An ocean of ink has been devoted to the surprising election results in Virginia, New Jersey, and especially Massachusetts. There is so much angst in the country that even the exceptionally obtuse Obama has become aware of it. To use a term rendered infamous by the feckless Jimmy Carter, we are experiencing a national malaise. But what Obama fails to comprehend is that at the root of the current national malaise is Obama himself.
In this, as in many other ways, Obama uncannily resembles Carter, who projected his own defects of thought and action onto the nation, generating the anxiety and distrust he was purporting to heal. We can rightly call the national mood “Obamalaise,” because it arises not just from Obama’s agenda but from his character.
A major factor in Obamalaise is, of course, the lingering economic recession. The unemployment rate seems stuck at 10%. But it’s really worse than that. The December 2009 Bureau of Labor Statistics (BLS) report put non-farm job losses at 85,000 in November but showed that unemployment stayed at 10% — because so many people (over 660,000) had given up looking for work. The BLS household survey — a more accurate indicator of the unemployment picture, because it measures underemployed along with unemployed — put the November loss at nearly 590,000 jobs.
More recent data are not encouraging. The January 2010 report put the non-farm job losses at only 20,000, but it showed that the December report underreported the number of unemployed. The unemployment rate dropped to 9.7%, but again this was because of the large number of people who were no longer searching for work. The Bureau of Labor Statistics job report for Feb. 5 showed that roughly 15 million Americans remained out of work.
Even if the economy continues to expand, job growth will probably continue to lag, for reasons I explore below. And we can’t be sure it will continue to expand. Nouriel Roubini — to cite only one economist who holds this view — predicts that the economy will grow at only 3% in the first half of the year, then drop to 1% or 1.5% in the second half, with unemployment possibly hitting 11%
Which of Obama’s actions have led to this malaise? Quite a few, but let me just review six major fields in which the pres ident’s work has been counterproductive, to say the least.
First, he has focused almost exclusively on forcing some kind of massive new healthcare entitlement on the country. This has had three perverse effects, all of which have deterred
Obama’s cap-and-trade bill, should it be enacted, will cost 3.2 million jobs over 15 years and $9.9 trillion by 2035.
hiring. As Kathryn Nix emphasized in a report for the Heritage Institute (Jan. 12), no matter which version of the bill would have been passed, it would have imposed massive new labor expenses on small businesses, which create the bulk of new jobs.
Moreover, as the different versions of healthcare were negotiated, the uncertainty as to what new regulatory bur- dens the insurance, pharmaceutical, and medical industries would be saddled with made them unwilling to undertake expansion. Finally, in crusading into an area where nobody really saw a crisis, Obama overlooked the economic crisis that everybody recognizes as real. Scott Brown’s election has, per- haps, slain Obamacare, but Obama has made it clear he will keep on the issue.
Second, there is Obama’s reflexive tendency to bash business, obviously an outward manifestation of an inner — what? lack of enthusiasm for? or is it loathing of? — free enterprise. He has vociferously attacked doctors, insurance companies, banks — everyone but lawyers. As Amity Shlaes has noted, in this Obama resembles one of his heroes, FDR, whose demonizing of business was a major factor in prolonging the Great Depression. “Roosevelt’s tender mercies toward businesses,” she says, “so terrified companies that they postponed both hiring and investment.”
In February Obama’s Two-Minutes Hate against banks dropped the Dow by 5% in three days. Is it any wonder that in a recent poll of investors and analysts who are Bloomberg subscribers 77% said that Obama is antibusiness?
Third, Obama’s conspicuous stiffing of secured lenders has — naturally — discouraged lending. His thoroughly immoral bankruptcy deal with GM and Chrysler cheated the secured creditors in favor of the United Auto Workers Union. Who is eager to lend money to businesses, now that the secured lender’s claim on assets (set by a century of bankruptcy law) can be negated by one call from a union boss to the White House?
