VP Biden: 'We Misread the Economy' and Other Lies
by Thomas R. Eddlem
by Tom R. Eddlem
Asked by This Week's George Stephanopoulos about the Obama Administration's terrible economic prognostications in advance of passage of the $787 billion stimulus spending bill back in February, Vice President Joe Biden regurgitated a familiar talking point:
Stephanopoulos: While we've been here, some pretty grim job numbers back at home — 9.5 percent unemployment in June, the worst numbers in 26 years. How do you explain that? Because when the president and you all were selling the stimulus package, you predicted at the beginning that, to get this package in place, unemployment will peak at about 8 percent. So, either you misread the economy, or the stimulus package is too slow and too small.
Biden: The truth is, we and everyone else misread the economy.
Of course, if you eliminate the and everyone else from that sentence, he's simply stating the painfully obvious. The only appropriate response to such a sentence is a sarcastic: DUHH!!!
The and everyone else part is the big, well-rehearsed lie. There were plenty of people who predicted a severe recession well in advance of Obama's bad predictions. Representative Ron Paul predicted the housing bubble would result in a crash, writing in 2002 that like all artificially-created bubbles, the boom in housing prices cannot last forever. Perhaps the Federal Reserve can stave off the day of reckoning by purchasing GSE debt and pumping liquidity into the housing market, but this cannot hold off the inevitable drop in the housing market forever. In fact, postponing the necessary but painful market corrections will only deepen the inevitable fall. The more people invested in the market, the greater the effects across the economy when the bubble bursts.
Peter Schiff, the economic adviser for Rep. Paul's presidential campaign, predicted the crash and the severity of the crash years in advance in a series of television interviews that today are compiled into a series of Peter Schiff was right videos on YouTube that have garnered millions of views. (Perhaps Biden is unfamiliar with YouTube?) Legendary investor Jim Rogers predicted in January 2008: We are probably going to have one of the worst recessions we've had since the Second World War. It's not a good scene.
But under the Washington idea of everyone, people who follow the U.S. Constitution and understand the Austrian school of economics don't count. The reality is that dozens of Austrian school economists (as well as a few from other economic schools) predicted the recession with astonishing precision, but according to the Washington view, only people who follow the erroneous philosophy of John Maynard Keynes count.
July 9, 2009
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