The Late, Great Democratic Party

During the past eight years of Obamanomics, economic growth has stagnated

 

By Stephen Moore
WashingtonTimes.com

Illustration on the stagnation of the Democrat party by Alexander Hunter/The Washington Times 

This week the Democrats officially coronate the battered Hillary Clinton as the torch bearer for the party. She has slouched to the finish line. She is tired and the country is tired of her. Sorry, Democrats, no do-overs. You’re stuck with her.

But it isn’t just Hillary who is out of touch and in tragic decline, it’s the wholeDemocratic Party. My friends at the American Enterprise Institute reported last week that the Democratic platform is silent on “economic growth.” Maybe that is because across the country during the past eight years of Obamanomics economic growth has been silent.

This is an exaggeration, of course, but not much of one. We have had 2 percent growth under President Obama, but that’s an economy treading water. It’s sister-kissing growth that, yes, has thankfully kept us out of recession, but doesn’t lead to much if any rise in living standards.

Just as Mr. Obama refuses to utter the words “Islamic terrorism,” now the whole party can’t seem to bring itself to endorse “economic growth.” For the left growth isn’t really the goal. They want redistribution of wealth.

The language of a party platform doesn’t matter much, if at all. But if you’re not for growth, you probably aren’t going to produce it, just as If you’re not even trying to get in shape, it’s a good bet you’re not going to shed those extra 16 pounds.

Amazingly, the last great growth hawk of the Democratic Party of modern times, John F. Kennedy, ran against Republican Richard Nixon in 1960 on the issue of the “growth deficit.” The economy in the 1950s was fairly prosperous and much more so than over the last eight years. But JFK said we can “do bettah” and convinced Americans we could see much faster wage gains with greater opportunities.

Through tax cuts and free trade the JFK era sparked growth rates of 4, 5, and even 6 percent in the go-go ‘60s until LBJ crashed the economy with New Deal welfare statism. Now we have this weird austerity-worship that has taken over the party. The rich and businesses are portrayed as scalpers and scoundrels. And employers are exploiters in the “you didn’t build that” mindset. Radical environmentalists, a bedrock of the party, are anti-growth and believe that when people get richer, it’s worse for the planet. (They should go live in India or Mexico City and see how well the environment is doing there.) They ridicule what they call “growth-mania” on the right. Human economic activity, they warn, is causing catastrophic global warming.

Perhaps this explains the litany of economic failures during the Obama years. We have had $8 trillion of new debt, minimum wage increases, Obamacare, an $800 billion stimulus plan with “shovel-ready” projects, tax increases on the rich, more than $100 billion in green energy subsidies, auto company and union pension bailouts, reregulation of the financial industry and banks, and a Fed that has manufactured near zero short term interest rates for seven years with up to $4 trillion of bond acquisitions. All of these were designed primarily to redistribute income, and so is it a shock that they haven’t produced growth?

Poor Hillary Clinton has the unenviable task of persuading Americans to open up wide and swallow four more years of this swill.

Here’s a question that Donald Trump and Mike Pence should be asking every day: what would Hillary offer that is any different? She is promising minimum wage increases, tax hikes on the rich, and more infrastructure spending. This is new? This is change?

The left’s defense of growth anemia is that 2 percent growth is the new normal, so get used to it. Mr. Obama’s first economic guru Larry Summers calls this secular stagnation that is here to stay. This past week at a Politico economic forum I made the claim that we could have 4 percent growth easily and the jaws of the media dropped in collective disbelief as if I suggested that we could suspend the laws of gravity.

Actually 4 percent growth isn’t that hard to achieve. A pro-America energy production policy, including putting coal back in business, could produce $150 billion more output each year. Another percentage point of growth could come from tax reform with reductions in business taxes to spur investment and hiring, according to the folks at the Tax Foundation.

But Democrats will never get us there because they aren’t even trying. They will celebrate 2 percent growth — the weakest recovery in half a century — as a glittering achievement. The party that once stood with the working class now says Americans have to work more and settle for less. That’s not just wrong; it’s sad.

• Stephen Moore is an economic consultant with Freedom Works and a senior economic adviser to the Donald Trump campaign.