Freedom Line Blog

Earlier this month, we noted the sad irony that leaders from welfare states like Germany now lecture President Obama about fiscal discipline.  At the recent G-20 summit in Toronto, Obama attempted to strongarm other industrialized nations into more of the deficit-inflating “stimulus” spending that has failed here, but to no avail. Germany has actually announced budget cuts, whereas Obama admitted that this year’s $1.5 trillion deficit will exceed even last year’s $1.4 trillion pit.

Yesterday, German labor market data provided additional evidence that they were right, and Obama was wrong.  For the thirteenth consecutive month, German unemployment fell, and Germany has now recovered its jobs lost during the recession.  Meanwhile, U.S. unemployment remains near its recessionary high at 9.5%, compared to Germany’s 7.6%.  Obama continues to employ his mindless “jobs saved or created” talking point, but Germany suggests that fiscal discipline and spending restraint are the better course.

Perhaps Obama can go on the German version of “The View” and explain to them why his agenda works better despite the stark evidence.

Below is one of the latest cartoons from Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.

Senate Majority Leader (for the time being, at least)  Harry Reid (D – Nevada) mistakenly believes that he’s got a winning card with his scheduled vote today on yet another unemployment benefit extension.  Reid, along with co-conspirators Nancy Pelosi and President Obama, predictably mischaracterize Republican opposition to the vote that will immediately follow the introduction of replacement West Virginia Senator Carte Goodwin.

But here are some facts.  First, Senate Republicans only request that unemployment benefit extensions be offset with cuts in other forms of runaway federal spending.  Second, Harry Reid’s proposed extension will add $30 billion to this year’s projected $1.4 trillion deficit.  Third, unemployment benefits already stretch for 99 weeks – almost two full years.  Fourth, there have already been seven extensions in unemployment benefits during the period in which Obama’s $1 trillion “stimulus” spending has instead managed to stifle what should be a robust cyclical rebound by this point.  Fifth, even Obama’s own economic advisers have proclaimed that jobless benefits actually perpetuate and exacerbate unemployment itself.

Here’s the better policy prescription:  prevent upcoming tax increases, slow the federal government’s breakneck spending expansion and reduce the threat of anti-growth regulatory uncertainty.  When we implemented those prescriptions during the Reagan Administration, we witnessed astounding two-year gross domestic product growth of approximately 7% over eight consecutive quarters in 1983-1984.  How much longer will it take Harry Reid, Nancy Pelosi and Barack Obama to finally learn that simple lesson?

Senate Majority Leader Harry Reid (D – Nevada), who foolishly said in 2007 “this war is lost” just as the surge was winning in Iraq, just had another one of those “he didn’t really just say that, did he?” moments.

A local reporter raised the issue of high unemployment in Nevada’s hard-hit construction sector, noting that construction companies often find it easier to hire illegal aliens.  To this, Reid bizarrely replied, “any information you have in that regard is absolutely without foundation.”  The reporter then cited a Pew Hispanic Center study showing that 17% of construction workers are illegal aliens, to which Reid replied even more absurdly, “that may be someplace, but it’s not here in Nevada.”

As noted in the following Fox News video, however, the Pew Center confirms that Nevada actually suffers the highest percentage of unauthorized immigrants in the workforce.

Is it any wonder that Reid’s son avoids using the family surname in his own political race for Nevada governor?

Only in Washington, D.C. does the title of this post make any sense.  When gauging the state of jobs in our country, most look to the figure produced by the Bureau of Labor Statistics referred to as “unemployment.”  That number rose last month from 9.7 to 9.9 percent.  Yet the economy added 290,000 non-farm jobs to payrolls.

Obama is upbeat about the numbers as 290,000 people who were not working last month are today.  The silver lining of the unemployment figure is the assumption that some people who gave up on job searching are back at it and thus are counted in the unemployment number again.

But there are plenty of reasons to be skeptical about any assertions the jobs market is rebounding.  Since Obama came into office, Washington has exploded with public sector jobs.  The most illusory job creator is the Census Bureau, which balloons every ten years with temporary positions to complete the national survey.  Of the jobs created last month, the Census created 66,000, building up to the expected 1.2 million temporary jobs at the Bureau, which will not exist next year.

