Freedom Line Blog

Oregon, whose 11% unemployment rate exceeds the national rate by a full percentage point, sits just to the north of California, whose suicidal economic policies have provided a close-up lesson that reducing economic freedom reduces prosperity. As a result, Oregonians have seen first-hand the mass exodus of jobs and residents stemming from those policies.

So as Oregonians head to the polls tomorrow to consider two tax-raising ballot measures, we’ll see whether they’ve internalized California’s straightforward lessons.

Proposition 66 would increase Oregon’s personal income tax on “the rich” by fully 2%, and Proposition 67 would foolishly increase the corporate income tax. You know…  those corporations that actually create jobs and add to the economy.

Just as California’s reckless tax-and-spend policies have driven residents and jobs to surrounding states, Oregon may astonishingly slit its own wrists in the same manner by passing these measures.  Residents and community leaders in Washington, Idaho, Utah, Montana, Nevada and Arizona may welcome the resulting influx, but it will mean doom for Oregon. Nike, Inc. founder and chairman Phil Knight, hardly a starched-collar conservative, has labeled Propositions 66 and 67 “Oregon’s Assisted Suicide Law II,” and some economists predict 70,000 lost jobs if the measures pass.

So which way, Oregon?  Freedom and prosperity, or suicidal tax increases?  Massachusetts, Virginia and New Jersey voters have learned the lessons of Obamanomics, and now we’ll see if the news has traveled out to the West Coast…

For a man of such supposed intellectual prowess, Barack Obama certainly seems oblivious to any sense of irony.

Attempting to stanch his hemhorraging public aproval numbers, Obama yesterday retreated to phony populism by proposing $90 billion in new taxes upon American banks. It must be noted that many of these banks have already repaid the questionable bailout funds that they received, and are now staring at a form of double jeopardy.

Obama’s misguided proposal contradicts his own stated goal of encouraging bank lending in this choppy economy, because the new tax will undercut banks’ ability to create new loans.  Further, the tax will merely be passed on to strapped American consumers, as all corporate taxes ultimately are.  It’s such a terrible idea that even Democrat Senator Kristen Gillibrand voiced opposition, saying it “could disproportionately affect New York City’s economic recovery, which relies on a growing financial services industry.”

Disregarding this reality, Obama was undeterred, sanctimoniously thundering, “we want our money back, and we’re going to get it.”

We feel the same way, Mr. President.  In just the first year of your administration, we have seen you squander our hard-earned dollars on failed “stimulus” behemoths and bureaucratic boondoggles on behalf of labor unions and other favored special interests.  We have seen you triple the budget deficit after telling us duirng your campaign that you were going to reduce it by scouring the budget “line by line.”

Yes, Mr. President, we also want our money back.

The Obma White House has long followed the idea that there’s no problem that the federal government shouldn’t fix.

Now, it’s telling us that there’s no improvement that the federal government shouldn’t fix, either.

That appeared to be the message from White House Council of Economic Advisors Chairman Christina Romer and National Economic Council Chairman Lawrence Summers, both of whom made the rounds on yesterday’s Sunday talk shows.  In his comments to George Stephanopoulos on ABC’s This Week, Mr. Summers said that, “most professional forecasters are now looking for a return to job growth by spring.”  And appearing on NBC’s Meet the Press, Ms. Romer predicted “positive job growth sometime in the first quarter.”

But as noted by The Wall Street Journal today, we must ignore federal deficits in favor of more “stimulus” spending.  According to both Summers and Romer, shifting focus to the deficit instead of spending even more during a period of record deficits would be “suicide.”

So let’s get this straight:  Obama’s first “stimulus” was supposed to cap unemployment at 8%.  It’s now at 10%.  But despite the fact that the White House expects job growth to return in the next quarter, it wants to spend even more to “stimulate?”

One is left to wonder whether the Obama Era more closely resembles a work of Orwell or merely an issue of The Onion.

Barack Obama has done little, if anything, right during his year in office, but he’s obviously perfecting the art of shameless hypocrisy.

