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Obama's Policies Failing: Dismal Stats Tell Story

By Larry Kudlow - June 2, 2011

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Then, of course, there's all the bad weather: hurricanes, tornadoes and floods have depressed all kinds of economic activity here at home.

There also are jitters about the ongoing saga in Greece. The potential for a Greek bond default and various credit-agency downgrades are taking a toll on stock markets around the world.

But this whole boom-and-bust monetary policy, with its blatant disregard for King Dollar, is a snare and a delusion. Stabilize the greenback by linking it to gold. Then move to the supply-side: Slash individual and business tax burdens, roll back enormous regulatory costs and stop the merciless threat of higher future taxes.

If there was a serious pro-growth movement in Washington to accelerate tax-reform overhaul and pin-back regulatory barriers like the National Labor Relations Board war with Boeing, the EPA war against energy and the Obamacare threats that are too numerous to count, that just might revive the animal spirits. But what we know for sure is that small businesses are barely hiring today, and that brand new startups are few and far between.

What's lacking here is confidence.

No, we're not going into a double-dip recession. The most important indicator is the Treasury yield curve, which is still very steeply sloped. And businesses are profitable. Those profits have been the backbone of what little growth we've had in the last two years. And they're the mother's milk of the stock market.

But the point is, without real growth policies, there's not much to cheer about in the market or the economy. We're muddling along. It could even be called a growth recession.

Wednesday's 280-point Dow drop is cry for help. Is anybody listening?

 

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Lawrence Kudlow is host of CNBC's The Kudlow Report and co-host of The Call. He is also a former Reagan economic advisor and a syndicated columnist. Visit his blog, Kudlow's Money Politics.

Copyright 2011, Creators Syndicate Inc.

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