Tag Archives: Economics

News

Obama loses 2.19 million jobs, 9.4% unemployment, worst in 25 years

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UPDATE: Welcome readers from 4Simpsons! Thanks for the link Neil!

Gateway Pundit has the story in graphs. (H/T Lonely Conservative)

What was the unemployment rate under Bush?

Despite the recession he inherited, 9-11, stock market scandals, Hurricane Katrina and two wars in Iraq and Afghanistan, the unemployment rate during the Bush years averaged out to 5.27%. (Misery Index)

How about so far under Obama?

The US economy lost 598,000 jobs in January.
The US economy lost 706,000 jobs in February.
The US economy lost 742,000 jobs in March.
The US economy lost 545,000 jobs in April.
And, in May the US economy lost 345,000 jobs.

Here’s a graph that may help you to understand how bad Obama really is, compared to Bush:

US Unemployment Rate
US Unemployment Rate

Clinton’s rate is good because Newt Gingrich was in charge of the House in 1994 onward, and the House is where all spending bills originate

Hot Air reports (with a graph) that the unemployment rate is worse than the White House predicted it would be if they hadn’t passed the stimulus:

We are heading towards double-digit unemployment and doing that while we incur the massive debt of the unstimulating stimulus package. We could just as easily have kept the money and ridden out the unemployment, much as we’re forced to do now, only being a lot poorer while doing it.

Why is this important?  It demonstrates that the President and his economic advisers have gotten pretty much everything about this economic collapse wrong.  Instead of contracting government spending and shoring up the credibility of the currency, they’re setting records in dissipating it instead.  Instead of focusing on fixing the problem that government explicitly created — mortgage-backed securities — they’ve literally left that for last while they waste money chasing every Democratic constituency but ignoring the actual cancer in the financial system.

Bush was cutting into the deficit until the Democrats Community Reinvestment Act caught up with him in 2008. But Obama has ruined Bush’s effort to balance the budget, with his massive redistributions of wealth.

Obama's projected deficits
Obama's projected deficits

And the Heritage Foundation shows that the national debt is getting much worse under Obama’s tax and spend policies:

debt-deficits_04-580
Debt as % of GDP under Obama

The Heritage Foundation writes:

The national debt is skyrocketing. In 2009 publicly held debt is projected to jump to 54.8 percent of GDP, up from 40.8 percent in 2008. A year to year increase of this size hasn’t occurred since World War II. While the main causes of this massive increase – $787 trillion economic “stimulus” and the $700 billion Troubled Asset Relief Program (TARP) – are sure to be debated for some time, the truly freighting revelation should be not what has already taken place, but what our elected officials have planned.

President Obama’s budget, if passed, would send debt to levels 26.3 percent of GDP over current law. Although President Obama has publicly stated his desire to both bring down deficits and reform entitlements under his watch, his actions don’t match his words.

Who caused the recession? The democrats caused the recession, Bush tried to stop them in 2003. And Obama’s spending spree is only making things worse. We have a worse economy than Canada now, in every measure that counts. Obama’s planned tax hike is causing companies like Microsoft to ship jobs overseas, and his cap and trade plan will cost us even more jobs.

High tax rates cause the most productive people to stop working, costing us jobs. Obama is to blame. His total ignorance of economics means that he will be playing whack-a-mole with the US economy – always inventing new interventions into the market to fix the problems his last intervention caused.

UPDATE: Muddling Towards Maturity links to a comment by a business owner who explains why he will be hiring in Panama, not in the USA.

News

Obama’s corporate tax hike would cause Microsoft to outsource jobs

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This Bloomberg article may be helpful to those Democrats who voted for Obama because they hoped that Obama would stop outsourcing by taxing “the rich” and by taxing “greedy coporations”. (H/T Club For Growth)

Excerpt:

Microsoft Corp. Chief Executive Officer Steven Ballmer said the world’s largest software company would move some employees offshore if Congress enacts President Barack Obama’s plans to impose higher taxes on U.S. companies’ foreign profits.

“It makes U.S. jobs more expensive,” Ballmer said in an interview. “We’re better off taking lots of people and moving them out of the U.S. as opposed to keeping them inside the U.S.”

…In a roundtable discussion today, Ballmer, Symantec Corp. Chairman John Thompson and the heads of smaller companies such as privately held Bentley Systems, an Exton, Pennsylvania-based maker of engineering software, said such policies would hurt domestic investment, reduce shareholder value and increase the cost of employing U.S. workers.

See, there’s a difference between what Obama thinks will happen (fantasy) and what actual will happen (reality). He is probably very surprised that corporations are responding to his socialism by shipping jobs overseas. What an unexpected surprise! Let’s recall the simplest possible economics lesson from Henry Hazlitt’s “Economics in One Lesson”.

From this aspect, therefore, the whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.

Obama shows no evidence of knowing this lesson. And neither does anyone who voted for him. And it isn’t just that he and his voting bloc seem to know nothing about economics, it’s that they seem not to know anything about anything. And this, coupled with disregard for the unemployment rate, the budget deficit and the national debt, is what fuels his domestic policy.

