Category Archives: The Economy

Obama’s Latest Jobs Speech: “Stop the political circus,” says the Ring Master.

President Obama and I agree on at least one thing: “Washington hasn’t always put [Americans’] interests first.”

Ain’t that the truth.

With Republicans vying for his job, the economy persistently sluggish, and unemployment relatively unchanged since the Bush Administration, President Obama took to the podium to make “the big speech” before a special Joint Session of Congress to lay out his job plan.

This is not his first job plan. In fact, you’d be hard pressed to find a month where the news has not talked about an Obama job plan.

  • In November of 2008 (“After more than two weeks of virtual silence on the economy, President-elect Barack Obama’s transition team burst on the scene with new ambition and urgency Sunday, demanding swift passage by Congress of a massive two-year spending and tax-cutting recovery program.”)
  • In January of 2009 (“President-elect Obama countered critics with an analysis Saturday by his economic team showing a program of tax cuts and spending like he’s proposed would create as many as 4.1 million jobs, far more than the 3 million he has insisted are needed to lift the country from recession.“)
  • In March of 2009, after its passage (“President Obama on Friday touted the benefits of his economic recovery plan […] the recently passed $787 billion stimulus package.”)
  • In July of 2009, after the plan failed to stop unemployment from climbing to 9.5% (“Obama, a Democrat, is trying to restore economic growth to the US but his $787-billion economic stimulus plan […] failed to stop the unemployment rate from rising to 9.5 percent.”)
  • In December of 2009 (“President Barack Obama says his administration needs to “get America back to work” as quickly as it can, and he‘s putting together a list of proposals aimed at doing just that.”)
  • In February of 2010 (“President Obama hit the road again Tuesday to promote the new job-creation program he described as his No. 1 priority, […]”)
  • September of 2010, just one year ago (“U.S. President Barack Obama will announce on Monday a six-year infrastructure revamp plan with an initial investment of $50 billion to jump-start job creation, a White House official said.”)
  • In February of 2011 (“The Obama administration outlined an “innovation strategy” for US job growth Friday, […]”)
  • In May of 2011 (“Obama, GOP unveil competing plans for job growth.”)

That’s a lot of talk, but not a lot of change. But don’t lose hope. The President has another plan for you. 

I’ll give him this: Obama’s got a lotta plans. But he isn’t making much headway. Unless, of course, you have managed to convince yourself that he actually staved off a worse disaster.  Maybe, but even President Obama sells his plans not as fingers in the dike, but as reversals.

Anyway, in America we don’t believe in treading water–we believe in winning. Why else would we keep score? 14 million people can’t be wrong–the plans just aren’t working.

So what is he proposing, this time?

Where we agree

First, there are a couple things he said that I liked…assuming he means them:

Economic Growth is  Driven by Business

Those of us here tonight can’t solve all of our nation’s woes. Ultimately, our recovery will be driven not by Washington, but by our businesses and our workers.

Great! But why have all of your plans up to now been focused more on funding the public sector, increasing the debt that must be paid by taxes from individuals and the private sector, and not just decreasing the cost of doing business for “businesses and workers,” as per your speech? Why wait until the 11th hour to come to Jesus?

Infrastructure Helps Business and Employs Construction Workers

Everyone here knows that we have badly decaying roads and bridges all over this country. Our highways are clogged with traffic. Our skies are the most congested in the world.

This is inexcusable. Building a world-class transportation system is part of what made us an economic superpower. And now we’re going to sit back and watch China build newer airports and faster railroads? At a time when millions of unemployed construction workers could build them right here in America?

I like upgrading our roads. But what’s new about this from promised infrastructure fixes over the last three years? What happened to the spending you’ve been talking about since 2009?

OK, so, maybe I agree, but I’m a little distrustful of his sincerity. And that the money is actually going to get the economy going again. Employing workers to build roads and bridges will get cash into the economy, but it alone won’t employ 14 million people, most of who are not construction workers.

Where  He’s Wrong

On the other hand, there are several places that I just flat out think the President is wrong.

Federal Money to Rebuild Schools

And there are schools throughout this country that desperately need renovating. How can we expect our kids to do their best in places that are literally falling apart? This is America. Every child deserves a great school — and we can give it to them, if we act now.

The American Jobs Act will repair and modernize at least 35,000 schools. It will put people to work right now fixing roofs and windows; installing science labs and high-speed Internet in classrooms all across this country.

I’m all about education (even if, as a high school drop-out, I’m not a huge fan of public ed), but I don’t agree that this has anything to do with getting the economy going or creating jobs. Yes, every kid should go to a good school, but no, that has nothing to do with the economy, or with the federal government. That’s the states’ job, and the only thing it does is redistribute money from state A to state B.

So, Mr. President, rather than increase our taxes (or the deficit, but it’s the same thing, in the long term), just let us keep our money in our states, and we’ll fix the schools ourselves.

