Can Obama Kill the Economy? Only Time Will Tell

It is no wonder that the stock market has been going down. It is in the red for the year, loosing maybe a third of the uphill gains it had made since the big bust in the fall of 2008. It is not a coincidence that the biggest losses have come days after the president announced his new budget. BHO proposes spending that will vastly increase the current annual deficits, and therefore borrowing. He also wants congress to increase taxes, especially business taxes. This is the first pay-off of his blitzkrieg propaganda campaign against banks and big business. By the way, US business is already taxed at rates near the top for all industrialized nation. The new taxes also include an increase in taxes on corporate dividends. Dividends are only paid by successful corporations. Conservative mutual funds often concentrate their investments among these usually slower growing, yet dependable companies. So investments in these companies will be targeted, along with struggling growth and value investments. Investment in bonds is risky too, because if interest rates go up to keep up with the lowering value of the dollar (i. e. inflation), then the value of the current bonds will go down, because new bond will be paying higher rates.

Of course, higher business taxes are not only bad for investors but they are bad for workers. With profits being taxed away, how can companies expand and hire? Most of us are both workers and investors so we get a double whammy. This could help social security, since no one will be able to afford to retire. (If they have a job to retire from, that is.)

The American economy was showing signs of recovery in spite of the disastrous policies of the last 12 months. The American economy is like an old war elephant. Although it has been shot full of arrows, it keeps plodding along. But for how long? Barrack Obama is shooting those arrows from his quiver of economic 'stimulus' programs. One is labeled 'Cash for Clunkers.' There is another arrow called 'Shovel Ready Projects.' Two or three really big arrows are the 'Jobs Bills.' 'Health Care' and 'Carbon Tax' are still in his quiver. He has let fly the new 'Big Bank Busters' and 'Business Tax' arrows. You can see the elephant shudder. (Incidentally,Obama does not want individual tax decreases to remain in place either. Those arrows are at the ready.) He has now notched the great 'Deficit Arrow;' that should bring the beast down.