Did Roosevelt start American down the road to economic chaos?

Unemployment is going up.  Some workers have been unemployed so long that they have given up the job search.

Oil prices are going out of sight, while oil beneath our feet and off our shores goes untapped.

The dollar is falling and gold prices are going up on world markets.  Americans and most of the world are rushing to protect their wealth by converting dollars into gold.

Congress and the President are bickering over the budget.

The federal government is strapped for revenue.Debts are mounting up, and there is no leadership in Washington to solve the crisis.It is a crisis, but who IS really responsible?

When I was born, Franklin Roosevelt was still president.  He started America down the road to debt.

Before the New Deal, budgets were balanced and debts — except for war-time — were paid.   FDR’s policy was derived from what is now called Keynesian Economics.  It was — and is still — thought that government spending could offset the shortage in the free market economy.

The only issue is that FDR did not get us out of the Great Depression.  It was World War II.  Just draft a million or so jobless young men and his unemployment problem was “cured”.

Meanwhile, FDR and the Democrats blamed the Great Depression on Herbert Hoover, yet did little to lift the debacle from the shoulders of the American people.  In reality, FDR only exacerbated and prolonged the Great Depression.  All the European nations emerged from the depression long before the U.S.

FDR started in 1938 the Federal Housing Administration (FHA).  Millions got FHA home loans. The FHA is the ancestor of the Federal National Mortgage Association also known as FNMA or commonly known as Fannie Mae.

Now,  urban America wants to hide these hideous, unsightly, rundown, substandard homes.  They are there for everyone to see.

FDR started Social Security Administration.  It was susposed to pay for itself from workers’ wages.  It’s in peril of collapse.  It was never on a sound financial basis.

“The first monthly payment was issued on January 31, 1940 to Ida May Fuller of Ludlow, Vermont. In 1937, 1938 and 1939 she paid a total of $24.75 into the Social Security System. Her first check was for $22.54. After her second check, Fuller already had received more than she contributed over the three-year period. She lived to be 100 and collected a total of $22,888.92“, according to Wikipedia.com.

By the end of WWII, the national debt was 100% of Gross Domestic Product (GDP).

It did not stop there.   President Dwight David Eisenhower started up the Interstate Highway system.  (read more …)The Feds had been building roads since the late 18th Century.  Interstate Highways were supposed to be funded as we drove our cars.  That’s where the federal tax on gasoline originated.  It created a huge slush fund to build interstate highways and support them.

The liberals tapped the Highway Trust fund in the 1960′;s for public transportation.  Poof!  It was gone.   Development of the Interstate Highways slowed and maintenance was stymied.

Russia launched Sputnik I.   Congress appropriated funds for missiles, defense, and — education.  It was thought that federal money would spur better education, but it brought the Feds into the schools.

President Johnson had no fear of spending your money

Lyndon Johnson created the War on Poverty.  His campaign slogan was “A Great Society” as a campaign slogan and the War on Poverty was the keystone.

His opponent, Barry Goldwater, a conservative, warned against it.

The  voters chose LBJ.  LBJ won the election and had his War on Poverty and a war in Southeast Asia.  Johnson created Medicare and Medicaid.  Spending rose.  Debt rose, too. Inflation rose.  Joblessness rose.

Richard Nixon took over.  The war ended.  Congress had a huge debt and a large source of tax revenue and a deep recession. The liberals in Congress chose to spend that revenue on social programs while reducing the military budget. Entitlements increased.   Nixon answered with his now almost forgotten Revenue Sharing Program also known as the New Federalism.

Here is Nixon’s statement upon signing the bill:

“IN MY State of the Union Address nearly 2 years ago, I outlined a program which I described as “a new American revolution–a peaceful revolution in which power [is] turned back to the people…a revolution as profound, as far-reaching, as exciting as that first revolution almost 200 years ago.

“The signing today of the State and Local Fiscal Assistance Act of 1972–the legislation known as general revenue sharing-means that this new American revolution is truly underway.”

Federal money would go directly to the states and the cities … with strings attached.   That began the Feds reach into almost every aspect of Americans’ lives in the states, cities, and schools.

