Is the age of prosperity over?

That is the argument from Arthur Laffer, famous in economics and political circles for the "Laffer Curve". His argument in the Wall Street Journal is that we have come to the end of the age of prosperity, an age that has lasted for decades and is really all many people my age have known. It has given us material wealth unimaginable by most generations of American, and along with that a sense of entitlement and discontent also unimaginable. We never have enough. We desire the latest, the newest. I know this all too well (as I eagerly await my ESV Study Bible, as if I don't have enough study Bibles). The article carries the title: The Age of Prosperity Is Over with the subtitle: This administration and Congress will be remembered like Herbert Hoover. That is not intended as a compliment. Here is an excerpt:

If you don't believe me, just watch how Congress and Barney Frank run the banks. If you thought they did a bad job running the post office, Amtrak, Fannie Mae, Freddie Mac and the military, just wait till you see what they'll do with Wall Street.

Some 14 months ago, the projected deficit for the 2008 fiscal year was about 0.6% of GDP. With the $170 billion stimulus package last March, the add-ons to housing and agriculture bills, and the slowdown in tax receipts, the deficit for 2008 actually came in at 3.2% of GDP, with the 2009 deficit projected at 3.8% of GDP. And this is just the beginning.

The net national debt in 2001 was at a 20-year low of about 35% of GDP, and today it stands at 50% of GDP. But this 50% number makes no allowance for anything resulting from the over $5.2 trillion guarantee of Fannie Mae and Freddie Mac assets, or the $700 billion Troubled Assets Relief Program (TARP). Nor does the 50% number include any of the asset swaps done by the Federal Reserve when they bailed out Bear Stearns, AIG and others.

But the government isn't finished. House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid -- and yes, even Fed Chairman Ben Bernanke -- are preparing for a new $300 billion stimulus package in the next Congress. Each of these actions separately increases the tax burden on the economy and does nothing to encourage economic growth. Giving more money to people when they fail and taking more money away from people when they work doesn't increase work. And the stock market knows it.

The stock market is forward looking, reflecting the current value of future expected after-tax profits. An improving economy carries with it the prospects of enhanced profitability as well as higher employment, higher wages, more productivity and more output. Just look at the era beginning with President Reagan's tax cuts, Paul Volcker's sound money, and all the other pro-growth, supply-side policies.

Bill Clinton and Alan Greenspan added their efforts to strengthen what had begun under President Reagan. President Clinton signed into law welfare reform, so people actually have to look for a job before being eligible for welfare. He ended the "retirement test" for Social Security benefits (a huge tax cut for elderly workers), pushed the North American Free Trade Agreement through Congress against his union supporters and many of his own party members, signed the largest capital gains tax cut ever (which exempted owner-occupied homes from capital gains taxes), and finally reduced government spending as a share of GDP by an amazing three percentage points (more than the next four best presidents combined). The stock market loved Mr. Clinton as it had loved Reagan, and for good reasons.

The stock market is obviously no fan of second-term George W. Bush, Nancy Pelosi, Harry Reid, Ben Bernanke, Barack Obama or John McCain, and again for good reasons.

These issues aren't Republican or Democrat, left or right, liberal or conservative. They are simply economics, and wish as you might, bad economics will sink any economy no matter how much they believe this time things are different. They aren't.

A stinging indictment. Was Bill Clinton, gulp!, a better President that George W. Bush? Not a better person, a better President? For all of his well-meaning attempts, President Bush has abandoned any pretence of being a conservative fiscally and in an unholy partnership with the Left has saddled us with an enormous debt and soon will have saddled us with the most liberal President in my lifetime.

Our age of prosperity is over. And believe it or not, that is probably the best thing that could happen to the church. Barack Obama may be good for the Gospel, not because he is a godly man because he certainly is not, but because as our self-reliance in our own culture war and our affluence wanes, we are left with nowhere and no one to turn to but God. I predict that if Obama wins, our culture will suffer like never before but our God will show His glory in salvation, in changed hearts like few of us have seen in our lifetime. Pray God will send us revival and send us repentance.