The centerpiece word of the Obama Administration is “crisis.” Anytime Obama and company wants to accomplish anything in terms of gaining greater public support, the crisis du jour always requires the government to hand out money. Such is the case for the opening weeks of 2014, as Obama declares that unemployment benefits should be reinstituted for all unemployed Americans. If that indeed comes to pass, you can bet that the line to sign up for those benefits will likely match the surge in welfare benefits since Obama has taken office.
The problem, as the Obama Administration sees it, is that the private sector is not creating enough jobs to either flatten or reduce the unemployment numbers. Already unemployment benefits have been extended to an unprecedented 99 weeks, and Obama will likely press to extend the benefits even further. The president’s position is that the government must fix this problem. In all his liberal blindness, he fails to recognize that government is actually the source of the problem—as it usually is, first, last, and always.
Back in 2008, two things happened which were disastrous to the future of The United States and its economy. First, as a result of government legislative action put in place by Dodd-Frank, the housing/mortgage market ran totally out of control and eventually collapsed under its own weight. Back in the mid-90’s, President Clinton and a few Democrats in Congress decided that the opportunity to own a home was not as accessible as it should be. Accordingly, they introduced legislation that all but pre-qualified anyone who simply wished to own a home, regardless of credit-worthiness. While this alone should have been considered a major flaw in the legislation, the real problem was that the government had introduced “false growth” into the housing market by extending credit and opportunity where there shouldn’t have been any. Anytime markets grow for reasons other than economic interaction driven by supply and demand, the end result is collapse. The second mistake of 2008 was that the American voters elected Barack Hussein Obama as President—a huge economic mistake. Together, these two actions have been nothing less than an economic poison pill for the USA.
Obama, like all good socialists, subscribes to an economic model in which the federal government is the center of the economic universe, familiarly known as “Keynesian Economics.” In embracing this approach, Obama is basically ignoring the lesson of what happened when the government fiddled with the private sector—i.e., the 2008 financial collapse and its aftermath. He is determined to show that the government can and will pull the nation out of its economic doldrums and return it to lower levels of unemployment. Here again, we have a situation in which the government is going to introduce a process of “false growth” by simply flushing taxpayer money into various sectors of the U.S. economy. Keep in mind that we already did a lot of that with TARP at the end of Bush’s term, and then followed that up with an additional $800+ billion in “stimulus spending” after Obama took office. Basically, the government tossed a trillion dollars at the economy. A trillion dollars, and look at the results on people’s lives and livelihoods…almost nil.
“Why is this not working?,” you might ask. A big reason is that the government tends to cancel out its own actions in the private sector. First we throw out stimulus money, and then the Obama Administration goes to work to ostracize, regulate, and penalize those industries that could potentially provide employment to many Americans if they were not “handcuffed” by the federal government. Under the Obama administration, the Code of Federal Regulations—already an onerous tome— has grown an additional 11,327 pages.
Besides the new regulations, ObamaCare has changed the game such that employers can no longer figure out what new, full-time employees are going to cost them downstream. Under the ACA, even the definition of “full-time” has been changed from 40 hours per week to 30, forcing many industries to shift employees back to a 28 hour work-week to stay within the definition of “part-time” employee. In addition, the increased prices for gasoline since 2008 (thanks in large part to Obama’s energy policies) have raised transportation costs for goods and services and also brought financial hardship to workers who travel to their jobs. There is not a great deal of analysis necessary in this case to sort out the fact that further government intervention is not the solution here.
Unfortunately, the Obama Administration, with its myopic need to be at the epicenter of control, is not going to back the government out of its current meddling or diminish its chances to “call dibs” on any measure of economic success. Recognizing this fact, the private sector has essentially hunkered down in its bunkers, trying to wait out the final years of this administration, and hoping that most of these problems disappear along with Obama. Most of them are praying that they can hold out that long, given the government’s propensity for continued attacks on the private sector.
When I say private sector, small business comprises a major factor here—according to data gathered by the Small Business & Entrepreneur Council in 2009, 89.7% of 5.8 million U.S. firms have less than 20 employees. Look around you. Talk with the small business operators that you know and see how many of them can tell you how great their business is since Obama took office. Some businesses seem to have a high level of “bullet-proof” resistance to almost anything that happens in the economy, but those numbers are dwindling by the day with Obama in office. For those in the small business private sector, a government-centric economic plan is nothing more than a bridle with a barbed-wire bit.
For now, we are going to see a lot more national debt pile up as a function of the unemployment benefits extension coupled with a swarm of people grabbing those funds—people who have no intention of either looking for a job or working, even if someone offers them one. We now have a nation with a large population of people who have no shame when it comes to “gaming the system” for all they can get. They pay no taxes and suffer no penalties. It is all gravy to them, and Obama is “the Man,” or “the Savior.” For the rest of us, Obama and his cronies—like Harry Reid and Nancy Pelosi— make up the “Great American Disaster,” and we, as a nation, will be lucky if we can survive them and resurrect our future with any semblance of our founding history.
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