates and 13% inflation.
No government has printed money like this without ruining their respective economy in the history of the world.”
“I’ll believe Obama is serious about fixing deficit spending when he starts to tackle entitlements, defense spending and homeland security spending. Surely there’s waste in those parts of the budget.”
“So how about quit throwing trillions down a rathole? Just a thought.”
“And as Mr. Obama preached fiscal conservatism, his administration wrote the U.S. insurance industry a $22 billion check. Allstate, Prudential, Ameriprise, Hartford Financial, Lincoln National and Principal Financial will now all have access to TARP funding, the Treasury announced today.”
Now proceeding under the assumption that the comments weren’t just a huge practical joke, why were they given? Perhaps because polls are beginning to register alarm by the public as it becomes clearer just how much debt the Obama administration is amassing. Additionally the remarks were made at a townhall meeting and no doubt Obama is politician enough to realize the issue of the debt is one he has to address, at least rhetorically.
Of course if Obama wanted to take real action he could ask Congress to repeal the Bankrupt the Nation Act of 2009. However in this area I am quite confident that Obama will always say one thing and do precisely the opposite.