How seriously are we to take President Obama on economic matters? Is anybody still expecting him to “create jobs?”
Since the early days of his presidential bid in 2007, many have marveled at Barack Obama’s dulcet-toned voice and charming demeanor, while applauding at every word he utters – including what he says about the economy and employment. Now, roughly two and a half years into his presidency, it is painfully apparent that mere charisma and smooth talk don’t “create jobs.”
But why not? What, possibly, could have gone wrong? When Mr. Obama began his presidency in January of 2009 he noted that his “economic stimulus plan” would “save or create three to four million jobs.” Why hasn’t that happened?
The only plausible, reasonable answer to this question has to go something like this: in order for any economy to be sustainable, the majority of its employment opportunities absolutely must come from the for-profit, private sector of our economy. Sure, government agencies employ people too, but they should only employ people in numbers necessary for those agencies to provide essential basic services, and pay these employees commensurate with their private sector counterparts.
The most important thing government can do for the economy is to help to expand employment in the private sector, for-profit arena of our economy. And government can help make this happen, not by cajoling and manipulating and threatening businesses into “hiring,” but rather, by providing a stable and consistent regulatory environment, reasonably low tax rates to businesses and their investors, and encouraging free trade.
Unfortunately, both President Obama’s words and deeds have been hostile towards the private sector, while at the same time he has encouraged the expansion of the government sector. Thus here we are in July of 2011, with many government employees having their compensation and benefits packages expanded, as many private sector businesses continue to eliminate eliminate jobs. President Obama has said and done the opposite of what a President should be doing on economic matters, and – not surprisingly – he has produced the opposite of what we would all want.
If you think this is harsh or unfair, consider some of what the President has been saying over the last few years. Let’s start with this quote from August of 2008, when candidate Obama was speaking before a stadium full of his true believers.
Several American oil companies had just posted some robust profits, and the soon-to-be-President Obama seemed to think this was a bad thing. “First of all,” candidate Obama stated, “you’ve got oil companies making record profits…no… no companies in history have made the kind of profits the oil companies are makin’ right now…They..they…….one company, Exxon Mobil, made eleven billion dollars…billion, with a “b” ….last quarter….they made eleven billion dollars the quarter before that…makin’ money hand-over-fist…makin’ out like bandits…”
That was some great campaign rhetoric back then. But today we are in dire need of great policies from our President – and maligning American companies for being “too profitable” doesn’t incentivize them to grow.
Fast-forward to January 29th of 2009. Despite the economic decline, some of the nation’s largest financial and lending institutions had actually just posted some hefty profits, and had paid their executives bonuses. And once again President Obama chastised the achievement, stating “there will be time for them to make profits, and there will be time for them to get bonuses…now’s not that time, and that’s a message I intend to send directly to them..” Apparently, in Mr. Obama’s view, it is sometimes preferable for companies to be unprofitable – yet unprofitable companies don’t “create jobs.”
And here’s one of my favorites, from May of 2009. Speaking at the commencement exercises at Arizona State University, President Obama advised the new college graduates against private-sector success: “…You’re taught to chase after all the usual brass rings,” the President lamented. “Yah try to be on this ‘who’s who’ list or that ‘top 100 list’…ya chase after the big money, ya figure out how big your corner office is…ya worry about whether or not ya have a fancy enough title, or a fancy enough car…Now you can take that road, and it may work, for some. But at this critical juncture in our nation’s history, at this difficult time, let me suggest that such an approach won’t get you where you want to go. Did you study business? You can go start a company…or, why not go help a struggling not-for-profit find better and more effective ways to help folks in need?”
From there the President went on to extol the many virtues of “public service” – that is, becoming a government employee – and how important it is for people to become public school teachers. Yet he had nothing positive to say about how to create the wealth that funds the non-profit groups and that pays for the labor of the government employees.
Barack Obama is the President who loathes and chastises for-profit enterprise while praising and expanding government bureaucracies. Our current economic conditions provide a mirror image to the President’s vision.