Jobs and Economic Growth
January 9th, 2010 | 
Author: Jobs and Economic Growth Forum
(Transcript: http://www.whitehouse.gov/the-press-office/remarks-president-and-vice-president-opening-session-jobs-and-economic-growth-forum)
Healthcare, Afghanistan, and recession: The big three for 2009. The Obama administration has been in charge for almost 12 months and we appear to be in the same place as when the hapless Bush administration left. There has been some cosmetic changes and some major policy shifts, however I am a results oriented-guy. What are the results?
Let’s take a look at the current positions on Jobs & economic growth as it is discussed in the speeches by Biden and Obama on December 3rd before a dog & pony media event which featured the administration discussing issues with business leaders.
The event was a publicity stunt and I certainly do not hold that against anyone. Part of politics is creating photo ops and showing people you are in charge and doing something. Despite the backdrop, the speeches were illustrative of how my conservative values clash with the current leadership of my party.
An initial irritation is the cavalier attitudes toward job grow, in particular growth in relation to the Obama stimulus package. Let’s be real for a moment. The economy has not come back and the stimulus (both Bush and Obama) packages were simply reactionary measures and did nothing more than get us farther into debt. Whether it is 600K, 1.6M, or whatever number, unemployment is still 10% and underemployment has grown considerably. That means we are still bad off. Could be worse, but it is still bad. Anyone in the job market understands this. I know Biden has to say what he says (what choice does he have?), but I can’t help but roll my eyes and see the national debt grow and grow. I will take some time in a later blog to discuss my 2009 unemployment thoughts.
Let’s stick with philosophical points. Biden ranted that he wants “no more bubbles” The only way to have no more bubbles is with a command economy (i.e. Marxism). Is Biden tipping his hand? Free markets have expansions and contractions… bubbles and corrections. As powerful as the government is it is still not powerful enough to eliminate corrections in the US economy. When it tried to sustain expansions (i.e. create a bigger bubble) with policies it simply makes for a bigger correction (note: the sub-prime fiasco with Freddie Mac?). The only way for the government to eliminate the normal business cycles is to try to mess with it through policies (sub-prime insurance) or take it over (healthcare). I’d prefer politician to stay out of the normal business cycles and simply work on creating a healthy business climate. A discussion on corporate taxes is not on the list for future blogs.
Another philosophical point is the swipe the President Obama took at business profits. I believe he suffers from a misunderstanding that businesses are in the business of providing jobs. Businesses are in the business of making profits. That is what they do in their basest form. He asked, “How do we get businesses to start hiring again?” This is simple. Businesses need to believe that hiring will make that more profit than not hiring. The tone set by this administration AND congress is that achievement will rewarded with more taxes. Perhaps the President does not understand this; or more likely he has an underlying moral objection to this simple truth about a free market economy.
A third philosophical point is related. The simple fact is that the Capital Markets are paralyzed. Really. There are many reasons for this; however I think they can be boiled down to two: toxic assets and uncertain landscape. The first has to do with the current holdings of private and institutional investors. A new investment needs to not only show promise of profit, it has to show enough promise to make up for the “bath” the investor is going to take to liquidate his toxic asset. Obama can do little to help this (other than some capital loss policy changes) it will work itself out as the economy recovers.
The other factor is the uncertain landscape. Investors need to be able to predict the future in order to evaluate risk and reward. This area President Obama has a lot of influence. His policies have played a key negative role. Whenever he floats another trial balloon or threatens another tax or moves to take over an industry it makes the landscape uncertain. The best thing the President can do is the one thing that no politician can do…do nothing. Really, give the markets time to evaluate the landscape and understand the risks/rewards then they will make their investments.
Accept that bubbles happen in a free-market economy, understand that profits are “good” and “helpful” in creating jobs, and promoting a stable capital market environment by doing (and just as important “saying”) nothing. These three fundamental conservative values are missing from the current national leadership and they are key factors behind our economic recovery (or lack there of). Food for thought.
Next week (or soon there after) Obama-isms and Guantanamo Bay War Prison.
I welcome your thoughts here or at conserv.democrat@gmail.com.
Michael
Posted in
Since this post is a year old I will only reply to the title and not the post. Economic growth is slow. Job growth is very slow. Our country is in a financial mess. I think I have the cure for it all and I am not joking. It will take all of our collective efforts but very little resources. Here is a list of my recommendations:
1) Tax code reform – Fair Tax is my favorite. No more loop-holes and even illegal aliens pay equally into the system. http://www.Fairtax.org for more info.
