Back from his 11 day golfing vacation on Martha’s Vineyard, President Obama will reveal his bold new plan to reduce unemployment. Last year, the President also said he would have a new jobs plan after his extended vacation on the same island of the rich and famous.
Since taking office, President Obama has occasionally said that jobs are his number one priority. His first year, with Democrats controlling both the Senate and House, they passed his massive $787 billion “Stimulus” spending bill. Two of Obama’s chief economic advisers predicted that it would keep the unemployment rate below 8% and create new jobs. It didn’t. The opposite occurred. Unemployment increased.
If the government calculated unemployment today the way it did 40 years ago, the official unemployment rate would be reported as almost 20% (i.e., including people who have run out of unemployment benefits and/or stopped looking for work). Since that first stimulus package, Obama has continued to propose more government spending.
Will Rogers once said, “It is awful hard to get people interested in corruption unless they can get some of it.” We now know that much of the “stimulus” money went to Obama’s and Democrats’ favored political allies, principally union and government workers.
The result was that it saved the jobs of many of our least productive government workers at the expense of massively increasing our national debt and reducing the financial resources available to the private sector to create new jobs. It also resulted in a net increase of almost two million unemployed.
Unless President Obama has a sudden epiphany, it is expected that he will come up with some poll-tested nice sounding ideas that will result in giving more taxpayer money to his political allies. Understand that Obama has given money to private sector friends. It is called crony capitalism.
Crony capitalism is not capitalism. It is a socialist redistribution of wealth from profitable private sector producers to uncompetitive private interests—which many times go bankrupt anyway.
For example, last year the President declared at a photo opportunity at Solyndra, a solar panel manufacturer, that such companies were going to be the big employers of the future. The company received a $535 million loan guarantee from the government in 2009, the first company selected under President Obama’s clean energy stimulus program. They were the third major solar company to file for bankruptcy in August, laying off 1,100 workers.
Undoubtedly, President Obama will make a number of new spending and/or targeted tax credit proposals benefiting his political allies that will be so outrageous that Congress will never pass them. Then he will go into his reelection campaign mode and claim that intransigent Republicans are trying to prevent a recovery.
After a Town Hall meeting at Young Harris College last week, I had the opportunity to converse with U.S. Senator Saxby Chambliss (R-GA). He said he would like to have Congress pass a moratorium on all regulations made by federal government agencies that were not legislated by Congress.
During the two-year moratorium all such regulations would be analyzed as to their cost versus benefit. Those found more detrimental than beneficial to the economic wellbeing of our society would be permanently removed.
This is the greatest job creation plan suggested since it was implemented in Chile in 1975. Chile went from being bankrupt to having the strongest real growth economy in the world for 16 years according to the UN and World Bank.
All President Obama has to do to get the economy in a growth-hiring mode is to propose legislation that will rescind job-killing regulations, lower taxes, reduce bureaucracy and guarantee personal property rights. It has virtually always worked in the past. As Senator Jim DeMint recently said, “No more speeches, put something in writing.”