Isn’t it mysterious that Bush cut taxes across the board, and tax revenues skyrocketed, while unemployment dove down below 5%? It’s a mystery! At least it’s a mystery to people who have never cracked open a book.

How communists operate

Here’s a preview of what we can expect from someone like Obama, who has no doubt absorbed the views of many left-wing arts professors, who, like him, have probably never run so much as a lemonade stand. Chavez doesn’t even have a college degree. (I have not seen Obama’s grades, he hasn’t ever released them – but he used alcohol, pot and cocaine).

IBD writes about Chavez:

It ought to worry people that what’s happening at GM is perfectly recognizable in Caracas.

In 2004, Chavez began by expropriating cattle ranches in Venezuela, saying he only wanted to clarify property rights, not confiscate land. End result: Virtually all productive land now is in his hands, redistributed to his loyalists in serfdom.

After that, he went after the U.S. oil industry, snagging prizes like Exxon Mobil’s $1 billion heavy-oil complex on the Orinoco River in 2007, citing a different legal issue: tax disputes.

He did similar expropriations with steel, cement, ports, banks, sugar, rice, pretty much any industry that was viable.

Running out of companies to steal, he now persecutes private media — not, he claims, to stifle dissent, but to protect children from smut, his pretense for shutting down RCTV in 2007.

For the last remaining nonstate TV station, his concern is now environmental desecration, with Chavistas using the pretense of some old antlers on the wall of a Globovision executive following an open-ended state raid as the excuse to shut down the TV station.

Whatever Chavez’s legal concerns are, the punishment is always the same: expropriation and more power to the state, the two pillars of socialism.

Read the whole thing, it goes on to juxtapose Obama and Chavez. (MP3 Podcast is here)

Commentary

Featured blog: Dr. Jennifer Roback Morse

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One of my favorite topics is the interplay between economics and marriage. And the best blog on the topic is Dr. Jennifer Roback Morse. She has excellent credentials as a sound fiscal conservative and a staunch social conservative. She is not only solid on abortion and traditional marriage, but she is one of the few people with enough vision to know the damage caused to the family by no-fault divorce and big government, as well.

Note to you young men who are thinking of marrying: marry someone like Dr. Morse, who understands how economic policy affects the marriage. Regular readers will know how I regularly gush over Michele Bachmann’s attempts to try to wrestle with Democrats to cut spending. That is how wives ought to be – defending their family from high taxes and regulations.

Articles

Here is one of the papers from Dr. J that I really liked. (the PDF version is better!)

In the paper, she addresses many topics related to feminism:

  • work/parenting balance
  • no-fault divorce
  • marriage vs. cohabitation
  • domestic violence
  • fertility
  • single-mother subsidies
  • income disparities
  • recreational sex
  • power struggles in marriage

She also discusses remedies from a Catholic perspective. (Note: the Wintery Knight is a proud evangelical Protestant)

Dr. J’s full list of articles is here.

Lecture

Here is a 30-minute lecture version of that paper by Dr. J, if you prefer watching and listening to reading. The title is “Freedom, the Family and the Market”.

The description of the lecture is:

“The socialist ideal of equality has played an independent role in the breakdown of the family. Socialism has attacked the family directly, and has adopted policies that have led to demographic collapse. Christianity and capitalism offer more appealing solutions to the problems socialism claims to solve.”

I highly recommend this lecture. It’s as good as William Lane Craig, just on a different topic. This lecture is especially suitable for men.

Here’s her bio:

Born into a Catholic working class family, Dr. Morse earned a doctorate in economics during her twelve year lapse from the faith. A committed career woman before having children, she taught economics for fifteen years at Yale University and George Mason University.

The devastating experience of infertility brought her to her knees and back to the practice of the Catholic faith. In 1991, she and her husband adopted a two year old Romanian boy, and gave birth to a baby girl. She left her full-time university teaching post in 1996 to move with her family to California. She is now a part-time Research Fellow at the Acton Institute for the Study of Religion and Liberty.

Dr. Morse writes about the family and the free society. Her first book, Love and Economics: Why the Laissez-Faire Family Doesn’t Work, shows why the family is the necessary building block for a free society and why so many modern attempted substitutes for the family do not work. Her second book, Smart Sex: Finding Life-Long Love in a Hook-Up World, exposes the sexual revolution’s fraudulent promise of freedom and points the way to the most thrilling adventure of all–life-long love.

Her public policy articles have appeared in Forbes, Policy Review, The American Enterprise, Fortune, Reason, the Wall Street Journal, Vital Speeches,
and Religion and Liberty.

Dr. Morse’s scholarly articles have appeared in the Journal of Political Economy, Economic Inquiry, the Journal of Economic History, Publius: the Journal of Federalism, the University of Chicago Law Review, and the Harvard Journal of Law and Public Policy, Social Philosophy and Policy, The Independent Review, townhall.com, and The Notre Dame Journal of Law Ethics and Public Policy.

I know I don’t have to tell you George Mason University is home to Walter Williams, one of my two favorite living economists, whose work I often feature. GMU has the best economics school in the entire nation, featuring 2 Nobel prize winners. (Their only black mark is their shoddy treatment of intelligent design theorist Dr. Caroline Crocker).