Meanwhile, Obama’s mortgage modification program (aptly nicknamed the “mortgage cram down plan”) forces mortgage holders to renegotiate legal contracts to the holder’s detriment — another discouragement to lending. There has to be a kind of blindness in an administration that would lead it to institute a program that screws lenders for past loans, then bashes them for not issuing enough new ones.
Fourth, Obama has pushed an extreme environmentalist agenda that is a major drag on employment. According to the estimate from last year by the Charles River Associates, his cap-and-trade bill, which passed the House and awaits approval in the Senate, will cost 3.2 million jobs over 15 years, should it be enacted. And a study this year from the Heritage Foundation estimates the cost of cap-and-trade, if enacted, at $9.9 trillion by 2035.
Then there is the whole wacky “green jobs” plan to replace jobs in fossil fuel industries with jobs in the wind and solar power industries. As George Will warned last year (Washington Post, June 25), the Spanish experience demonstrates that such a plan creates far fewer jobs than it costs. The reason is bloody obvious to all but the economically clueless: replacing one source of power with another source, which happens to cost hundreds of times more to produce, destroys jobs elsewhere.
But this hasn’t stopped Obama’s Interior Secretary Ken Salazar from directing his agency to ratchet up regulations on oil and natural gas companies seeking to drill on federal lands. Obama clearly intends to break his campaign promise to expand domestic drilling.
Fifth, Obama is the most protectionist president since Hoover. He has refused to enact the free trade agreements (FTAs) that were on his desk the day he walked into the Oval Office (including agreements with Colombia, Panama, and South Korea), much less negotiate any new ones. Meanwhile, our trading competitors are increasing the pace of signing new FTAs, especially in Asia.
Worse, Obama’s actions have caused mini-trade wars with our partners. There is the breaking of our NAFTA agreement that allows a small number of Mexican trucks to operate in the United States, an event that has led Mexico to impose tariffs on our goods. The “Buy American” provisions in Obama’s stimulus bill have led to retaliation by Canada. And his tariffs on tires and other products have led the Chinese to slap major tariffs of their own on our products, and to file suit against us at the WTO, and most recently dump $35 billion of our bonds in one month.
Sixth, Obama’s spending is grotesque and destructive. Over 2.7 million jobs have been lost since the passage of his deceptively named stimulus bill (priced at $787 billion). He will add more to the deficit in the first 20 months of his presidency than his predecessor did in eight years — and George W. Bush was certainly no slouch in the deficit department. The Congressional Budget Office estimates that the deficit for 2010 will hit $1.6 trillion, higher than the record $1.5 trillion deficit of 2009. And it estimates a deficit of nearly $1 trillion in 2011.
The metastasizing deficit causes profound unease, because people know what it entails: massive new taxes, or massive inflation, or both. Already the end of the Bush tax cuts draws nigh: next year, the top income tax rate will go from 35% back up to 39.6%, the capital gains tax from 15% back up to 20%, and the dividend tax from 15% back way up to 39.6%. The estate tax will rise from zero this year back to 55%. With trillion-dollar deficits as far as the eye can see, the Obama administration will gladly let tax cuts expire.
Indeed, Obama has stoked fears of massive new taxes with his recent pronouncement that he is open to raising taxes on households earning less than $250,000 a year, despite his repeated promises during the campaign that he wouldn’t raise taxes on such families “by one dime.”
To summarize: Obama’s policies in office look like a bizarre mishmash of the worst policies of Hoover and FDR at the onset of the Great Depression. Take Hoover’s foolish idea to raise taxes in a severe recession and his acceptance of Smoot-Hawley protectionism, add FDR’s endless jeremiads against big business, his soak-the-rich taxes, and his Keynesian spending schemes, and — behold! — you have Obamaism.
But Obamalaise is not the product simply of Obama’s anti- business, pro-big-government policies. It is tied to his character, a character with deceitfulness at its core. He has lied on more matters more often than any other president I can recall. People have fun writing columns enumerating his lies. I wrote one last year listing six howlers (Orange County Register, Oct. 9). A recent article by John Ellis (FrontPageMagazine.com, Jan. 21) lists 30 major lies, and he admits that it is not exhaustive. Here is just a partial list of Obama’s major deceptions (equivocations, lies, broken promises, and flip-flopped policies). Consider their size and number.
