Obama Economics - How Bad Is It?

Americans Lose Ground Under Obama's Failed Policies

IBD Editorial
Posted 07/27/2012

Gross Domestic Product: The U.S. economy grew at a slothful 1.5% in the second quarter and way below the level needed to create new jobs. Workers and small businesses are losing hope. Yes, Mr. President, "you built that."


Despite our $16 trillion in debt and a bloated federal deficit of $1.2 trillion, Obama and the Democrats keep telling us that we need more spending and intervention in the economy for it to reach "escape velocity," as if the economy were a rocket ship or something.


Obama also likes to say the economy "grows from the middle out," and that America needs "bottom-up prosperity" — two nifty little sayings that, as any economist worth his salt will tell you, are utterly bereft of meaning.


Economies grow when entrepreneurs start businesses and create jobs. That's what creates "the middle," and also what lets "the bottom" rise up. It's that simple.


So let's pause for a minute and consider the reality of this GDP report. In the last six months, the economy has expanded at an annualized 1.7% rate — barely above the 1.4% average since Obama took office in 2009. That's pathetic.


The economy needs to grow 3% or more just to sop up the 130,000 new workforce entrants each month. We've done that in exactly two quarters since 2008.


Looking back over postwar recessions, GDP is usually 15.1% higher at this point in a recovery than when the recession began. Under Obama, it's up just 1.7%.


Today, our economy is roughly $13.56 trillion in size, adjusting for inflation. If we had grown at just the median 15.1% rate, our economy would be $15.34 trillion in size — a $1.78 trillion difference.


Does it matter? You bet. Obamanomics has cost Americans a huge piece of their standard of living. By our calculation, that $1.78 trillion in missing growth has cost each American $5,780 in lost output. That's $5,780 less for paying mortgages, investing for retirement, kids' college education — in short, our standard of living has been slashed.


The failure of Keynesian stimulus and Obama's socialist meddling in our economy is clear. Unemployment has remained above 8% for 42 straight months. The total number of unemployed, officially 13 million, is really closer to 28 million when you count discouraged workers and those who can find only part-time work.


Yet, Obama continues to slam the door on the entrepreneurs who create small businesses and 80% of all new jobs. Rather than help them, Obama and the Democrats threaten to hike their taxes.


Small business is in crisis, but help isn't on the way. Obama has some 300 regulations pending, each with a job-killing annual cost topping $100 million.


Small businesses today spend more than $10,000 per worker on regulatory costs, and it's only getting worse.


Meanwhile, Obama's planned tax hikes will hit 1.2 million small businesses and kill 710,000 jobs, a new study says — even as a report from the U.S. Census shows that from 2008 to 2010, an estimated 200,000 small businesses disappeared, taking millions of jobs with them.


No matter how the White House spins it, Friday's disappointing GDP report shows Americans continue to lose ground under Obama — not gain it.

Obama And His Balled-Up Foreign Policy

Romney's foreign tour isn't all gaffes and games


by Charles Krauthammer:


Posted: Jul 27, 2012


A generation ago, it was the three I's. A presidential challenger's obligatory foreign trip meant Ireland, Italy and Israel. Mitt Romney's itinerary is slightly different: Britain, Poland and Israel.
    
Not quite the naked ethnic appeal of yore. Each destination suggests a somewhat more subtle affinity: Britain, playing to our cultural connectedness with the Downton Abbey folks who've been at our side in practically every fight for the last hundred years; Poland, representing the "new Europe," the Central Europeans so unashamedly pro-American; Israel, appealing to most American Jews but also to an infinitely greater number of passionately sympathetic evangelical Christians.
    
Unlike Barack Obama, Romney abroad will not be admonishing his country, criticizing his president or declaring himself a citizen of the world. Indeed, Romney should say nothing of substance, just offer effusive expressions of affection for his hosts — and avoid needless contretemps, like his inexplicably dumb and gratuitous critique of Britain's handling of the Olympic Games. The whole point is to show appreciation for close allies, something the current president has conspicuously failed to do.
    
