Obama Didn't Save The Economy, He Hurt It
July 28, 2016 at 4:25 p.m.
By Gary [email protected]
Certainly, things are much better in Elkhart County these days than they were in 2009, the last time Obama visited. Unemployment in the county back then was nearly 20 percent. It hovers just above 4 percent today.
But I would guess if you asked around, Elkhart County officials would be hard-pressed to point to any policy or program enacted during the Obama administration that was responsible for the turnaround.
They’re more likely to point to the Navistar deal. That’s when Obama, during his last visit, announced a $39 million federal grant for the company that was supposed to make electric delivery trucks. Navistar – or any other electric vehicle maker, for that matter, – never arrived. I remember there being talk of Elkhart County becoming the electric vehicle manufacturing capital back then.
Never mind.
The RV industry’s turnaround is more in spite of government policy than because of it, largely driven by a severe downturn in the world oil market and resulting low gas prices.
Frankly, I think Obama’s policies have fostered more of an economic stagnation than a turnaround.
Did anybody notice the jobs report that came out Friday?
U.S. employers dramatically slowed hiring in May. Government “experts” predicted 160,000 hires during May. The actual number was 38,000. That’s the slowest pace in five years.
Beyond that, jobs figures for March and April were revised lower, with gains now just 123,000 in April and 186,000 in March. Initial reports were 160,000 and 208,000, respectively.
That’s a reduction of 59,000 jobs.
Of course, the administration will be hailing the “good news” in the report – that the unemployment rate tumbled to 4.7 percent from 5 percent.
Of course there is a huge. “yeah, but” here.
The reason the rate fell is because nearly 500,000 people who stopped looking for work are no longer officially counted as “unemployed.”
While administration talking heads are bragging about the 4.7 percent unemployment rate, perhaps they could explain how that squares with a record 94,708,000 working-age Americans not in the labor force in May – 664,000 more than in April.
The big question is, “Why is this happening?”
Well, just last week, the Heritage Foundation – a conservative think tank – released an analysis of regulations unleased on the economy by the Obama administration.
There were 20,642 new regulations added during the Obama presidency and the total cost of regulation for the Obama administration will easily exceed $100 billion.
The most sweeping came in the form of the “Clean Power Plan” from the Environmental Protection Agency.
It was the first time emissions of “greenhouse gas” were directly regulated at a direct cost to power plants of $7.2 billion per year. Critics say the cost is actually much higher and also argue that the new rules will do nothing to reduce global warming.
According to the Heritage Foundation:
The number and cost of government regulations continued to climb in 2015, intensifying Washington’s control over the economy and Americans’ lives.
The addition of 43 new major rules in 2015 increased annual regulatory costs by more than $22 billion.
The tide of regulation is expected to rise even higher in 2016 – President Obama’s final year in office. With 144 additional rules already in the pipeline, Americans should be prepared for a regulatory surge before year’s end.
The White House, Congress and federal agencies routinely ignore regulatory costs, exaggerate benefits, breach legislative and constitutional boundaries, and dictate lifestyle choices rather than focusing on public health and safety.
The more government pokes its nose into the private sector, the less efficient the private sector becomes. This invariably means economic growth and individual freedoms suffer.
Over the past 10 years, economic growth in America has averaged less than 2 percent per quarter. That’s just not good enough to create jobs and wealth.
And current conditions don’t seem to be improving, no matter how rosy a picture the administration – and to some extend, the media – try to paint it.
The U.S. Purchasing Managers Index is an indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.
The PMI stood at 50.5 in May – compared to 50.8 in April, which was below the market expectation of 51.
When the index level is above 50, it indicates an expansion, below 50, a contraction. The most recent data show the PMI recovered at a slower rate in May than it did in April.
So what does this mean for the overall economy?
Well, according to finance.yahoo.com, new orders improved at a slower rate in the first quarter and there was slower growth in business inventories. That means the manufacturing sector is experiencing slower output, weaker client demand and a weaker global outlook. Manufacturers started adopting more cautious inventory policies to overcome uncertainties in the business outlook.
This helps explain the poor jobs report, doesn’t it?
Bright spots are consumer spending, housing sales and modest wage increases.
But despite the positives, the Commerce Department came out with a report this week under the headline: "Firms Dial Back Investment."
Orders for nonmilitary capital goods excluding aircraft fell 0.8 percent in April after dropping 0.1 percent in March. These capital goods orders have fallen for three consecutive months.
One analyst noted that businesses seem to be more interested in buying back their own stock, increasing dividend payments, or engaging in mergers and acquisitions than investing in capital. Capital investment, of course, is what creates jobs.
Also last week, a leading international group – the Organization for Economic Cooperation and Development – downgraded its outlook for the U.S. economy and asked policymakers to act immediately to boost growth.
A story on latimes.com reports:
“Without comprehensive, coherent and collective action, disappointing and sluggish growth will persist, making it increasingly difficult to make good on promises to current and future generations,” Catherine L. Mann, the OECD’s chief economist, said as the group released its semiannual world economic outlook.
The U.S. economy will expand 1.8 percent this year, down from 2.4 percent last year, the OECD said. The forecast is down from 2.5 percent in November and 2 percent in an interim report in February.
I think we need significant changes in government policy, government structure, labor laws and how we look at technology. We need to get away from the notion that government can regulate us into economic prosperity.
