Rush Limbaugh

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RUSH: We always try to go to the phones earlier than normal today. Normally we don’t get to the phones ’til the second hour of this program, but on Friday — since we’re urging people, inviting them to call and telling them the show is theirs, the content’s theirs when we go to the phones — we try to go earlier, and I’m going to do that today. We’re gonna start with Edgar in Atlanta. It’s great to have you with us, Edgar. Hello.

CALLER: Hi, Rush. Back in January, you said you were going to let us know when it’s time to panic. And I don’t want to wait ’til I hear you broadcasting from New Zealand. I feel…

RUSH: (laughing)

CALLER: I feel the time is here, and I’m wondering: At what point does secession become a real option? Because I feel like the left and the right in this country, we’re just irreconcilable.

RUSH: Wait a second. Secession? Who seceding from where?

CALLER: I’m ready to go to whatever state wants to secede first, Rush.

RUSH: Well, that’s Texas. They’re the only one talking about it.

CALLER: Then let it be Texas.

RUSH: And, by the way, Texas is in the best economic shape of any state in the country in terms of job losses and budget deficits and so forth — and there’s no state income tax in Texas.

CALLER: Well, in my mind, Rush, we’ve separated into a country of a host organism and parasites, and we don’t need them. We don’t need the left, Rush, but they need us because without us they’re broke. And I think if Texas seceded, us productive people and businesses would flock there, and eventually the blue states of America would collapse.

RUSH: Well, we’ve gotta face reality, Edgar. Nobody is going to secede from anything. I mean, Governor Perry in Texas talked about it and things blew up. I mean, there might be some people in Texas that wouldn’t mind it but it isn’t going to happen. I want to focus on something that you said that you just glanced over. You just sort of threw it away out there.


RUSH: You said that the left and right are ‘irreconcilable.’

CALLER: I believe that.

RUSH: I do, too! I’ve always said that. That’s why I’m against bipartisanship! That’s why I’m against compromise. That’s why the only thing that matters is beating them.

CALLER: Well, maybe what we need is a two-state solution. I think they’ll collapse under their own weight eventually without us.

RUSH: Well, what he’s saying here is that without the productive class in this country to tax, that the left has no money. Wrong. They’re printing it now. We don’t have the money now. Obama is purposely destroying the private sector by printing money. This year alone we’re going to be over budget by $2.2 trillion. We don’t have money that he’s spending now. The money that he is spending technically hasn’t even been earned yet. The money he’s spending now will be earned by people’s children and grandchildren and great-grandchildren, but he’s printing it now, spending it now. You know, every time I have a show like I had yesterday, ladies and gentlemen, where I unabashedly say that President Obama is seeking to destroy the US economy, I get lots of e-mail. ‘Rush, do you really believe that?’ That’s so hard for people to grasp. It’s so difficult for people to put their arms around, a US president that wants to destroy the economy.

Look, what is the centerpiece of Barack Obama’s agenda to accomplish what he wants? It is health care. Nationalized, single-payer, public-option health care. Because that, as Mona Charen said in a column, is ball game. If that happens, every aspect of life is subject to regulation by the federal government on the basis of saving money for health care costs. That will be what they say. The objective is just to simply exert power and the control over people. And once health care is the single responsibility of the government — not you, but the single responsibility of the government — they will have infinite power. We aren’t even able to define it now, but infinite power to regulate the way individuals live and work and play.

There’s no end to this. Now, if that’s your centerpiece, and if you need that to accomplish your ultimate objective (which is the expansion of federal government, a totalitarian state, or however you want to characterize it) wouldn’t you need as many people in economic pain as possible? Health care insurance, as we all know, is not ‘portable.’ If your health care insurance is provided by your employer and you happen to lose your job, you don’t keep your health care insurance because you’re not paying for it, he is. Now, when you lose your job, you keep your car insurance because you’re paying for that, but you don’t keep your health insurance. So this whole notion of portability has been a gigantic argument with the leftists demanding portability, meaning you don’t ever lose your health insurance.

Well, okay. Who’s going to pay it if you get canned or if you quit and your employer is paying your health care insurance or most of it? Who’s going to pick up the tab? That’s where Obama wants to step in, in one of just many areas. Now, if the central objective is health care — because getting nationalized health care permits you this cradle-to-grave, Nanny State control over individuals and every aspect of their lives — if you really want it, wouldn’t it really be easier to make sure that more and more people have lost theirs? They know that they have drummed up in people’s heads the importance of health care. People are more frightened of going a day without health care in this country than they are of getting on an airplane with one wing.

