ObamaCare: Dithering while the economy burns
[Posted by Karl]
Folks from Allahpundit to Robert Reich are noticing the same thing:
Obama’s focus on health care when the economy is still so fragile and unemployment moving toward double digits could make it appear that the administration has its priorities confused. While affordable health care is important to Americans, making a living is more immediately urgent. Yet the administration’s efforts to date on this more basic concern have been neither particularly visible nor coherent. It’s hard for most people to understand that unemployment would be worse were it not for the stimulus package; the much-flaunted new “green jobs” have not appeared yet, nor are they likely to for years. The White House has had equal difficulty explaining to Main Street why it would be far worse off today had Wall Street’s biggest banks not been bailed out. Almost nothing has trickled down. Small businesses still can’t get loans.
In reality, the stimulus has fallen well short of Obama’s promises and is filled with fraudulent numbers to boot. The stimulus argument does not even ask how adding $200 billion to one part of the economy created/saved 650,000 jobs, but removing $200 billion from another part of the economy has not cost a single job. And the “green jobs” claims are a scam. But Reich does grasp the basic political point that the US economy has shed about two million jobs since May, when Democrats started trying to take over the healthcare system in earnest. And it’s not a good look.
In this environment, it is not surprising that voters are not excited about ObamaCare mandates that will kill up to another 1.6 million jobs (according to the National Federation of Independent Businesses), with up to 5.2 million low-wage workers at risk of losing their jobs or having their hours of work reduced (according to the Heritage Foundation). That is not just a right-wing talking point; the lefty Center on Budget and Policy Priorities has expressed the same concerns.
There is little reliable data explaining why companies are retrenching despite signs of life in the economy, including recent increases in production in some industries and rises in housing prices and new home sales. However, a variety of organizations that monitor business behavior, including the NFIB, the Associated General Contractors of America and the National Small Business Association, say political uncertainty is a substantial factor, alongside other more typical problems, such as availability of credit.
“No question, this is a tough issue for a lot of these companies,” said David Wyss, chief economist at ratings firm Standard & Poor’s. “It’s all anecdotal, and it affects everybody differently, but the one common factor is people postpone decisions, and I’m afraid that’s going to slow us down coming out of the recession.”
Mr. Wyss said the resulting lack of hiring is one reason he’s forecasting just 1.5% growth in the economy for 2010. “It’s better than going down but it’s not going to be fun.”
Academic economists have long noted a link between economic growth and the political environment. Fed Chairman Ben Bernanke, in his 1979 Ph.D. thesis, wrote that “increased uncertainty provides an incentive to defer…investments in order to wait for new information.”
This uncertainty turns up in the forecasts from firms like Administaff, too.
Ironically completing the vicious cycle, rising unemployment is a primary driver of Obama’s declining popularity (and likely the GOP gains on the Congressional ballot). The economy and jobs were the issues that walloped Democrats in the bellwether of Virginia this past Election Day. And job growth may not turn around enough for voters to notice by next November. The more Dems dither and threaten the business climate, the more unemployment rises, and the harder it gets for Dems to pass their agenda. I think James Carville would have the appropriate advice.
–Karl
Obama’s focus on health care when the economy is still so fragile and unemployment moving toward double digits could make it appear that the administration has its priorities confused.
Appear?
Seems to me there’s no doubt about it.
Blacque Jacques Shellacque (76097c) — 11/9/2009 @ 12:58 pmI read the Reich interview as well – not more than six months ago he was singing a far different tune, supporting most of this massive boondoggle. Now, suddenly, not so much – ladies and gentlemen, when the Dems lose somebody from the far left with the stature in the party that Reich has, they’re in the process of losing the ballgame.
Dmac (a964d5) — 11/9/2009 @ 1:01 pmNothing that the president or Congress has done in the last 10 months has done anything to encourage my employer’s owners to commit funds to the company or hire new employees. In fact, it’s the reverse: They see the Bush tax cuts expiring and realize the implications of both the health-care bill and the regulations and taxes that cap-and-trade will entail.
In anticipation of all this, they’re pulling every penny they can out of the company, forsaking the stock market for cash, and holding back on expansion plans.
