The U.S. economy was motoring along as 2020 got underway, but has taken a sizable hit because of the coronavirus. Getting it back on track requires sound economic policy, not tax and regulatory hikes – and that means advantage Trump.
No one should forget that the eight years of Obama/Biden produced the weakest economic growth of any modern presidency. Not one year did the policies of increased taxes and a much higher regulatory burden produce growth of 3 percent – an all-time record of poor performance.
While those on the Left blame the George W. Bush administration for handing off a poor economy, simple economics tells you that the Obama/Biden response made things worse. By dramatically increasing the costs of doing business in the United States, the Obama/Biden administration reduced growth from what it could have been.
President Reagan, on the other hand, who faced double-digit unemployment and inflation and interest rates above 20 percent – a condition far worse than Obama faced – achieved stellar growth through tax and regulatory reform. In other words, policy matters.
Remember, the economic Law of Demand tells us that the more something costs, the less of it we get. The Obama/Biden administration raised taxes (costs), including those in ObamaCare, on the economy overall.
The Obama/Biden administration also undertook a war on energy in the form of regulatory costs. Beyond just the energy sector, overall, Obama/Biden regulations added billions annually in costs to the U.S. economy – and the higher the cost of something, including the economy overall, the less of it you get.
Faced with poor economic numbers at the end of the Obama/Biden years, the Left said 3 percent growth was no longer possible. In a sense they were right: under the burdens of ever-growing government – spending, regulations and taxes – economic growth is reduced.
That is why our average growth from the 1950s to today has fallen from 4 percent to 2 percent. In Europe, which has an even higher government burden, growth has fallen from 2 percent to zero.
Candidate Donald Trump, who understands such things as the Law of Demand, promised tax and regulatory reductions. Obama suggested that Trump would need a magic wand to reach 3 percent growth.
Instead of a magic wand, President Trump and his Republican allies paid heed to the Law of Demand. By significantly cutting the costs of doing business in the United States, American entrepreneurs, businesses and workers responded as predicted, and the economy indeed reached 3 percent growth and beyond.
No one should be surprised by that outcome. Before 2017, we’d had four major tax reforms (1920s, 1960s, 1980s and 2000s). Prior to each the economy was weak or falling and tax revenues were weak or failing. Each time doubters said a tax reduction would make things worse. Each time, however, the economy improved and tax revenues rose because of the wider economic base and activity that tax reform created.
That is why I predicted that, in the second quarter of 2018, four to six months after December 2017 tax reform passed, economic growth would top 4 percent. Historically, there is a time lag after reform. Also, historically, there is a burst of energy that is let loose after reform. Until the coronavirus, the reforms were producing stellar economic growth – even in the face of our still oversized government burdens.
Now, there can be little doubt that the coronavirus is reducing economic activity. The hospitality and travel industries are being especially hard hit. The stock market drops hurt everyone given that virtually every pension, public and private, in this country is invested in the market.
All of which brings us back to the 2020 election. If Joe Biden is indeed the Democrat nominee, he will do for economic growth exactly what the Obama/Biden administration did for eight years.
How could anyone predict otherwise?
Biden is promising to raise taxes dramatically by undoing the Trump tax reform. Biden has also said: “I guarantee you, we’re going to end fossil fuel.” In other words, Biden is going to reignite the war on business that his prior administration prosecuted. In the face of a weakened economy, the Law of Demand tells us such cost increasing policies would pull the economy under – just as increased taxes on you reduces your ability to spend and save.
Simply put, why anyone would again hire the same people who delivered the worst economic performance ever?
On the other hand, the Trump administration is already moving to further reduce the costs of doing business in America. A reduction in any tax, including the payroll tax and personal taxes as Trump has suggested, is in keeping with the Law of Demand, and is the right prescription to boost the private sector.
We face uncertain economic times. The response should not be to drain the private sector, as Biden would love to do. We should leave money in the private sector, which Trump advocates.
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No comments on The coronavirus economic recovery
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Today in 1965, Britain’s Tailor and Cutter Magazine ran a column asking the Rolling Stones to start wearing ties. The magazine claimed that their male fans’ emulating the Stones’ refusal to wear ties was threatening financial ruin for tiemakers.