The psychology has succeeded. People are scared to death to go one day without health care. You get canned — and right now, over two million people have lost her jobs since Obama was elected, and there’s not one policy prescription he has proposed to reduce that, to reverse it. Everything he’s doing is going to encourage more unemployment. Because he wants it, because the more people who are unemployed with the fear of health care, the more they’re going to demand somebody ‘do something’ to restore their health care. He’s got all the retailers and the doctors joining up and the hospitals. That’s what I mean.


RUSH: It’s not just health care that Obama seeks — and that’s the biggie, because that encompasses every aspect of our lives. Once the federal government is in charge of that there’s no rolling that back. Well, not instantly. Too many people will have their lives personally intertwined, changed with government. It’s gotta be stopped. But it’s not just health care. If you look at the economy in general, we’ve been trying for nine months now the political solution: stimulate, Keynesian economics, spend, spend, spend, spend. Stimulate, stimulate, stimulate! In fact, if I may be so bold and so honest, the stimulus package is not even that. It was advertised and promoted as shovel-ready. ‘We’re going to build schools, Mr. Limbaugh, and we’re going to build roads and bridges and we’re going to rebuild the infrastructure.’ None of that’s happening. I think 6% of the stimulus has been spent, and now they’re talking about a second one?

The purpose of that stimulus was not to create jobs. That’s not what government does. The only way government does that is when they hire people, and that’s not what this was about, as far as the people were told. The people were told that this is going to put them back at work. There’s a chart I saw today, and I’m going to try to describe this. As you know, describing charts on radio is a challenge that very few broadcast professionals would ever take. I, my friends, will take it because I am a great chart reader — and I also happen to tell a great story. This chart shows since I think World War II, maybe it’s World War I, the beginning of every recession in terms of job losses. And each one of these recessions has a color-coded line so you can follow each year or each recession that happened. And the chart is one of these left-to-right charts and it’s a giant V-chart except that the V is a different size for every recession. Some recessions lasted longer than others and some were deeper. But at every point in this chart there is an end to the falling unemployment and a dramatic uptick to complete the right side of the V as jobs are gained.

Now, you have to know history, ’cause the chart does not explain this. You have to know history to be able to determine, ‘Well, what’s the magic?’ What happened here that reversed the left side of the V, which is unemployment going down and all of a sudden it bottoms out (and peaks) and starts going up — and it’s dramatic. You look at the 1981-82 recession, and you can see when we came out of it, and you know why. You know what brought us out of it. And practically every other one of these recessions, if you just know history, you know what brought us out of it: incentives in the private sector led to people hiring more people to work and more tax revenues and all that. The recession that we are currently in is a red line, and there is no V yet. It is just almost a direct plunge. You ought to see this. It’s a direct plunge, almost like that Air France plane took into the Atlantic, and there’s no end in sight for this. All these other recessions you can see the V, the right-hand side of the V going up where employment starts to pick up, but there’s no end in sight for this, and it’s deeper. This V, the left side of this recession V… I ought to double-check. I think it’s deeper than any of the others on the chart or very close to it.

Now, obviously because of the way this chart is, this chart charts every recovery from a recession in terms of employment. There is none yet in this recession. So that line is a stand alone. It’s by itself. It’s bright red. So you ask yourself, ‘What’s going to be the magic that starts people back to work?’ I’m telling you there isn’t one Obama or Democrat Party policy that’s going to cause that to happen. The Obama policies are going to keep that line plunging, keep the left side of the V down, keep employment going down. We’re losing jobs. There’s not one thing being proposed even! There’s not one thing being proposed. The list of tax increases Obama is talking about will choke off any job creation. The unknown in the future is: ‘Are we actually gonna get this cap-and-trade fiasco? Are we actually going to get health care?’ Those two great unknowns have paralyzed business. You can’t make long-term plans unless you know what the game’s going to be and what the rules are, and right now nobody knows the rules.

If you’re smart and running a small business, your effort now is not to hire workers; it’s to stay in business. And you’re looking down the road and saying, ‘Okay, what happens to me and my business if cap and trade’s passed? What happens to me if health care passes?’ And, by evidence of what’s happened the last nine months, you have to say things are going to get even worse because the government sector is going to get bigger, and to get bigger the government sector has to deplete the private sector. The government can’t produce anything. It can print, but it can’t produce anything. Not without the private sector working — and that’s being dwindled away. It’s being attacked. It’s under attack daily by this administration. There’s no end in sight to it, and there’s not one policy that they’re prepared to enact that would bring it about. While they talk about bringing it about — they talk a good game, they talk about restoring jobs and all that — it’s not happening. The talk is meaningless because it’s deflective.

