There’s no joy in saying “we told you so.” Not when millions of Americans are beset by plummeting home prices, stagnant income levels, deteriorating job opportunities and rising consumer prices. And let’s not forget the trillions of dollars in debt that America’s politicians have saddled taxpayers with in an unsuccessful effort to alleviate these economic ills.
Free market advocates repeatedly warned political leaders of both parties regarding these inevitable “bailout byproducts,” but they didn’t listen. Instead, they rushed to reward their favored banks and bureaucracies for years of gross fiscal negligence — leaving taxpayers stuck with a scarcely-fathomable tab.
The only silver lining to this Keynesian tsunami? That the failure of the largest, costliest and least effective government economic intervention in human history could be the impetus for an urgently needed course correction — and a long-overdue debunking of one of the greatest myths in American history.
According to Barack Obama and the New Keynesians, years of unrestrained and unregulated “corporate greed” pushed America to the precipice of a second Great Depression. That’s when government rode to the “rescue” with more than $13 trillion worth of new spending, lending, loan guarantees and money-printing.
It’s a familiar narrative — one evoking all too common misconceptions about the policies responsible for the depth, duration and the eventual demise of previous economic downturns. Like its predecessors, however, this narrative ignores a flood of politically-correct, government-mandated lending that helped artificially inflate the nation’s housing bubble. It also ignores a steady increase in deficit spending in the years leading up to the recent recession.
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