Federal Money to Hire Teachers

Again, with the education thing.

Pass this jobs bill, and thousands of teachers in every state will go back to work. These are the men and women charged with preparing our children for a world where the competition has never been tougher. But while they’re adding teachers in places like South Korea, we’re laying them off in droves. It’s unfair to our kids. It undermines their future and ours. And it has to stop. Pass this jobs bill, and put our teachers back in the classroom where they belong.

My problem with this is the horribly faulty logic and the blatant pandering to the education unions.  As economist Arnold Kling explains “it assumes that state and local governments need more money in order to keep teachers. They do not. They could reduce compensation and maintain hiring or even increase it.”

In other words, states aren’t firing teachers. Teachers are leaving for better paying jobs, or the states are paying teachers too much (and that’s an entirely different conversation than this one, which is, if you forgot–THE ECONOMY).

A reduction in the number of teachers only indicates that you need more money if the reduction comes from teachers quitting their jobs. If you are laying off teachers, that shows that you are making a choice to keep their compensation too high rather than have more on staff.

Get it? States aren’t firing teachers to make cuts–they are paying them more than they should. They could pay less, and employ more, but (again, enter the unions), that’s not going to happen.

Remember, I’m not saying that what teachers are paid is fair or enough. I’m saying that there’s no correlation, in spite of what President Obama is trying to trick you into believing–that states have fired teachers because of budget crunches.

If you aren’t a teacher, you must be an oil executive

Should we keep tax loopholes for oil companies? Or should we use that money to give small business owners a tax credit when they hire new workers? Because we can’t afford to do both. Should we keep tax breaks for millionaires and billionaires? Or should we put teachers back to work so our kids can graduate ready for college and good jobs? Right now, we can’t afford to do both.

This isn’t political grandstanding. This isn’t class warfare.

Actually, it sounds a lot like class warfare. The 14 million people out there that are unemployed are, for the most part, not former teachers. In fact, education, up until 2010, was the industry that actually increased in employment.

Enter the graphic:

And that was just as of the middle of 2010!

Who are the big losers, then? You wouldn’t know it to listen to the President’s speech, but among the unemployed you can find former professionals and business service providers , construction workers (housing industry, not bridge building, though arguably, they could cross over, I assume), durable goods (like the auto industry) and retail (where shop).

Conclusion: Fail. Just like all the other plans.

I’d like to see the economy rise in the next year, because everyone would win. But what President Obama does get is that he doesn’t get it. Like one candidate said in the Reagan Library Republican Debate Wednesday night, “the President is a nice guy, but he doesn’t have a clue.” And, as another said, “its time to get out from behind the teleprompter.”

Yes, he can speech-ify, but speeches don’t amount to results, as we’ve seen for the last three years. I hope the Congress can find the morsels within the plan that will help, pass them, and move us forward.

On the whole, though, I’m not sanguine. As one Twitter level pundit put it, the speech was not expected to offer anything new. And it didn’t fail to deliver on that point.

[Read the full text here.]

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The death of boredom, the doom of creativity, and the fall of Western Civilization.

Do you know what America’s problem is?

No, it’s not the economy. It’s not even the politicians. No, it’s something worse.

It’s your iPhone/Android. And your iPad. And your Kindle. And every other gadget that’s keeping you from getting bored. According to Scott Adams, America’s problem isn’t the economy: it’s that we don’t get bored, anymore. As a result, we just don’t have the time to be creative, to innovate, or the mind numbing boredom that inspires creation and innovation.

That’s right. I just said that boredom inspires creativity. If I ever write something that sounds more like Orwellian doublespeak, I’ll buy the first person to point it out lunch. (Offer good for one time only…)

In a column for the Wall Street Journal, Adams–who you know better by his syndicated comic “Dilbert” and his protagonist’s perpetually upturned tie–argues that creativity has taken a beating due to the perpetuation of gadgets and gizmos that allows us to keep ourselves constantly occupied. He harks back to another day (one that I remember), when kids made guns out of sticks, monsters out of decapitated Barbies, and spent hours outside. On bicycles. Playing.

We didn’t have many toys by modern standards. But I discovered that if you have a blob of clay and some Lincoln Logs, you can make your own toy rifle. You can use those same materials to create a FrankenBarbie doll with body-image issues and a G.I. Joe that looks like an angry starfish with snow shoes. I’d take turns shooting at both of them, sometimes using the Lincoln Log rifle and sometimes the handgun that I whittled out of a block of wood. I blame society for all of that.

When I wasn’t making something inappropriate out of nothing, I would stare out the window into the frosty tundra and watch birds freeze to death in midflight. In the summers I rode my bike for hours every day, imagining fantastic worlds in which ice cream was free and farm dogs didn’t attack kids on bicycles just because biting is fun.

Weird.

