Economic Illiteracy

"We saw this happen in Japan in the 1990s, where they did not act boldly and swiftly enough, and as a consequence they suffered what was called the “lost decade,” where essentially for the entire ’90s, they did not see any significant economic growth."

Said Obama in last night's press conference. Is there a more incorrect interpretation of what created the Japanese economic malaise of the nineties? If so, I haven't seen it. More evidence that Obama lacks a basic understanding of elementary economics.

Ironically, it was Obama's type of recovery plan that caused a decade of recession in Japan. Most Japanese now acknowledge that massive government spending in the nineties not only didn't help their economy, but delayed any substantial recovery for over ten years.

The only lasting effect of their version of "fiscal stimulus" has been more government involvement in their economy, slower growth, fewer new businesses and products, and higher structural unemployment. In other words, welcome to Europe.

And that, of course, is exactly what Obama and the Democrats want to do in this country. Problem is, the United States is the economic engine of the world economy. So if they succeed in making this another statist economy, the whole world will see lower growth and greater poverty.

That's a big price to pay for political vanity... a price we may be able to afford here, but one that countries like Russia and China will not tolerate. The deal they have with their people goes something like this. Don't play in politics and we will let you get rich. But if the people can't get rich because of the impact of American policy on the world's economies, well Houston, we have a problem.

All that Hopey Changey stuff may make the rich Americans feel good about themselves. But if we grind down the global economy with massive US government spending, it won't just be making matters marginally worse here. It will blow out the economies of some very dangerous countries.

That's a pretty big price to pay for ensuring that Nancy Pelosi gets to keep her seat at the head of Congress. Which is, after all, what Obamanomics is all about.