Category Archives: Economy

OLD WHITE MEN AND THE FISCAL CLIFF

Will he or won’t he, no one but he knows; however, president Obama is very capable of letting the economy fall over the fiscal cliff.  After all, it would mainly affect old white men because it’s old white men who own stocks and engage in private enterprise.  The Republicans would be to blame for the economic collapse due to their obstructionist policies designed to return the country back to the horse and buggy days rather than progress Forward into Obama’s New America.

Remember, the modus operandi of a community organizer is to gain power by taking advantage of a crisis.  Then Saul Alinsky taught that, if you can’t find a crisis, make one.  Remember also the answer Obama gave when an interviewer suggested that the consequences of raising capital gains taxes might be a loss of revenue.  The simple answer would be “I don’t believe it would.” but that’s not what the president said.  He said that spreading the wealth around was worth the cost of a little lost revenue.  That reply revealed where his priorities lie.  Add a dash of “Never let a crisis go to waste” and you have a formula for a return to economic recession.

The free market system results in unequal prosperity but that beats socialism which leads to equal misery.  Or as another wise man said “You can’t make the poor rich by making the rich poor.”  It’s too bad the president doesn’t know that.

Post script: However, you can make the poor poorer by making the rich poorer.

REAGAN vs. OBAMA ON THE ECONOMY

President Obama often asks the voters to understand that he inherited a very bad economy, and he did. But in many ways it was not as bad as the economy Reagan inherited from Carter.

On Reagan’s Election Day in 1980, unemployment was at 7.5 percent and headed for 10.8 percent; inflation was at 12.5 percent, headed for 13.6 percent, and interest rates were at 15.5 percent, headed for 21.5 percent by Christmas, well before Reagan was sworn in.

Obama inherited an unemployment rate of 6.8 percent and no inflation problem. Inflation was only 1.1 percent in comparison to the crushing 21.5 percent left by Carter. By the time Reagan was sworn in in January business men, farmers and home buyers (if you could find one) were paying 23 to 24 percent interest rates on loans.

Reagan wasted no energy on blaming Jimmy Carter. He approached the problem by lowering marginal tax rates in gradual steps over three years. He eased the regulatory burden on businesses, making it simpler to open or expand a business. His infectious optimism reminded people “the best is yet to come.” America was still “the shining city on the hill,” and Reagan reversed the country’s mood from a Carter-induced “malaise” to a can-do spirit.

In stark contrast, Obama did just the opposite with predictable results. He increased the regulatory environment increasing the cost and difficulty of opening or expanding a business. He introduced new law burdening business with new costs that are significant and beyond measurability at the same time. He fought for a return to higher taxes before acquiescing. Obama made his belief clear that America never was a shining city on a hill; it was a country in need of complete transformation. For America’s leader to wear a flag pin on his lapel was to honor a nation that was undeserving of such respect, a country that was in no way exceptional.

Reagan’s policies worked. By the end of his first term, inflation was down, employment was up, the economy was in good shape again and the mood of the nation had gone from morose to bright and cheery. In the bid for a second term, Reagan won every state with the sole exception of Minnesota.

Today we are where we are because of the president we picked in 2008, not because of what he inherited.

This post was adapted on an article by Peter Hegseth.

LET’S CALL IT A DRAW

President Obama needed a clear win to stem the slide.  He didn’t get it.  As in the Biden-Ryan debate, the Republican came across as a gentleman, the Democrat as more articulate and assertive.  It is difficult to judge the net effect on the election without knowing how well informed the undecided are.  Polls show unwavering support for each candidate at around the 47% level.  It is the relatively small group of undecided voters who will determine who the next president will be.

Right out of the box Obama painted his administration as one that gave strong support to the increased use of coal, the pipeline to Canada and made expansion of exploration and drilling for domestic oil and gas a priority.  Every one of those assertions is exactly the opposite of the truth.  But how many of the undecided viewers know that?  Obama also said that what we need is efficient energy.  How many undecided voters know that wind and solar are the least efficient and that’s why they need government subsidies to exist?  How many know the Solyndra story, not just the headlines but the full story?

Two down, one to go.  If the third is anywhere close to a draw, Obama’s record on the economy will cost him the election as well it should.

KRUGMAN ARGUES THAT GREECE AND SPAIN ARE VICTIMS

Paul Krugman, ever the liberal, is less vituperative than usual in today’s column in the New York Times.  It is entitled Europe’s Austerity Madness and is well worth reading.  Not for the column’s correctness but for its clarity.  He outlines with rare accuracy the predominant views of the cause of Europe’s financial woes and the solution for them.