And yet, maybe not so much. I remember those days myself. I grew up on on five acres on a plateau just east of the Rockies (and by “just east” I mean, I was two miles down a dirt road from the first slopes). I spent summers making forts from fallen branches  and winters making sled trails through the gullies and ravines that ran behind the house. There was stream just large enough to encourage beavers, and I spent entire afternoons watching to see the dam builders show their head above the water, just for a few seconds.  My first Nintendo didn’t make a showing in the house until I was old enough to take drivers ed, and by then I had far more interesting things to spend my time on, namely, girls.

In short, I had a lot of time to be bored.

Today, however, I am constantly carrying my phone, a device that’s powerful enough to be a computer,  a jukebox of thousands of songs, a high quality camera or camcorder, or, in a pinch, act as a phone. My biggest worry is not what it can do, but that the battery will run out. It can do everything.

That’s the problem, says Adams (not the battery, but that it can do everything). We always have something to do.

Lately I’ve started worrying that I’m not getting enough boredom in my life. If I’m watching TV, I can fast-forward through commercials. If I’m standing in line at the store, I can check email or play “Angry Birds.” When I run on the treadmill, I listen to my iPod while reading the closed captions on the TV. I’ve eliminated boredom from my life.

But why is that a problem? What does it look like when we don’t have time to be bored? Downtime, if you will.

What might such a world, a world lacking in sufficient boredom look like?

For starters, you might see people acting more dogmatic than usual. If you don’t have the option of thinking creatively, the easiest path is to adopt the default position of your political party, religion or culture. Yup, we see that.

You might see more movies that seem derivative or are sequels. Check.

You might see more reality shows and fewer scripted shows. Right.

You might see the best-seller lists dominated by fiction “factories” in which ghostwriters churn out familiar-feeling work under the brands of famous authors. Got it.

You might see the economy flat-line for lack of industry-changing innovation. Uh-oh.

You might see the headlines start to repeat, like the movie “Groundhog Day,” with nothing but the names changed. We’re there.

You might find that bloggers are spending most of their energy writing about other bloggers. OK, maybe I do that. Shut up.

You might find that people seem almost incapable of even understanding new ideas. Yes.

Bloggers writing about other bloggers? Ouch! Guilty, as charged.

But to the point– Well, he has made the point. We’re so busy surfing, Facebooking, downloading, uploading, and, heck, maybe even reading [gasp!] that maybe there isn’t enough free time, as in free time for our brains, to wonder, day-dream, and, yes, create.

Reminds me of something I once read that Albert Einstein said: “Reading, after a certain age, diverts the mind too much from its creative pursuits. Any man who reads too much and uses his own brain too little falls into lazy habits of thinking.”

Hmmm…

Do you take time to be bored?

I know I don’t. But I’m going to try it. I’m going to find an hour, and I’m going to turn it off. The iPod, the phone, the laptop, the tv, and the myriad of other devices. All of it. And just be bored.

Maybe I will go for a hike while I am bored. I hear it’s quiet out there. Maybe I can get my kids to come, and, as we hike,  I can tell them what it was like “back in the day” before boredom died and creativity still flourished in those quiet moments when we had nothing else to do.

Go read Scott Adams’ full column “The Heady Thrill of Having Nothing to Do.” It’s witty, insightful, and fun, and, really, an interesting perspective on what why we less time on our devices and more time in our own heads.

[WSJ]

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In which I express mock surprise at how well it pays to work for the President of the United States

Evidently, these salary increases are not connected to performance.

Gawker tells the story:

The White House says that many of those positions are considered nonpolitical jobs that come with their own pay schedules, and that what matters is that the total budget and average salary are decreasing slightly. But that doesn’t change the fact that White House staffers who stick it out are being rewarded, on average, for their continued service at a rate that far outstrips how the average white-collar worker is doing. The rhetoric behind the White House salary freeze was about making sure that the people engaged in leading the nation out of its economic mess share a sense of what American workers are experiencing. Unless roughly half of American workers saw their paychecks go up by an average of 8% last year (hint—they didn’t), that’s not the case.

Shocker.

Government revenues are down, but employee salaries are up. Well, not every employee’s salary–just those who work in the President’s staff. If this were a business (which it is not, and no, I’m not saying government should be run like a business), this would be the equivalent of the CEO giving his executives big raises while company revenues are falling.

In other words:

Lest you think that’s a partisan sentiment:

 

I’d love to hear what those highly paid special and deputy assistants advise on that one.

PS: I’m not opposed to government workers receiving compensation commensurate with their qualifications, job description, and market demand. However, I do oppose policies that have done little but strap us with greater spending liabilities with little to no effect on our revenues.

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When headlines state the obvious…

Round Two: Keynes v. Hayek

If you remember Round One (“Fear the Boom and the Bust“), then you won’t want to miss Round Two.

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