Appearing on CBS’s 60 Minutes yesterday, Barack Obama said with a straight face that “the people on Wall Street still don’t get it.  They don’t get it.” For good measure, he also broadly labeled bankers “fat cats” who have behaved in an “irresponsible” manner and not shown “a lot of shame.”

Let’s see.  This is the same Barack Obama who promised to address the $0.4 trillion deficit, only to add a trillion to make it $1.4 trillion in just his first year.  In other words, he is addressing the deficit by…  tripling it.  Lest one reflexively attribute that to his inheritance, this year’s deficit is on an even worse trajectory.  He is also the man who proposes adding an endless array of new entitlements and highly-paid new federal employees to an already-unsustainable budget trajectory.  He is also the man who seeks to reward the same federal bureaucracies that failed to recognize the financial bubble, and even abetted it, by granting them nearly plenary powers over the entire struggling economy.  He is also the man who aims to compound the nation’s economic woes by imposing catastrophic healthcare costs and carbon taxes upon it.  He is also the man who seeks to increase taxes on broad swaths of struggling individuals and small businesses by allowing rates to increase next year. He is also the man who promised to usher in a new era of international diplomacy and peace, only to see rogue regimes such as Iran increase their menace since his inauguration.

Yet he says that others “don’t get it?”

Laughably, he mocked bankers for being “puzzled” why the public is “mad” at them.  Perhaps he was merely projecting his own puzzlement at his record-low poll numbers, which similarly reveal a public “mad” at him?

Remember when the Obama Administration promised that, if we only passed his potent “stimulus” plan, unemployment would top out at 8%?  In contrast, according to Obama, if the American people foolishly refused his master plan, unemployment might rise as high as 10%?

Well, this morning, the U.S. Department of Labor provided yet another wakeup call and simple math lesson to Mr. Obama.  Unfortunately, the unemployment rate has now risen to 10.2%.  Worse, Obama’s ineffective “stimulus” has only exacerbated the problem by adding to our unsustainable federal debt and creating a forward-looking business climate that is inhospitable to creation of new employment and enterprises.  Something to keep in mind as Obama issues new promise after promise regarding his healthcare, carbon cap-and-tax and other agenda items.

When Ford abstained from accepting federal bailout dollars, observers rightfully worried that it would suffer a competitive disadvantage compared to its new Obama-favored counterparts General Motors (GM) and Chrysler.

But so far, a funny thing has happened thanks to American consumers.  Ford has actually gained in its share of American market sales, whereas GM and Chrysler have declined.  According to CNW Marketing Research, Ford jumped from approximately 12% of domestic auto sales in the third quarter of 2008 to approximately 17% in the third quarter of 2009.  In contrast, GM fell from approximately 27% to 22%, and Chrysler fell from approximately 8% to 6% during that span.  The only other major automaker to gain in market share over the past year was Toyota, but its increase isn’t nearly as dramatic as Ford’s.

Several factors may have contributed to Ford’s improvement, but Americans have sent a clear signal in rewarding it for righting its course the old-fashioned way, while rebuking GM and Chrysler for jumping onto the Obama bailout bandwagon.

How’s this for unadulterated, sanctimonious chutzpah:  “Top Obama Aides Upbraid Wall Street.”

So announces a Washington Post headline, discussing the harsh criticisms leveled by Obama Administration officials against Wall Street firms.  But consider this:  if Wall Street executives ran their firms and kept their books the same way that the federal government does, they would be in jail until their dying days.  Or consider how Obama and his apologists promised that if his “stimulus” plan was passed, unemployment would top out at 8%.  Well, it’s now at 9.8% and rising.  If a Wall Street CEO made similarly fatuous promises to unwary consumers, the resulting onslaught of class action lawsuits would descend faster than a Swiss avalanche.

Yet there was David Axelrod on ABC’s This Week, labeling Wall Street behavior “offensive” and admonishing them that “they ought to think through what they are doing.”  Perhaps, but nobody should take that advice more than officials of an administration that is taking an already-dangerous fiscal situation and making it positively deadly.  Too bad there are no righteous trial lawyers who can do anything about them.

