Obama's Wealth Destruction by Llewellyn H. Rockwell Jr.

[Stephane Budge]

President Obama is under the impression that history owes him $1
trillion right now to spend on whatever he wants. His language is
strident and full of irritation that anyone would question his right
to live out his personal dream of being Franklin Roosevelt to George
Bush's Hoover. This, he says, is what the election was all about.

The arrogance reminds me of George Bush after 9-11, who similarly
believed that history owed him a gargantuan war in the tradition of
FDR. And look how that arrogance led to disgrace and loss, as he
unwittingly presided over the destruction of American prosperity while
searching for bugbears abroad.

It just goes to show you that the presidency is something like a drug.
It makes people lose all connection to reality. Part of the reality
that Obama needs to recognize is that the New Deal was a calamity far
worse than the initial market downturn that began it. He needs to stop
basing his policies on dumbed-down civics texts versions of events and
consider the economic logic.

With his rhetoric and policies, he has decided to demonize private
enterprise, just as FDR did, as a way to present government as the
great savior. Now, think about this. If there is a way out of the
recession, it will have to be provided by private enterprise. It will
come by new businesses, business expansions, entrepreneurship, new
technology, and this will be the source of lasting jobs and
prosperity.

You cannot make a country rich by looting taxpayers and paying people
to pound nails into siding at public schools! These activities amount
to capital consumption. They are not sources of investment. You can
say that they are stupid tasks or wonderful tasks, but it is not a
matter of ideology as to whether such public projects will make us all
wealthier. They will not. They drain the sources of wealth from
society. They represent a cost, not a blessing.

That was also true of Bush's dumb stimulus program. He was only
bailing out his friends at our expense. The effect was to give a
little longer life to institutions that were failing anyway. It's
pathetic that the Republicans ever went along with it. You will notice
that the scheme didn't actually work.

Well, Obama is doing the same thing, though rewarding a different set
of friends. This is not wealth production. This is wealth consumption.
Do enough of this nonsense and you can destroy the livelihoods of an
entire generation.

Americans are proud of their system of government, but consider what
it has given us this time around. We had an outgoing president who
thought it was his right to grab as much as he could while leaving.
Now we have a new president who thinks that the election entitled him
to grab as much as he can, right from the beginning. We get looted by
the state coming and going. It all amounts to one massive war on
prosperity and freedom.

Particularly culpable here are the official historians who have for
generations heralded FDR as the great savior. It is a case study in
how a civic lie can appear and fester for decades. The fact is that
the New Deal did not work. It prolonged what might have been a
troubling two-year downturn into a horrifying blow to world prosperity
that ended up in a war that killed countless millions. It was one of
the greatest acts of wreckage in world history.

And Obama is inspired by this? He wants to repeat it?

I'm not so cynical about human affairs that I believe that errors must
be endlessly repeated. Obama can put a stop to his madness. He needs
to know — someone must tell him frankly and openly — that his current
path is going to lead not to recovery, but to an extension of
suffering, and untold amounts of it.

The biggest threat facing the American economy right now is rarely
even discussed. It is the massive buildup of paper bank reserves in
the last quarter of 2008. This was Bush's doing. He ordered the Fed to
print like mad. Fortunately for us, the banks are still holding on to
these reserves. When they start lending again, the result could be
hyperinflation of Confederate-dollar proportions.

Hence the priority of the Obama administration should be to first do
no evil, and second to find some means for withdrawing those reserves
from the banking system before they wash through the economic
structure and destroy the dollar. There is still time. He must act.
Yes, that will lead to bank failures. That's good! It will lead to
business failures. That's good and essential too.


There simply is no choice. If he acts now, he could find that recovery
will come before his second term. This is precisely what happened with
Reagan. He was fortunate to have advisers who insisted that he let the
liquidation happen rather than attempt to fix the recession of 1981–82
with huge new government spending programs.
In any case, the hardest work to do here is intellectual. Obama's head
is filled with myths and lies, not only about FDR and the New Deal but
also about the government's power to repair the existing economic
problems. With this model in his head, he can only do evil. This must
change.

Nothing is inevitable. He can turn on a dime. The main message: do not
repeat the actions of FDR, lest you destroy what is left of American
liberty and prosperity.