Conservatives complain heartily about Barack Obama. “Bush wasn’t the best, but this guy is spending us into oblivion.” Obama believes, or so he says, that he has no other choice.
It’s necessary to see the larger picture before putting Obama on a special pedestal of infamy on the specific topic of government spending. I believe that we’re seeing a historical crescendo. Since 1971 the dollar has been unhinged completely from gold, and this, along with other factors such as the dollar’s currency reserve status, has led to an explosion of spending and debt. Politicians became addicted to cheap money and huge deficit spending (even the “balanced budgets” of the 90s were frauds because they were raiding the misnamed “Social Security Trust Fund” the whole time, and thus massively growing unfunded liabilities). As the heroin addict needs ever greater hits to get the same high, a debt-laden economy requires ever greater infusions of government spending to postpone collapse. The federal debt has more than doubled since 2000, and the debt ceiling has been raised with increasing regularity. The scope of government bailouts continues to widen. Problems are hitting the shore in waves, with the largest wave hitting in late 2008. Ensuing waves have been increasing the destruction, and the government response (propping up large and insolvent banks, guaranteeing nearly all mortgages, and so on) is ensuring that larger waves are in store. In short, the crescendo is building.
Eventually, just as a junkie will crash, so will the economy. The government will be forced to stop spending and make life-altering changes when it can’t find enough borrowers, or if it sees prospect of monetary collapse, or some other crisis. Perhaps it will lose control and we’ll see a hyperinflation. You will definitely be seeing broken promises. They were never sustainable promises.
If the crash doesn’t happen in the next few years, expect the next president, regardless of party, to be a larger spender than Obama. Both parties share a devotion to Keynesian economics and both parties realize that, politically, they don’t have any other choice but to keep spending. Economically, they do. Morally, they do. Politically, they don’t.
Politics always wins out with political parties. They are not going to do the right thing and let the economy (that is, all of us) freely restructure through a lot of pain. The voters won’t stand for it, and politicians know it.