Some people are hoping that President Obama's plan will get the economy out of the doldrums and start providing jobs for the unemployed. Others are hoping that the Republicans' plan will do the trick.
Those who are truly optimistic hope that Democrats and Republicans will both put aside their partisanship and do what is best for the country.
Almost nobody seems to be hoping that the government will leave the economy alone to recover on its own. Indeed, almost nobody seems at all interested in looking at the hard facts about what happens when the government leaves the economy alone, compared to what happens when politicians intervene.
The grand myth that has been taught to whole generations is that the government is "forced" to intervene in the economy when there is a downturn that leaves millions of people suffering. The classic example is the Great Depression of the 1930s.
Those who are impressed by words seem to think that President Barack Obama made a great speech to Congress last week. But, when you look beyond the rhetoric, what did he say that was fundamentally different from what he has been saying and doing all along?
Are we to continue doing the same kinds of things that have failed again and again, just because Obama delivers clever words with style and energy?
Once we get past the glowing rhetoric, what is the president proposing? More spending! Only the words have changed — from "stimulus" to "jobs" and from "shovel-ready projects" to "jobs for construction workers."
If government spending were the answer, we would by now have a booming economy with plenty of jobs, after all the record trillions of dollars that have been poured down a bottomless pit. Are we to keep on doing the same things, just because those things have been repackaged in different words?
On August 31, with job creation grinding to a complete halt, U.S. Labor Secretary Hilda Solis was asked this question: “Why do you think there have been so many jobs created in the last decade in Texas?”
She laughed and said, “Come again.”
The questioner rephrased his query, adding a citation: ”The Federal Reserve Bank of Dallas estimates about half of the jobs created in the U.S. in the last decade have been created in Texas. Why do you think that is?”
Replied Solis, “I haven’t done a lot of research in terms of the economic growth in Texas.”
It appears that Labor Secretary Solis had no interest in looking at how a state with 8 percent of the nation’s population had created nearly half of the nation’s new jobs over the past 10 years.
In his speech on the economy on September 8, President Barack Obama tied our nation's fiscal recovery to the passage of three free trade agreements (FTA) currently awaiting approval. Said the president:
Now it’s time to clear the way for a series of trade agreements that would make it easier for American companies to sell their products in Panama and Colombia and South Korea — while also helping the workers whose jobs have been affected by global competition. (Applause.) If Americans can buy Kias and Hyundais, I want to see folks in South Korea driving Fords and Chevys and Chryslers. (Applause.) I want to see more products sold around the world stamped with the three proud words: “Made in America.” That’s what we need to get done.
While the Republicans may disagree with much of what the president proposed, their leadership is adamantly and enthusiastically behind the trade agreements. Evidence of the bipartisan support for the agreements is found everywhere. Last week, Senate Minority Leader Mitch McConnell (R-Kent.) wrote an op-ed piece in the Washington Post lamenting the languishing of the trade agreements on President Obama’s desk and imploring him to pass them along to Congress.
The enlightened scholars of the American Political Association gathered for a convention during Labor Day Weekend, and wouldn’t you know it, the degreed wizards agree: Tea Party Americans are bigots.
While last week’s report in the Washington Times is hardly unique, it suggests Tea Party Americans can expect the mainstream media and its lefitst allies to continue smearing the grass-roots movement as part of their effort on behalf to reelect President Obama.
Despite abundant evidence to the contrary, the Left has been peddling the lie that Tea Party members are sheet-wearing night riders for some time, and the charge hasn’t just come from the fever swamps of the blogosphere. Seemingly intelligent top-level officials in Washington say the same thing.
In yet another display of government inefficiency, government officials in Bethesda, Maryland, located just outside of Washington, D.C., have decided to spend $4 million to house 12 homeless people for a single year. That averages out to approximately $330,000 per person, a figure that grows even more absurd when one observes that the average price of a single family home in the United States is just over $170,000.
