But in 2008, candidate Obama portrayed successful American businesses as the cause of our faltering economy, and a fearful electorate, desperate for solutions and “change,” embraced him as their President. The spiteful rhetoric helped him win the White House – yet the President’s “spite” has transcended mere rhetoric and has become official Administration policy – and this is where the problem lies.
Days after taking office, on January 29th, 2009, the President was hit with the news that in the midst of the economic crash, some American corporations, even some that had received government “bailout” funds, had nonetheless posted profits and had paid bonuses to their executives. In response to the news, President Obama stated at a White House news conference that "there will be time for them to make profits, and there will be time for them to get bonuses…now is not that time. And that's a message that I intend to send directly to them…"
Those were extraordinary words, and at the time they probably helped him politically. Americans didn’t like the tax payer funded” bailouts” in the first place, and the thought that government funds helped bankroll somebody’s “bonus” was especially distasteful.
Yet in terms of economic ideas, Obama’s response was deeply troubling, and for multiple reasons. For one, the President seemed not to care that these corporations had contractual obligations to pay performance bonuses to their executives, and, legally speaking, the contracts had to be honored. Secondly, the President’s remarks implied that, so far as he was concerned, there are times when it is appropriate for American companies to not earn a profit, and times when it is appropriate for workers to not be compensated for their labor.
Since those early days, we’ve experienced repeated incidents of the President and his Administration running rough-shod over the individual rights and choices of private business. There was the self-serving government take-over of G.M., and the questionable “forced bankruptcy” of Chrysler. There have been the various ways in which the Administration has tried to “save” the real estate market, by forcing mortgage lenders to lower interest rates and forgive principal on existing loans, and forbidding home foreclosures.
And there is – of course – the “Obamacare” healthcare law. It imposes new mandates on employers to provide more healthcare to more employees, but also imposes a bevy of new non-healthcare related restrictions and requirements on businesses, and provides for the hiring legions of new IRS agents.
And the President seems baffled that American companies aren’t hiring again, despite the fact that many of them have begun to post solid profit. He seems unaware that his words and actions and policies have given businesses all the incentive they need to not invest, to not take risks, and to not “hire.”
Yes, President Obama has moved America closer to a government run, centrally controlled economic model, yet he seems surprised that his control of things has not produced “jobs.”
President Obama would do well to study the lesson of recent history, as well as economics.
Austin Hill is an Author, Consultant, and Host of "Austin Hill's Big World of Small Business," a syndicated talk show about small business ownership and entrepreneurship. He is Co-Author of the new release "The Virtues Of Capitalism: A Moral Case For Free Markets." , Author of "White House Confidential: The Little Book Of Weird Presidential History," and a frequent guest host for Washington, DC's 105.9 WMAL Talk Radio.
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