While the debt ceiling dance continues in Washington D.C. and the Republicans in the Senate are going wobbly, they need to understand they are dealing not only with an intransigent party in the White House but also someone that is the most incompetent president in modern history, and the worst steward of the American economy since the nation's founding.

The Obama sycophants often resort to the White House pre-packaged line that Obama inherited the worst economy since the Great Depression, as a means of deflecting responsibility onto George Bush.  Like so many of the emanations from this administration that too is a fabrication.  As side-by-side comparison of circumstances inherited by Reagan and Obama is as follows: 

Among the factors that reflect the tale of the two presidencies is the price of gold. 

Recently the price of gold reached $1,609.00 per ounce.  While this is an historic high in terms of raw dollars, it is not the high insofar as inflation-adjusted price.  That came on January 21, 1980 when gold reached $850.00 per ounce; however adjusted to 2011 that price is the equivalent of $2,328.00. 

Gold prices often are a bellwether and commentary on the foibles and successes of those in power in the United States, as the dollar is the de facto global reserve currency and America has been the dominant economic and military power since World War II.

In 1980, when gold prices set the record, the United States was in the throes of a recession with annual inflation running at 13.5%, the unemployment rate was 7.5%;  the annual GDP growth was a minus 0.27%, and the bank prime interest rate was over 18.5%.  The flight to gold was overwhelming as no one had any confidence in the policies of Carter and the Democrats in Congress. 

That was the landscape of the country when Ronald Reagan assumed office in January of 1981. 

The job facing Reagan was the most daunting since the Great Depression -- and far worse than what Barack Obama inherited in 2009 -- as the combination of extreme inflation (the highest annual rate in the nation's modern history), unemployment (which peaked at 10.8% in 1982), and virtually no one able to pay the exorbitant bank interest rates were major obstacles that had to be overcome in order to revitalize the economy.  The price of gold reflected that dilemma.

However markets react not only to the actual circumstances at hand but to confidence in leaders and what is perceived as future positive or negative factors.  Because of Reagan's policy pronouncements and belief in the free markets combined with the passage of his economic growth agenda, by the end of his first 12 months in office the price of gold had declined to $377.50 per ounce (equivalent of $936.78 today).  This remarkable drop of nearly 60% from the previous all-time peak just 24 months before came about despite the fact that America was still in the throes of excessive (but declining) inflation and extremely high unemployment.

By August 1983 (28 months into President Reagan's first term) the price of gold was at $401.75 or $910.48 per ounce in 2011 dollars (down 61% from 1980 peak).  Inflation had been reduced to 3.2% (from 13.5%); the unemployment rate was at 9.2% (down from a high of 10.8% in November of 1982); annual GDP growth in 1983 was 4.52%, the highest in the previous four years.  In the final year of Reagan's first term GDP grew by an astounding 7.19% and the unemployment rate had been reduced to 7.6%).  Yet the average annual federal government budget deficit over those years was kept at 4.2% of GDP despite the overwhelming debacle facing the country in 1980-81.

The contrast between Ronald Reagan's first term and that of Barack Obama is stark and indicates a deliberate effort by the current president to destroy the American economy as he will have added over $5.5 trillion to the national debt in an effort to transform the United States into his vision of a socialist utopia.  By comparison Reagan added $1.35 trillion (inflation adjusted to 2011) over his first term while saving the American economy.

Yet many Republican Senators are willing to accede to political considerations in granting Obama his wishes regarding a massive increase in the debt ceiling and raising taxes coupled with vague promises of future spending cuts.  Instead of listening to the American people many are allowing themselves to be intimidated by the president, the Democrats in Congress, and a media who view the current debt ceiling debate as a sporting event while openly cheerleading for their team.  Rather than take the matches away from a pyromaniac, they are predisposed to hand him a flaming torch to complete the job.

Twenty-eight months into the term of Barack Obama the scene is considerably different.  Gold was priced at $849.00 per ounce on Inauguration Day (January 20, 2009); today it has nearly doubled (95%) to $1,609.00. 

The other Obama failures: Unemployment was at 7.6%, today 9.2% (if calculated as in the early 80's the rate today would be over 10.5%).  Annual GDP growth will be between 1.5 and 1.75% in 2011.  All current estimates conclude that the final year of Obama's term will show a GDP growth of less than 2.2% and unemployment still around 8.8 to 9.0%.  But most devastating of all, the annual federal budget deficit has averaged nearly 10% of GDP (double the worst single year from 1947 to 2008).

Additionally, the financial crisis of 2008 had been mitigated by the actions of George W. Bush (TARP et al) prior to Obama assuming office and the recession was declared over by June of 2006, just 5 months after inauguration.  On the other hand the recession in play when Reagan became president was in its early stages and did not officially end until November 1982, 22 months after inauguration.

It has been debated whether Jimmy Carter or Barack Obama is the epitome of incompetence in modern U.S. history.  While Carter made myriad mistakes and was in over his head, he did not put the country in an untenable position regarding its future.  Obama has.  Post-Obama America has a questionable ability to financially overcome severe economic downturns; there is a very real possibility that the dollar will no longer be the world reserve currency -- a disaster for the American consumer. 

When Carter left office, the Gross Federal Debt as a percent of GDP was 33% (he never recorded an annual deficit higher than 2.65% of GDP).  When George W. Bush left office the debt to GDP ratio was 69% (his highest annual deficit was 3.48% of GDP).  On the other hand, by the end of the Obama term the debt will be nearly 100% of GDP (the annual budget deficit in 2011 is projected to be 11% of GDP).

The United States as a nation is 222 years old, yet over one-third of the nation's debt will have been accumulated by Barack Obama in just four years.