Or at least close certain loopholes in our tax code and lower the tax rate on businesses, just like the White House deficit panel recommended.
2) Raise the collection age on Social Security higher.
3) Lower foreign aid by 50% and suspend it 100% until our national debt is under 1 trillion dollars. We should not be trying to borrow money just to give it away. That is bad policy.
4) Close down more overseas bases.
5) I am not happy with the proposal to change Medicare to a voucher system.
I would agree with the option to opt out of Medicare for a voucher system.
It needs to be a choice.
6) I know there is government property that is hard to sell, such as
foreclosed property from VA loans the government guaranteed. Fix them up
and rent them out using a property manager. It could be for section 8
people. We would make and/or save a bunch of money, at the same time
create private jobs. Rent out these properties could bring money back to
the reserve.
7) Allow more flexibility to states to do there own reforms. If the people
of Vermont want universal health-care and they are going to pay into it
with state funds, then so be it.
have one military member serving in the Middle East. Osama Bin Laden is
dead, and we are fighting in Libya on borrowed money.
9) Use less military contractors to do a job that service members are
already trained to do.
10) If everybody want the recent healthcare reform repealed (which I do not agree with) the H.R. 4626, the Health Insurance Industry Fair Competition Act
bill should be reintroduced, voted on and made law. It is the only other way to restore integrity and competition to the healthcare markets. Remove government barriers on HSA and Flex savings accounts.
11) If we are going to be sending our war ships to protect cargo ships from pirates them we need a little commission. The U.S. military is not a private security firm. We should not be protecting Middle Eastern Oil when our citizens are having to pay over $2.50 per gallon.
Now where you come in is to do something simple. Vote and write your elected officials in support of these positions (Flexible on 10 if you do not want to support it). Voting has real impact and there is always time to do it. Just register to vote and register for an absentee ballot and you will always get to vote by mail with at least 2 weeks to throw it in the mail.
Writing your elected officials is real easy and simple. http://www.congress.org is free and easy to register. And on one email you can write your congressman, both senators, and president. You can write your state government also. If everybody wrote and voted it would make a big difference in swaying how congress and the senate votes.
If people want to elect the people they really want then they going to have to stop at looking who is electable, or political strategies that are taught by radio commentators and other media and start voting for people for what they stand for. Look at Romney. He says all the right things all the time but he panders and he is the establishment and more of the same.
We talk crap about politicians all the time about how they do not care and are self serving, and then we vote them in. Well I am going do what I have done for years now. I will vote my values and judge them past on my own home work. Not what TV or radio tells me who should be electable. I do not give a crap about parties. I care about issues and judge the individual. You may not like Ron Paul and you can have your opinions, but my advice is if you are thinking of not voting for the incumbent President look at all the other candidates with an open mind. The third party and independent candidates and for all seats in the election are worth looking at. The Ron Paul vote is the only non-third party who is getting my vote this year. Over eight years ago he was a third party candidate.
Real change starts with you. Changing the world is one house at a time. I choose to vote, write my elected reps in federal & state government weekly, have respect for others beliefs, recycle weekly, get my car checked annually, be conservative with my overall home & car energy consumption, advocate for responsible use of the environment and resources, educate my children, be good Christians, and maintain a well functioning marriage with my angry wife to serve as an example to my kids that divorce is not an option because I want to help change the world to a better place. Changing the world will only happen one house at a time. It can start with you.
Keep in mind a lawyer goes to law school because he wants to make good money. He has to have the disposition to defend someone he knows is guilty, because in the U.S. everybody deserves a fair trial. He is trained to sway groups to his opinions and stances. This is what we want representing us in government? No wonder our government is in such a state. If you can defend someone in court you know is a child rapist, you may be a good lawyer, but you are a jerk and you should not be taking you self serving values to represent us in congress.
We are the dumb for listening to the radio commentators, and the talking heads on TV. We are the ones voting. We can change all that this year. Do your home work on the candidates, based on the list you are given by your state elections office, and make a the right choice BASED ON YOUR VALUES. Make it count.
Quit voting 4 LAWYERS!!!
http://www.ronpaul2012.com/