Spending our way to prosperity
By
Rory Ryan-hcpress@cinci.rr.com
“Life is really simple, but we insist on making it complicated.”
– Confucius
My dad often quoted Confucius. More often, he misquoted Confucius. His favorite misquotation from the sagacious Chinese philosopher was: “He who sits in jelly, gets arse in jam.”
That very simple lesson might soon apply to today’s Obama-nomics. The presidential arse is, indeed, in a jam with national unemployment hovering around 10 percent and no relief in sight, according to his own Treasury secretary, Tim Geithner.
Last month, author William Tate wrote that the Obama administration has acknowledged that “Obama-nomics, the dismal science of spending other people’s money as fast as possible, has failed.”
This was right after the administration came clean and admitted the federal deficit over the next decade will be $2 trillion more than they had predicted. How we lookin’? Not good.
But Obama, the lifelong pol and former community organizer who’s never earned a private-sector buck, has a marvelous accomplice in his economic deviancy. Yup, there’s a good reason why nearly two-thirds of all Americans are suspicious of today’s media. We’ve earned the bad rap.
As Mr. Tate wrote, “The O Team’s media wing immediately spun into damage control, with the AP quoting Budget Director Peter Orszag’s contention that another trillion dollars spent on health care would somehow ... help balance the budget. ...They’re beginning to look like the gang that couldn’t add straight.”
How, exactly, spending more of other people’s money will help is not clear. What is clear is that Obama and this Congress will spend it. (As an aside, if simply spending money were the key to prosperity, there would not be a poor nation on the planet. This point is lost on Congress.)
The administration has been, without question, a failure in its first nine months. Shortly after taking office, Obama encouraged other countries to follow his “lead.” The ones which didn’t are better off than the ones that did. As Mr. Tate said, “France and Germany actually exited the recession last quarter. The leaders of both nations specifically and publicly rejected Obama’s cries.”
What Obama and other pols who have never waded into the real waters of private-sector business and job creation fail to realize is this: Our old post-World War II dynamic of having the world’s best work force, best infrastructure and best technology – coupled with minimal global competition – no longer exists.
Some well-known and reputable economists suggest a better approach is to follow the so-called Taylor Rule. Named after Professor John Taylor of Stanford University, the rule relies on both current output and inflation data to indicate when the federal shifts in policy are needed.
In simple terms, the Taylor Rule calls for a higher interest rate when inflation is above its target or when output is above its full-employment level, in order to reduce inflationary pressure. It recommends a relatively low interest rate in the opposite situation, to stimulate output. When you think about it, it does make sense.
As one local businessman (think a well-earned history in steel roofing and siding, located off U.S. 50 west), told me this week, “After World War II, we had the infrastructure, the technology and the work force that other post-war countries did not have, and we had an era of great productivity. Both employers and employees were happy. That’s not true today.”
Like it or not, those “other countries” are beginning to catch up to us. And it’s our own fault. In order to compete globally, we must become more productive and more efficient than our overseas competition. And we must resist certain domestic and international policies (think excessive taxation and regulation) which are clearly unfair to American productivity. This plain reality is becoming more and more obvious, as U.S. jobs are lost to other countries.
“We’re used to the United States leading the way to recovery, but this time we’re having to look eastward to Asia and to a home-grown recovery in Europe,” Julian Callow, chief European economist at Barclays Capital in London, told Mr. Tate.
“Obamanomics has failed,” Mr. Tate concludes. “Countries that rejected it have turned the economic corner, even ended the recession, while the U.S. economy continues to contract.”
And if Congress passes the Obama medical insurance plan, which would force additional federal mandates on small business – and actually redefine small businesses – today’s 10-percent unemployment rate will only increase.
So much for community organizers as president. How much longer until the 2010 mid-term election?
Rory Ryan is publisher and editor of The Highland County Press.[[In-content Ad]]
– Confucius
My dad often quoted Confucius. More often, he misquoted Confucius. His favorite misquotation from the sagacious Chinese philosopher was: “He who sits in jelly, gets arse in jam.”
That very simple lesson might soon apply to today’s Obama-nomics. The presidential arse is, indeed, in a jam with national unemployment hovering around 10 percent and no relief in sight, according to his own Treasury secretary, Tim Geithner.
Last month, author William Tate wrote that the Obama administration has acknowledged that “Obama-nomics, the dismal science of spending other people’s money as fast as possible, has failed.”
This was right after the administration came clean and admitted the federal deficit over the next decade will be $2 trillion more than they had predicted. How we lookin’? Not good.
But Obama, the lifelong pol and former community organizer who’s never earned a private-sector buck, has a marvelous accomplice in his economic deviancy. Yup, there’s a good reason why nearly two-thirds of all Americans are suspicious of today’s media. We’ve earned the bad rap.
As Mr. Tate wrote, “The O Team’s media wing immediately spun into damage control, with the AP quoting Budget Director Peter Orszag’s contention that another trillion dollars spent on health care would somehow ... help balance the budget. ...They’re beginning to look like the gang that couldn’t add straight.”
How, exactly, spending more of other people’s money will help is not clear. What is clear is that Obama and this Congress will spend it. (As an aside, if simply spending money were the key to prosperity, there would not be a poor nation on the planet. This point is lost on Congress.)
The administration has been, without question, a failure in its first nine months. Shortly after taking office, Obama encouraged other countries to follow his “lead.” The ones which didn’t are better off than the ones that did. As Mr. Tate said, “France and Germany actually exited the recession last quarter. The leaders of both nations specifically and publicly rejected Obama’s cries.”
What Obama and other pols who have never waded into the real waters of private-sector business and job creation fail to realize is this: Our old post-World War II dynamic of having the world’s best work force, best infrastructure and best technology – coupled with minimal global competition – no longer exists.
Some well-known and reputable economists suggest a better approach is to follow the so-called Taylor Rule. Named after Professor John Taylor of Stanford University, the rule relies on both current output and inflation data to indicate when the federal shifts in policy are needed.
In simple terms, the Taylor Rule calls for a higher interest rate when inflation is above its target or when output is above its full-employment level, in order to reduce inflationary pressure. It recommends a relatively low interest rate in the opposite situation, to stimulate output. When you think about it, it does make sense.
As one local businessman (think a well-earned history in steel roofing and siding, located off U.S. 50 west), told me this week, “After World War II, we had the infrastructure, the technology and the work force that other post-war countries did not have, and we had an era of great productivity. Both employers and employees were happy. That’s not true today.”
Like it or not, those “other countries” are beginning to catch up to us. And it’s our own fault. In order to compete globally, we must become more productive and more efficient than our overseas competition. And we must resist certain domestic and international policies (think excessive taxation and regulation) which are clearly unfair to American productivity. This plain reality is becoming more and more obvious, as U.S. jobs are lost to other countries.
“We’re used to the United States leading the way to recovery, but this time we’re having to look eastward to Asia and to a home-grown recovery in Europe,” Julian Callow, chief European economist at Barclays Capital in London, told Mr. Tate.
“Obamanomics has failed,” Mr. Tate concludes. “Countries that rejected it have turned the economic corner, even ended the recession, while the U.S. economy continues to contract.”
And if Congress passes the Obama medical insurance plan, which would force additional federal mandates on small business – and actually redefine small businesses – today’s 10-percent unemployment rate will only increase.
So much for community organizers as president. How much longer until the 2010 mid-term election?
Rory Ryan is publisher and editor of The Highland County Press.[[In-content Ad]]