On the contrary. Obama started his presidency by returning to the British Embassy the bust of Winston Churchill that had graced the Oval Office. Then came the State Department official who denied the very existence of a U.S.-British special relationship, saying: "There's nothing special about Britain. You're just the same as the other 190 countries in the world."
    
To be topped off by the slap they received over the Falkland Islands, an issue the Brits had considered closed since they repelled the Argentine invasion there 30 years ago. They were not amused by the Obama administration's studied neutrality between Britain and Argentina, with both a State Department spokesman and the president ostentatiously employing "Malvinas," the politically charged Argentine name, interchangeably with "Falklands." (Although the president flubbed it, calling them the "Maldives," an Indian Ocean island chain 8,000 miles away.)
    
As for Poland, it was stunned by Obama's unilateral cancellation of a missile defense agreement signed with the Bush 43 administration. Having defied vociferous Russian threats, the Poles expected better treatment than to wake up one morning — the 70th anniversary of the Soviet invasion of Poland, no less — to find themselves the victim of Obama's "reset" policy of accommodation with Russia. So much for protection from Russian bullying, something they thought they had finally gained with the end of the Cold War.
    
And then there is Israel, the most egregious example of Obama's disregard for traditional allies. Obama came into office explicitly intent on creating "daylight" between himself and Israel, believing that by tilting toward the Arabs, they would be more accommodating.
    
The opposite happened. (Surprise!) When Obama insisted on a building freeze in Jerusalem that no U.S. government had ever demanded and no Israeli government would ever accept, the Palestinian Authority saw clear to become utterly recalcitrant. Palestinian President Mahmoud Abbas openly told The Washington Post that he would just sit on his hands and wait for America to deliver Israel.
    
Result? Abbas refused to negotiate. Worse, he tried to undermine the fundamental principle of U.S. Middle East diplomacy — a negotiated two-state solution — by seeking unilateral U.N. recognition of Palestinian statehood, without talks or bilateral agreements.
    
In Israel, Romney will undoubtedly say nothing new. He'll just reiterate his tough talk on Iran's nuclear program. But I suspect he'll let the Israelis know privately that contrary to the conventional wisdom that his hawkishness signals his readiness to attack Iranian nuclear facilities, his real intent is to signal that, unlike Obama, he is truly committed to permitting Israel to do what it needs to defend itself. This will be welcome news to a nation that has never asked anyone to fight on its behalf, just a green light to defend itself without impediments or veiled threats from its friends.
    
Most important, however, is to just show up. That's 80 percent of life, Woody Allen once noted. No need to say much. Romney's very presence will make the statement.
    
To the Israelis: "We understand your unique plight. If and when you do as you must, we will stand by you." To the Poles: "You can count on the American umbrella. I will never leave you out in the cold." And to the British: "We are grateful for your steadfast solidarity in awful places like Iraq and Afghanistan. The relationship truly is special."
    
"And one more thing. Still have that bust of Churchill?"
    
Righting his ship late Thursday in London, Romney did say he wants Winnie back in the Oval Office.  
     

Economics 101

BAR STOOL ECONOMICS

Suppose that every day, ten men go out for a beer and the bill for all ten comes to $100.  If they paid their bill the way we pay our taxes, it would go something like this:


The first four men (the poorest) would pay nothing.
The fifth would pay $1.00
The sixth would pay $3.00
The seventh would pay $7.00
The eighth would pay $12.00
The ninth would pay $18.00
The tenth man (the richest) would pay $59.00


So that’s what they decided to do. The men drank in the bar every day and seemed quite happy with arraignment, until one day, the owner threw them a curve.


“Since you are all such good customers, he said, I’m going to reduce the cost of your daily beer by $20.00."  Drinks for the ten men now cost just $80.00


The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men – the paying customers? How could they divide the $20 windfall so that everyone would get there “fair share"?  They realized that $20.00 divided by six is $3.33.  But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer.  So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay!


