This week we saw President Obama come out swinging to that old class warfare tune. Lashing out at Republicans in Congress for not adding to the deficit by extending unemployment benefits, he implied they were heartless and cruel. The president used the same tired prop of the straw man, that is, accusing “the same people” without naming any of those people. He uses this tactic because if he actually named the people he was accusing he would have to produce facts to back up the charges and Obama, as usual, doesn’t have any.
But here’s what he does have. He has a record of focusing his energy on passing ObamaCare instead of focusing on growing the economy. He is layering on more uncertainty of huge government programs and impending taxes that are scaring most small businesses from any hiring until the dust settles and they can tally up the bill. He has Republicans who are ready to go along with the extension in benefits, if and only if, they are paid for. With only about half of the $787 billion stimulus bill money spent, which is working fabulously by the way, taking the needed $30 billion from that kitty should be obvious.
President Obama also has a chief economic advisor named Larry Summers. Mr. Summers wrote an article on unemployment for the Concise Encyclopedia of Economics while at Harvard and in it he raised the following points:
- Government assistance programs contribute to long-term unemployment is by providing an incentive, and the means, not to work.
- Unemployment insurance also extends the time a person stays off the job. [Colleague Kim] Clark and I estimated that the existence of unemployment insurance almost doubles the number of unemployment spells lasting more than three months.
- If unemployment insurance were eliminated, the unemployment rate would drop by more than half a percentage point, which means that the number of unemployed people would fall by about 750,000.
- Another cause of long-term unemployment is unionization. High union wages that exceed the competitive market rate are likely to cause job losses in the unionized sector of the economy. Also, those who lose high-wage union jobs are often reluctant to accept alternative low-wage employment.
It seems as if President Obama has painted himself into a corner. The stubbornly high unemployment numbers are poised to ravage the Democrats in the mid-term elections. But if his advisor, Mr. Summers, is to be believed, the unemployment benefits he is trying to use as a campaign issue against the Republicans is probably propping up the unemployment numbers.
The American people have reached their limit on deficit spending and want it reined in. The Democrats put in place something called Paygo, which means pay as you go. If you want something, you have to pay for it. However, the Democrats are bypassing their own rule at every turn. You can’t have it both ways, ceremoniously pass a Paygo rule for the purpose of the photo op and to look responsible, and then spend recklessly once the klieg lights go dark.
What prompted this president to conduct his Rose Garden show with three unemployed Americans used as props? Could it be that Nancy Pelosi is hopping mad that this president has not been helping Democrats to get reelected in the fall? If so, perhaps that was the point of the Rose Garden performance, nothing but election year politics. And you wonder why the American people are becoming increasingly cynical about their government?
