Simpson Column:And the crystal ball says . . .

Today I am going to peer into my economic crystal ball.

Virtually everyone has been affected by the recession. If you still have a job, you’re not likely to have received a raise, and many individuals have been forced to take pay cuts, reduced hours, furloughs,
etc.

Even worse, many businesses have failed. Quite a few of those businesses used to sell goods and/or services that were purchased by way of an individuals’ expendable income or purchased on credit.
As belts tighten, the first things to go are usually items that are considered luxuries. For example, Boaters World and Ritz Camera, companies previously located along the Prince William County
Parkway, have closed their doors.

On Aug. 7, 2009, President Obama made several statements during a Rose Garden press conference regarding the state of the economy. He claimed that earlier that day he had “received additional
signs that the worst may be behind us” and that we are “pointed in the right direction.”

In his remarks, President Obama praised how money from the Recovery Bill was being spent. This money, which will come out of YOUR future earnings, may be helping a number of people who made
unwise decisions; however, what Obama and the Congress have done is shift the burden of poor decisions to all taxpayers. In true Democratic Party fashion, we will now all be punished for the
indiscretions of those who should be individually held responsible.

President Obama went on to state: “While we’ve rescued our economy from catastrophe, we’ve also begun to build a new foundation for growth.” And a little later on adds “... we can’t afford to return to an
economy based on inflated profits and maxed out credit cards ...” Wow! Really? Hate to say it, but Obama’s “rescued” economy is one of smoke and mirrors. The fact is, most of the money that is being
spent is on projects that have no sustainability. Once the money runs out, the jobs are gone as well.

Many people are still up to their eyeballs in debt. Over the past several decades the United Stated has based its economic health on how much people could consume. This is coming to a stop.

The thing is ... I don’t see this “new foundation for growth” that he is referring to. All that has been done is the government has printed a lot of money and taken over most of the mortgage and automobile
industries. Oh, and it has created policy that will increase the amount of money Americans are going to be required to spend on “alternative” energy while not addressing the real danger of international
pollution from countries such as China and India.

It is my contention that we are still looking at a long term economic crisis. The government has printed hundreds of billions of dollars, and incurred trillions in debt over the past few months. Normally a
country’s economy would experience a significant reaction to this influx of funny-money in the form of hyperinflation. I thought so too, at least until recently. Now I am starting to think something else will
happen.

What I foresee is a time of extended economic suffering as the government tries desperately to find ways of squeezing more and more money out of citizens; especially now that they are throwing
healthcare on top of the bankrupt social security and Medicare/Medicaid systems. Ultimately, representatives will turn to the producers in our nation and demand that they pay what will be called “their fair
share” – meaning the lion’s portion of their wealth. Consequently, due to the fact that most Americans have been poorly educated by our government school system, they will support a call for higher
taxes on the wealthy and on profits … failing to comprehend that they are killing the goose that lays the golden eggs. The determination of who is “wealthy” will be continuously lowered as well. When
businesses and entrepreneurs don’t have the capital necessary to create new jobs, we will see a downward spiral of the American economy.

Politicians are going to use this economic pain to manipulate people. The bad economy will allow those who are elected to propose never-ending “solutions” and our elected representatives and political
parties will claim (upon the inevitable failure of these proposals) that the reason the solutions did not or are not working is that they were not given enough time to implement them (if they are at risk of
losing the next election) or that the other political party did something to interfere with what was otherwise a perfect plan.

James Simpson lives in Lake Ridge.