Written by Phil Guarnieri Thursday, 08 August 2013 00:00
What is it about this administration and its economic policy? It’s not working and yet the president persists as if it is. We’ve lost 9 million jobs over the last 4 plus years and it hasn’t in the slightest altered the president’s mindset that the answer to America’s economic woes is more redistribution, regulation and unionization. This is what he outlined in his speech in Galesburg, Illinois and rarely has a president been so ideologically straitjacketed that he fails to see how otiose his vision for economic prosperity has been.
This stubbornness was not evident, much less conspicuous, in his two political heroes. Abraham Lincoln noted that he would change his views as soon as new views prove to be true views. Franklin Delano Roosevelt argued for “bold and persistent experimentation.” If something doesn’t work, try something else. Obama’s mantra appears to be if something isn’t working try the same thing until it does. This modus operandi is one that perpetually plows into a dead end in the forlorn hope that it will finally find an opening.
This is not to say the economy isn’t improving, it is. But instead of crawling forward on its hands and knees it could be hitting its stride and sprinting. Unlike Mitt Romney,
Obama knows next to nothing about the dynamics of economic growth. Like his kindred spirit, the late Senator Ted Kennedy, Obama has never worked a day in the private sector. He is a public sector man through and through. Economics is not, of course, an exact science, but there are some reasonable approximations to that discipline and over the years it becomes obvious what works and what doesn’t work in creating jobs and growing the economy.
The Obama miscalculation starts root and branch at the very foundation of his philosophy. He is, unquestionably, a bright man, but clearly not a wise one. He prefers shibboleths to facts, which accounts for his focus on reducing inequality rather than fostering growth. The result has been, to paraphrase Winston Churchill in another context, more inequality and less growth. There is an inescapable emotional element to his thinking and he cannot divorce himself from the notion that because such ringing phrases sound right and just they make for good economic policy. It doesn’t seem to register that median real household income is 5 percent lower than when the recession officially ended in June of 2009. This indicates a problem and demands a change of heart.
As much as the Left hates to hear it, deregulation, lower marginal taxes and thwarting the influence of public unions will light a fire under the economy’s posterior and we just might end up with something other than a jobless recovery --- which is no recovery at all. After four and a half years I’ve become all but convinced (although there are some rumblings that Obama will offer to Republicans some pro-growth provision that has been sorely lacking) that even Archimedes’ lever, capable of moving the world, will fail to dislodge the president from his redistributive philosophy.
I expect this column will generate the usual comments and e-mails that I couldn’t be more wrong in my analysis, that what I’ve diagnosed is not Obama’s ideological inflexibility but my own. To those criticisms I can only present the facts and hope that common sense will eventually prevail. Markets rely on voluntary exchanges and taxes and regulations, the salt and pepper of Obama’s economic initiatives serves as an impediment to both the number of exchanges as well as the gains those exchanges can accrue.
Less regulation and government intervention inevitably result in a more inexpensive product, which incites the consumption that grows the economy
Instead, Obama and his allies impose Godzilla-like footprints on the private economy. Take the preposterous Retailer Accountability Act (a euphemism for the Wal Mart
Accountability Act) in Washington D.C., which mandates a $12.50 minimum wage for retailers with 75,000 square feet or earnings of one billion dollars a year or more in sales.
How did Wal-Mart react? In the face of such onerous mandates they will close three of their six stores. How is that going to help the non-working poor?
Just the other day a city college professor was haranguing me about supporting the doubling of the minimum wage for workers at McDonald’s. Her reasoning was that the extra money they earn will boost the economy because they will have more of it to spend boosting the economy. History tells us that there will be less money to spend because under such a scenario McDonald’s will close stores and reduce jobs. The CEOs at big companies are not the same people running Detroit. They know what it takes to be profitable and create jobs instead of losing them and going bankrupt. It’s depressing. How can we expect college students to be economically literate when those who are teaching them are clueless?
Obama may have seized more money from the wealthy with his policies, but it has done nothing to help the unemployed, the indigent and those with limited employment opportunities. Look how the labyrinth of regulations is inhibiting hydraulic fracking, which would not only be a boom in energy production but would be a royal flush in terms of generating cash. Former presidential candidate Michelle Bachman had some sound advice for the United States: Let’s make energy legal.
If you intend to steer the economy in the right direction then those highways that allow trafficking of higher taxes, more onerous regulations and unions that do not benefit the middle class but only their own members at the expense of everyone else, then in their mind’s eye one should see the warning signals of flashing red lights with oversized signs inscribed with big white lettering that says, “Danger: Wrong Way.”