President Obama did a good job last night in outlining a progressive 2nd term. All except for one issue that I'll get to in a minute. The state of the Union, Obama said, "is stronger." Text of speech here.
The President opened by explaining why the pending sequester should be modified. Replacing across the board spending cuts on defense and domestic spending with "reducing subsidies to prescription drug companies", "asking more from the wealthiest seniors", changing the fee-for-service status-quo for Medicare.....and by "getting rid of tax loopholes and deductions for the well-off and well-connected" in the tax code.
Obama focused on job creation through energy efficiency, alternative energy sources, and a new "Fix-It-First" infrastructure program....."I propose we use some of our oil and gas revenues to fund an Energy Security Trust that will drive new research and technology to shift our cars and trucks off oil for good."....."I propose a “Fix-It-First” program to put people to work as soon as possible on our most urgent repairs, like the nearly 70,000 structurally deficient bridges across the country."
The President spoke of "high-quality preschool" becoming "available to every child." He spoke of a new refinancing program for home owners in trouble, incentives for high schools to improve graduation rates, making college more affordable, making more job training available to more people.
Increasing the minimum wage to $9.00 per hour and indexing it to inflation was Obama's best offering last night.....but it's doubtful a GOP House will touch that with a ten foot pole. Raising the minimum wage is the best direct way right now....outside of sending everyone a $10,000 check.....to put more purchasing power into the hands of average American consumers.
Obama's most disingenuous offering last night...."I will continue to engage with Congress to ensure not only that our targeting, detention, and prosecution of terrorists remains consistent with our laws and system of checks and balances, but that our efforts are even more transparent to the American people and to the world."
That sentence is total bunk. Obama, just like his predecessor, continues to openly violate the Constitution and accepted national and international law. He defended his lawlessness last night.....but then, I didn't expect he would do anything else.
My argument with Obama's speech last night is based on his thinking as found here....
"Over the last few years, both parties have worked together to reduce the deficit by more than $2.5 trillion – mostly through spending cuts, but also by raising tax rates on the wealthiest 1 percent of Americans. As a result, we are more than halfway towards the goal of $4 trillion in deficit reduction that economists say we need to stabilize our finances. Now we need to finish the job."
For the last 5 years America has been suffering from the financial industry collapse of 2008. This period has been the worst economic period for the masses of Americans since the Great Depression of the 30's....another deep downturn caused by the Bankster set. During historic downturns, record economic downturns....when consumer spending drops significantly....the government's response in the past has always been to shore up the loss of consumer spending by spending more itself.
It is true that Obama was successful in early 2009 in passing an economic stimulus bill of almost $800 billion.....in so doing, he was following the lead of every previous president facing similar circumstances. But what Obama has also done since his first Inauguration is push for deficit and debt reduction by cutting spending and raising taxes. He acknowledges that, "over the last few years, both parties have worked together to reduce the deficit by more than $2.5 trillion – mostly through spending cuts,..."
How can an economy in a low-demand recession recover....adding jobs, purchasing power and consumer confidence....if government cuts $2.5 trillion of spending in the middle of that recession? Yes, the cuts are over a ten year period, but cutting has already begun....when what the government should be doing is spending more right now, not less.
What I'm saying is that Obama's boasting about how hawkish he has been over cutting spending is not something to brag about. Obama's acceptance of the "ZOMG deficits and debt will kill us all if we don't do something right NOW" conservative malarkey has helped to slow down the recovery. In many ways, the slowness of the economic recovery has been caused by Obama's apparent obsession with some bipartisan Grand Bargain of total contractionary policies. Contractionary economic policies (cutting spending and/or raising taxes) during a recession.....are contractionary (even less consumer spending and a downward spiral).
It is a fact that our economy has lost some 700,000 government jobs since the recession began. Those job cuts were, and are, slowing down economic recovery.
But Obama said last night....that $2.5 trillion in contractionary policy cuts so far....is not enough. It's only half of the cuts "economists say we need." Those are the same economists who missed the 2007 recession altogether, didn't see that one coming. Those are the same economists who didn't see the mortgage derivative meltdown coming. The same economists who were wrong about almost everything before, and after, the collapse of the paper-shuffling industry.
Contractionary economic polices, cutting government spending during a recessionary period, only makes matters worse.....ask the UK. But the ultra-liberal, socialist, communist Obama.....worried to death about all policy being "revenue-neutral".....calls for "finishing the job" of cutting even more government spending.
That will work out.....how?
About This Blog