To that, Mick Jagger replied:
“The trouble with a tie is that it could dangle in the soup. It is also something extra to which a fan can hang when you are trying to get in and out of a theater.”
Jagger is a graduate of the London School of Economics. Smart guy.
Today in 1974, Jefferson Airplane …
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Russian media have deployed a “significant disinformation campaign” against the West to worsen the impact of the coronavirus, generate panic and sow distrust, according to a European Union document seen by Reuters.
The Kremlin denied the allegations on Wednesday, saying they were unfounded and lacked common sense.
The EU document said the Russian campaign, pushing fake news online in English, Spanish, Italian, German and French, uses contradictory, confusing and malicious reports to make it harder for the EU to communicate its response to the pandemic.
“A significant disinformation campaign by Russian state media and pro-Kremlin outlets regarding COVID-19 is ongoing,” said the nine-page internal document, dated March 16, using the name of the disease that can be caused by the coronavirus.
“The overarching aim of Kremlin disinformation is to aggravate the public health crisis in Western countries…in
line with the Kremlin’s broader strategy of attempting to subvert European societies,” the document produced by the EU’s foreign policy arm, the European External Action Service, said.
A specialist EU database has recorded almost 80 cases of disinformation about coronavirus since Jan. 22, it said.
Kremlin spokesman Dmitry Peskov pointed to what he said was the lack in the EU document of a specific example or link to a specific media outlet.
“We’re talking again about some unfounded allegations which in the current situation are probably the result of an anti-Russian obsession,” said Peskov.
The EU document cited examples from Lithuania to Ukraine. It said that on social media, Russian state-funded, Spanish-language RT Spanish was the 12th most popular news source on coronavirus between January and mid-March, based on the amount of news shared on social media.
The EEAS declined to comment directly on the report.
The European Commission said it was in contact with Google, Facebook, Twitter and Microsoft. An EU spokesman accused Moscow of “playing with people’s lives” and appealed to EU citizens to “be very careful” and only use news sources they trust.
The EU and NATO have accused Russia of covert action, including disinformation, to try to destabilise the West by exploiting divisions in society.
Russia denies any such tactics, and Russian President Vladimir Putin has accused foreign foes of targeting Russia by spreading fake news about coronavirus to whip up panic.
Russian media in Europe have not been successful in reaching the broader public, but provide a platform for anti-EU populists and polarise debate, analysis by EU and non-governmental groups has shown.
The EEAS report cited riots at the end of February in Ukraine, a former Soviet republic now seeking to join the EU and NATO, as an example of the consequences of such disinformation.
It said a fake letter purporting to be from the Ukrainian health ministry falsely stated here were five coronavirus cases in the country. Ukrainian authorities say the letter was created outside Ukraine, the EU report said.
“Pro-Kremlin disinformation messages advance a narrative that coronavirus is a human creation, weaponised by the West,” said the report, first cited by the Financial Times.
It quoted fake news created by Russia in Italy, the second-most heavily affected country in the world, that health systems would be unable to cope and doctors would choose who lived or died because of a lack of beds.
The EEAS has also shared information with Slovakia over the spread of fake news accusing the country’s prime minister, Peter Pellegrini, of being infected with the virus and saying he may have passed on the infection to others at recent summits.
EU leaders have been conferring by videoconferences since early March.
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Today in 1965, the members of the Rolling Stones were fined £5 for urinating in a public place, specifically a gas station after a concert in Romford, England.
Today in 1967, Britain’s New Musical Express magazine announced that Steve Winwood, formerly of the Spencer Davis Group, was forming a group with the rock and roll stew of Jim Capaldi, Chris Wood and Dave Mason, to be called Traffic …
… which made rock fans glad.
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Joe Biden has proven that he’s not above politicizing the coronavirus on multiple occasions. On Sunday, he doubled down on his politicization of the outbreak in an op-ed credited to him that was published on CNN, which claims that the country would be better equipped to handle outbreaks under a Biden presidency.
“No President can promise to prevent future outbreaks. But I can promise you that when I’m President, we will prepare better, respond better, and recover better,” the op-ed reads.
Here’s why that’s a bunch of malarkey.
