Monday, June 4, 2012

Obama Economics

What’s New Today

Story #1 shows how Obama’s economic policies have failed.  #2 demonstrates that Romney is not John McCain.  #3 looks at what is at stake in tomorrow’s recall election.  #4 looks at the nanny state as exemplified by Mayor Bloomberg in NYC.  #5 tells another story of a decision Obama wants to put off until after the election.  #6 has a woman who knew Obama at Harvard talking about her impressions of who he is.  #7 looks at the desperation of the environmental lobby.  They were so close with global warming.  How do they cope?

Today’s Thoughts

Some final polling shows the Wisconsin recall tightening, but Walker still leading.  I’m predicting that on Wednesday we will have a plethora of excuses being made as to why the Unions lost and how it has nothing to do with the coming election.  

The crisis in Europe regarding the Euro may afford opportunities for people who want to travel there. Already the Euro is down to $1.25 and if Greece leaves the zone it may spur others as well.  

After Obama’s six fundraisers on Friday I began to wonder if he had put as much work into the economy as he has into raising money, might we finally be out of the recession?  Just a thought. 

If appears black ministers in Massachusetts are calling Elizabeth Warren to the carpet.  They aren’t happy that she portrays herself as a “woman of color.”

1.  Obama’s Economics Failure

As the NRO sage points out, it isn't just his ideology, or philosophy, or even just his policies that have failed; it is Obama's entire view of economic reality that must be called into question:

The Keynesian government-spending model has proven a complete failure. It's the Obama model. And it has produced such an anemic recovery that, frankly, at 2 percent growth, we're back on the front end of a potential recession. If anything goes wrong -- like another blow-up in Europe -- there's no safety margin to stop a new recession.

Barack Obama doesn't get this, but businesses create jobs. And firms have to be profitable in order to hire. Yet the president is on the campaign trail criticizing Mitt Romney by degrading the importance of profits. Huh?

Without profits, businesses can't expand. And if they don't expand, they can't hire. And if they don't have profitable rates of return, they're not going to attract new capital for investment.

Which brings us to a couple of important reasons for the virtual freeze in hiring.

First, there's the fiscal tax cliff. If all the Bush tax rates go up, incentives will go down and liquidity will leave the system. You can't pick up a newspaper these days and not find a story about how the fiscal cliff is elevating uncertainty and slowing U.S. growth. House Speaker John Boehner asked Obama for help in extending the Bush tax cuts this summer. But Obama said no. Instead, he wants to raise marginal tax rates on successful upper-income earners, capital gains, dividends, estates and many successful corporations.
Where's the corporate tax reform that would lower rates and broaden the base and end the double-taxation of the overseas profits of American companies? A business tax cut would help enormously, but it's nowhere in sight….

Most liberals don’t really understand economics.  They talk about subsidizing firms that take jobs overseas.  The problem is that the USA has the highest tax rates in the world on business.  Money made overseas can’t be brought back to the USA without paying this rate.  But they can keep the money offshore paying the local rate if they keep it overseas.  Hence the incentive to expand there rather than here.  The fix is not to charge taxes on all money no matter where it is made, but to lower the corporate tax rate to eliminate the need to keep the money overseas. 

2.  Obama vs Romney Game On 

At the NATO Summit, President Obama said his opponent's private equity success vs. the administration's failed industrial policy was what this election was all about. Speaking at the bankrupt Solyndra headquarters, his GOP opponent agreed.

It is said a picture is worth a thousand words. The photo of Mitt Romney holding a surprise press conference in front of the headquarters of the bankrupt solar energy firm Solyndra poster may just be worth a good portion of the 270 electoral votes needed for victory in November.
"Two years ago President Obama was here to tout this building and this business as a symbol of the success of his stimulus," said Romney, stepping off a bus and onto the public sidewalk in front of the Solyndra buildings just outside Silicon Valley. "Well you can see that it's a symbol of something very different today."

Indeed, it is a symbol of the failure of the administration's green energy boondoggle, where over a half billion dollars has been spent to reward donors while subsidizing an uncompetitive company with a doomed business model.

Solyndra, where 1,100 employees lost their "green jobs," is only one of many green failures that included companies like Beacon Power, First Solar and Ener1, battery maker for President Obama's fantasy fleet of electric cars.

