When Time magazine decided to show a cover depicting Obama as FDR, I could only shake my head. And now Obama is trying his best to be the next FDR, talking about a massive plan for public works.
The little secret, which isn’t really much of a secret anymore (except to those who refuse to listen) is that FDR’s New Deal never brought America out of the Great Depression. By the end of the 1930s, the economy was just as depressed as when FDR took office. The unemployment rate was virtually the same.
When the public sector spends more money, there is less to go around for the private sector, thus slowing a recovery. Of course, it looks good to spend this money and provide short-term jobs, but it doesn’t really deal with the problem.
We need to return to the Reagan solution. Yes, I know some people say this is a different time, so different solutions are called for. Well, if that’s the case, why are we rehashing the 1930s? Reagan’s concepts are still viable today because they are principles that apply at all times: reduce taxes, cut government spending, allow the people to keep more of their own money, and let them develop their entrepreneurial ideas. It worked in the 1980s and it can work now.
When will we ever truly learn from history?