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President Obama says the Private Sector is Doing Fine

President Obama recently stated the private sector is doing fine. The statement reveals how clueless he is on economic matters.

President Obama made a mistake in claiming “the private sector is doing fine.”

As Rush Limbaugh has stated it is always a mistake when a Democrat tells the truth, not that the statement is correct, but that is how President Obama feels about the private sector economy.  The more important thing is to learn what this statement and the reasons behind the statement reveal about the president. I see two major points, he is clueless about economic issues, and that he wants to delay states from dealing responsibly with the debt and excessive pension obligations they face.

It amazes me that in polls that Obama holds a slight lead over Romney, or anyone for that matter, on how they would handle the economy. It is hard to imagine anyone doing worse on the economy. This statement that he thinks the private sector is doing fine reveals he has no understanding of the economy. Like most Keynesian’s he clings to the theory of spending your way out of a recession, despite this having no track record of success. The real purpose of the first stimulus program was to spend on items the Democrats wanted to spend on, and give money to supporters to buy votes. Then since recessions average 18 months declare by 2010 how it “fixed” the economy. But with Obamacare and his anti-business administration he successfully suppressed a real recovery.

Last year when proposed a new stimulus using the same failed ideas from his earlier stimulus attempts, I assumed he proposed a plan so stupid that it had to be rejected. Then he could claim he would have fixed the economy if the House would have approved his so called “jobs bill”. But what is scary about his recent statements, is that they show he is so incompetent on economic issues, that he actually thinks we can fix the economy by stimulating government. 

Clearly government is a taker of wealth not a maker of wealth. Only with a vibrant private sector can we truly improve the employment situation, without just removing people from the labor force to pretend it is fixed. For that matter improving the private sector is only path that can lessen the pressure to cut the size of the public sector. Rush Limbaugh has said Obama is running against capitalism. Rush is right we can see that not only with his attacks on Bain capital but with his policies and attitude towards the private sector.

The money President Obama is pushing wants to spend to grow government jobs would have the same effect as the stimulus spending in his first two years. All that was done with that money is state’s plugged holes in their budgets and delayed dealing with serious issues.  When that money dried up we have seen many states that cut education spending and aid to localities. This in many states did result in mass layoffs of public workers. In Wisconsin Walker showed true leader ship and lead the way on how the cuts could be made without requiring layoffs of public workers, if local leaders use the tools given. President Obama does not want other states to protect jobs the Walker way, after all, the money is intended to bail out the unions, and prevent states from dealing with the excessive benefit promises they made. If we were trying to help bail out the states to help the people rather than bail out the unions, the bill would insist on long term reforms like ACT 10 and requiring the end of defined benefit pensions to qualify for the money.  The point of the bill is to delay the reforms that will have to happen sooner or later, to keep the money flowing from taxpayers to unions to Democrat campaigns. While doing this he must know that the delays will make the problems worse.

There are two schools of thought about Obama’s economic policies, some think he is trying to slow growth as many in his base want (2), the other is that he is clueless on economic matters. You can pick for yourself, but I would go with the second thought that he is clueless. Beyond that he wants to waste taxpayer money to discourage states from fixing the root cause of their issues. He knows reforms to curb public union benefits and power will happen, it is just  a question of how much pain voters need to experience before they wake up to the corruption and say enough is enough like we did here in Wisconsin. It is understandable he wants to delay that, to empower himself, but it is downright scary he thinks that stimulating government will fix our economy. The only way we can sustainably improve local government revenues is a more robust private sector that increases the labor participation rates and economic output. But I guess under Obamanomics this is as good as it gets for the private sector.

 

1)      http://www.foxnews.com/on-air/special-report-bret-baier/2012/06/11/hume-primacy-public-vs-private-sector

2)      http://dailycaller.com/2012/06/14/obama-fights-the-cancer-of-economic-growth/#ixzz1xmytRvTH

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Lyle Ruble June 25, 2012 at 05:33 PM
@Greg...One of the reasons that the Europeans are heading back into recession is that they choose austerity measures rather than stimulus measures. Every economic downturn since the Great Depression have been softened by the government stimulating the economy, even Reagan's "Rust Belt" Recession of the early 1980s. He stimulated the economy with defense spending to name one. Now what conditions are different now in comparison to economic downturns of the past?
Greg June 25, 2012 at 06:10 PM
You don't see any economic differences between WWII and now? I would say pretty much everything has changed. As far as spending goes, Europe is Europe we are not Europe. We have been spending on 2 wars, every social program possible and we even bought a car company for the unions. How's it working so far?
Bren June 25, 2012 at 08:01 PM
Was there documented proof of urine and tape, Greg? Or the $7 million invoice for "repairs?"
Greg June 25, 2012 at 08:44 PM
Yep, how about documentation on that brass.
Geoff Tolley June 26, 2012 at 01:48 AM
@Greg: aarrrgh, even simpler then: taking your statement and running with it far further than it will go is *exactly* the same as "Geo doesn't agree with me, so he's a Romney-hater". "As to the second issue, you are technically correct, but I think you again missed the point, in your quest to be argumentative. The "despite this having no track record of success" would best be applied to current economic conditions. " - the claim in the article was wrong, period. At least you have stopped trying to defend the indefensible even if you are still trying to couch it as something else. Now, if you wish to make the claim that instead of Keynesian stimulus having no track record of success, it has no track record of success in a modern economy, then you need to at least address the obvious counterexamples, such as why the apparent success of e.g. the Chinese Keynesian stimulus of 2008-2009 shouldn't be counted. Ideally provide some examples of comparable modern economies with and without Keynesian stimulus in the face of a recession. As for "How's it working so far?", check out http://data.bls.gov/timeseries/CES0500000001 - the United States been growing private sector jobs at Bush-boom rates for the last two years. You can claim that to be a coincidence if you like, but then you need to at least offer some alternative explanation.

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