Living in a small community I know this is true. I have friends who own small business's and have heard them say specifically that they are too uncertain about how all this change is going to further impact them. Then we have the Bush tax cuts set to expire; Obama could do a lot of good by announcing a plan to extend them.
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I call it the mattress economy.
People seem to be following this investment strategy. Step one: Go to Mattress Discounters and buy the biggest mattress you can find. Step two: Take it home, and stuff all your money in it. Step three: Lie down, and get some rest.
This hurts the economy, but it's a rational response to the Obama Democrats' public policies. And that's not just the view of their political opponents.
Consider the plaint of Verizon CEO Ivan Seidenberg, head of the Business Roundtable, which has been playing footsie with the Obama administration for most of the last 18 months. "By reaching into virtually every sector of economic life," Seidenberg recently wrote, "government is injecting uncertainty into the marketplace and making it harder to raise new capital and create new businesses."
Or take a look at Obama backer Nate Silver's fivethirtyeight.com Website. "Why aren't businesses hiring?" asks tax lawyer Hale "Bonddad" Stewart. "Uncertainty: There has been a tremendous amount of change over the last 12 months. Businesses are still trying to figure out what this means for their bottom line. Until there are firm answers, they will freeze hiring."
In other words, the Obama Democrats' vast expansion of the size and scope of government -- and the threat that they may pass even more such legislation in a lame duck session of Congress after the November election -- has chilled the animal spirits that John Maynard Keynes said were the driving force for economic growth.