Furthermore, the underemployment rate, which also includes the unemployed who have quit job searching or have taken part-time work because they can’t find a full-time position, continues to climb.   Underemployment has risen from 16.5 percent to 17.1 percent since the beginning of the year.

And Obama has the gall to keep telling us the stimulus, the emergency $787 billion porker that if passed would prevent unemployment from rising above 8 percent, is working.

Even after recent declines, the level of unemployment claims is higher than one would expect it to be if private nonfarm payrolls were really poised to begin sustained gains.”

That is the observation of Joshua Shapiro, an economist at MFR Inc., speaking about the employment and economic climate more than one year after Barack Obama’s trillion-dollar borrow-and-tax-and-spend “stimulus.”

Mr. Shapiro’s assessment echoes a a survey of economists released by the National Association of Business Economics (NABE) this week.  Almost 75% of surveyed economists reported that Obama’s “stimulus” had no effect on the nation’s natural economic healing cycle or employment:

About 73% of those surveyed said employment at their company is neither higher nor lower as a result of the $787 billion Recovery Act, which the White House’s Council of Economic Advisers says is on track to create or save 3.5 million jobs by the end of the year.  That sentiment is shared for the recently passed $17.7 billion jobs bill that calls for tax breaks for businesses that hire and additional infrastructure spending.  More than two-thirds of those polled believe the measure won’t affect payrolls, while 30% expect it to boost hiring ‘moderately.'”

In other words, Obama pointlessly heaped almost $1 trillion more upon our nation’s unsustainable debt to be repaid via some toxic combination of future borrowing and higher taxes.  In pushing that “stimulus,” he promised that it would keep unemployment under 8%, but unemployment continues to fester at 10% and economists say that the “stimulus” had no effect on employment or the natural cyclical recovery.

According to the Department of Labor, the cost of living in America is humming along at an affordable rate, so long as increases in the price of food and energy are ignored.  You read that right: food and energy.  If there is a third category that every American uses more on a daily basis, let me know.  Ignoring the continuing increases in the costs of food and energy to claim the economy isn’t worsening for everyday Americans is like calculating unemployment to exclude people who don’t have a job and stopped looking.  Oh, wait…

For months, Barack Obama has promised to turn his focus toward job creation, but instead obsessed over destructive agenda items like ObamaCare and alienating our international allies like Israel and Britain.  Meanwhile, unemployment festers at approximately 10% despite Obama’s promises over a year ago that it would not exceed 7.8% under his borrow-and-spend “stimulus” program.

So what is the Obama Administration doing now to address American jobs?

Encourage more legal action against employers.

Obama’s Labor Department Secretary Hilda Solis announced last week its “We Can Help!” program, which encourages employees to pursue legal claims against their employers.  This program promises “the use of Spanish/English bilingual public service announcements — featuring activist Dolores Huerta and actors Jimmy Smits and Esai Morales” in order to “address such topics as rights in the workplace and how to file a complaint with the Wage and Hour Division.”

Yes, just the thing to reduce burdens on strapped employers and encourage job creation – more litigation and bureaucratic persecution of private businesses.  Never mind that swarms of ambulance-chasing litigators stand ready to wrench nuisance dollars from employers via litigation – the Obama Administration seems to believe that the pressing issue in our employment picture is not enough employer prosecution.  This program will merely divert employers’ resources toward litigating these cases, taking even more money away from the job creation that our economy needs so desperately.

Perhaps nothing symbolizes our nation’s sad state of political affairs than the fact that government-town Washington, D.C. thrives relative to other major American cities.

As noted by a recent Wall Street Journal report, home prices in the D.C. area rose 2% in 2009, compared to a 3% decline in 20 areas covered by the S&P/Case-Shiller Index.  The capital’s unemployment rate stands at 6.9% compared to 9.7% nationally, and restaurants have added workers in D.C. while other metropolitan areas bleed such jobs.  The reason?  Federal government employment in the area increased by over 20,000, whereas approximately 100,000 private-sector jobs were lost there.  Not only has our bloated federal government increased its employment rolls even as the rest of our society cuts back, but $78.5 billion in federal contract work and the flurry of bureaucratic activity brings domestic and foreign visitors to town.

