I read a staggering statistic yesterday. According to former Reagan budget director David Stockman, since the third quarter of 2008, the nation’s gross domestic product has grown at the rate of only $4 billion per month while the federal debt has at the same time grown by $100 billion per month.
In other words, federal debt is growing at a rate 25 times greater than the American economy. Much of this debt has been taken on in the name of stimulating the economy yet little stimulation has taken place. Unemployment remains near ten percent and the economy is growing so slowly that the growth is barely perceptible.
Yet Obama and the Democrats cling to the idea that their economic policies, born of left-wing ideology, are working. This illustrates the biggest difference between business and government. Business is driven by results. Government can be, at least for a while, driven by ideology.
Lacking sovereign borrowing power and the ability to expand the money supply, when faced with poor results, business must quickly change course in order to survive. No business can afford to borrow at 25 times its rate of growth. No government can either. But nobody in our government has ever been in business.
And that’s the critical difference.