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realclearworld

The law of unintended consequences

You can always count on unintended consequences when liberals impose their ideas on society. They never think ahead about what their actions will ultimately cause because... well, because they don't think. They "feel." As long as they feel good believing they are being nice and compassionate and fair, they will go forward and ram their idiotic premises down the throats of everyone. And that's when the fun really begins...

[...] The zero-sum rhetoric has enabled President Obama to create what can be called a redistribution bubble.  Not all of his spending goes toward income redistribution, but he carefully refuses to categorize his spending.  He will not say, for example, that "this amount" is going to repay campaign contributors and "these amounts" to crony capitalism, income redistribution, etc.  His out-of-control spending has created such big deficits that the American economy will continue to slow down, spawn few new jobs, and usher in a lower standard of living for average working Americans.  One aspect of this bubble is the increased service of the national debt, which will result when interest rates return to their historical average of 5.4%.  At that point, the payment on the debt will increase from the $360 billion it is today to one trillion dollars.  This loss of funds will mean less for redistribution goals.

By printing too much money, Obama will create inflation.  Inflation will cause the value of everyone's dollars to decline, resulting in an effective pay cut for all.  The only tool the Federal Reserve has to control inflation is to raise interest rates; these higher rates will themselves cause prices to increase and put great pressure on the federal budget to cut spending in many programs.  Inflation is also a tax on the poor.  So paradoxically, income redistribution policy creates a tax on all working people and will force cuts in people programs.

The zero-sum concept has macroeconomic consequences.  Once the bubble breaks, these consequences will be all too real for working Americans, and by then little will be able to be done to ameliorate their effects.

Obama's greatest achievement may turn out to be that he proves, once and for all, that income redistribution has the tendency to hurt the very people it purports to help. [...]

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