From USA Today:

The $787 billion economic recovery package … is stimulating growth in the federal government as agencies hire thousands of workers and spend millions of dollars to oversee and implement the package, according to government records and spokesmen. … That’s helped fuel the continued growth of the federal government, which increased by more than 25,000 employees, or 1.3%, since December 2008…”

Have no fear:  John Berry, head of the federal government’s Office of Personnel Management, says the increase is small and temporary.  Believe that, then there’s a bridge in Brooklyn for sale with your name written all over it.

In related news, the Labor Department this morning reported that the number of newly laid-off workers seeking unemployment benefits this week was 530,000.  While the number was less than economists expected, that brought the total number of jobs lost since December, 2008 to nearly 4 million, most coming from the private sector.  This, despite Congress’ passage of the $787 billion taxpayer-funded stimulus bill.

There has been a lot of talk in the media (here, here and here) about how Herbert Hoover was a great miser and should have spent his way out of the economic downturn like Obama is attempting to do.  The myth might be as old as Hoover’s administration: Hoover was a free-market Republican who let Americans suffer instead of attempting government intervention.

False.  It’s hard to believe that a quick search through our own budget data proves that Hoover was more of Keynesian, someone who spent plenty and raised taxes in his vain attempt to “prime” the U.S. economy toward a resurgence.

Reviewing budget numbers from the White House’s own budget, we see that Hoover drastically increased the size and scope of government.  When Hoover arrived in the White House in 1929, he inherited a surplus of $734 million (back when that was real money).  After he left in 1933, the surplus turned into a $2.6 billion deficit.

Of course, some of this decline was due to lower revenues as a result of the depression, but looking at the outlays during his tenure and you’ll see a massive increase in the size of the federal budget, partly with the help of a Republican Congress as well.  From 1929 to 1933, Hoover increased federal outlays from $3.1 billion to approximately $4.6 billion, a 48% increase. From 1931 to 1932, outlays surged 30%.  Yes, Hoover was a real miser, a free-market fiend who hated spending the money of hard-working taxpayers.

To put Hoover’s 48% increase in perspective, progressives often assailed President Bush as a free-market disciple who refused to spend money on levies, the poor, or the uninsured.  During Bush’s tenure, estimated federal outlays surged 57%, even more than Hoover and LBJ’s Great Society (approximately 50%).

So, the next time you hear someone say that a runaway free-market caused the Great Depression and our current crisis, just remind them that Bush made LBJ look like Uncle Scrooge and Hoover drove federal expenditures faster than President Clinton.  Old rumors die slowly but this is one that needs to end now before we continue to perpetuate even more big-spending government boondoggles.

The White House’s Office of Management and Budget (OMB) today released its mid-year long term deficit projections.  While the  2009 deficit estimates came in at $262 billion less than predicted earlier in the year ($1.58 trillion total), OMB’s 10-year projection increased to a whopping $9 trillion, or $2 trillion more than previously estimated.

That’s a lot of money – so much, that it’s hard for the average person to even comprehend.

Fortunately, John Lott, economist and author of “Freedomonics,” has a great opinion piece today on FoxNews.com that helps put the figure in perspective.  For starters, Lott writes that the new OMB projection “likely underestimates the deficit by at least another $1 trillion,” which means the real 10-year deficit number is probably closer to $10 trillion.  Elaborating on what that means for you and your family, Lott writes:

Ten trillion dollars simply is a lot of money. Whether it is an individual going into debt or a country, spending the money now means that we have less to spend on other things. In the case of ten trillion dollars of national debt, it comes to over $33,000 per person– $130,000 for a family of four. The $130,000 is the amount of taxes that a family is going to have to pay back, somehow, and people have to ask what their family could have gotten for that much money. Is the benefit they get from the government spending all this money greater than what they could have gotten if they had spent that money themselves?