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The Shocking Truth About How Barack Obama Was Able To Prop Up The U.S. Economy

barack-obama-looking-into-a-mirror-public-domainBarack Obama is one of the biggest “Keynesians” of all time, but unfortunately most Americans don’t even understand what that means.  In this article, I am going to share with you the primary reason why Barack Obama has been able to prop up the U.S. economy over the past eight years.  If Barack Obama had not taken the extreme measures that he did, we would be in the midst of a historic economic depression right now.  But by propping things up in the short-term, he has absolutely demolished our long-term economic future.  But like most politicians, Obama has been willing to sacrifice the future for short-term political gain.

If you take any basic college course in economics, you are going to learn about John Maynard Keynes.  Without a doubt, Keynes was one of the most famous economists of the 20th century, and one of the things that he believed was that governments should go into debt and spend more money when an economic downturn strikes.  By injecting additional funds into the economy during a time of crisis, he believed that the severity of recessions and depressions could be reduced.  This approach ultimately become known as “Keynesian economics”, and in the post-World War II era virtually the entire world embraced it at least to some degree.  Here is more on Keynes from Investopedia

An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed by the British economist John Maynard Keynes during the 1930s in an attempt to understand the Great Depression. Keynes advocated increased government expenditures and lower taxes to stimulate demand and pull the global economy out of the Depression. Subsequently, the term “Keynesian economics” was used to refer to the concept that optimal economic performance could be achieved – and economic slumps prevented – by influencing aggregate demand through activist stabilization and economic intervention policies by the government. Keynesian economics is considered to be a “demand-side” theory that focuses on changes in the economy over the short run.

Keynesian economists correctly point out that there is a “multiplier effect” to government spending.  In other words, when the government spends money it ends up in the hands of ordinary people.  In turn, those people spend that money on various goods and services that they need, thus boosting overall economic activity.  And the more the money circulates, the more the economy is stimulated.  So one dollar of additional government spending does not just add one dollar to GDP.  Rather, the impact on GDP is often significantly greater than that.

Of course the bad news is that whenever the government borrows money it is stealing consumption from the future.  So we are literally destroying the future that our children and our grandchildren were supposed to have in order to make the present look a little bit brighter.

When Barack Obama entered the White House, the U.S. was in the midst of the worst financial crisis since the Great Depression.  The Bush administration had already begun to ramp up spending, but Barack Obama took “government stimulus” to ridiculous new levels.  The national debt has risen by an average of more than 1.1 trillion dollars a year while Obama has been in charge, and this fiscal year we are on pace to add more than 2 trillion dollars to the debt.

At this moment, the U.S. national debt is a whopping $19,901,545,151,126.51, and it will cross the 20 trillion dollar mark by the time Donald Trump is inaugurated on January 20th.

But when Barack Obama was inaugurated, the national debt was only 10.6 trillion dollars.  That means that we have added about 9.3 trillion dollars to the debt since that time.

So we have borrowed and spent 9.3 trillion dollars under Obama that we did not have.  But because of the “multiplier effect”, that 9.3 trillion dollars actually had a far greater impact on the U.S. economy.

Let’s be conservative and just double that number.  So that would give us an 18.6 trillion dollar overall impact on U.S. economic activity.  Spread over eight years, that comes to an average GDP impact of 2.325 trillion dollars a year.

But over the last eight years U.S. GDP has only been averaging about 16 trillion dollars a year.  So if you took away 2.3 trillion dollars a year, that would be about one-eighth of our entire economy.

In other words, without all of this debt that Barack Obama and Congress have been getting us into, we would be in the worst economic depression in U.S. history right now.

And I haven’t even factored in state and local government debt, corporate debt or household debt.  The truth is that I am not exaggerating one bit when I say that we are enjoying a debt-fueled standard of living that we simply do not deserve.

But even with all of this debt, the U.S. economy has still not been performing really well.  In fact, Barack Obama is going to be the only president in U.S. history to not have a single year when U.S. GDP grew by at least three percent.

Despite what many in the mainstream media are telling you, the reality of the matter is that Donald Trump is going to inherit an economy that is deeply troubled.  If you doubt this, please see my previous article entitled “11 Very Depressing Economic Realities That Donald Trump Will Inherit From Barack Obama“.

Donald Trump is talking about cutting taxes and reducing regulations, and all of those things are good, but ultimately those measures are not going to matter that much.

What is going to matter is what Donald Trump decides to do about our exploding debt.

If Donald Trump wants the U.S. economy to continue to remain at least somewhat stable in the short-term, he is going to have to keep piling up debt like Obama has.  Because if Trump and the Republicans decide that they want to get our debt under control, that will plunge us into a horrifying economic depression almost immediately.

But if Donald Trump continues to steal money from future generations of Americans at the same pace that Barack Obama has been doing, he will literally be destroying the future of America.  It will be a crime on a scale that is almost beyond words, and if they get a chance to do it, future generations of Americans will look back and curse him for what he has done to us.

So Donald Trump is really in a no-win situation when it comes to the economy.

The only way that he can match Obama’s performance is to do what Obama did, but by doing so he would literally be killing the future.

As a nation we have been consuming far more wealth than we produce for a very, very long time, and the only way that we have been able to do this is because we have been able to go into so much debt.

But now a day of reckoning is fast approaching, and I am not sure if Donald Trump even realizes that he will soon be faced with some incredibly heartbreaking choices.