And so:


The fifth man like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33% savings).
The seventh now pay $5 instead of $7 (28% savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).


Each of the six was better off than before!  And the first four continued to drink for free.  But once outside the restaurant, the men began to compare their savings.


“I only got a dollar out of the $20" declared the sixth man.  He pointed to the tenth man, “but he got $10!”


“Yeah, that’s right", shouted the seventh man. “Why should he get $10 back when I got only two? The wealthy get all the breaks!”


“Wait a minute,” yelled the first four men in unison.  “We didn’t get anything at all.  The system exploits the poor!”


The nine men surrounded the tenth man and beat him up.


The next night the tenth man didn’t show up for drinks, so the nine sat down and had beers without him.  But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!


And that, boys and girls, journalists and college professors, is how our tax system works.  The people who pay the highest taxes get the most benefit from a tax reduction.  Tax them too much, attack them for being wealthy, and they just may not show up anymore.  In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.


For those who understand, no explanation is needed.


For those who do not understand, no explanation is possible.


David R. Kamerschen, PH. D
Professor of Economics, University of Georgia

Remove The Threat

Obama's Record

The Lowlights Of Obamanomics

Posted 06/04/2012

The Obama Record

The Obama Record: May's weak jobs report further confirms the president's policies are failing to help the economy. This is, indeed, the worst recovery since the Depression.

Negative superlatives associated with this presidency keep piling up. The toll so far:

• The share of Americans who've been out of work a long time — now at 42% of the unemployed — is the highest since the Great Depression (source: Labor Department).

• The proportion of the civilian working-age population actually working, at 58%, is the smallest since the Carter era (Labor Department).

• Growth in nonfarm payroll jobs since the recovery began in June 2009 is the slowest of any comparable recovery since World War II (Hoover Institution).

• The rate of new business startups — the engine of job growth — has plunged to an all-time low of 7.87% of all businesses (Census Bureau).

• 3 in 10 young adults can't find jobs and live with their parents, highest since the 1950s (Pew Research).

• 54% of bachelor's degree-holders under the age of 25 are jobless or underemployed, the highest share in decades (Northeastern University).

• Black teen unemployment, now at 37%, is near Depression-era highs (Labor Department).

• Almost 1 in 6 Americans are now poor — the highest ratio in 30 years — and the total number of poor, at 49.1 million, is the largest on record (Census).

• The share of Hispanics in poverty has topped that of blacks for the first time, 28.2% to 25.4% (Census).

• The number of Americans on food stamps — 45 million recipients, or 1 in 7 residents — also is the highest on record (Congressional Budget Office).

• Total government dependency — defined as the share of Americans receiving one or more federal benefit payments — is now at 47%, highest ever (Hoover).

• The share of Americans paying no income tax, at 49.5%, is the highest ever (Heritage Foundation, IRS).

• The national homeownership rate, now at 65.4%, is the lowest in 15 years (Census).

• The 30-point gap between black and white Americans who own their own homes is the widest in two decades and one of the widest on record (Census).

• Federal spending, now at 23.4% of GDP, is the highest since WWII (CBO).

• Excluding defense and interest payments, spending is the highest in American history, at 17.6% of the economy (First Trust Economics).

• The federal debt, at 69% of GDP, is the highest since just after WWII (CBO).

• The U.S. budget deficit, now at 9.5% of the economy, is the highest since WWII (CBO).

• U.S. Treasury debt has been downgraded for the first time in history, meaning the U.S. government no longer ranks among risk-free borrowers (S&P).

This is what Obamanomics has wrought. Fiscal promiscuity. Trickle-up poverty. Shared misery.


Just what else do you need to know?

Impeach Eric Holder Now!