The story was first reported by the Washington Examiner:
Owned and operated by Montgomery County's Housing Opportunities Commission, the "permanent supportive housing" facility will be at 4913 Hampden Lane — between Woodmont Avenue and Arlington Road in downtown Bethesda — and will house six studio and six one-bedroom apartments.
The project received $1 million in federal stimulus money, as well as $944,829 from the Montgomery County Department of Housing and Community Affairs and $2.1 million in Low-Income Housing Tax Credits from the state.
Prime Minister George Papandreou’s speech on Saturday evening in Thessaloniki was designed to reassure not only his Greek citizens that all would be well but also that those holding Greek sovereign debt would be getting their money back. The government’s top priority, he said, is “to save the country from bankruptcy.”
Said Papandreou: "We have taken the decision to fight to avoid a catastrophe for our country and its citizens: bankruptcy. We will remain in the Euro. And this meant and means difficult decisions.... If this year the recession [already in its third year] is markedly greater than the estimates of international organisations on which the medium-term fiscal plan [to obtain additional bailouts from the European Central Bank] was based, despite that, Greece will make its fiscal targets, doing all that’s needed in this direction."
Collectivist statists from America to southern Europe are singing a familiar tune: The private sector is to blame for the economic nightmare that they have created. The Obama administration began complaining that businesses with cash were not instantly using that cash to hire employees, whether market conditions made that a prudent decision or not. Now the Greek government is issuing more bonds and, according to the condition of their second proposed bailout by the European Union, is being required to convince private investors to acquire the vast majority of the new debt of the Greek government.
The feedback that the Greek government is getting over its sovereign debt crisis is more than just from the private sector. German Chancellor Angela Merkel, whose own job hangs by a thread and who has just been limited by Germany’s Constitutional Court in using German assets to solve the Greek sovereign debt crisis, is now acknowledging that it was a mistake to admit Greece to the European Union. Merkel remained committed, however, to keeping Greece in the union, provided that no more help is needed from nations with stable and sound fiscal policies, and the Chancellor also warned the rest of the "PIIGS" nations to expect no more bailouts. European Central Bank President Jean-Claude Trichet echoed Merkel’s sentiments, and warned that the purpose of the ECB was to maintain the stability of the euro and not to protect nations that incurred debt far beyond the nations’ ability to repay those debts.
The FBI is investigating bankrupt solar-panel maker Solyndra after the company secured more than $500 million in loan guarantees from the federal government. Glorified by President Obama as "the future" of clean energy and a "testament to American ingenuity and dynamism," Solyndra headquarters was raided by FBI agents on Thursday, as allegations were made that executives knowingly misled the government in an attempt to swindle $535 million in federal loan guarantees. FBI spokesman Peter Lee said the investigation commenced following a request by Energy Department inspector general Gregory Friedman, who alleged that the department’s clean-energy loan program lacks "transparency and accountability."
The investigation launched a week after the Silicon Valley solar company filed bankruptcy, which resulted in immediate layoffs for 1,100 workers. The company has gleaned raving reviews from the Obama administration, as the President branded the company as a poster child for clean energy: "Companies like Solyndra are leading the way toward a brighter and more prosperous future."
In his talk on Thursday to the Economic Club of Minneapolis, Federal Reserve Chairman Ben Bernanke warned the Congressional Supercommittee not to cut government spending by too much, and that if the economy continues to slide into another recession, the Fed has tools to meet the challenge.
Speaking over the heads of his audience directly to the Supercommittee, Bernanke warned that “while prompt and decisive action to put the government’s finances on a sustainable trajectory is urgently needed, fiscal policymakers [i.e., you members of the Supercommittee] should not, as a consequence, disregard the fragility of the economic recovery.” In other words, it’s OK to do a little nibbling around the edges of government spending, but anything that would cut such spending seriously needs to be avoided altogether, at least until the economy gets back on its feet.
And that’s the problem. With the economy stalled, consumer spending slowing, factory production dropping, job growth at zero, 14 million Americans unemployed, jobless claims increasing, 42 million on food stamps, and consumer and investor confidence at its lowest levels in years, jumpstarting the economy is going to be a Herculean task even for the Fed.