Markets react to Obama’s radical policies

You would have to be living in a cave in the dessert NOT to know that the Dow Jones has lost almost 20% it’s value since the Election of ‘The Great One’. Here is a brief synopsis by Michael Boskins of the Hover Institute:

The illusion that Barack Obama will lead from the economic center has quickly come to an end. Instead of combining the best policies of past Democratic presidents — John Kennedy on taxes, Bill Clinton on welfare reform and a balanced budget, for instance — President Obama is returning to Jimmy Carter’s higher taxes and Mr. Clinton’s draconian defense drawdown.

Mr. Obama’s $3.6 trillion budget blueprint, by his own admission, redefines the role of government in our economy and society. The budget more than doubles the national debt held by the public, adding more to the debt than all previous presidents — from George Washington to George W. Bush — combined. It reduces defense spending to a level not sustained since the dangerous days before World War II, while increasing nondefense spending (relative to GDP) to the highest level in U.S. history. And it would raise taxes to historically high levels (again, relative to GDP). And all of this before addressing the impending explosion in Social Security and Medicare costs.

Some comments from the author of the article this is from, Ed morrissey:

Wall Street sees rampant incompetence at the top and has given Obama a vote of no confidence.

The question that Boskin poses is whether they see something worse than incompetence, and clearly, they do. The policies Obama espouses — tax increases, greater regulation, limitations on energy production — are explicitly anti-growth. All three kill growth in different but linked ways. All of them increase the costs on businesses at a time when prices can’t go up, squeezing people out of the market and into unemployment lines, along with all of the people they may have hired otherwise. That gives Obama a mandate for a nanny-state approach that he claims will be temporary but already has taken on the permanence of the European system that drives down growth and keeps unemployment at the levels we just reached this month as a rule.

It’s incompetence married to ideology. It’s a fatal prescription for investors, and they’re voting with their feet.