Did Nixon’s idea create a “new American revolution”?   You decide.

In 1970 Nixon signed into law the Federal Home Loan Mortgage Corporation (FHLMC), known as Freddie Mac.

Nixon opted to follow the liberal Congress and carry out wage and price controls.  All wages and prices were held to only 7 per cent a year.  That resulted in shortages of everything from gasoline to wire for farmers’ hay bales.  Shortages effected every segment of the economy.   Japanese auto manufacturers made huge inroads in the American market.   America lost jobs in the steel, rubber, and auto industries.

Wage and price controls was a failure.  (read more …)

Was Jimmy Carter lacking in leadership and economic knowledge?

Then Jimmy Carter came in with the country divided and the economy in a shambles.  He campaigned on reducing the federal government.

He had been the governor of Georgia, where he implemented a Sunset Act to close down state agencies.  He promised the same for the federal government.  His campaign slogan was “A Leader, For a Change”.  Does that sound familiar?

Carter did cut some things such as regulations on the air lines and the nations’ telephone monopoly by AT&T.  It was thought deregulation would spur competition and cut prices.  He was  right, but  he increased the debt and spending.

Inflation was 12-17 percent.  Prices rose.

Ronald Reagan: The greatest American president of our time!

Ronald Reagan is the greatest American president of our time

The last great spending and debt cutter was Reagan. During his campaign, he added the inflation rate to the jobless percentage and called it the Misery Index.  He campaigned on it.

 He asked the question, “Are you better off now than you were four years ago?”  He capture control of the Senate and had a working majority in the House of Representatives.  He cut spending  and reduced debt.   …and he reduced inflation!

Then came George H. W. Bush.  He campaigned on a Kinder Gentlier Nation.  It was only an empty slogan.

“Read my lips,” he said, “No more taxes!”

His policies did nothing.  He got us into war in the Arabian Gulf.  That led to a financial budget crisis.   He had to swallow his campaign promise of no more taxes.  He signed a bill raising taxes, spending, and the debt. Liberals in the media had a field day.

Conservatives had their fill of Mr. Bush.  Americans gave him only one term.

Clinton: Remarkable rise from trailer trash to the White House. He was impeached.

Bill Clinton campaigned as a new-ideas-feel-good president.   His campaign slogan was “Don’t stop thinking about tomorrow”. (Hope?)  He made millions feel good.

He had a Democratic majorities in Congress for his first two years. He also raised spending, inflation, and debt.  He served two terms but the GOP held control of the Congress for six of his eight years. The budget came under control.  Debt was no longer an issue.  Markets felt secure.  The economy rose, and Clinton took credit for the economic upturn.

However, Clinton and the liberal Democrats changed the rules for Fannie Mae and Freddie Mac, two government arms that financed housing for poor to median income people.  The loans sored.  Banks lined up to finance homes for people who had no income to support home ownership.  After all , “won’t the feds bail them out?”  …so they believed.

Left the White House stuttering and bewildered

Then George W. Bush came in.  He was a feel-good happy-go-lucky guy with a driving record to match.  While under the influence, he was arrested and later convicted.  Terrorists hit the Pentagon and the World Trade Center.

Bush started spending like a relapsed drunken sailor. He used China and their growing economy to finance his spending.   People felt good, and Bush served for two terms.

On Aug. 2, 2008, during the presidential campaign, financial bond rating corporation, Moody’s, reduced Freddie Mac’s rating from the highest (A1) to Baa3, which is the lowest possible rating.   On Sept. 7, 2008, the federal government through the treasury took over Freddie Mac and Fannie Mae.  Bush’s economy went south.

Hope and Change has turned to Cope and Despair. In just two years, he has been reduced to a caricature.

Then came the collapse that helped to elect Barack Hussein Obama and a super majority in the House and Senate.

Bush walked out of the White House stuttering and sobered.  The crew who replaced him came in like drunken sailors and spent more  than any administration has ever spent!

Two years later, Hope and Change turned to despair and cries for change.  Stimulus did not work just as FDR’s stimulus did not work.

So who is responsible for the debt crisis?   It certainly was not Herbert Hoover or the Tea Party!