As you watch the charade in the White House, you don't know whether to laugh, cry or go blind. As long ago as President Franklin Delano Roosevelt's administration, Keynesian economics has been the plan of preference.
Simply stated, that's "demand-side" economics. The theory is that if the demand is there, the economy will grow. Manufacturing will grow because of the demand for products, whatever they may be. As manufacturing grows, the general economy grows.
Well, that's what John Maynard Keynes said. He also said a little inflation is a good thing. Where has that gotten us? In 1957, $25,000 bought a Rolls Royce Silver Cloud. Today, it buys a well-equipped Volkswagen.
Inflation a good thing? Probably not.
In 1957, common laborers earned about $50 a week while middle management executives earned about $400 a week.
Today, a common laborer will earn $320 to $400 a week - while middle management execs will earn about $2,000 a week - and they still struggle. And $4 gasoline doesn't help.
Keynes said to borrow money to prime the economic pump. Put that money to work by recycling it into the economy - "stimulus" money. However, the stimulus money was put into state and local government, rather than into the private sector.
Well, some of it went to buy into General Motors and Chrysler. Chrysler has been sold to Fiat, an Italian auto maker, and Foggy Bottom sold its remaining shares in GM at a substantial loss. GM is barely showing a profit, if you can believe the media.
Therefore, when you prop up government with borrowed funds, what do you get? The answer is simple: No growth, greater unemployment and a continuing stagnation of the economy with another recession staring us in the face. Some prominent economists say this will be the nastiest double-dip recession on record. If it comes to pass, it's supposed to make the Great Depression of the 1930s look like prosperous times.
You can hear the strains of "Good Times Are Here Again" in the background. That was FDR's campaign theme song.
Today, we see the results of a lack of manufacturing jobs, and jobs in general. Those jobs represent the supply side of the equation. A large part of the population is unemployed. If they're without a job, people have no money with which to create a demand for products. Hence the failure of the demand side of the equation. Was Keynes wrong?
So, supply-side economics has merit after all. When people are employed they have money and they buy products.
But the Keynesians will never understand that. Socialists never understand that capitalism works. Since they're so much more compassionate and intelligent than everyone else, what can you expect?
Capitalism made us great in the past and it'll make us great again, if we have the courage to replace the current CEO and his minions in 2012. Or sooner, if possible.
Sound the claxon! Man the barricades! The battle of the century is upon us!
• Don Kennedy is a graduate of Dartmouth College with a degree in sociology. He has been a resident of Ahwatukee Foothills since 2002.