First we must note that what passes for the Right in most of Europe would be called Liberal in the U.S.  This places Krugman’s argument more in the Socialist camp than Liberal.  He says of the European Right,

Talk to German officials and they will portray the euro crisis as a morality play, a tale of countries that lived high and now face the inevitable reckoning.

And fear of a backlash from voters who believe, wrongly, that they’re being put on the hook for the consequences of southern European irresponsibility leaves German politicians unwilling to approve essential emergency lending to Spain and other troubled nations unless the borrowers are punished first.

Despite the insertion of the word “wrongly”, Krugman has done a good job of stating the argument coming from Europe’s Right.  One other fault to find, it’s not punishment that’s sought; it’s bearing the consequences of one’s own decisions.  If you choose to live beyond your means don’t ask someone else to pay for it.

In Krugman’s view,

More austerity serves no useful purpose; the truly irrational players here are the allegedly serious politicians and officials demanding ever more pain.

Consider Spain’s woes. What is the real economic problem? Basically, Spain is suffering the hangover from a huge housing bubble, which caused both an economic boom and a period of inflation that left Spanish industry uncompetitive with the rest of Europe.

Spending was not the problem and austerity is not the solution.  Greece and Spain are victims of a housing boom and collapse that occurred in the private sector.  The fault is with other nations in the Eurozone that are failing in their moral obligation to redistribute some of their relative wealth to where it is needed.  Inferred in that view is the notion that the greed of capitalism was the source of the problem and socialism is the solution.  Get the cause wrong and so it will be with the solution.

WHY ARE OBAMA’S VOTER POLLS SO STRONG WHEN HIS RECORD IS SO BAD?

It’s the media, stupid!  If you are a Conservative, how much time do you spend watching MSNBC?  And when you do, do you believe anything they say?  But what if it were all true?  And you believed it.  It would be a whole different world.  You would detest FOX News and be disgusted by Republicans.  Welcome to that world, you may not be of it but you are in it.

Fast and Furious never happened, Solyndra was a vast right wing conspiracy to spread dirt on Obama, and the President is a friend of Israel because he said so.  Tea Party demonstrators spat on Black Caucus members and screamed anti-gay epithets at them as they strolled from their offices to the State House.  Christianity is a threat to our freedoms and Republican obstructionism is the reason the economy is anemic and unemployment is so high.  If you are unable to see how hard Obama is trying to improve the world, if you can’t see that his steps are the correct ones, there can be but one reason and one alone for your blindness – racism.

If you are a modern Democrat, these are your beliefs.  Your media reinforces them.  You spend little or no time with media that doesn’t.  There is no neutral objective media any longer, none.  There is no comfortable place you can go to hear the other side of an issue.

Obama is a very charismatic man.  Women fainted at his 2008 campaign speeches; men get tingles up their legs.  Delegates cried listening to his 2012 acceptance speech.  His blackness satisfies a longing in the Liberal heart for release from guilt.  He is a force for good.  Therefore, any opposition to Obama is a force against all that is fair and right.  Put this all together and you see the man can do no wrong.  The Right dubbed him Messiah for a reason and the left has never denied it.

President Obama says the financial crisis that brought the economy down was created by the policies of his predecessors and was so devastating it was impossible to clean it up in four years.  And the word of a Messiah is truth.  The worse the economy is now, the more important it is not to put the people  back in office that caused it.

For the “True Believer” the joblessness, soaring debt and the poor economy only reinforces the need to re-elect the President.  But there is another much more alarming reason for the strength of the President’s polls.  The United States may have reached “Tocqueville Time.”  But that’s for another post.

OBAMA’S SINKING SUPPORT

The crowds are not coming out.  The money is not coming in.  The aura of omnipotence is gone.  Cracks in the liberal media are beginning to show.  The liberal leaning Newsweek covered the latest issue with “We Need a New President.”  Unemployment is higher longer than at any time since the Great Depression.  The President has revealed some very unpopular beliefs with statements like “You didn’t build that… “.  However, the polls don’t reflect the decline.  Why is that?

It’s a tough thing for any person to admit they were very wrong; that’s a fact of human nature.  Answering a pollster commits you to nothing while it allows you to defer a decision you are loathe to make.  But what happens in the voting booth stays in the voting booth.  It’s private.  For better or for worse, when the chips are down voters vote their pocketbook.  As Walter Cronkite famously said, “It’s the economy, stupid.”  That does not bode well for Obama.

If the theory is correct, remaining vestiges of it will show up in the exit polls as some voters will be reluctant to admit they voted against their one time hero and a black man.

The Obama team could garner a few more votes if they spread the fear that Big Brother can tell how you voted.  Let’s hope they don’t think of it.

JUST THE FACTS FOLKS, JUST THE FACTS