Americans everywhere have had to trim their budgets and expectations during the downturn, but not the expanding federal government.  What sad, albeit fitting, symbolism.

First, President Obama “invited” Republicans to view the Democrats unveil yet another version of ObamaCare (live on television, to make up for all those previously broken promises of an open process).  That little trap is scheduled for next week.

Now, House Republicans want Democrats to debate unemployment on live television.  That is scheduled for…never, we think.

There is, of course, considerable evidence that nothing is real that doesn’t appear on television.  But if all this talking is only about political oneupsmanship, as it surely seems, we would modestly suggest that pistols at dawn make better television (commercial proceeds going to reduce the deficit), with much greater personal and public consequence.

On year ago tomorrow, Barack Obama was sworn in as the 44th President of the United States.  Where exactly are we as a nation one year later?

The Associated Press has put together an interesting compilation of numbers to help answer that question.  Highlights of the AP piece, which is titled “A By-the-Numbers Look at Obama’s First Year,” include:

– 13 million—Number of people 16 and older unemployed as of January 2009.
– 14.7 million—Number of people 16 and older unemployed as of December 2009.
– 7.7 percent—Unemployment rate January 2009
– 10.0 percent—Unemployment rate December 2009
– $787 billion—Cost of economic stimulus approved by Congress.
– $10.6 trillion—Outstanding public debt Jan. 20, 2009
– $12.3 trillion—Outstanding public debt Jan. 14, 2009.

Read the entire piece via Breitbart.com here.

The nation’s unemployment rate dipped slightly last month, and Barack Obama predictably trumpeted this seemingly-postitive “trend.”

Unfortunately, we can’t pop the champagne corks just yet.

A one-month decline isn’t a “trend” (the unemployment rate has dipped slightly in recent months only to resume its increase, and remains high), and the longer-term prospect of improvement under current leadership is troubling.  As noted by The Wall Street Journal’s Mark Gongloff, the nation still shed 125,000 jobs last month.  Additionally, the portion of unemployed Americans on permanent layoff reached an all-time high of 55.1%, a record 9.3 million remain underemployed, over one million have abandoned the workforce altogether and employers “show little inclination to rehire, even though the recession has supposedly been over for five months now.”

The bottom line is that unlike previous recessions, there is a much dimmer light at the end of the tunnel due to the ominous prospect of new healthcare burdens, skyrocketing deficits, a weakened dollar, draconian carbon cap-and-tax burdens, tax increases, more federal regulations and bald negation of common-law contract rights by the government.  Until Obama, Reid and Pelosi smell the coffee and recognize the gloom that they’re casting over the nation’s economy and employment picture, the prospect of dramatic rebound remains thin.

Ah, the world of Democratic fiscal policy.  If you pass three massive stimulus bills that not only fail to stimulate job growth, but partly contribute to 10.2% unemployment, why not go back to the well and push for tax hikes?

According to the Hill, Democrats are seeking a $150 billion tax on the sale and purchase of financial instruments like stocks and derivatives.  The thinking is that since Wall Street is finally recovering and unemployment is still lingering above 10 percent that Wall Street needs to involuntarily fund a “Job Creation Reserve” for the unemployed.  If that’s all it takes to lift a $14 trillion economy out of recession, why didn’t our exalted class of politicos think of this before?

Now that Wall Street is starting to recover, what better way to welcome it back to prosperity than with a massive new tax hike?  This failed line of thinking reminds me of the old Ronald Reagan quote, “If it moves, tax it.  If it keeps moving, regulate it.  And if it stops moving, subsidize it.”

For real life illustrations of this quote see: Wall Street bailouts/new taxes, taxing “rich people,” bailing out Detroit, subsidizing Amtrak, subsidizing the postal service, subsidizing agriculture, and the regulation of pretty much every productive economic venture in the U.S.

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.

According to the Wall Street Journal, economists predict that our recent global economic meltdown has come to an end.   According to the survey, Gross Domestic Product (GDP) is expected to increase 2.4% in the third quarter of this year.  However, since employment is a lagging indicator, it may take several more months to see a pronounced decline in the unemployment rate.