I suspect they’re not alone.
The same concerns, BTW, motivate me as a consumer to spend less. We didn’t take a vacation this summer, we bought only the clothes necessary for a growing boy to go to school, we don’t dine out as frequently, and my home improvements and landscaping plans have been postponed. If I had enough money, some would call it “going galt”; to me, it’s just plain common sense to plan now for inflation and higher taxes.
Diffus (228fe4) — 11/9/2009 @ 1:07 pmThe basic problem is that Democrats put their economically-destructive ideology and feeding their corruption ahead of actually improving economic conditions.
SPQR (26be8b) — 11/9/2009 @ 1:14 pmComment by Diffus — 11/9/2009 @ 1:07 pm
Amen, Brother!
AD - RtR/OS! (7c0a4b) — 11/9/2009 @ 1:15 pmDmac, I just read the Reich piece too and, as usual where Robert Reich’s opinions are involved, I have to laugh. As you and Karl point out, he is warning the Obama Administration that absent any improvement in the unemployment numbers the voters will not give them much credit for the stimulus, health care, or any other pieces of the liberal agenda next November. That is probably a valid point. Reich ruins his newfound credibility, however, by suggesting that “the public may become easy prey for demagogues on the right who blame Democrats for the insecurities that bedevil the nation next November.”
How do you like that? Next fall we may be facing 10% unemployment, over $1 trillion added to the national debt, new health care legistation that a majority of Americans oppose, and foreign policy fiascos all over the globe, and to Robert Reich’s mind it will be “demagogues” who criticize Dear Leader for it. Only a Harvard-educated political hack Berkeley professor could come up with such utter nonsense.
JVW (d32e06) — 11/9/2009 @ 1:37 pmThere are still a lot of articles and people out there wondering why Obama is having a hard time seeing the obvious – that the economy is collapsing largely as a result of his policies. The reason these people are so surprised at Obama’s actions is that they don’t understand Obama.
Metallica (e4735c) — 11/9/2009 @ 1:40 pmObama is out to destroy this country and all that it stands for, period. Everything he does is to further this end.
If, armed with this knowledge, you approach the seemingly curious decisions of our president, it all becomes painfully clear.
knowing that the little president man is gonna make the capital gains tax goes up up up means people are gonna sell sell sell stocks next year which will probably give the little president man a little bump of revenue but it won’t be sustained… it’s very sad what the little president man is doing on our country.
happyfeet (71f55e) — 11/9/2009 @ 1:52 pmwell, that was an attack of the blindingly obvious…. i can’t imagine why the economy isn’t improving.
of course, the only discretionary spending we are doing these days is more ammo and reloading supplies. we didn’t buy a new TV when the converter box didn’t w*rk, and we didn’t spring for the additional fees to get the “free” channels.
we don’t go out to eat, we don’t go to the movies (mostly because they are crap, which makes it easy), and, as above, pretty much all improvment projects, etc, are on hold unless we already have the materials on hand.
the only reason HRH got a new car was because the lease was about up, and they covered a boatload of payments. she also went with a lesser car, with lower payments and a longer term….
the neighbor closed his office, laid off his employee that had been with him for years, and is trying to keep it together out of the house. the local shops are either having sales or are going out of business.
Ear Leader is getting results with his plan to wreck the economy. the only surprise is with the people who were dumb enough to think he was going to fix it….but the true believers that i know are still trying to blame it all on Bush.
redc1c4 (fb8750) — 11/9/2009 @ 1:56 pmOnly a Harvard-educated political hack Berkeley professor could come up with such utter nonsense.
The irony here is that although I dislike Dick Morris in any number of ways, if the Dems had listened to him back at the beginning of the year they would be in a much better position. But not these guys – they just know better.
Dmac (a964d5) — 11/9/2009 @ 3:42 pmForgot to say that you should have added “vertically – challenged Harvard – educated political hack Berkeley professor.”
Dmac (a964d5) — 11/9/2009 @ 3:44 pmGreat post as usual Karl.
Perfect job of cutting through the bullsh!t spin by the MSM and the Obama administration with lots of facts and links.
