The White House Council of Economic Advisers today proudly praised the $787 billion stimulus program, claiming that it had created or saved 2.5 to 3.6 million jobs. Without bothering to debate how the Council arrived at its estimate of jobs saved or created, lets take the average of their estimated jobs (3.05 million) and divide by the cost of the stimulus program of $787 billion.
The government cost the taxpayers $262,333 to “save or create” each job. Putting aside the obvious nonsense that the government can “create” jobs, if the government continues to “create” jobs in this manner, the country will soon be bankrupt.
Based on the Council of Economic Advisers’ math, we could recover the 8 million jobs lost over the past 3 years at a cost of only $2.1 trillion dollars!
Some more fun facts:
The $787 billion “stimulus” program cost each of the estimated 105 million households in the US $7,495.
The average median household income in 2008 was $52,029.
One certainty is that the average American household would have spend the $7,495 much more wisely than government bureaucrats. The other certainty is that the government’s public relations effort praising the stimulus plan is just another waste of taxpayer time and money. According to the New York Times:
The latest CBS News poll found that almost three-quarters of Americans said the stimulus had not improved the economy. Unemployment remains stubbornly high, at 9.5 percent, with few signs of improving in the short term. The reluctance of businesses to add jobs has weighed on other parts of the economy and there are signs that growth has begun to slow.
Aside from wasting $787 billion of the taxpayers money, the next most tragic part of this story is that the government continues to ignore the wisdom of the American people, and continues to insist that the program was a success. Joe Biden, regarded by many as the biggest buffoon in Washington, had this to say - “I am absolutely confident we are moving in the right direction, absolutely confident”. This statement should be more than enough to terrify most clear thinking Americans.
Statements made by an absolutely confident Herbert Hoover on the eve of the Depression:
August 11, 1928 - “Unemployment in the sense of distress is widely disappearing. . . . We in America today are nearer to the final triumph over poverty than ever before in the history of any land. The poor-house is vanishing from among us. We have not yet reached the goal, but given a change to go forward with the policies of the last eight years, and we shall soon with he help of God be in sight of the day when poverty will be banished from this nation.
November 1929 - “Any lack of confidence in the economic future or the basic strength of business in the United States is foolish.”
January 21, 1930 - “Definite signs that business and industry have turned the corner from the he temporary period of emergency that followed deflation of the speculative market were seen today by President Hoover. The President said the reports to the Cabinet showed that the tide of employment had changed in the right direction.”
A new poll released by the Washington Post-ABC News shows that support for the president has plunged to a new all time low. A staggering 60% of voters say that they “lack faith in the president to make the right decisions for the country, and a clear majority once again disapproves of how he is dealing with the economy”.
The poll results should not be a surprise to anyone based on recent state and local election results where voters have shown a resounding denunciation of Obama’s policies. The country is clearing going in the wrong direction with living standards declining across virtually every income and social group.
The Financial Times assessed Obama’s problems regarding his recent plunge in the polls:
Astonishingly, 55 per cent of citizens think Mr Obama is a “socialist” against only 39 per cent who do not share that diagnosis.
“The bottom line here is that Americans don’t believe in President Obama’s leadership,” says Rob Shapiro, another former Clinton official and a supporter of Mr Obama. “He has to find some way between now and November of demonstrating that he is a leader who can command confidence and, short of a 9/11 event or an Oklahoma City bombing, I can’t think of how he could do that.”
Big Brother directives flow out of Washington on a massive scale, attempting to micro manage and control every aspect of the economy and our personal lives. Imbued with an arrogance beyond comprehension, the ruling elite believe they can solve any problem by simply legislating another 2,500 page bill. The people are no longer being fooled by this nonsense and the recognition is slowly building that Congress could do more good by simply leaving town for an extended period.
Why Is This Man Smiling?
While the Obama administration has been spending trillions on unaffordable health care programs, global warming, financial reform and other matters mostly peripheral to most Americans, the issue of a floundering economy and sky high unemployment go unaddressed. It’s always “jobs and the economy stupid”. Without income growth, none of these other programs matter as reported by Bloomberg:
Seven of 10 Americans say reducing unemployment is the priority. At the same time, the public is skeptical of the Obama administration’s stimulus program and wary of more spending, with more than half saying the deficit is “dangerously out of control.”
The public mood is bleak, with 63 percent saying they believe the country is on the wrong track, the most negative reading of Obama’s presidency. After a year of economic growth, 71 percent say the economy is still in recession; another 13 percent say the economy is faltering and will dip back into recession.
Only 1 in 6 say they believe they are personally better off than they were 18 months ago, when President Barack Obama took office. They are more apt to see the economy today as deteriorating than improving.
Based on the direction the country is headed in, a logical mind would wonder why 40% of voters still apparently support Obama. Here’s some rather dark thoughts on this matter by Wayne Allen Root, 2008 VP nominee for the Libertarian party, as reported by truthorfiction.
