AMERICAN ISSUES PROJECT

What is Barack Obama's stimulus plan really accomplishing? Looking strictly at the numbers, one can't help but conclude that it's accomplishing very little. Unemployment is at 9.8 percent and is only expected to go up further, perhaps as high as 10.5 percent. It is expected to remain at that level for several years. Government tax revenues continue to decrease while government expenditures increase, as hundreds of thousands of Americans each month lose their jobs and become beneficiaries of government handouts, victims of Obama's jobless "recovery." As this cycle continues unabated, it poses a serious problem for our economy. But we are only just witnessing the beginning.

The health care reform bills circulating through Congress are job killers because many of their provisions include billions of dollars of fees and taxes that will hit the American people both directly and indirectly. The Baucus bill in particular is loaded with tax increases not just on individuals but also on insurance companies, device manufacturers, pharmaceutical manufacturers, and clinical laboratories. All of these taxes will be passed on to and will be paid for by the American people through increased medical costs. These de facto tax hikes on the American taxpayer would be a bad idea in a good economy. In a bad economy, they are instant poison. They will add up to large increases in insurance premiums. According to the Wall street Journal, a study by WellPoint shows that premiums could triple under ObamaCare. This rise doesn't even include the increases in health care costs that will occur naturally as technologies improve. Again, that's more money ripped out of the American people's pocket books.

We can expect similar increases in energy costs should the president's Cap and Trade plan become law. The legislation in the House would limit energy producers to a ceiling of CO2 production via the issuance of CO2 credits. If these companies need additional credits to burn more CO2, they will have to purchase them from other energy producers who are producing less CO2. If a company goes over its credit limit, however, the government will slap it with a hefty fine. Experts in the energy industry fully expect this plan to drive up the cost of energy production dramatically, inflating energy prices for already cash strapped consumers. Energy consumers can also expect to spend more money on everyday goods and services as increasing energy costs impact all areas of the economy.

Inevitably, all of this governmental meddling will lead to even more Americans losing jobs. Significantly fewer taxpayers mean less revenue for the Treasury. It also means a lot more money will go out because of millions of long term unemployed Americans will require unemployment benefits, food stamps and other social programs, including subsidies for access to a government run health care system. Money will also be required to pay the salaries of the additional government employees who will staff these two new massive health care and cap and trade bureaucracies.

Something in the budget will have to give and you can be assured it won't be either of the two new programs because once they are up and running, they will be as impossible to reverse as Medicare and Medicaid. So what part of the budget will have to be sacrificed in order to pay for these massive new government expenditures and entitlement programs? The same part that European countries sacrificed as a result of their ballooning social programs: the defense budget.

In 2008, America accounted for 41.5 percent of the world's military spending. Conveniently, America's massive military budget has allowed countries in the European Union to cut back on their defense spending and ramp up their social programs and entitlement spending. Countries with large entitlement programs and smaller military forces are incapable of defending themselves adequately in the face of an attack, yet they continue growing those social programs anyway. Why? Because it has been quietly understood that America would be there to fill the gap should some disaster strike.

However, if President Obama succeeds in taking over the American health care system and implementing his cap and trade scheme, the United States will be forced to do what European countries did in past decades and cut its military defense budget. Of course, the president will deny that he would ever do this, although he vowed as much during the Democratic primaries, but there simply would be no other choice. And in doing so, Obama could accomplish his ultimate goal: undermining America's military might and exceptionalism and putting us in greater parity with weaker European nations.

In a few years many leaders of European nations may find themselves a bit startled at the prospect of once again having to assume the responsibility of defending themselves should America be forced to reduce military spending. Many of these countries have not really provided for their own military defense since World War II. And here lies the irony: when America is forced to slash military spending in order to expand social programs, many of the nations that previously counted on America to be the world's defender may have to cut their country's social programs in order to rebuild their own militaries once again.

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