This post over at Hot Air is right in line with your post and the failure of the stimulus to do what our Paparazzi President said it would:
$25 billion “stimulus” program produces 0 jobs
posted at 10:12 am on November 9, 2009 by Ed Morrissey
http://hotair.com/archives/2009/11/09/25-billion-stimulus-program-produces-0-jobs/
What an absolute scam perpetrated on the American people by our Hustler and Chief.
Anything and everything that Obama has done since being sworn in has been about promoting himself,paying off for votes,and demonizing anyone who does not go along with his agenda.
“Yes We Can”
Baxter Greene (af5030) — 11/9/2009 @ 10:37 pmThis is a great post and the conclusions are obvious, so the next question is “Why is he doing it?”
Is Obama ruining the economy so he can “not let a crisis go to waste”, i.e., to gain power for himself or to deliberately push America toward socialism? Or is Obama ruining the economy because he can’t believe capitalism works better than an Ivy League-managed government where elites are committed to helping the masses? Or could it be that Obama and his advisers are just American-educated economic idiots?
DRJ (dff2ca) — 11/9/2009 @ 10:57 pmAs the sign in the STD clinic reads: “Erections Have Consequences.”
Doc99 (8ee96f) — 11/10/2009 @ 8:51 amYou need to take a step back and look at the big picture here. Obama and pelosi etc DONT CARE what happens to the economy, because that is by design. The big picture here is the destruction of the US economy in the name of socialism, to fit us in with the rest of the world. The US is the one big problem with the left’s nirvana; a one world government. We have freedoms here that get in the way of that big plan. The way to dumb us down is to destroy the US dollar, that also destroys the uncontrollable private sector, and destroys the wealth of the people, all the while funding their takeover attempts of the economy. When the US dollar is in the toilet, and the formerly rich have lost everything, this also forces the majority of the population to take the new government jobs that are spawning for virtually no actual public benefit at all. Once you have the majority of the population working for the government, the short trip from socialism to a communist society is easy. The crap and tax plans in the name of “global warming” is the rope that pulls us in to their one world government with a world tax plan that, once started, never stops growing. I see George Soros, obama, the clintons, and all the rest of this scumbag cast envisioning themselves as world leaders in this massive world domination scheme. Think I’m crazy? Then you just aren’t paying attention.
DGA (a66883) — 11/10/2009 @ 9:48 amI have but one hope and that is…Texans. I refuse to believe that the proud citizens of the Lone Star State will allow themselves to be assimilated into the Union of Socialist States of America. Texas will secede, and I and my loved ones will join her.
russ in nc usa (03c5ea) — 11/10/2009 @ 5:19 pmMy first impressions of the Obama administration was that they were exploiting the crisis to push porkulus, cap-n-tax and health care hijacking. The economy, after all, would naturally come out of the recession, and the WH/Dems would take credit while having pushed their radical liberal agenda.
It appears that I misunderstood the radical liberal agenda. Liberals, I’m convinced, want to destroy America. There is no other explanation for Obama’s foreign and domestic policies.
higgins1990 (fb463c) — 11/11/2009 @ 3:54 amI would describe it as “too much, too fast”. Obama should have focused like a laser on the economy; jobs, jobs, jobs. If he could have kept the unemployment number down, this would have given him credibility to tackle health care reform. But no, instead the Dems have crammed through utterly massive legislation that nobody even had time to read. It’s clear their strategy is to get “stuff” passed as quickly as possible before the voters realize they’re bald faced, lying frauds. My god, the unintended consequences of this legislation (let alone the intended consequences) are terrifying.
JohnR (02ca29) — 11/11/2009 @ 6:22 amMetallica (comment #7, you are more correct than most Americans can bring themselves to admit. The really scary part is that all liberals and even somw normal people refuse to believe this, even in spite of all they see to confirm it. I just hope they open their eyes before it’s too late, if it isn’t already.
edhornyak (1bf877) — 11/11/2009 @ 7:48 am[…] hundreds of billions of dollars they plan to spend. None of the amendments appear to address the “pay or play” employer mandate that is hated by both Right and […]
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