He looked young, fresh and presidential.
Then the press conference began and it was part pitch to the public and the other part a campaign speech. Considering it had been eight months since the last meeting with the press, those hoping for new comments were sorely disappointed. But there was still the question and answer period which began with a question about General Petraeus. It's an important topic especially considering the Benghazi cover up but not what the market wanted to hear. But, then it came, question number two.
President Obama: Jessica Yellin. Where's Jessica? Right there.
Jessica Yellen: Mr. President, on the fiscal cliff - two years ago, sir, you said that you wouldn't extend the Bush-era tax cuts, but at the end of the day, you did. So respectfully, sir, why should the American people and the Republicans believe that you won't cave again this time?
I think the word "cave" angered President Obama and later he really lost it more or less challenging John McCain and Lindsey Graham to meet him behind the White House because they are opposed to Susan Rice being Secretary of State. Of course, the President was the one that threw Rice under a bus in the first place. Anyway, this began a line of answers and follow up questions that actually left more confusion and less confidence than coming into the conference.
It's always harder to charm through a press conference (although this crowd was swooning like it was the Beatles- oops, dating myself again) than prepared statements and its clear washing the Republicans out of the lawmaking process will be harder than dying gray hair.
I thought the reply to the Chuck Todd question left open the door to raising the $250,000 threshold although Gerri Willis from Fox Business Network told me she thought the exact opposite.
I have come to accept there will be a tax hike but think the number has to be $1.0 million, which has denoted wealth for so long; adjusted for inflation, the real number is more like five million. Be that as it may, it felt like all that supposed good will and niceties vanished during the press conference. The stock market plunged as it looks like nobody on either side has had a change of mind. I will admit, however, I'm now wondering if I should color my grays?
I always wanted them on the temples but they're running amok now.
Good Thing They Like the Poor- Keep Creating Them
Big news that didn't make the news yesterday was Census Bureaus' new read on poverty in America. Using updated methodology that takes into account taxes and transfers and real life expenses like commuting and child care, it is now determined that there are 49.7 million people living in poverty or 16.1% of the US population. Poverty is defined as household income for a family of four of $22,811.
* Hispanic 28% from 25.4%
* Asians 16.9% from 11.3%
* Blacks 25.7% from 27.8%
* Whites 11.0% from 9.9%
Full time workers 97.4 million
* Old number 2.7 million or 2.8%
* Supplemental number 4.9 million or 5.1%
Part time workers 46.7 million
* Old number 7.6 million or 16.3%
* New number 8.6 million or 18.5%
These numbers illustrate the fact that not only is there a jobs crisis in America, but the kinds of jobs being created are not paying enough money. While some may think that's a reason for forced unionization, it's really a product of a workforce caught flatfooted in a world that shifted to knowledge-based skills that come with math and engineering degrees. Real incomes are lower over the last four years and it's not about corporate greed. If you're flipping burgers there is only so much money you can command on the open market.
As for hiking taxes on top earners as a way to placate the situation, it's going to be an utter disaster. Perhaps it will lift a few more children out of poverty or adults taking advantage of all the programs, but they will be close enough to poverty that in the grand scheme of things it doesn't make a difference. The lion share of any tax increase is going to be gobbled up by government like a hungry volcano demanding endless sacrifices. Higher taxes don't translate into job skills or real opportunities.
Bashing job creators might make people feel better, but it will not alter circumstances. The only solution is pro-markets policies, lower taxes and encouragement.
I guess the modern-day answer to that age old question is:
It's better to be loved by the 47% and feared by the 53%.
America is in trouble, but the villains aren't those that have achieved the dream. This is a fearful time for all and ironically more so for those that cheer the "solutions." I feel like we are on the cusp of sealing the fate of those stuck in poverty.
