The Government And Its Role With The Economy
Americans have a very bad habit. You see, throughout history we have tried to pin the economy on our leaders. When it’s good, our elected officials try to take credit for it. When it’s bad, they blame their political opponents. Well, there’s more to it.
Most textbooks will tell you that the President and congress don’t have as much to do with the economy as we’re lead to believe. The economy is determined by a number of factors and the government is just one piece of the pie. Economists will often tell you that it’s a very small piece of the pie at that. The President and congress can, however, do things to manipulate the economy. They can go public with reports of bailouts, tax cuts or new regulations that shift the way the rest of the world does business. We’ve seen how regulations have literally shut down certain industries during the Obama years. In fact, the stock market tumbled when Obama was elected and assumed office. Why? It has never been confirmed, but many have speculated that investors became hesitant to keep their money on a market when a President who is not viewed as business-friendly took office.
A sad reality is that some leaders have been known to try to shift the market with war. For some reason it is seen as a way to get business going. It’s not a great answer for financial problems, but economists often say that it’s what got us out of the Great Depression. Some will note that our country came out of its recession during the early 2000s due to the War on Terror and eventually the Iraq War. It makes one wonder if a new war is what will be used to get us out of our current economic woes.
The Obama Administration inherited a collapsed economy that wasn’t entirely the fault of George W. Bush. It wasn’t entirely the fault of Bill Clinton, Ronald Reagan or even Harry S. Truman either. The government played a part in it, but the real reason for the late 2000s collapse was that a lot of people put stuff on credit that they couldn’t afford. The you know what hit the fan for them and spread everywhere.
The slow economic comeback isn’t entirely Obama’s fault either. Yes, he hasn’t been overly supportive of the free market. He has introduced more debt, new taxation and crippling regulation. We have seen that this has not helped the economy. However, in the end, he is just manipulating the overall economic growth of America and not controlling it.
What will really bring America back is a number of factors. Every piece of the pie has to be involved. We need a government that isn’t spending, regulating and taxing too much. We need consumers to do things like shop a lot during this holiday season. We need to recognize how to handle our new competition from other countries. We have all heard the complaints that other countries are taking our jobs. Well, maybe we should create an atmosphere that companies would want to send those jobs back to. Americans also need to be able to compete with foreign shops in the growing world of online bidding. Most importantly, we need companies to start hiring again so that people have money to buy stuff.
The bottom line here is that the real solution for our tepid economic recovery is what has been the real solution for other tough times in America. The history books will show that a bustling free market is what turns our financial problems upside down every time out. Decades ago, America recovered from tough times or periods where the national debt grew with business development. Americans just started up their own companies. Some failed; others made a profit and hired people. With more people in the private sector working, there were more Americans with money in their pockets. They were more likely to circulate their wealth around other businesses. Then, much like our credit problems spread in the late 2000s, our free market business growth spread.
Let’s just hope the free market isn’t handcuffed by the idea that our government controls the economy.