Keynesians and Consumerism

RUSH: Craig in Vero Beach, Florida, former home of the Dodgers at spring training. Hello, sir.

CALLER: Professor Limbaugh. It’s an honor to speak with you, sir.

RUSH: Thank you very much, Craig.

CALLER: And I am a student of the Limbaugh Institute and have learned much. This has been an outstanding program today, Rush. I’ve enjoyed it. You’ve really brought to light a tremendous amount. My point today is what you were talking about earlier, and that is the reason for extending the so-called unemployment so-called benefits and what Pelosi has to say about this — and you described the Keynesian approach absolutely perfectly. This is all about consumerism, and I need to give you thanks and applaud you for it because consumerism is what is holding the Obama government together. And I think that your explanation was excellent. I would like you to expand upon it just a little bit more in the area of, as you just related, these so-called middle-class tax cuts. What do the Keynesians want that money to go towards? You named it, Rush: Consumerism. If consumerism falls apart, there goes the recovery. There goes Obama.

RUSH: Right. But what is the flaw in the Keynesian connection to consumerism?

CALLER: Well, it doesn’t work. There isn’t any recovery.

RUSH: Yeah, but why doesn’t at work? Why doesn’t Keynesian-sponsored consumerism work?

CALLER: Cause it’s based on the false assumption that more money in circulation will lead to more spending — and, of course, it doesn’t. It leads to the word you were talking about earlier: Inflation. Not deflation, inflation.

RUSH: Right on, but if the money that ends up in the hands of consumers is essentially not theirs and not earned by them — and, frankly, really never reaches their hands — how much consuming can they do? Because the money generated by Keynesian spending is of course printing or borrowing. It’s not produced by genuine economic activity.

CALLER: Yeah, right.

RUSH: The flaw here is the Keynesians believe you can print up a bunch of money, spend a bunch of money, throw it out there and put it into various strategic points and it’s gonna somehow end up in the hands of consumers. This is their silly thinking on unemployment checks.

CALLER: Correct.

RUSH: Their unemployment checks, they think, are gonna lead to all kinds of consumerism, as opposed to tax cuts, which won’t lead to any consumerism — and they’ve got it ass-backwards, because the tax cuts are what leads to consumerism because that’s people’s own money! Unemployment checks, by definition, are not enough for my consumin’. All you can do is basically sustain yourself.

CALLER: Exactly. And that’s what the Obama administration and their Marxism is: To sustain, not grow. They don’t want people to have real jobs and make real money because then they would no longer be dependent on the government, and you have described it perfectly. I think you need to say it every day over and over and over. The only thing that this younger generation understands and lives for each day is to consume, and it is a false security.

RUSH: One way I like to explain this — and I appreciate the kind words, Craig. I really do. One way I like to explain this in light of what we were just talking about — consumers, people consuming — is the Keynesian theory is you throw a bunch of money out there and put it strategic points of the economy, whatever they think they are, and it will end up in the hands of consumers. They’ll start spending and ergo you’ve got economic activity. They forget that consumerism is based on real things. People don’t just spend for the hell of it. Well, some women do, but for the most part… (laughing) I’m sorry, it’s stereotypically humor which I just happen to love. I know I deserve to be slapped. It’s nothing but stereotypically humor. It’s not tied to anything other than my sense of humor.

It’s like I love mother-in-law jokes, so don’t get offended. It’s like… (laughing) ‘Good news, bad news. Your new Cadillac is going over the cliff. That’s the bad news. The good news is your mother-in-law is in it attached with a seat belt.’ I love these old jokes. These jokes are back from the 1960s and so forth. The Lockhorns was a great, stereotypically humor comic strip. Consumerism has to be based on genuine need, not just spending idly which really doesn’t happen a whole lot (except if it’s by the rich). Now, in the case of unemployment compensation, let’s say it’s 300 bucks a week and $1200 a month. For most people, you’re not gonna be out doing a whole lot of luxury shopping on that kind of money. You’re not gonna buy a car.

But what are you gonna do? You’re gonna make sure the utility bill is paid…maybe. (chuckles) You may skip them until you figure you have to pay, but you’re gonna pay your cell phone bill. You’re going to pay your cable bill. These are the things that keep life normal for you. When is the last time you ever heard anybody say that the economy really came around and started growing because utility bills were paid on time? It doesn’t happen, and that’s the kind of spending that the unemployment compensation permits. It’s sustainment-type spending. It’s not expansion spending; it’s not growth spending, and that is the kind of spending they do want. I was talking to my good friend Mark Levin the other day and he had a great, great point.

It’s one of these things I wish I’d thought of myself about this business that people over $250,000 shouldn’t get a tax cut because they don’t need it. Levin was talking to some liberal on his show, and he asked the liberal, ‘Why should anybody even make over $250,000? If they don’t need it, if they don’t need a tax cut when they make that much, why don’t you guys just say, ‘Nobody should have more than $250,000, period’? Not that people over that shouldn’t get a tax cut, just that nobody can have more than $250,000.’ The liberal said that was not a bad idea. ‘Okay, well, then why not $150,000?’ It makes the point and throws it back in their face so well, this whole tax cut argument.

‘We’re gonna make sure there are tax cuts except for those at $250,000 or more ’cause they don’t need it.’ Fine. If they don’t need it, they don’t need any more than $250,000 period — and what if we just had a blanket limit: No American should have more than $250,000! Not just salary, you couldn’t have your car. Everything that you have could not add up to more than $250,000. Your house, nothing could add up to $250,000, because above that you don’t ‘need’ it. You don’t need anything more than $250,000. So every bit of your salary, your assets, your cars, your home, your jewelry, your watches, whatever, your underwear, clothes, nothing can be more than that. Once it totals 250,000, that’s it and you don’t get any more because you don’t need any more.

That’s the kind of stuff I just love to ask these New Castrati guys, you know, ’cause liberalism cannot be supported intellectually — and when you hit ’em with any kind of intellectual argument based on what they think and say, they crumble and they crumple like a cheap suit. It is just fascinating. When I stop and actually think about this, I can’t believe that there still are liberals with credibility. It is such BS. All of it is such a crock. And yet it does.