American Elephants

The Big Jobs Speech: No Change, Not Much Hope. by The Elephant's Child

Vacation is over, and next week, President Obama will give his big speech on jobs, or maybe the week after. He has announced his nomination of  Princeton University’s labor economist Alan Krueger to be chairman of the White House Council of Economic Advisers.

Mr. Krueger returned to Princeton a year ago after serving as assistant Treasury secretary for economic policy during the first two years of the Obama administration. He will replace Austan Goolsbee who has returned to the University of Chicago.

Krueger testified before the Senate Banking, Housing and Urban Affair Committee in support of government infrastructure spending, and Obama’s pet “Infrastructure Bank.” At least, Krueger  has co-authored a paper that shows that extending unemployment benefits will likely make unemployment worse, so that is a tiny step in the right direction — if he can convince the president. Krueger points out that it may be good safety-net policy, but will lengthen unemployment spells. The president has already signaled his intention to extend unemployment benefits and his belief that they will stimulate the economy.

Obama’s big jobs speech will offer more of the things that have not worked. The “shovel-ready” infrastructure jobs that turned out not to be shovel-ready, will return in the form of more infrastructure spending, and the bank as well. Unemployment will be extended, green jobs will be promised, the payroll tax reduction will be extended, and more food stamps.  It will not be a jobs speech, but a campaign speech in disguise. The government will once again be there to help you.

There is no way that Obama can support a real jobs program. A real jobs program would attack  the core beliefs of his political party, such as the idea that raising the minimum wage helps the poor and raising taxes on the rich will boost the economy.

The left believes in welfare, a strong government that will care for the people, that corporations have too much power, and that business needs much closer regulation.  The left believes that the fossil-fuel pollution emitted by industry and SUVs must be stopped to save the planet.  They believe that people must be instructed — and if necessary, forced — to move to a “clean green economy,” where they will use the lightbulbs, cars and appliances chosen by the government, and use energy and water economically, aided by smart meters that will ensure that they do.

What would a real jobs program look like? It is not as if nobody has described what is needed. As one small business owner said:

I’m not only sitting on my hands in terms of expansion and hiring, I’m paring back expenses wherever possible, getting lean as I can.  To say Ive lost confidence in Obamanomics is like saying the liberal media has lost confidence in Sarah Palin’s ability to govern if elected.  True enough, but it goes a bit beyond loss of confidence.

…The assault on folks like me comes on many fronts—business taxes, personal taxes, regulations, inflation, energy prices, Obamacare, etc. I have no way to reasonably outline any business plan(s) for the short or the long term.  All the variables are up in the air.

It is further exacerbated by the fact that I cannot predict what else these jackals might do to hurt me.  With most administrations and congresses, whether you agree with them or not, at least you could usually predict the limits of harm or help they might do to you.  Not with this Obama crew, and not with the Dems in Congress.

What do you suppose it says to American business when Obama’s National Labor Relations Board’s (NLRB) files a lawsuit against the Boeing Company for daring to build a manufacturing plant in a right-to-work state? No government has ever attempted to tell a private business where they must locate and who they may hire.  There is no Constitutional justification for such an attack.

The feds raided the Gibson Guitar Company last week; a swat team raided factories and offices, seizing pallets of wood, computers and guitars, and shutting the company down. The question seems to be about small amounts of ebony or rosewood used on the fingerboard of guitars. The wood is certified by the Forest Stewardship Council, and satisfies FSC standards.

The Justice Department apparently wants Gibson to not buy any wood from India, and to make their guitars in India — eliminating at least some of the company’s 2000 U.S. employees, but that isn’t clear yet. The government claims that Indian wood not finished by Indians is somehow illegal, but that is not what Indian law says.  That’s clear, isn’t it? Why would this send a tremor through American business?

Just these two cases demonstrate why business is hunkered down defensively. Add to that the enormous bundle of regulation the EPA is attempting to place on the back of the American economy. All forms of energy will become more costly. Brownouts and blackouts will be common. The cost of everything will rise because of higher energy costs. The government is trying to shut down oil pipelines, close coal-fired power plants, build unwanted and unaffordable high-speed rail, keep oil companies from drilling for oil.  Obama wants a new stimulus, and a renewed Fannie and Freddie.

There will be a new jobs program of some sort. It won’t help. No change, and not much hope.

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