The Age Of Prosperity Is Over

by Arthur B. Laffer - October 27th, 2008 - Wall Street Journal

I saw up close and personal Presidents Gerald Ford and George H.W. Bush succumb to panicked decisions to raise taxes, as well as Jimmy Carter's emergency energy plan, which included wellhead price controls, excess profits taxes on oil companies, and gasoline price controls at the pump.

The consequences of these actions were disastrous. Just look at the stock market from the post-Kennedy high in early 1966 to the pre-Reagan low in August of 1982. The average annual real return for U.S. assets compounded annually was -6% per year for 16 years. That, ladies and gentlemen, is a bear market. And it is something that you may well experience again. Yikes!

Then we have this administration's panicked Sarbanes-Oxley legislation, and of course the deer-in-the-headlights Mr. Bernanke in his bungling of monetary policy.

There are many more examples, but none hold a candle to what's happening right now. Twenty-five years down the line, what this administration and Congress have done will be viewed in much the same light as what Herbert Hoover did in the years 1929 through 1932. Whenever people make decisions when they are panicked, the consequences are rarely pretty. We are now witnessing the end of prosperity.

I have repeatedly condemned the socialism of our current President. It pains me that John McCain does not "get it" either. He has correctly expressed the opinion that he is not good with economic issues. In fact, as I have previously reported, he does not get freedom of speech either. McCain thinks that if some people have undue influence because they buy politicians, that justifies turning control over speech to government bureaucrats.

What I like about this article is that Laffer is not truly a politician. He recognizes that government goons harm society whether they are Republican goons or Democrat goons. George Bush, and unfortunately most Republican voters of recent years, did not get this either. Bush has done a few things right, but he has done so many more wrong. I do not agree the current economic crisis is a Republican crisis, but Republican leadership cannot absolve itself.

Republicans have got to get rid of the "compassionate conservative" socialists in our party and return to the Reagan party of free enterprise. Assuming of course that Bush's incompetence has not ended free enterprise and permanently turned our nation over to the Marxist Messiah's socialist future.