Barach Obama is no fool. He is not incompetent. To the contrary, he is brilliant. He knows exactly what he’s doing. He is purposely overwhelming the U.S. economy to create systemic failure, economic crisis and social chaos — thereby destroying capitalism and our country from within.
Barack Obama is my college classmate ( Columbia University , class of ‘83). As Glenn Beck correctly predicted from day one, Obama is following the plan of Cloward & Piven, two professors at Columbia University . They outlined a plan to socialize America by overwhelming the system with government spending and entitlement demands. Add up the clues below. Taken individually they’re alarming. Taken as a whole, it is a brilliant, Machiavellian game plan to turn the United States into a socialist/Marxist state with a permanent majority that desperately needs government for survival … and can be counted on to always vote for bigger government. Why not? They have no responsibility to pay for it.
Obama doesn’t care that giving free health care to 30 million Americans will add trillions to the national debt. What he does care about is that it cements the dependence of those 30 million voters to Democrats and big government. Who but a socialist revolutionary would pass this reckless spending bill in the middle of a depression?
– Cap and trade. Like health care legislation having nothing to do with health care, cap and trade has nothing to do with global warming. It has everything to do with redistribution of income, government control of the economy and a criminal payoff to Obama’s biggest contributors. Those powerful and wealthy unions and contributors (like GE, which owns NBC, MSNBC and CNBC) can then be counted on to support everything Obama wants. They will kick-back hundreds of millions of dollars in contributions to Obama and the Democratic Party to keep them in power. The bonus is that all the new taxes on Americans with bigger cars, bigger homes and businesses helps Obama “spread the wealth around.”
– Make Puerto Rico a state. Why? Who’s asking for a 51st state? Who’s asking for millions of new welfare recipients and government entitlement addicts in the middle of a depression? Certainly not American taxpayers. But this has been Obama’s plan all along. His goal is to add two new Democrat senators, five Democrat congressman and a million loyal Democratic voters who are dependent on big government.
– Legalize 12 million illegal immigrants. Just giving these 12 million potential new citizens free health care alone could overwhelm the system and bankrupt America . But it adds 12 million reliable new Democrat voters who can be counted on to support big government. Add another few trillion dollars in welfare, aid to dependent children, food stamps, free medical, education, tax credits for the poor, and eventually Social Security.
– Stimulus and bailouts. Where did all that money go? It went to Democrat contributors, organizations (ACORN), and unions — including billions of dollars to save or create jobs of government employees across the country.
Congress and the Obama administration continue to move forward with economy killing legislation such as Cap & Trade, Health Care Reform and Card Check legislation, to name a few. The gorilla in the room that no one wants to talk about is the massive deficit being forced on future generations.
The way Michael Whalen of the National Center for Policy Analysis figures it, the national debt is $11 trillion, but there’s also $107 trillion in unfunded entitlement liabilities for a total of $118 trillion, more than eight times the gross domestic product. More ominously, the Federal Reserve Board says federal liabilities are 2.3 times America’s total private net, which is just $51.5 trillion. “Ask any accountant, banker, or anyone remotely familiar with simple accounting knowledge if we can service this debt, and the collective answer is a resounding ‘no.’ Any business with these ratios would be a complete basket case, hopelessly bankrupt.” Hence, the headline on Mr. Whalen’s Washington Times op-ed Aug. 11: “We broke the bank.”
This is by far the greatest problem that our country will be facing, assuming that our economy and country can survive this onslaught of Socialist Programs. How much of the Federal Budget can be spent on debt repayment as our economy continues to shrink?
In other words….”I’m sorry Mr Geithner , based on your current situation, we can not approve your loan at this time. Feel free to visit Beijing again when your situation improves”.
The United States is functionally bankrupt. Our collective capacity to deal with this astonishing fact is seemingly nonexistent. Our national politics have become show business, exhibiting a complete refusal to strategically respond to this reality.
Even if we significantly slash the federal entitlements by half, we cannot fix this problem. Even if we increase federal receipts from the 50 year average of 18 1/2 percent of GDP to say 27 percent, killing private-sector growth, we cannot fix the problem.
Perhaps President Obama is planning on a fast track bankruptcy for the federal government, just as he did for General Motors and Chrysler. The result would be SEIU (Service Employees International Union) making the decisions for Congress and ACORN running the Treasury.
America has become more of a welfare state than most of us would care to admit as Robert Samuelson details in a recent article. The shock to many will come when it becomes obvious that the promises made by Government are so large that they simply cannot be kept.
Washington Post - Raised in an individualistic culture, Americans dislike the concept of the “welfare state” and do not use the term. But make no mistake, the United States has a welfare state, and its future is precarious. The true significance of General Motors’ bankruptcy lies more with this welfare state than with the battered condition of American capitalism.
