Obama's Plans to Kill the Economy and Cause a Depression

Barack Obama's economic proposals are wrong for the American economy. They defy both economic reason and economic experience.

In the election campaign of 2008, the economy and foreign policy are paramount with the candidates and the voters as well. The first two presidential debates focused almost exclusively in these two areas, with the second debate squarely centered on the economy as the U.S. was in the midst of a major financial meltdown.

Having the economy top-most on the voters minds should, and seems to be, benefiting Sen. Barack Obama; polls show the American people favor Barack as the savior of the country's economic future.

However, will Obama's policies fix the flagging economy or make it worse?

Sen. John McCain is trying, albeit likely too late, to charge that Obama's formula for economic recovery will not work, and will in fact plunge the economy deeper into recession, or worse.

A collective of 100 "distinguished and experienced" economists have signed onto a letter, released by the John McCain campaign, stating that Obama's policies will -- and already have -- hurt the U.S. economy.

These economists all agree:

• Obama's dividend and capital gains tax increases would reduce investment and cut into the savings of millions of Americans.
• His proposals to increase income and payroll tax rates would discourage the formation and expansion of small businesses and reduce employment and take-home pay,
• His mandates on firms to provide expensive health insurance (would reduce employment and take-home pay).

"Economic analysis and historical experience show that (Obama's proposals)... would reduce economic growth and decrease the number of jobs in America. (H)is proposals run a high risk of throwing the economy into a deep recession."

Obama plans to increase taxes on the "wealthy" -- including most small businesses, capital gains, oil, and other sources in order to finance a stimulus package for the, um non-wealthy, despite the fact that the Bush stimulus package from earlier this year has had limited impact on the economy.

"What we're seeing is a mild recession interrupted here by a rebate program," said David Wyss, chief economist for the rating agency Standard & Poor's in New York this week. "Once they (consumers) finish spending these checks, we'll head down again." (paragrah 11)

Most historians agree: An increase in the tax rates and additional barriers to trade, which raised tarriffs on lower-priced imported goods, helped prolong the Great Depression. (paragraph 14)

Surprisingly, Obama also plans to fight for increased restriction and regulation on trade. He opposes the planned Columbia free-trade agreement and the signed Central American Free Trade Agreement for fear that these pacts will not "spread good labor and environmental standards around the world."

Free trade, say the 100 economists, "make goods available to Americans at lower prices and are a particular benefit to families and individuals with low incomes." In addition, they write, International trade is "a powerful source of strength in a weak economy."

If this is true, is Obama really willing to cause more pain to the "families and individuals with low incomes" in America in an attempt to "spread good labor and environmental standards" to those in other countries?

According to these experts:

• Obama's opposition to trade agreements (with Colombia and Central America and renegotiating NAFTA) would block the creation of jobs for Americans these treaties would likely product.
• His opposition to trade treaties would reduce imports that would make goods available to Americans at lower prices, particularly hurting low-income families and individuals.
  

Wall Street Journal columnist John Fund agrees: "Most of the leading economists (during the Great Depression) opposed (restricting free trade); both Congress and President Hoover went along with the protectionist hysteria. As a result, the Great Depression was probably deepened and extended for years."

If history is a guide, then one must ask: Will Obama's economic plans kill the economy and even cause a depression?

Is there any wonder that as Sen. Barack Obama's odds of winning the U.S. presidency are increasing, the stock market in plunging? Or is that just a coincidence?