Darrell Castle talks about the end of year status of the U.S. Economy

Transcription / Notes

2018 IN REVIEW PART 2—THE ECONOMY

Hello, this is Darrell Castle with today’s Castle Report. Today is Friday, December 21, 2018 and on my time with you today I will continue my year end review with some thoughts about the economy. Today is also the last Friday before Christmas and that makes next week the week of Christmas so I will not be with you next Friday, but God willing I will return two weeks from today and that will be January 4, 2019.

Today is the day that the government of the United States is supposed to shut down because Congress is so hamstrung by politics that it will not pass a budget, as the Constitution requires it to do. The government, therefore, continues from year to year on a series of continuing resolutions. This year the President has said that he will take personal responsibility for shutting down the government if he does not get $5 billion for construction of a wall on the southern border. The Democrats, once again led by Nancy Pelosi, say that will never happen, so if no compromise is reached, let’s look at what would actually be shut down.

The Republicans have already managed to pass budgets this year for about 75% of government agencies, such as Defense, Education, Labor, Health & Human Services, Social Security, and Medicare so no threatening or intimidating seniors that they won’t get their checks or medical care. The remaining 25% of government will lose its funding at midnight tonight if no compromise is reached. Upon shut down, some employees deemed to be essential such as Border Patrol and ICE will keep working and getting paid. Non-essential employees which will apparently be several hundred thousand will be furloughed. They will end up getting a paid vacation as usual but I have often wondered why we need so many non-essential employees.

Many positive things have happened with the economy this year.  For example, due to lessoning of anti-fracking regulations by President Trump, America is very close to achieving energy independence and has become one of the world’s leading exporters of oil and natural gas. The fracking revolution in energy is being felt throughout the economy as lower fuel prices take effect. Here in my city of Memphis, Tennessee, the price for a gallon of regular gas has fallen below $2. If it’s cheaper to deliver goods then the price of goods should be lower and demand for those goods higher. Regulations have been reduced in many other areas as well and manufacturing is starting to return to America resulting in more people working and fewer on the unemployment rolls. Trade deals have been completed with Mexico and Canada and pressure on China and Germany is starting to weaken some of the trade disparity that we have seen with those trading partners.

Despite all those positives, and I’m sure there are many more, there are ominous signs hanging over the United States economy right now. First, remember what government is: an organization with a monopoly on force within a certain geographical area. Government is the only organization that can legally use force against people who haven’t harmed anyone. Government, in its very essence, is force and everything that people normally think of coming from the government is taken from the members of society by force. Government is, therefore, very dangerous and always threatening to overwhelm the society it is supposed to protect and so it must be strictly limited. The necessity of strict limits has not been adhered to by our representatives and that failure has caused most of the problems I am about to discuss.

Granted, some of these problems can be resolved by high growth, or at least that’s what government often tells us. I’m certainly for tax cuts and often wish my tax burden could be lessened, but tax cuts need to be accompanied by spending cuts to match them because that is the road to ...