Broadly speaking, the U.S. welfare system divides into two parts — the private, run by firms; and the public, provided by government. Both are besieged: private companies by competitive pressures; government by rising debt and taxes. GM exemplified the large corporation as private welfare state. In contracts with the United Auto Workers, GM promised high wages, lifetime employment, generous pensions and comprehensive health insurance. All this is ancient history: New workers get skimpier benefits.
What most Americans identify as government “welfare” are payments to single mothers, food stamps and (perhaps) Medicaid, the federal-state health insurance program for the poor.
But that’s not the half of it. Since 1960, government has changed radically. Then, 52 percent of federal spending went for defense, 26 percent for “payments for individuals” — the welfare state. By 2008, 61 percent consisted of “payments for individuals,” 21 percent for defense.
Social Security and Medicare — programs for the elderly — represented the biggest share: $1 trillion in 2008. Most Americans don’t consider these programs “welfare,” but they are. Benefits are paid mainly by present taxes; there’s little “saving” for future benefits; Congress can alter benefits whenever it wants. If that’s not welfare, what would be?
In theory, expanding public welfare could offset eroding private welfare. President Obama’s health-care proposal reflects that logic. The trouble is that the public sector also faces enormous cost pressures, driven by an aging population and rising health costs. The Congressional Budget Office projects the federal debt will double as a share of the economy (gross domestic product) to 82 percent of GDP by 2019.
Any sober examination of figures like these suggests that the system has promised more than it can realistically deliver. We are borrowing not to finance investment in the future but to pay for today’s welfare — present consumption. Sooner or later, the huge debt will weaken the economy. Nor would paying for all promised benefits with higher taxes be desirable. Big increases in either debt or taxes risk depressing economic growth, making it harder yet to pay promised benefits.
Politicians for the most part do not understand basic finance and they get elected based on who promises the most, regardless of the ability to pay. Do not expect things to change until America’s overextended credit line is cutoff.
President On A Roll
It seems as if the President is enjoying an extended honeymoon with both the press and voters, while the Republicans remain disarrayed and powerless. Public optimism and confidence is surging based on the hope that the steps taken by the Obama administration will lead to brighter economic days. The voters and Congress have effectively given the President what almost amounts to dictatorial powers.
The Obama infatuation is a great unreported story of our time. Has any recent president basked in so much favorable media coverage? Well, maybe John Kennedy for a moment, but no president since. On the whole, this is not healthy for America.
Our political system works best when a president faces checks on his power. But the main checks on Obama are modest.
The study examined 1,261 stories by The Post, the New York Times, ABC, CBS and NBC, Newsweek magazine and the “NewsHour” on PBS. Favorable articles (42 percent) were double the unfavorable (20 percent), while the rest were “neutral” or “mixed.” Obama’s treatment contrasts sharply with coverage in the first two months of the Bush (22 percent of stories favorable) and Clinton (27 percent) presidencies.
The infatuation matters because Obama’s ambitions are so grand.
The press has become Obama’s silent ally and seems in a state of denial. But the story goes untold: Unsurprisingly, the study of all the favorable coverage received little coverage.
Unlimited power allows one man to accomplish what could not otherwise be done with a gridlocked political system, but also allows for potentially unwise policy decision implementations that may have dangerous long term consequences. Our basic governmental structure of checks and balances seems to be in peril. Here are some more thoughts on this matter.
American Capitalism Gone With A Whimper
It must be said, that like the breaking of a great dam, the American decent into Marxism is happening with breath taking speed, against the back drop of a passive, hapless sheeple, excuse me dear reader, I meant people.
The final collapse has come with the election of Barack Obama. His speed in the past three months has been truly impressive. His spending and money printing has been a record setting, not just in America’s short history but in the world. If this keeps up for more then another year, and there is no sign that it will not, America at best will resemble the Wiemar Republic and at worst Zimbabwe.
Obama Led the US Economy Into a Fiscal Trap Containing a Monetary Time Bomb
The majority of Americans elected an arrogant and bumbling ideologue to the presidency and so the rest of the world — little Israel in particular — will have to pay the price. However, Economics is what invariably brings the Obama’s of this world undone.
Despite the bitter lessons of history — a subject that Obama is as deeply ignorant of as he is of economics — he does not really believe in the existence of economic laws. Let us not forget that this is the same man who thinks he can regulate bubbles out of existence, even though he and his cronies are totally ignorant as to the origin and nature of this economic phenomenon.
Obama and his brilliant economic advisors have driven the US economy into a fiscal trap containing a monetary time bomb. And the markets are taking notice.
It’s a pretty state of affairs when China feels impelled to lecture the US on the need for exercising greater fiscal and monetary responsibility. Nevertheless Bernanke and the Obama administration appear to be completely oblivious to the situation. So much so that the Fed was authorised to print $1.75 trillion in new money so as to buy Treasury bonds. It’s almost as if they were deliberately thumbing their noses at the rest of world.
If the economy resumes its downward decline or the average American does not see his financial situation improving soon, expect the Obama administration’s honeymoon to come to an abrupt end. In the final analysis, it is always about jobs and incomes.
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