The Fast And Furious Scandal May Be Biggest In U.S. History

By ANN COULTER
Posted 06/29/2012 05:41 PM ET

Forget executive privilege, contempt of Congress, "fast and furious," how many documents the government has produced and who said what to whom on which date.

The Obama administration has almost certainly engaged in the most shockingly vile corruption scandal in the history of the country, not counting the results of Season Eight on "American Idol."

Administration officials intentionally put guns into the hands of Mexican drug cartels, so that when the guns taken from Mexican crime scenes turned out to be American guns, Democrats would have a reason to crack down on gun sellers in the United States.

Democrats will never stop trying to take our guns away. They see something more lethal than a salad shooter and wet themselves.

But since their party was thrown out of Congress for the first time in nearly half a century as a result of passing the 1994 "assault weapons ban," even liberals know they were going to need a really good argument to pass any limitation on guns ever again.

So it's curious that Democrats all started telling the same lie about guns as soon as Obama became president. In March 2009, Secretary of State Hillary Clinton announced to reporters on a trip to Mexico: "Since we know that the vast majority, 90% of that weaponry (used by Mexican drug cartels), comes from our country, we are going to try to stop it from getting there in the first place."

As she sentimentally elaborated on Fox News' Greta Van Susteren show: "The guns sold in the United States, which are illegal in Mexico, get smuggled and shipped across our border and arm these terrible drug-dealing criminals so that they can outgun these poor police officers along the border and elsewhere in Mexico."

Suddenly that 90% statistic was everywhere. It was like the statistic on women beaten by their husbands on Super Bowl Sunday.

CBS' Bob Schieffer asked Obama on "Face the Nation": "It's my understanding that 90% of the guns that they're getting down in Mexico are coming from the United States. We don't seem to be doing a very good job of cutting off the gun flow. Do you need any kind of legislative help on that front? Have you, for example, thought about asking Congress to reinstate the ban on assault weapons?"

At a Senate hearing, Sen. Dianne Feinstein, D-Calif., said: "It is unacceptable to have 90% of the guns that are picked up in Mexico and used to shoot judges, police officers and mayors ... come from the United States."

And then, thanks to Fox News — the first network to report it — we found out the 90% figure was complete bunkum. It was a fabrication told by William Hoover, of the Bureau of Alcohol, Tobacco, Firearms and Explosives (BATF), and then spread like wildfire by Democrats and the media.

Mexican law enforcement authorities send only a fraction of the guns they recover from criminals back to the U.S. for tracing. Which guns do they send? The guns that have U.S. serial numbers on them. It would be like asking a library to produce all their Mark Twain books and then concluding that 90% of the books in that library are by Mark Twain.

You begin to see why the left hates Fox News so much.

Obama backed away from the preposterous 90% claim. His National Security Council spokesman explained to Fox News that by "recovered," they meant "guns traceable to the United States." So, in other words, Democrats were frantically citing the amazing fact that almost all the guns traceable to the U.S. were ... traceable to the U.S.

Attorney General Eric Holder told reporters that even if the percentage is inaccurate, the "vast majority" of guns seized in crimes in Mexico come from the United States. (And he should know, because it turns out he was sending them there!)

This was absurd. Most of the guns used by drug cartels are automatic weapons — not to mention shoulder-fired rockets — that can't be sold to most Americans. They are acquired from places like Russia, China and Guatemala.

Right about the time the 90% lie was unraveling, the Obama administration decided to directly hand thousands of American guns over to Mexican criminals. Apart from the fact that tracking thousands of guns into Mexico is not feasible or rational, the dumped guns didn't have GPS tracing devices on them, anyway. There is no conceivable law enforcement objective to such a program.

This is what we know:

(1) Liberals thought it would be a great argument for gun control if American guns were ending up in the hands of Mexican criminals.

(2) They wanted that to be true so badly, Democrats lied about it.

(3) After they were busted on their lie, the Obama administration began dumping thousands of guns in the hands of Mexican criminals.

