Author's Note: I wrote this article in December, 2009. The points made then are still relevent today.
The Obama administration continues to act surprised that its policies are not achieving job growth for our economy. Instead of stopping the rise in the unemployment rate at 8.00% as promised by Obama as part of his justification for the $787 billion in stimulus spending, the unemployment rate jumped to 10.2% in October. And, there is no sign that the unemployment rate is going to come down appreciably for the foreseeable future. Instead of paying lip service to the problem with “jobs summits” like the one hosted by Obama a few weeks ago, he and his administration should acknowledge that his policies and initiatives are inhibiting our economic recovery and the job growth that would follow.
The prospect of new taxes for individuals and businesses to fund drastic changes in health care is creating uncertainty in the business community and a disincentive to hire new people.
Obama’s push for a Cap and Trade system of energy allocation promises to be an enormous burden for our economy if it is ever enacted, because it will lead to higher costs for the energy that drives our economy. With the prospect of higher energy costs, businesses are delaying new projects and the related job creation.
The Obama administration and Congress are openly seeking new estate taxes, increasing capital gains taxes, high taxes and fines to support a health care overhaul, as well as a huge tax increase that will result when the Bush tax cuts are allowed to expire next year. The prospect of adding so much to an already heavy tax burden draws the vitality out of the economy and stifles job creation.
The “stimulus” spending has not stimulated the economy. Most of the funds are being misspent. Much of the spending has gone to states to temporarily fill shortfalls in budgets that should have been trimmed years ago. Instead of getting the pain behind them, states have used stimulus money to put off the day of reckoning. Spending billions in subsidies for so-called “green” initiatives…wind energy…electric cars, etc. will likely turn into an enormous waste of our tax money. When the technology becomes economically viable, it will be developed without government help. Government’s effort to force us to buy “green” products will waste resources and slow the pace of economic recovery.
The stimulus bill also included thousands of pet projects for various members of Congress to take home to their states. They are essentially political payoffs and should never have been allowed by this president who came into office pledging “no more pork”.
If Obama wishes to reduce unemployment and support economic growth, he needs to acknowledge the failure of his policies to date. Then, he should do the following:
End the push to establish a Cap and Trade system. Acknowledge that the global warming issue has been hyped for years and that there is no urgency to impose global controls on carbon dioxide emissions.
Promote energy self sufficiency by developing domestic oil reserves, building new refineries, building new nuclear power plants, and upgrading our power grid. Advances in technology are allowing us to burn fossil fuels cleanly and efficiently. Nuclear power is dependable, safe, and has zero carbon dioxide emissions.
Scrap Congress's current bills calling for massive government involvement in our health care to be funded by higher taxes. The public is against it and it is far too costly, especially for an already weakened economy. Instead, recognize that we already have the best health care system in the world, and focus on making the kind of incremental changes that will make it even better, including uniform regulation of insurance companies across state lines, tort reform, fully funding Medicaid and Medicare, elimination of employer-based health insurance, and subsidies and/or tax incentives for those who cannot afford health insurance premiums.
Do not re-deploy the TARP funds as they are repaid (with interest) by the financial institutions. The purpose of TARP was to temporarily shore up the financial institutions in a time of severe stress. We should celebrate the fact that the TARP program appears to have been successful, but the funds repaid should be used to reduce our staggering debt as originally planned.
Declare that there will be no new taxes and no tax increases for 5 years. This will provide the incentive and financial certainty to allow businesses to invest and expand leading to new job opportunities.
Temporarily reduce payroll taxes for employers.
These initiatives would accelerate economic activity and spur growth in the job market.
Our economy has suffered a great deal in the past year, not only from the excesses in the financial arena, but even more so from the wrong-headed policies and initiatives promoted by the Obama administration.