when the DOW hits 10, 000.

The very resilience of the economy in the short and medium term might be one of Obama's best assets. The economy will probably recover and will probably endure whatever Obama manages to throw at it (cap and trade, new taxes to finance healthcare) at least through 2012. Bad Obama policies might slow down the economy. The unemployment rate might be 6.5% in 2012. That isn't good by the standards of the last 25 years, but it will look really good compared to 10% unemployment (which will be blamed on the Republicans). Ironically, the recovery which Kudlow ascribes to free market capitalism will plausibly be linked to higher tax, higher spending, higher regulation Obama statism. The piper will have to be paid of course (in the form of higher long-term unemployment and maybe runaway inflation,) but the country's institutions might well have been transformed in a way that a return to the economic policies of the Clinton era will be very difficult. Just because statism produces bad results does not mean that a return to limited government politics will actually happen. My biggest fear is that Obama will create a kind of American Peronism in which you have nominally right and left wing political coalitions that fight for the spoils of a more statist system and have no inclination or seemingly reasonable hope of reforming it.

My biggest fear is that Obama will create a kind of American Peronism in which you have nominally right and left wing political coalitions that fight for the spoils of a more statist system and have no inclination or seemingly reasonable hope of reforming it.

Isn't that we've had for the past 75 years?

I think Pete's basically right on the Peronism thing and the difficulty of going back. I hope he's right on the short-term recovery, even at the expense of reelecting the president. John Moser is sort of right in seeing Obamaism as a intensification of certain longterm trends. But I still want more advice on getting out of the Stock Market.

Yes, John Moser is right.

I thought part of Kudlow's point was that you do not want to get out of the stock market now, but get in, or get more in. Whether you want to get out when your investments have recovered depends on whether whether you think Obama and friends have stopped or will stop trying to strangle American capitalism. Does Geithner ever make any sense
or ever say anything that indicates or inspires confidence in the administration's good sense where the economy of the country is concerned?

Obama's stimulus was a political win-win, as most people knew, and while we can all be glad that it has not hurt us as much as we might have feared, short term, we really aren't done -- what-- digesting it yet. Wasn't paying for the stimulus always the big concern? Reading The Economist, because I read on here that it is a good source, the only problem with what the president is doing is that Democrats in Congress are greedy and they are leftists, while he is not. Oh yeah? If all the proposed statist programs succeed then I suppose the trick will getting out of the stock market, and what, out of capitalism? Where does that leave any of us?

I think America has had a pretty healthy limited government (not Jeffersonian small government) political camp. The ability of politics to move our economics in a free market, limited government, direction might not be all that we might wish, but there have been have won some impressive political victories in the last thirty five or so years. Marginal tax rates have come down, oil and natural gas were deregulated, we have had a pretty stable currency, welfare was reformed, our labor markets are flexible. The political dificulty Obama is facing in getting government-run healthcare is a testament both to how far we are from Peronism and the strength of the limited government camp even at low ebb. But institutional changes (especially on healthcare) could erode the base of the limited government camp. For a hint of what American Peronism might look like, check out the poltitics of California minus the supermajority requirement to raise taxes or Richard Brookhiser's most recent post at his NRO blog about Big Government, the burden on business and New York State. Those two examples don't really do justice by themselves. Add in government-run healthcare, a government rationing approach to energy the expansion of labor unions with the government acting as the pro-union "referee" in wage disputes, and hyperinflation to really get the flavor. The Clinton era would look like a golden age of limited government by comparison.

It certainly might be a good time to get in the stock market right now. It certainly was a couple of months ago. Those who sold early in the year to avoid even worse losses choked. So far, I'm thinking 10,000 and punt isn't bad advice, but my own hunch is that it goes higher than that. And those who want to retire in their lifetimes need more as a hedge against the semi-inevitable big-time inflation. The Clinton era, by the way, does look like a gold age of limited government, even perhaps by comparison to the George W. Bush era. Everyone--listen to Kate and Pete

The more I think about the disturbing scenario that Pete sketches, the more I think that the best prospects for heading it off may well come from big GOP wins in the VA and NJ governors' races this fall. I'm not as familiar with Chris Christie, the GOP candidate in NJ, but Bob McDonnell in VA is running pretty vocally and overtly against Obama and his plans for the massive (and, as Pete notes, once accomplished nearly impossible to reverse) expansion of government. Convincing GOP wins in those two states will scare the bejeebers out of Democrats on the Hill and could embolden those on their side of the aisle who might want to help the GOP stop our national slide toward the abyss of el Peronismo norteamericano and all it so ignobly signifies.

I don't get how you can say the best hope to stop this lies with the GOP when they are one of the sides fighting for the spoils of tyranny and have been doing it for 75 years. The best hope is the death of the GOP in my opinion. I just got you handle btw, nice Johny Quest. I kept thinking you were the agent who tried to stop Homer from being the beer baron in the classic episode Homer vs. the 18th amendment, but that was Rex Banner.