The stock market seems to be telling us that all the classical ways of reviving a moribund economy have been exhausted: We have hit near rock-bottom interest rates that cannot go much lower; we have borrowed about as many trillions as our credit is worth without any realistic plan of paying off the debt; government entitlements and subsidies have expanded to the point of non-sustainability. All the economic gurus who in late 2008 advocated the incoming administration’s additional “stimulus” and mega-debts have left the administration and are not claiming ownership of its policies. There are not priming tools left.
If the government were an individual household, the only way out would be to cut spending and find new sources of wealth. Given worldwide demand for food and fuel, and given recent quite astounding new finds of natural gas and oil in the Dakotas, the eastern seaboard, offshore, the American west, Alaska, and Canada, it seems that we should be hell-bent on recovering these high-value fuels through new drilling, refineries, and pipelines, including ways to power our heavy trucks and equipment on natural gas. We should be planting acre to acre and end nonsensical biofuel subsidies and artificial limitations on irrigation deliveries to California’s West Side and elsewhere in the West. We need a national manufacturing policy that prunes regulations and encourages investment here in the U.S., ceases talk of new taxes, repeals the trillion-dollar take-over of the health-care industry, and stops hectoring Boeing about opening a new facility or trying to shut down energy generation plants. Unemployment, food stamps, gargantuan debt, absorption of private companies, solar and wind subsidies, new environmental, labor, and financial regulations atop an existing labyrinth of red tape — all that has not led to new job creation or economic growth.
Only a private sector confident that of long-term government predictability and encouraged by a national culture that applauds manufacturing, energy and food production, and private health initiatives and reform can see us of this mess.