American Elephants

Has President Obama Ever Admitted Blame For Anything? by The Elephant's Child

The news on Friday was indeed bad. Unemployment climbed, an ‘unexpected’ event, as economists have assured us that there would be teeny-tiny GDP growth at 1.6%. again, ‘unexpectedly’ it declined by 0.1%.  Such a surprise brings up all the other numbers that the administration would prefer go unmentioned, like the deficit topping $1 trillion last year, and growing by $5 trillion over the past four years. Joblessness has been at least 7.8% practically forever, except when it was higher, and for particular segments of the workforce, like black workers.

The immediate response that it was the fault of recalcitrant Republicans in Congress didn’t go viral, so now they are blaming it on — Superstorm Sandy and “disruptions from deep scheduled spending cuts.” The current chairman of Obama’s Council of Economic Advisers, Alan Krueger, said in a post on the White House blog that the bad news came “amid signs that Hurricane Sandy disrupted economic activity and Federal defense spending declined precipitously, likely due to uncertainty stemming from the sequester.”

Huh. Republicans have been trying to explain for four years that uncertainty affects the economy and business. That when the government is threatening business with new taxes, and new regulations, and new costs, they’re not going to enthusiastically start hiring, start expanding, borrowing (even when the Fed is keeping interest rates low.) Businesses have to plan. You can plan for some uncertainty, but you can’t plan when everything is uncertain.

Democrats are appalled that Republicans would suggest that they should cut back on spending. The president has said spending cuts must be paired with tax revenue increases. Republicans say we already did that, now you need to, as Senate Minority Leader Mitch McConnell urged, take a look into “the dark corners that often evade real scrutiny” on a mission to make government programs more efficient and scrap those that don’t work. “We need to root out waste, which will serve as the first real test of Democrats’ seriousness in this debate” he said.  He added: “Why is the federal government funding Chinese studies on pig manure, and research into the smoking habits of Jordanian college students and reality TV shows in India?” Are Democrats prepared to cut this kind of waste?  No, no they’re not.

About that spending “decline” Domestic federal spending was up 1.4% in the fourth quarter. The defense spending declines may have been the result of lower war outlays, as well as anticipation of the automatic spending cuts looming from the upcoming sequester scheduled on March 1.  Oh.

The Fed announced that it will stick with its bond-buying theme to expand its balance sheet by another $1 trillion or so through the end of this year —its fifth in a row of near-zero interest rates and some form of “quantitative easing.” The Keynesian excuse is that we’re still recovering from the financial panic, though the WSJ reminds us that in January 2010, the Fed predicted that growth in 2012 wold be 3.5% -4.5%.  his remains the 2% recovery, the slowest in the modern era.

Has nobody noticed that every time Obama gets any kind of increase in jobs created (he doesn’t subtract the folks who have dropped out of the labor market) he immediately runs out and spends money in a way that discourages growth. He bans a pipeline here, he shuts down coal-fired power plants there, his EPA issues new and costly regulations, and nobody seems to understand why it it a problem.

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