Friday, September 9, 2011

Obama's Grand Unveiling

The big jobs plan turned out to be exactly what most thought it would be: the same old stuff, dressed up in the hopes of getting a dance from across the aisle. Here's the transcript, for those that missed the speech.

Move along, nothing to see here...

To be fair, it wasn't a total crock. Slashing payroll taxes for companies is a much smarter move than just slashing them for workers, if economic growth is the goal. Of course, at the same time, the plan involves other ideas that won't do jack for growth and will only help increase the unemployment rate, like extending unemployment benefits again. As to tax cuts for companies that raise wages, that's just stupid. Sometimes--per a previous blog post--it's simply mind-boggling what so-called experts in the economy come up with.

Aside from that, the speech was full of straw, so much so that I feared a repeat of the Great Chicago Fire.

Dan Mitchell's (from Cato) take on the speech:
My reaction yesterday was mixed. In some sense, I was almost embarrassed for the President. He demanded a speech to a joint session of Congress and then produced a list of recycled (regurgitated might be a better word) Keynesian gimmicks.

But I was also angry. Tens of millions of Americans are suffering, but Obama is unwilling to admit big government isn’t working. I don’t know whether it’s because of ideological blindness or short-term politics, but it’s a tragedy that ordinary people are hurting because of his mistakes.
And as the WSJ notes:

We'd like to support a plan to spur the economy, which is certainly struggling. Had Mr. Obama proposed a permanent cut in tax rates, or a major tax reform, or a moratorium on all new regulations for three years, he'd have our support. But you have to really, really believe in hope and change to think that another $300-$400 billion in new deficit spending and temporary tax cuts will do any better than the $4 trillion in debt that the Obama years have already piled up.

We've had the biggest Keynesian stimulus in decades. The new argument that the 2009 stimulus wasn't big enough isn't what we heard then. Americans were told it would create 3.5 million new jobs and unemployment would stay below 8% and be falling by 2011. It is now 9.1%. But this stimulus we are told will make all the difference.
Of course, one might say that these opinions--like mine--are a product of ideology, and they most certainly are. But in this case, it's ideology backed up by empirical evidence. We know the first Stimulus did none of the things that its supporters promised it would do. And we know--per an earlier blog post--that the multiplier effect is all theory, no fact.

At the same time, the admin's sycophants see the speech as a monumental achievement, as laying out a real plan that can't help but work. From Eleanor Clift:
Obama finally laid out a clear and compelling case for government that he sounds prepared to fight for. He urged Congress to think what life would be like if their predecessors had succeeded in voting down Social Security or Medicare or funding for the Internet. If Obama watched the Republican debate the previous evening, one of his opponents, Mitt Romney, had the best line of the evening. The president, he said, is “not a bad guy, he just doesn’t have a clue what to do about the economy.”

Obama showed Thursday night he has a way forward, and when Republicans stayed glued to their seats when he talked about rebuilding schools, they were the ones who looked clueless.
I'd wonder if we heard the same speech, but I know we did.

Cheers, all.

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