We also know that hundreds of people were murdered with these U.S.-government-supplied guns, including at least one American, U.S. Border Patrol Agent Brian Terry.

But let's look on the bright side. The ATF was originally going to ship warheads to Iran until realizing the explosions might disable the tracking devices.

(Contrary to more Democrat lies, there was no program to dump thousands of guns in Mexico under George W. Bush. The Bush administration did have a program that put GPS trackers on about 100 guns in order to actually trace them.

(That operation was ended almost as soon as it began because of the lack of cooperation from Mexican officials. You may as well say Holder's program was "started" by the first cop who ever put tracer dye on contraband.)

No one has explained what putting 2,500 untraceable guns in the hands of Mexican drug dealers was supposed to accomplish.

But you know what that might have accomplished? It would make the Democrats' lie retroactively true — allowing them to push for the same gun restrictions they were planning when they first concocted it. A majority of guns recovered from Mexican criminals would, at last, be American guns, because Eric Holder had put them there.

Unfortunately for the Democrats, some brave whistleblower inside the government leaked details of this monstrous scheme. As soon as Congress and the public demanded answers, Holder clammed up. He just says "oops" — and accuses Republicans of racism.

ObamaCare: Just How Bad Can It Be?

What's Wrong With ObamaCare? Here's A Partial List

Posted 06/29/2012

Repeal: After a full day's reflection, we still feel that the ObamaCare ruling is an outrage. And while we acknowledge that it's now settled law, we believe that it's poor public policy and needs to be expunged from the books.

We're still nettled by the Supreme Court ruling that ObamaCare's individual mandate can stand constitutionally as a tax when Congress failed to define the penalty for failing to buy health insurance that way. But we can do nothing about that. The court has spoken.

What we can do, with an eye toward repeal, is point out just how malignant the Patient Protection and Affordable Care Act is.

We began this exercise on Friday, when we wrote about ObamaCare's hidden taxes. The law imposes at least 21 new or higher levies that will cost trillions. That's too much to demand of hard-pressed taxpayers.

New taxes aren't the only rising burden under ObamaCare. Far from being a law that will cut costs, it will increase them.

Yes, the president promised that his signature legislation would bend the cost curve down. But when has a government program ever done such a thing?

It won't happen with ObamaCare, though the president also swore that the legislation would not add to the federal deficit.

In March, the Congressional Budget Office said the law would cost $1.76 trillion from 2013 to 2022, nearly double the $900 billion Obama quoted in September 2009. That's only a partial picture. Beginning in 2014, the next 10 years of ObamaCare — through 2023 — will cost more than $2 trillion.

The medical overhaul is also a choice killer. Many will recall Obama promising that under his plan, "If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you'll be able to keep your health care plan, period."

Those aren't the facts.

As we reported in April, the CBO estimates that as many as 20 million Americans will be forced out of their plans as employers toss workers into government health exchanges to avoid ObamaCare's costs.

A survey by McKinsey and Co. found that nearly one-third of employers will likely to drop coverage for their workers once ObamaCare kicks in.

And an analysis by the Medicare actuary found that ObamaCare's attacks on Medicare's private insurance options will force nearly 8 million seniors out of the coverage they've chosen.

So what else is wrong with ObamaCare? Try these:

• Consumer costs will rise. CBO says premiums will increase over the next decade faster than they did in the past five years.

• The Affordable Care Act is just the beginning. It's the door to a single-payer government system run by a DMV-type bureaucracy.

• The quality of care will suffer. The Democrats' law will chill the incentives to become a doctor, to create innovative drugs and to produce live-saving and life-enhancing medical equipment.

• Don't be surprised when treatment is rationed by government. As it takes over a larger portion of health care — it already controls nearly half — resources won't be able to keep up with demand. Somebody wins, somebody loses based on someone else's whim.

There's much more that we've covered and will cover again. And it all points to a single solution: Repeal the law before it takes deep root, and replace it with policies that put the patient in charge.