Obama's Speech Solves Nothing

Donald Lambro

4/15/2011 12:01:00 AM - Donald Lambro
WASHINGTON -- There he goes again. President Obama says that what America needs right now are higher taxes to pay the government's mounting bills and curb its $14 trillion debt.

It isn't enough that every business and every American is already getting whacked daily with $4-a-gallon gasoline prices, because of the White House's policies to discourage drilling for oil. As a result, top economists are cutting their economic-growth forecasts for this year into the mid-2-percentage-point range.

Then there are the new Obamacare taxes that will be imposed on businesses and individuals who don't buy the plans the government wants to impose on everyone.

Throw in federal taxes that rake in about $2.5 trillion a year from all of us, businesses, individuals, retirees, investors, shopkeepers and every other nook and cranny of our economy. Add in all of the state income taxes, sales taxes, property taxes and dozens of other fees and taxes on everything from the tires on our cars to the food we eat.

It isn't as if our economy is going gangbusters, jobs are plentiful, and Obama is getting high marks for how he's handling the nation's economy. Quite the contrary.

In the third year of his presidency, the average unemployment rate remains nearly 9 percent -- with half the states running jobless rates of between 9 percent and 14 percent. A Gallup Poll puts the unemployment rate at 9.6 percent and the underemployment rate at a shocking 18.9 percent.

Meantime, wages have been flat or falling. Home foreclosures continue to rise at a furious pace. Home sales and new construction are in a recession. Small businesses, the engines of employment growth, are still struggling. The New York Times, Washington Post, Wall Street Journal and legions of economists say the economy is still "fragile."

A growing percentage of Americans are blaming Obama and his failed tax-and-spend economic policies. The Gallup Poll reports that 55 percent of Americans say "he is doing a poor job of making America prosperous," and, by 47 percent to 41 percent, they say, "he is doing a poor rather than a good job of improving the nation's energy policy."

Our economic future doesn't look so hot, either. It didn't make the network nightly news shows, but Gallup found in a separate survey that "Optimism about the future of the economy declined across all political parties" during the first three months of this year.

"Democrats remain the most optimistic, with 45 percent saying things are getting better, but this is down from 55 percent in January and 52 percent a year ago. Independents' economic optimism is at 31 percent and Republicans' at 21 percent, both down from January," Gallup said.

Obama's job-approval scores are sinking, too: just 44 percent approve of the job he is doing versus 48 percent who now disapprove.

Democrats on Capitol Hill have complained that he is not showing leadership, staying above the fray. There is rebellion in his party's left-wing electoral base, which feels that he has betrayed the liberal agenda he ran on in 2008.

He has paid only lip service to the mountain of spending, deficits and debts that have piled up during his presidency, until the issue proved incendiary in last year's elections, toppling Democrats from power in the House and pounding them into a weak majority in the Senate.

The White House at first dismissed the idea of any cuts in this year's budget, calling Republican proposals "extreme," then Obama capitulated in a deal that cut nearly $40 billion in spending. It shook his party and his base, which now think he could cave even further to GOP demands for deeper budget cuts and debt reduction.

His speech on Wednesday -- sprinkled with excuses and blame-pointing -- was 90 percent campaign rhetoric and maybe 10 percent economic proposals. Rep. Paul Ryan, R-Wis., the House Budget Committee chairman, fumed that "a speech is not a plan."

Now in the third year of his presidency, Obama is still blaming President George W. Bush's across-the-board tax cuts for all the economic ills that are happening on his watch. He did so again Wednesday in yet another flip-flop of a previous flip-flop.

He ran and governed on repealing the two top tax rates, pushing them to nearly 40 percent, only to throw in the towel last year after being lectured by GOP leaders, and some Democrats, that "this is no time to be raising taxes" on anyone. The lower Bush tax rates were extended for two more years, with Obama's blessing, which means they will expire at the end of 2012. House Republican leaders told Obama that tax increases are out of the question, not now, and not at anytime in the future.

Obama called for eliminating a lot of special interest tax breaks and other loopholes, but it wasn't clear to what end other than to squeeze still more money out of the tax-strapped economy.

His fiscal-reform commission called for closing tax loopholes to cut the 35 percent corporate tax rate to 25 percent. A sensible idea to help boost economic expansion, which will in turn increase federal tax revenues and thus cut the deficit.

But the idea of increasing economic growth was nowhere to be seen in Obama's budget, er, political speech.