So businesses, they’re not poised to start hiring anybody here. In the unemployment numbers, it’s not just that they’re worse in some cases than ever. It’s not just that we’re at 9.5% unemployment. It’s not just that we’ve lost over two million jobs since January. We’re also working fewer hours a week. The average work week now is 33 hours. The Drive-Bys are not reporting this. I mean, you have to dig deep to find it. The average work week is 40 hours and people are working 33. What does that mean? Well, it means that a lot more people have been laid off, fired, and hired back as part-timers, or they’re being furloughed. But regardless the reason, when people are working fewer hours, there is, by definition, less productivity. Manufacturing is way down — and, yes, we still do manufacture in this country.

I mentioned this website earlier. There’s a story here by Richard Bernstein at BusinessInsider.com, Why is weak employment a surprise? He’s asked the question here that we all ask. Every time the State-Run Media reports economic numbers they’re always surprised. It was ‘unexpectedly high’ or ‘unexpectedly low,’ but the experts are always just bamboozled by it. So he says: ‘Today’s weaker-than-expected employment report sent the financial and commodities markets reeling. But why was this report such a significant surprise to anyone? I’m not particularly bearish or bullish with respect to stocks right now, but I am a pragmatist. The fact is that the leading indicators of employment have been weakening, yet the consensus has been ready to reap the fruits of the so-called ‘green shoots.” There aren’t any green shoots! People are responding to Obama’s words. ‘We’re about to come back,’ and, you know, ‘We’ve bottomed out,’ or, ‘Our backs are no longer against the wall,’ but the job losses keep coming.

‘First, let’s set the record straight. Employment is NOT a lagging indicator. Some indicators of employment, like jobless claims and the length of the work week, are actually official leading indicators of the economy. Payroll employment is a coincident indicator. It is actually somewhat odd that investors are currently paying so much attention to true lagging indicators related to inflation. Wage pressures, and not commodity prices, are the true catalysts for inflation. Wage increases, abnormal credit creation, and excess demand relative to supply come first, and inflation comes second. There are no wage pressures, there’s not a lot of credit being created, and output gaps abound, so why is everyone focused on lagging inflation indicators?’

Well, the answer is because everybody wants to try to convince the American people it’s not as bad as it is, and it’s going to get better real soon, but it’s not ’cause there’s nothing in place to get it better. The things that are in place are obstacles to economic improvement, and they’ve been purposely put there. ‘Second, the monthly payroll report, like the one issued today, is full of largely coincident data. However, it does have one piece of leading data: the length of the work week. This is generally considered a leading indicator because employers will tend to adjust the number of hours their employees work before hiring or firing them. For example, it would be normal for companies to begin to pay existing workers overtime before they hire additional workers because of the uncertainty related to the initial upturn in a production or service cycle.’ People may not believe the first indication of economic return, so rather go out and hire new people, you just take your existing staff and pay them overtime.

‘However, commentators rarely highlight the length of the work week when discussing the monthly employment report. What has been happening to the length of the work week? It has hit all-time lows the last two months. That’s right. The only official leading indicator in the employment report has hit all-time lows the last two months. Who has reported that? No one. … Could it be that momentum, rather than fundamentals, remains the defining aspect to most investment strategies? Prudent investors should be watching sound leading indicators, and not the markets’ short-term momentum for clues as to whether the ‘green shoots’ will sprout flowers or weeds.’

Let me get something at the bottom of the stack. I put at the bottom of the stack. I was going to gloss over it but now I’m not. It’s a CNBC.com post from yesterday. ‘The financial system is crashing and action must be taken by the US government to convert debt into equity to produce a more stable environment, Nassim Taleb, author of The Black Swan, told CNBC Thursday. ‘You may have green shoots, whatever you want to call them, you may have temporary relief, but you are still in a world that’s breaking,’ Taleb said on ‘Squawk Box.’ [sic] Anything that’s fragile like the financial system will eventually crash, he said. ‘We’re in the middle of a crash,’ Taleb said. ‘So if I’m going to forecast something, it is that it’s going to get worse, not better.’ The government needs to deleverage debt and not try stimulus packages that will inflate assets, he said.’

You know, when I read these guys say, ‘The governments needs to do this, and the government needs to do that,’ it’s as though these people in government are making honest mistakes. Nobody’s this stupid in government to make these honest mistakes! This has been tried countless times in the past, the world over. It doesn’t work unless your objective is something else. If your objective is to wreck the economy — to cause more chaos, more unemployment, create greater dependence on government — then this is a championship policy. But it is not a championship policy to revive the US economy, and everybody involved in this knows it. This is why some of these people involved in this need to be seriously questioned about their intentions for this country. This is not merely an economic mistake. This is not a divergent opinion. This is not left economics versus right economics. Economics is economics. It’s science. There are left-right disagreements in it obviously, but what Obama is doing here, there is nobody that can say, ‘This is an honest attempt at really doing what they think is best.’ Maybe so, but for them, not you and not us!