Biden claimed that “Our government’s ability to respond effectively has been undermined by the hollowing-out of our agencies and the disparagement of science.” This is a regurgitation of an allegation he made last month when he said the Obama administration increased the budgets of the CDC and NIH, but that Trump cut the funding for these agencies. This was fact-checked by the Associated Press last month and was determined to be not true, yet Biden doubled down on the lie anyway. Neither agency saw their budgets cut.
Biden then mentioned that last week he “released [his] plan to combat and overcome the coronavirus,” which basically plagiarized everything the Trump administration had done already. I guess he still wants credit for stealing Trump’s plan.
But regardless of what Biden says he’d do differently, let’s look at his record to see what that tells us. The best way we can tell how an outbreak would be handled by a Biden administration is to look at how things were handled when Biden was vice president.
In short, not very well.
Remember the H1N1 pandemic? According to the CDC, from April 12, 2009, to April 10, 2010, there were an estimated 60.8 million cases, 274,304 hospitalizations, and 12,469 deaths in the United States due to H1N1. Clearly, the United States wasn’t prepared for it. We didn’t see any travel bans to slow the spread of it.
As PJM’s Victoria Taft noted about the H1N1 outbreak, “American health officials declared a public health emergency on April 26, 2009,” yet sought to downplay the announcement, calling it “standard operating procedure.” Barack Obama didn’t declare a national emergency until October, after millions of people in the United States were already infected, at least 20,000 were hospitalized, and over a thousand had died. Had a national emergency been declared right away, it would have freed up resources to address the pandemic earlier. Perhaps if the Obama administration had treated the outbreak more seriously, fare fewer than 12,469 people would have died during the outbreak.
On a similar note, the CDC, under Obama and Biden, was slow to generate a vaccine for H1N1. Yet, Biden has the nerve to claim the CDC was better prepared on his watch than it is currently under Trump? What a joke.
I think it’s clear that the Obama-Biden administration failed to meet the challenges of the H1N1 outbreak. The Obama-Biden administration proved itself to be less than adequate during the significantly smaller-scale West Africa Ebola outbreak of 2014-2016. The Ebola outbreak was never declared a global pandemic, but the Obama-Biden administration still had to concede that there were “shortcomings” in the federal government’s response. Even CNN panned the Obama-Biden administration’s response to the scare. CDC models were way off.
The lessons learned by the Obama-Biden administration in response to the global H1N1 pandemic and the Ebola outbreak should have resulted in improvements to our country’s ability to handle outbreaks. But that never happened. “The system is not really geared to what we need right now,” said Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases. “That is a failing. Let’s admit it.” Fauci was responding to a question about our nation’s coronavirus testing capacity.
The Obama-Biden administration should have taken what it learned from the H1N1 pandemic and modernized the system to be able to handle such outbreaks. As a result of that inaction, the Trump administration is now having to address these issues. But, we should trust Biden when he says he’d handle the coronavirus outbreak better than Trump, who was busy addressing the outbreak while the Democratic Party was distracted by their efforts to impeach him. In fact, Trump’s decisive actions early on saved lives, according to experts.
Ultimately there would be little difference between a Trump administration pandemic and a Biden administration pandemic, except that Democrats lock up people faster.
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Business Insider composed this list from various health sources:
And the U.S. Army compiled a list of things to do if you are self-quarantining.
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The number one British single today in 1959:
Today in 1964, the Beatles set a record for advance sales, even though with 2.1 million sales the group would argue …
The number one single today in 1967:
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Since today is the Ides (Ide?) of March, let’s begin with the Ides of March …
… an outstanding example of brass rock.
Today in 1955, Elvis Presley signed a management contract with Andreas Cornelis van Kuijk, an illegal immigrant from the Netherlands who named himself Colonel Tom Parker.
The number two single that day:
The number one British album today in 1969 was Cream’s “Goodbye,” which was, duh, their last album:
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The texting shorthand term “smh” (“shakes my head”) didn’t exist in 1955 because texting didn’t exist in 1955.
But surely “smh” was invented for things like this: Today in 1955, CBS talent scout Arthur Godfrey made a signing decision between Elvis Presley and Pat Boone.
Godfrey chose Boone.
Steve Prestegard.com: The Presteblog 