RUSH: The CBO predictions that we’ve talked about, the unemployment number where if you add the number of unemployed and compare it to the actual number of jobs available when Obama took office, it would be 9.75% unemployment? The CBO is unquestioned in their credibility. Nobody ever says they’re lying. They are the coin of the realm! You dig deep into this whole story, and the CBO gives their predictions for economic growth for this year and next.
Are you sittin’ down?
The CBO projects growth to be 2.2% this year. The ChiComs are growing at 9%. Obama, in his budget of a year and a half ago or whenever he last presented a budget, projected growth of 5% by now, and into infinity. We have 2.2% economic growth predicted this year, and 1% in 2013. An economic growth rate predicted by the CBO — which is unchallengeable. Don’t ever disagree with them. They never lie, and they see 1% economic growth for 2013. My gosh, if they’re right about that, this is horrible. And, of course, one of the fundamental reasons for that 1% economic growth prediction is the implementation of Obamacare, ladies and gentlemen. So that’s what I am not looking forward to. After the elections, after November, we can look forward to a 1% GDP. That’s a recession, folks. The New York Times called 3.5% GDP a recession under Bush.
RUSH: There’s even more in the latest CBO report. “The amount of money the federal government takes out of the U.S. economy in taxes will increase by more than 30 percent between 2012 and 2014, according to the Budget and Economic Outlook published today by the CBO.” Now, look at what we’ve learned from the CBO just today. We’ve learned that the real unemployment rate is 10%. If the same number of jobs were available today as were available when Obama took office, the real unemployment rate would be 10%. We have learned that economic growth is forecast to be 2.2% this year and 1% next year. And now the CBO says that taxes will go up by more than 30% over the next two years. Scheduled taxes, not just income taxes. And this is why the economy will grow at 2.2% this year and 1% next year.
“In particular, between 2012 and 2014, revenues in CBOÂ’s baseline shoot up by more than 30 percent, mostly because of the recent or scheduled expirations of tax provisions, such as those that lower income tax rates and limit the reach of the alternative minimum tax.” Now, along these lines, for the longest time I remember citing an essay, a piece from a brilliant thinker at the Heritage Foundation who explained very succinctly why stimulus doesn’t work, why government stimulus doesn’t work. If you’re gonna stimulate the private sector with money, you first have to take the money out of the private sector. If you’re gonna inject $800 billion into the private sector, you first have to take it away from them. The money doesn’t exist elsewhere. Unless you print it. Then we’re talking distortion of reality anyway.
Another piece has come along by a couple of professors. One of them is UC San Diego professor Valerie Ramey. She’s got a report here along with Christopher Nekarda, the National Bureau of Economic Research study, the NBER, and they found that “private spending falls significantly in response to an increase in government spending.” They found, secondly, that “increases in government spending lower unemployment through an increase in government employment, not private employment.”
This is her conclusion: “For the most part, it appears that a rise in government spending does not stimulate private spending.” The Heritage Foundation guy said, “It can’t. It’s not possible.” A rise in government spending does not stimulate private spending. Keynes was all wet. He didn’t know what he was talking about. “Most estimates suggest that it significantly lowers private spending. These results imply that the government spending multiplier is below unity,” which is one. In other words, there’s no such thing as government stimulus in the private sector. Cannot happen. Government spending does more harm than good to the private sector economy. You’re not gonna see this report in the Drive-By Media. It’s common sense. It’s economic common sense.
Now, in this CBO story I just read, the 30% taxes going up, the reason economic growth in 2013 is 1%, I think the CBO just called the health care mandate a tax, which is what Obama would love for it to be called. That would make it constitutional. I don’t care what they call it, the bottom line is that government spending, government revenue, tax increases are going to continue to starve the private sector, and that, my friends, is by design. That is not incompetence, it’s not being in over his head. It is purposeful. When the government’s sole source of revenue outside printing it or borrowing it from the ChiComs, when the sole source of revenue for the government is taxing the output of the private sector, how does it make any sense to put $800 billion into the private sector that can only come from the private sector in the first place?
It’s not as though there’s $800 billion lying around not being used. You and I both know we’re $16 trillion in debt. We don’t have $800 billion laying around. There isn’t $800 billion idle, not doing anything, that we can grab and say, “You know what, we’re gonna put it in the private sector.” Can’t happen, and even if that kind of money did exist, that was idle, how can the government put it in the private sector and stimulate anything? It can’t. All it can do is choose winners and losers. And Obama did. It was the unions and public sector jobs, all shovel-ready jobs didn’t exist, laughed about ’em later. All this is a giant lie, not to mention joke, on us.