Most Americans Are Slaves And They Don’t Even Know It

Chain - Public DomainMost Americans spend their lives working for others, paying off debts to others and performing tasks that others tell them that they “must” do.  These days, we don’t like to think of ourselves as “servants” or “slaves”, but that is what the vast majority of us are.  It is just that the mechanisms of our enslavement have become much more sophisticated over time.  It has been said that the borrower is the servant of the lender, and most of us start going into debt very early into our adult years.  In fact, those that go to college to “get an education” are likely to enter the “real world” with a staggering amount of debt.  And of course that is just the beginning of the debt accumulation.  Today, when you add up all mortgage debt, all credit card debt and all student loan debt, the average American household is carrying a grand total of 203,163 dollars of debt.  Overall, American households are more than 11 trillion dollars in debt at this point.  And even though most Americans don’t realize this, over the course of our lifetimes the amount of money that we will repay on our debts is far greater than the amount that we originally borrowed.  In fact, when it comes to credit card debt you can easily end up repaying several times the amount of money that you originally borrowed.  So we work our fingers to the bone to pay off these debts, and the vast majority of us are not even working for ourselves.  Instead, our work makes the businesses that other people own more profitable.  So if we spend the best years of our lives building businesses for others, servicing debts that we owe to others and making others wealthier, what does that make us?

In 2015, the words “servant” and “slave” have very negative connotations, and we typically don’t use them very much.

Instead, we use words like “employee” because they make us feel so much better.

But is there really that much of a difference?

This is how Google defines “servant”…

“a person who performs duties for others, especially a person employed in a house on domestic duties or as a personal attendant.”

This is how Google defines “slave”…

“a person who is the legal property of another and is forced to obey them.”

This is how Google defines “employee”…

“a person employed for wages or salary, especially at nonexecutive level.”

Yes, most of us might not be “legal property” of someone else in a very narrow sense, but in a broader sense we all have to answer to someone.

We all have someone that we must obey.

And we all have obligations that we must meet or else face the consequences.

At this point, Americans are more dependent on the system than ever before.  Small business ownership in the U.S. is at a record low, and the percentage of Americans that are self-employed has fallen to unprecedented levels in recent years.  From a very early age, we are trained to study hard so that we can get a good “job” (“just over broke”) and be good cogs in the system.

But is that what life is about?

Is it about being a cog in a system that ultimately benefits others?

Perhaps you don’t think that any of this applies to you personally.

Well, if someone came up to you and asked you what you truly own, what would you say?

Do you own your vehicle?

Most Americans don’t.

In fact, today the average auto loan at signing is approximately $27,000, and many of them stretch on for six or seven years.

What about your home?

Do you own it?

Most Americans don’t.

In fact, overall the banks have a much greater “ownership” interest in our homes and our land than we do.

But even if you have your home totally “paid off”, does that mean that you actually “own” it?

Well, no, not really.

Just see what happens if you quit paying your property taxes (rent) to the proper authorities.

So if they can take your home away from you for not paying rent (property taxes), do you really own it?

That is something to think about it.

What about all of your stuff?

Do you own it?

Perhaps.

But a very large percentage of us have willingly enslaved ourselves in order to acquire all of that stuff.

Today, the typical U.S. household that has at least one credit card has approximately $15,950 in credit card debt.

And if you do not pay off those credit card balances, the credit card companies will unleash the hounds on you.

Have you ever had an encounter with a debt collector?

They can be absolutely brutal.  And they use those tactics because they work.  In fact, they are so good at what they do that many of those that own debt collection companies have become exceedingly wealthy.  The following is from a recent CNN article

Yachts. Mansions. Extravagant dinner parties. Life is good for the founders of one of the nation’s biggest government debt collectors.

That firm, Linebarger Goggan Blair & Sampson, rakes in big money from government contracts that allow it to pursue debtors over toll violations, taxes and parking tickets. While the debts often start small, the Austin-based firm charges high fees, which can add hundreds or even thousands of dollars to the bill.

After growing this business from a small Texas law firm in the late 1970’s to a nationwide debt collection powerhouse, the firm’s founders and top brass have walked away with millions of dollars.

And I haven’t even mentioned our collective debts yet.

We have willingly chosen to collectively enslave ourselves on a local, a state and a national level.

It is bad enough that we are doing this to ourselves.  But we are also cruelly saddling future generations of Americans with the largest mountain of debt in the history of the planet.  The following is from my previous article entitled “Barack Obama Says That What America Really Needs Is Lots More Debt“…

When Barack Obama took the oath of office, the U.S. national debt was 10.6 trillion dollars.  Today, it has surpassed the 18 trillion dollar mark.  And even though we are being told that “deficits are going down”, the truth is that the U.S. national debt increased by more than a trillion dollars in fiscal 2014.  But that isn’t good enough for Obama.  He says that we need to come out of this period of “mindless austerity” and steal money from our children and our grandchildren even faster.  In addition, Obama wants to raise taxes again.  His budget calls for 2 trillion dollars in tax increases over the next decade.  He always touts these tax increases as “tax hikes on the rich”, but somehow they almost always seem to end up hitting the middle class too.  But whether or not Congress ever adopts Obama’s new budget is not really the issue.  The reality of the matter is that the “tax and spend Democrats” and the “tax and spend Republicans” are both responsible for getting us into this mess.  Future generations of Americans are already facing the largest mountain of debt in the history of the planet, and both parties want to make this mountain of debt even higher.  The only disagreement is about how fast it should happen.  It is a national disgrace, but most Americans have come to accept this as “normal”.  If our children and our grandchildren get the opportunity, they will curse us for what we have done to them.

So can we really call ourselves the “home of the brave and the land of the free”?

Isn’t the truth that the vast majority of us are actually deeply enslaved?

Please feel free to share what you think by posting a comment below…

 

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