During a visit to Solyndra Inc.'s Fremont, Calif., facility in spring 2010, President Obama boasted of what the company was going to do with the $535 million in loan guarantees his stimulus package provided.
"We can see the positive impacts right here at Solyndra," he said. "(T)hrough the Recovery Act, this company received a loan to expand its operations. This new factory is the result of those loans." Loans that Romney pointed out, the taxpayers were left on the hook for. The $535 million loan guarantee that was issued despite the warnings of private and federal agencies helped build a plant the size of five football fields outfitted with whistling robots and spa-like showers.

At the NATO Summit, President Obama said he couldn't just think about profits for investors but the good of all the people, at least all the people like George Kaiser, the billionaire behind the Solyndra debacle. Frankly, we prefer the risks and chances for success of firms like Romney's Bain Capital versus the crony socialism involved in President Obama's backing of firms like Solyndra….

It’s pretty simple.  Obama’s crony capitalism vs Romney’s free market. 

3.  Wisconsin:  What’s at Stake

A single election rarely determines a democracy's fate, but some matter more than others. Tuesday's recall election of Wisconsin Governor Scott Walker is one that matters a great deal because it will test whether taxpayers have any hope of controlling the entitlement state and its dominant special interests.

Specifically, we will learn if a politician can dare to cross government unions and survive. Mr. Walker isn't facing this extraordinary midterm challenge because he and a GOP legislature asked public workers to pay 12.6% of their health insurance premiums and put 5.8% of their paychecks toward their pensions. Those are small sums compared to what private employees typically pay.

His political offense was daring to challenge the monopoly sway that public unions have come to hold over modern state government through collective bargaining. Public unions aren't like private unions that negotiate labor terms with a single company or workplace. Public unions have outsize influence because they can often buy the politicians who are supposed to represent taxpayers. The unions effectively sit on both sides of the bargaining table. 

Thus over time they have been able to extort excessive wages, benefits and pensions, as well as sweetheart contracts like the monopoly provision of health insurance. Their focused special interest trumps the general interest of taxpayers, who are busy making a living and lack the time to focus on politics other than during elections or amid a fiscal crisis….

In addition, many people are saying this election will be a forerunner of the coming Presidential election.  If in a highly unionized and progressive state like Wisconsin, Scott Walker wins, Obama is in big trouble.

4.  Bloomberg’s War on Sugar and the Left Applauds

There’s only one way to say something like this, and it’s loud and proud and without apology: I wholeheartedly support Mike Bloomberg’s war on sugar. It’s unassailable as policy. Refined sugar is without question the worst foodstuff in the world for human health, and high-fructose corn syrup is little better. We are a fat country getting fatter and fatter, and these mountains of refined sugar that people ingest are a big part of the reason. The costs to the health-care system are enormous, so the public interest here is ridiculously obvious. Obesity is a killer. Are we to do nothing, in the name of “liberty” that entitles millions of people to kill themselves however they please, whatever their diabetes treatments costs their insurers? We have this “liberty” business  completely backward in this country, and if Bloomberg can start rebalancing individual freedom and the public good, God bless him, I say…

Columnist Michael Thomasky shows us where the left is coming from.  They will take over your life and take away your choices “for your own good.”  But this is an old story and we also know the end.  Because eventually they take away things not for your own good, but for someone else own good.  Remember back in the time of Henry VIII they burned people “for the good of their immortal souls” although I think it had more to do with insuring people stayed in the Catholic/Protestant church.  This is the nose of the camel. BTW I remember when it was salt that was the worst foodstuff in the world for human health.

5.  Another Reason Obama needs to Go

Does President Obama care more about jobs for Americans or about his own re-election chances?  A decision last week on natural gas exports provides the answer.

On Monday, the White House announced that it would postpone a decision until after the election on whether to allow natural gas exports to non-Free Trade Agreement countries.  While this is just one of a thousand decisions Obama has postponed for political reasons, it is an important one.  It puts hundreds of thousands of good jobs at risk.

