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What the Democrats’ Stimulus and Shenanigans Mean to Virginia

President Obama’s Democrat Stimulus means lengthening the recovery from recession, running the risk of inflation and adding to the crushing, country-changing national debt. The economy should recover from the housing bubble – that means an upturn in jobs and other economic measures – in less than a year. Full recovery should be 18 months – 24 months tops – to be back where America was – if the federal government did nothing; just as the American economy recovered in past bubbles where government didn’t screw it up.


But the federal government is going to do something which will cause another $1 trillion in spending.


It all boils down to capital. See the late economist Milton Friedman’s “Monetary History of the United States.” Read Niall Ferguson’s “Ascent of Money.” The economy will correct for a bubble, even a bubble of more than a trillion dollars in bad housing loans.


At any point in time there is a finite amount of capital – the money supply – and highly mobile money. When the federal government spends a trillion or more than its tax revenues, then citizen and commercial spending is crowded out. Furthermore, a dollar spent by a citizen or a private company isn’t the same as a dollar spent by the government. The relationship I learned almost 30 years ago in grad school was this: A dollar spent by the government produces less than 28 cents in goods and services. A dollar spent by a person or company, produces about four dollars in new capital over time.


Some government spending – like Defense – is necessary and Constitutional. Most federal government spending is the misapplication of tax dollars for the purposes of Ponzi scheme social programs – Social Security, Medicare/Medicaid, Prescription Drugs, etc. which will literally bankrupt the nation – sooner or later. The 2009 Stimulus is no exception.


The details of folly make depressing reading. So, let’s just concentrate on the Stimulus outcome. The follies will slow the economy. When jobs start coming back in 24 months, instead of less than 12, the upturn in the economy will be credited to the Stimulus. Furthermore, the handouts of government money for services and jobs mean many more folks will think they owe their jobs during desperate times to the Democrats, terrible economics, but great politics.


The Stimulus puts the pay-to-play and back scratching of Chicago ward heel politics on a national scale.


In Virginia it means a million here and million there. No indications of multi-billion dollar transportation solutions. It may mean more folks working for the federal government in NoVa, but, that isn’t a Democratic phenomenon. I call Washington, DC – New Rome – for a reason. Until our position as the sole Uber SuperPower changes, the government in DC will be the center of the world for power. Power creates wealth and wealth creates attendants. There will be growth in NoVa for the foreseeable decades to come.


Tidewater will lose a couple of billion in capital when one aircraft carrier moves to Florida. It’ll slow things down, but not kill the region.


The stimulus shifts to shenanigans over the next four years. After the 2010 and 2012 elections are secured by Chicago pol handouts and old socialist wealth distribution, the economy faces stagflation of the 1970s. The Jimmy Carter years of more inflation and slow economic growth may be upon Virginia. Slow growth outside the federal government.


The election of 2012 will be subject to the shenanigans – or should we just call it the criminal corruption – of the U.S. census. The decennial census, which determines the reapportionment of the House of Representatives, will be under the direction of B. Hussein Obama’s White House. This is gerrymandering taken to a new, higher – more dangerous – level.


The economy can be fixed by cutting taxes, cutting spending and reforming entitlements. But, fixing the apportionment of representation would take another decade to correct – unless the shift of political power is such that it can’t be undone.


In Virginia our Congressional Districts may shift to the imaginary numbers of a political census to make more districts unassailable Democrat bastions. Meanwhile, Conservatives would overpopulate a few districts. In other words, if a Congressional district is supposed to represent 700,000 Virginians, then some districts might be 600,000 and others 800,000 – if based on bogus census figures.


Finally, look at this chart.


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That debt will bankrupt the U.S. It will destroy America.


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