So when I read these guys, ‘The government needs to deleverage debt.’ The government’s doing purposely what it intends to do! It intends stimulus packages that will inflate assets and not create jobs. This guy said, ‘What makes me very pessimistic in not seeing any leadership or awareness on parts of government on what has to be done,’ as though they’re just ignorant and making mistakes. People don’t have the guts to say what’s really happening here — and this is purposeful. His solution, this debt business of, ‘Look, we’re not helping anybody when we foreclose on them. We’ve gotta deleverage some of this debt. Rather than foreclose on people, the banks,’ I’m summarizing what he says, ‘need to lower the monthly payment and take an equity stake in the house,’which, of course, they already have. The mortgage holder already has an equity stake. ‘But get rid of some of the debt and turn the debt into equity,’ that’s what he’s saying,’ and that will help stave off the financial crisis.’


RUSH: Here’s the guy from CNBC’s Squawk on the Street yesterday. It’s Universa Investments principal and author of The Black Swan, Nassim Taleb. The co-host, Carl Quintanilla, is talking to him. Here, in his own words, is what I just quoted him as saying.

TALEB: Anything that’s fragile eventually will crash. And the system is very fragile. It is crashing. We’re in the middle of a crash. So if I was going to forecast something, I know it’s going to get worse, not better. The monkey on our back is the debt. Okay, we have huge amount of debt. Instead of the government doing that, now they’re trying to look at stimulus plans and things that may inflate assets. And that may run out of control. So instead of deflating debt, they’re thinking of inflating assets or — actually, they don’t even know what they’re doing —

RUSH: They do.

TALEB: — because they’re doing a lot of contradictory things. So this is what makes me very pessimistic, not to see any leadership or any awareness on the part of the government —

RUSH: Wait a second. This should have ended.

TALEB: — of what needs to be done, which is to deleverage by, I don’t know, somewhere between 40 and $70 trillion worldwide.

RUSH: They didn’t give me a full transcript. I thought it was over 15 seconds. I’m sorry for talking over that, folks. Anyway, when he says they ‘don’t even know what they’re doing’ and they’re doing ‘a lot of contradictory things.’ They do know what they’re doing. Obama knows what he’s doing. Obama may not be a macroeconomist. I mean, he may not be up there plotting and planning every day’s economic machinations, but he’s got a vision. His vision is emperor. His vision is all-empowered leader for life. The government has got to take over and correct the injustices of this country. Wealth and profit are injustices. They are immoral, as far as Obama looks at it. The more wealth, the more prosperity he can wipe out, he thinks he’s doing a morally good thing — and I’m giving him the benefit of the doubt saying that.

He’s grown up surrounded by people who despise prosperity and wealth because they believe it’s the epitome of inequality, and they also believe that prosperity and wealth exist because of thievery or other means by which ill-gotten gains produce the wealth and the prosperity. It’s always happening on the backs of Obama’s type of people, and so he’s got to make the world right. He’s gotta make the country right and he’s gotta cut it down to size. Now, he may not be sitting there every day plotting virtually every aspect of this, but there’s an overall vision — and it’s happening. They know what they’re doing. They’re too stupid to not know what they’re doing. That’s what makes this scary. And rather than these CEOs bending over backwards and joining his team out of fear, they need to stand up and say, ‘Stop! You’re not going to bully us anymore into doing things that are not helpful to the country.’


RUSH: I can’t stop laughing here, folks, and you’re going to hear it again very soon. Colin Powell is a guest again on CNN this coming Sunday. All of a sudden he can’t believe the amount of debt and spending that’s going on in America. Ha! (laughing)


RUSH: Last hour I spoke of this chart — this employment, unemployment chart — of every recession since World War II to the present. Remember when I was talking about the V charts? They’re not actually all V’s. There are some U’s. It’s not a dramatic increase when the uptick in jobs happens. Anyway, I posted that chart at RushLimbaugh.com. You can see it now. It’s from BusinessInsider.com, and the thing to look at is every recession has an end, and you can clearly see it on this chart, in terms of we’re talking employment versus unemployment. When the unemployment uptick begins it’s dramatic, and there’s a reason that it happens in each case if you know history. Then you’ll find the color of the line for this recession is bright red and it’s still plunging. There’s no hint of any kind of an uptick whatsoever. So it’s there for one and all to see, even though you probably don’t need to see it since I did superb job of describing it to you, but I’m sure that when you look at it, you’ll say, ‘It’s just exactly like Rush talked about,’ which is one of many elements of the magic part of the content of this program.

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