Without changes like these, I fear we will be stuck in low-growth mode for a long time.[[In-content Ad]]
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Certainly, things are much better in Elkhart County these days than they were in 2009, the last time Obama visited. Unemployment in the county back then was nearly 20 percent. It hovers just above 4 percent today.
But I would guess if you asked around, Elkhart County officials would be hard-pressed to point to any policy or program enacted during the Obama administration that was responsible for the turnaround.
They’re more likely to point to the Navistar deal. That’s when Obama, during his last visit, announced a $39 million federal grant for the company that was supposed to make electric delivery trucks. Navistar – or any other electric vehicle maker, for that matter, – never arrived. I remember there being talk of Elkhart County becoming the electric vehicle manufacturing capital back then.
Never mind.
The RV industry’s turnaround is more in spite of government policy than because of it, largely driven by a severe downturn in the world oil market and resulting low gas prices.
Frankly, I think Obama’s policies have fostered more of an economic stagnation than a turnaround.
Did anybody notice the jobs report that came out Friday?
U.S. employers dramatically slowed hiring in May. Government “experts” predicted 160,000 hires during May. The actual number was 38,000. That’s the slowest pace in five years.
Beyond that, jobs figures for March and April were revised lower, with gains now just 123,000 in April and 186,000 in March. Initial reports were 160,000 and 208,000, respectively.
That’s a reduction of 59,000 jobs.
Of course, the administration will be hailing the “good news” in the report – that the unemployment rate tumbled to 4.7 percent from 5 percent.
Of course there is a huge. “yeah, but” here.
The reason the rate fell is because nearly 500,000 people who stopped looking for work are no longer officially counted as “unemployed.”
While administration talking heads are bragging about the 4.7 percent unemployment rate, perhaps they could explain how that squares with a record 94,708,000 working-age Americans not in the labor force in May – 664,000 more than in April.
The big question is, “Why is this happening?”
Well, just last week, the Heritage Foundation – a conservative think tank – released an analysis of regulations unleased on the economy by the Obama administration.
There were 20,642 new regulations added during the Obama presidency and the total cost of regulation for the Obama administration will easily exceed $100 billion.
The most sweeping came in the form of the “Clean Power Plan” from the Environmental Protection Agency.
It was the first time emissions of “greenhouse gas” were directly regulated at a direct cost to power plants of $7.2 billion per year. Critics say the cost is actually much higher and also argue that the new rules will do nothing to reduce global warming.
According to the Heritage Foundation:
The number and cost of government regulations continued to climb in 2015, intensifying Washington’s control over the economy and Americans’ lives.
The addition of 43 new major rules in 2015 increased annual regulatory costs by more than $22 billion.
The tide of regulation is expected to rise even higher in 2016 – President Obama’s final year in office. With 144 additional rules already in the pipeline, Americans should be prepared for a regulatory surge before year’s end.
The White House, Congress and federal agencies routinely ignore regulatory costs, exaggerate benefits, breach legislative and constitutional boundaries, and dictate lifestyle choices rather than focusing on public health and safety.
The more government pokes its nose into the private sector, the less efficient the private sector becomes. This invariably means economic growth and individual freedoms suffer.
Over the past 10 years, economic growth in America has averaged less than 2 percent per quarter. That’s just not good enough to create jobs and wealth.
And current conditions don’t seem to be improving, no matter how rosy a picture the administration – and to some extend, the media – try to paint it.
The U.S. Purchasing Managers Index is an indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.
The PMI stood at 50.5 in May – compared to 50.8 in April, which was below the market expectation of 51.
When the index level is above 50, it indicates an expansion, below 50, a contraction. The most recent data show the PMI recovered at a slower rate in May than it did in April.
So what does this mean for the overall economy?
Well, according to finance.yahoo.com, new orders improved at a slower rate in the first quarter and there was slower growth in business inventories. That means the manufacturing sector is experiencing slower output, weaker client demand and a weaker global outlook. Manufacturers started adopting more cautious inventory policies to overcome uncertainties in the business outlook.
This helps explain the poor jobs report, doesn’t it?
Bright spots are consumer spending, housing sales and modest wage increases.
But despite the positives, the Commerce Department came out with a report this week under the headline: "Firms Dial Back Investment."
Orders for nonmilitary capital goods excluding aircraft fell 0.8 percent in April after dropping 0.1 percent in March. These capital goods orders have fallen for three consecutive months.
One analyst noted that businesses seem to be more interested in buying back their own stock, increasing dividend payments, or engaging in mergers and acquisitions than investing in capital. Capital investment, of course, is what creates jobs.
Also last week, a leading international group – the Organization for Economic Cooperation and Development – downgraded its outlook for the U.S. economy and asked policymakers to act immediately to boost growth.
A story on latimes.com reports:
“Without comprehensive, coherent and collective action, disappointing and sluggish growth will persist, making it increasingly difficult to make good on promises to current and future generations,” Catherine L. Mann, the OECD’s chief economist, said as the group released its semiannual world economic outlook.
The U.S. economy will expand 1.8 percent this year, down from 2.4 percent last year, the OECD said. The forecast is down from 2.5 percent in November and 2 percent in an interim report in February.
I think we need significant changes in government policy, government structure, labor laws and how we look at technology. We need to get away from the notion that government can regulate us into economic prosperity.
Without changes like these, I fear we will be stuck in low-growth mode for a long time.[[In-content Ad]]
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