•After bashing Bush for a $498 billion deficit, Obama ran a $1.5 trillion deficit, to be followed by a $1.6 trillion deficit, and then trillion-dollar deficits going forward.
•Obama campaigned promising to protect Medicare from cuts, but then proposed half a trillion bucks worth of them in his healthcare “reform.”
•Obama pretended that he understood why whites resented never-ending racial quotas aimed at them, but appointed the most unapologetic quota queen he could to the Supreme Court.
•Obama bashed Bush for not spending enough for manned space exploration, but he cut it altogether in his new budget.
•Obama promised that his stimulus bill would stop unemployment from going above 8%, and that most of the jobs created would be in the private sector, but the rate went above 10% and most of the jobs created are in government.
•Obama pretended to agree with McCain about the evils of pork-barrel spending, and promised to veto every pork-barrel bill, before signing a bill containing 9,000 pork-barrel projects.
•Obama repeatedly promised that all negotiations on healthcare would be completely transparent, indeed, would be broadcast on C-SPAN, but had nothing but closed door hearings with only Democrats present in the crafting of the legislation.
•On other areas as well, Obama promised greater transparency, but rammed through controversial bills with little discussion.
•During his campaign, Obama asserted that he opposed a single-payer system, but he had in fact repeatedly called for it in prior years; then he pushed for a public option that would crowd out private carriers, result- ing in a de facto single-payer system.
•Obama promised not to hire lobbyists, but wound up employing massive numbers of them.
•Obama promised to abide by the campaign finance reform law funding limits that he himself had sup- ported, but broke his pledge (and outspent McCain, $600 million to $300 million).
•Obama constantly said that if people liked their healthcare provider, they could keep it, but his bill would have limited that privilege to people currently insured, ending it if they changed providers; it also had built-in incentives that would have led employers to drop private coverage and use the public option.
•Obama promised to stop the practice of introducing bills so long that people couldn’t read or discuss them, but he has introduced bills of record length (witness the health bill at 2,000 pages).
•Obama promised a new era of bipartisanship, but he froze the Republicans in Congress out of negotiations on important bills and bashed his Republican predecessor every chance he could find.
•After bashing McCain, both in debates and in tens of millions of dollars worth of ads, for his willingness to tax healthcare benefits provided by employers, Obama proposed a health bill constructed on the basis of that tax proposal.
•Obama promised to close Gitmo. It remains open.
•After promising in his campaign against McCain that he would open up domestic drilling, he did the reverse, bringing new regulations to block exploration on public lands.
•After heatedly denying that his healthcare proposals would fund premiums for illegal aliens, he persistently blocked attempts to spell that out clearly in the bill he pushed.
•After promising when pitching his healthcare bill that it wouldn’t raise premiums, he insisted that the bill require insurance carriers to cover people with preexisting conditions, which could do nothing but raise premiums.
Ellis rightly notes that most other politicians known for their lies have been trying to protect themselves from scandal (Clinton’s adultery, Nixon’s abuse of power), or just “to make themselves look good”; but Obama lies about everything. He employs deceit as a standard tool. This bespeaks a man false to his core — a man lost in a state of metaphysical mendacity in which one can say anything one likes to manipulate others.
Given the prevalence of news media that, as Ellis observes, are unwilling to hold this president to account for his array of untruths — as they held Nixon to account for his lies, Bush the elder to account for breaking his tax pledge, and Bush the younger to account for the nonexistent weapons of mass destruction — it is no surprise that Obama has lied so blatantly. But this has not escaped the notice of the public, and it frightens them, for it tells them they have no idea what he really wants or intends.
In short, there is a growing awareness among Americans that their president is economically ignorant, politically radical, deeply duplicitous, and totally untrustworthy. This is the cause of Obamalaise.