Exhibit 1: Stimulus. President Obama signed the Economic Recovery and Reinvestment Act on February 17, 2009. This $787 billion union payoff was supposed to “save or create” 3.5 million jobs and keep the unemployment rate at 8%. We know how that worked out: unemployment rose to and persists at 9%. The only thing “saved or created” by the Recovery Act is those ubiquitous, embarrassing orange roadway signs that serve as a permanent reminder of government failure. No one is ever working beside those signs, but that’s apparently beside the point. According to the government’s own website, www.recovery.gov, around $725 billion has been “paid out,” and 400,000 jobs have been created, for a cost of $1,812,500 per job. Commenting on this debacle, former Republican candidate Gary Miller memorably noted, "My next door neighbor's two dogs have created more shovel-ready jobs than this current administration." Americans no doubt smelled what Johnson was stepping in.
Exhibit 2: The Patient Protection and Affordable Care Act (Obamacare). Signed into law on March 23, 2010, the law was supposed to let Americans keep their existing doctor, lower health care costs, increase health care benefits, spout the fountain of youth, cure love handles and wrinkles, etc. At the signing ceremony, the President applauded himself by noting that, “we are not a nation that scales back its aspirations.” The law may not have scaled back Democratic aspirations, but it has scaled back affordable health coverage: it has forced employers (who could not get a waiver from D.C. bureaucrats) to drop coverage, has increased premiums by as much as 60% for families, led to a spate of lawsuits, and done nothing serious to address the medical malpractice lawsuits that drive up health care costs. Indeed, Health and Human Services staffers told Republican Congressman Darrell Issa, chairman of the House Oversight and Government Reform Committee, that malpractice reform was not a “priority” of the Administration. No kidding. It seems the only jobs “saved or created” by the Affordable Care Act are those of the lawyers contesting the law’s constitutionality.
Exhibit 3: Solyndra and the Green Energy Debacle. On September 4, 2009, after a shoddy, rushed, and politically diluted “due diligence” effort by the White House and, over the objections of the Energy Department, Solyndra received a $535 million federal loan guarantee. Two years later, the California company declared bankruptcy, fired over 1,000 employees and had its office raided by the FBI. Incredibly, as of the date of this writing, November 8, 2011, Solyndra’s website still proclaims that Solyndra’s “solar power solutions offer strong return on investment and make great business sense.” No joke.
Exhibit 3(b) is Massachusetts-based Beacon Power, which received a $43 million loan guarantee to build an energy storage plant in New York. Beacon soon went the way of Solyndra, and after being de-listed on the NASDAQ exchange, filed for bankruptcy protection on October 30, 2011. Similar government-backed green energy failures have been reported in Seattle and Los Angeles. The result of the Green energy escapade: taxpayer money squandered, jobs lost, and a politically motivated industry exposed.
Exhibit 4: Dodd/Frank. Promoted as an effort to “reform” Wall Street, the bill fails of its essential purpose: preventing the conditions that gave rise to the mortgage crisis. It does nothing to regulate trading in complex mortgage-backed securities that proved so tantalizing to risk-takers on Main Street and Wall Street; does not increase capital requirements for banks to ensure they have sufficient assets to cover their losses; does nothing to prevent the ratings agencies – arguably among the chief culprits in the mortgage mess – from giving their blessing to junk securities; and does nothing to reign in Fannie Mae or Freddie Mac or in any way end taxpayers’ obligations for the consistent failings of these GSEs.
Most importantly, Dodd/Frank does nothing to roll back almost twenty years of misguided government policy that incentivizes lending to unfit borrowers and penalizes lenders who have the chutzpah to lend to credit-worthy individuals with a demonstrated ability to repay their obligations. According to a recent Reuter’s “analysis,” Dodd/Frank has proved a boon for attorneys, consultants, and others who will be charged with making sense of the law’s myriad regulations and requirements. The law also created a Consumer Protection Bureau that is all but dead, and perhaps most importantly, mandates feel-good diversity quotas for businesses that do business with government. How reassuring to know that when the next crisis comes and the next Lehman fails, the jobless will meet federal diversity requirements.
Exhibit 5: regulatory overkill. In addition to Dodd/Frank, President Obama’s EPA has unleashed a torrent of job-killing regulations aimed at addressing non-existent health “emergencies,” putting energy plants out of business, and blocking the Keystone XL Pipeline, which would create an estimated 435,000 jobs in the U.S. by 2035. His Interior Department has all but killed oil and gas exploration in or around the continental United States. And the regulatory components of Obamacare threaten to drown small businesses in job-killing red tape and compliance costs. Finally, to add a Christmas insult to regulatory injury, the Obama administration announced – then delayed – taxing the purchase of fresh Christmas trees by $.15 to promote the Christmas tree industry. Santa must have a powerful lobbyist.
Exhibit 6: opposing reform, encouraging stagnation. President Obama came out strongly against the badly needed and thus far successful union benefits reforms enacted in Wisconsin, and similarly opposed the collective bargaining reforms that were passed and then undone this week in Ohio. Further, President Obama has sympathized with the “Occupy” miscreants who have disrupted commerce, defecated on and trashed private property, attacked police, and created modern day Hoovervilles replete with unsanitary conditions, sexual abuse, and drug use. In light of these and other policy misdeeds the president has clearly breached his fiscal duty to manage the economy as a reasonable president would have.
Third, as to causation, President Obama bears principal responsibility: he either directly supported or acquiesced to Democratic congressional support for every initiative noted above, without hesitation or regard to its economic impact. He promised that every offering from the “federal family” would “save or create” millions of jobs. His Vice President, ever careful with his language, promised a “recovery summer” that never materialized. But for President Obama’s actions, the American taxpayer would have avoided the following damages.
Finally, the damages from his economic mismanagement are myriad: hundreds of billions of taxpayer dollars wasted for no appreciable economic benefit; historic debts and deficits incurred at an alarming rate -- federal spending increased as a share of GDP from 20% to 25%, and the federal debt has skyrocketed to $14 trillion; the scandalous downgrading of the nation’s credit rating; food stamp usage and poverty rates are at historic levels; companies are moving overseas to friendlier tax locales; and corporations sit on their cash, hoping for change in 2012 and some measure of economic predictability. Simply put, the economy, job market, and the finances of millions of Americans are worse off as a result of President Obama’s actions and inactions.
The Verdict. President Obama is the chief executive, and the buck stops with him. He has not acted as a reasonable president would have. He pursued a stale Keynesian agenda in an increasingly globalized, complex, and competitive world, and attempted to impose a statist, leftist vision on a center-right nation. The results of his efforts to address the economic challenges present at his inauguration demonstrate that he is not up to the task. He has failed the American people and subjected himself to clear liability. The judgment against him next fall will provide America much needed relief, and fitting relief it will be: electoral eviction of the White House occupant. It can’t come soon enough.