For natural gas to be exported to countries in Europe and Asia, it must be liquefied at plants such as Cheniere Energy's plant at Sabine Pass, Texas.  The Sabine Pass liquification project, one of many under development or consideration, would create 50,000 jobs in the natural gas supply chain, in addition to jobs constructing and operating the plant itself.  Overall, a dozen such plants could create as many as 750,000 new jobs, and each of those jobs would spawn others as wages were spent on homes, cars, food, and other purchases.  But the president refuses to approve liquefied natural gas exports to non-FTA nations.  Is there some reason, other than politics, why the exportation of natural gas is acceptable only to nations with which the U.S. has free-trade agreements?

The only reason, it turns out, why the president is blocking LNG exports is his quaking fear of the environmental lobby….

Fossil Fuels are the wave of the future and that wave will help to heal our economy.  Natural gas used to be the most favored of the fossil fuels by the environmental lobby until they found lots of it and it became apparent it was a fuel that limits the need for green energy.  Now it seems to be public enemy number one with environmentalists claiming it’s dirtier than coal. 

6.  Who is Barack Obama

Conservative commentator Carol Platt Liebau,..described her relationship with Obama during her law school years. Despite his liberal slant, she said Obama was respectful of the conservative perspective when he was president of the Harvard Law Review.

“I knew him reasonably well — as well as most people knew him, if not better — because quite in contrast to this image that Barack tries to project, as someone who is warm and all-embracing and all that kind of stuff,” Liebau said.

“I mean, I will tell you I’ve written a piece that has praised Barack for certain things and I stand by that piece: He was color-blind in the way he chose, staffed the law review when he was president. He did give both sides a fair hearing. He always went with the far-left side, but he did give both sides a respectful hearing, which was fairly atypical at Harvard Law School at that time.”

Her longest one-on-one communication with Obama, she said, came when she was managing editor of the Harvard Law Review.

“So I guess it caused a lot of rumbling that I didn’t know about, and so we were all impressed with a return visit by our retired president, the former president, Barack Obama, who took me out on the back steps of Gannett House, which is where the review was housed and wanted to have a little one-on-one with me,” she said.
Liebau said his advice started off sound, but ultimately came off as disappointing.

“He said, ‘Look, what do you care who does the work?’” Liebau recalled Obama saying in reference to her management of the law review. “’It is the same amount of work for you to hand out the work no matter who it goes to, so why fight it? Do what’s easiest for you. Give the work to the people who will do the work, and just don’t worry about the people who don’t want to pull their weight.’”

Liebau wasn’t impressed.

“I guess I was young and naïve: I was like, ‘Ah but that wouldn’t be fair,’” she said….

But he’s obviously grown since then.  If he were the same person, he would have probably come into office and given the Congress the task of writing the Stimulus Plan and ditto on the healthcare plan. 

7.  Environmentalist Turn Desperate

The National Wildlife Federation’s new publication "The Psychological Effects of Global Warming on the United States” gives wildlife a new meaning.  Citing evidence that many in the climate alarmist community are "frustrated and burned out," it quotes one member as trying to keep on persuading mankind that a climate apocalypse is at hand so "I will not be able to feel the angst or despair" of failure.
For nearly three decades, certain U.S., U.K., and U.N. activists, like NASA's James Hanson, have tried to sell governments on draconian centralized economic policies supposedly to save the planet.  Anyone disagreeing -- regardless of credentials and reasoning -- becomes the target of rhetorical terrorism.  But the skeptical resistance is so strong and growing so rapidly -- not just in the public, but also among scientists -- that the alarmists increasingly show signs of both despair and loss of self-control.
In his recent Forbes article, alarmist Steve Zwick, apparently inspired by Hanson's tirades, wants the scientifically unpersuaded to be hunted down and their homes burned.  Daniel Souweine of the Soros-funded Citizen Engagement Lab demands that TV weathercaster who disagree that man is the prime cause of climate change to be persecuted until they repent.

A rational person would think a call for psychological intervention would be directed against such behavior.  Not so.  The National Wildlife Federation (NWF) now calls upon government to bankroll massive intervention by the mental health community to deal with up to 200 million cases of stress from projected "climate related events and incidents."

Then, in language reminiscent of Mao Tse-tung’s education camps for the non-compliant, the NWF eagerly anticipates how government-funded psychological experts will break down denial and bring "rational thinking into decision making."

This is what they used to do in the Soviet Union.  Anyone who didn’t love Communism was obviously mentally unbalanced and was put into mental hospitals. 

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