Why American Prosperity Needs Discipline to Succeed

Change for the Worse

It’s nearly all over and done. By failing the economy, Barack Obama has failed to promote the general welfare.

Indeed, with seventeen months left until a referendum election in which American voters will judge his term, the U.S. housing market is getting worse . Economists expect home prices this year to sink another 5%, more than double the amount previously expected.

And instead of falling well-below Barack Obama’s promise of an 8% upper limit, the national unemployment rate in May rose again to 9.1%, according to the Bureau of Labor Statistics, with unemployment in many states remaining in the double digits.

In brief, nearly three-fourths of the way into Barack Obama’s term, change for the worse in housing and job markets continue to fail Americans’ traditional hope to achieve middle-class dignity: the many with distressed mortgages are less able to pursue the few jobs available.

Record-High Poverty under Obama

But a more noticeable indicator for American households of diminishing middle-class dignity under Barack Obama may be in their declining incomes.

In addition to reporting that a record-high number of Americans suffer in poverty under Obama’s administration, the Census Bureau says household incomes are declining at an increasing rate. Real household incomes fell 1.2% in 2008 and another 3.5% in 2009, when following the financial crisis Barack Obama showed his lack of discipline by making health-spending his top priority, thus forcing unneeded change during the first year of his term that increased the size of government while failing with much-needed financial reform.

First Step: Maintain Discipline

This is in stark contrast to what would be accomplished with discipline from a Grey administration, which would hit the ground running in 2013, observing the successful tradition of President Ronald Reagan.

On economic matters, the Reagan administration did “hit the ground running,” as presidential counselor Edwin Meese III had promised.

Reagan’s first official acts as president were to cancel all federal hiring, retroactive to the November 4 election, and to freeze pending regulations until they could be reviewed. On February 18 the president brought to Congress an ambitious plan to slow the growth of government and return billions of dollars in taxes to workers and business.

As the above figure shows, such discipline succeeds in raising prosperity for Americans. It led not only to upward mobility that lasted through the 1980s, with increases for all households in real incomes, but also had a more immediate effect by lowering unemployment 0.3% during the initial six months of Reagan’s first term.

Tradition of Success over Harmful Change

In the spirit of Reagan and his vice president who rightly followed, President George H.W. Bush, Americans in 2012 will have the opportunity to elect a president who calls not for more change to force the country further off track, but who instead observes the best of tradition, with more than thirty-five years of training to lead the White House through the discipline known only to veterans of America’s military — join me.

References

Congressional Quarterly, President Reagan (Washington: Congressional Quarterly, 1981).

Kathleen C. Engel and Patricia A. McCoy, The Subprime Virus: Reckless Credit, Regulatory Failure, and Next Steps (Oxford: Oxford University Press, 2011).

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