Where are the jobs?
Not the stimulus signs, not the rhetoric about “shovel-ready” economic voodoo, not the propping-up of an anemic manufacturing sector, but real jobs?
Polls showed at the beginning of July that President Obama is in an increasingly hazardous position with voters when it comes to jobs and the economy.
The McClatchy-Marist poll put his economic-approval favorable rating at just 37 percent of registered voters, and a Gallup poll found U.S. economic confidence has plummeted by seven percentage points since last month.
Last year in Pennsylvania, Obama used the Allentown Metal Works as backdrop to tout the success of his stimulus and job-creation programs. A couple of months later, the plant closed.
His vice-president, Joe Biden, told a crowd in Pittsburgh that 250,000 to 500,000 jobs would be created each month by the start of last summer. The numbers never even came close.
To date, this administration’s handling of our economy is a failure.
“Excepting some unanticipated major event, the election will largely ride on the state of the economy and public perceptions of how Obama has handled it,” said Mark Rozell, a professor of public policy at George Mason University.
All that the political opposition must do is to seed as much doubt as possible about Obama’s economic leadership, to strike this tone early and often, and the president has a political problem more potent than his rhetorical skills.
On a “Factory Belt” tour last month, Obama spoke about new worker-training partnerships with government and academic elements in the political battlegrounds of Iowa, Ohio, Pennsylvania and Virginia.
It was an attempt to project confidence in our economic future – but it’s hard to sell job growth that is moving at glacial speed.
“In the short term, there may be some support for the president because he is ‘doing something’ about the economy,” explained Rozell, “but, ultimately, the real test is whether economic circumstances improve in time for election day next year.”
In politics, perception is what counts.
Last weekend, the White House released its seventh quarterly report. Written by the White House Council of Economic Advisers, it showed the Obama stimulus effort added or saved fewer than 2.4 million jobs – at a cost to taxpayers of more than $250,000 per job.
Most Americans cannot understand how that can be considered sound economic reasoning. They find it difficult to rally around what, to them, looks like foolishness.
Since the recession began, the private sector has regained about 30 percent of the manufacturing jobs it lost. Those jobs were created in spite of an array of regulatory policies that are detrimental to manufacturing’s expansion.
Add to that the administration’s health-care policies (which drive up the cost of employment by increasing medical insurance costs) and its environmental policies (which drive up the price of energy, particularly in Western Pennsylvania where coal is a major source of energy), and you can see why private-sector companies are skittish about enlarging payrolls.
That means the president has not only a small-business problem but also a blue-collar worker problem. Both are sources of those independent voters who are so essential to winning elections.
And add to all that the Dodd-Frank bill, says former Federal Reserve governor Larry Lindsey, “which has made it much more difficult for banks to make business loans, as more of their resources must be devoted to regulatory compliance and (the) building of capital than to granting loans.”
Partnerships are the key to economic growth. One of the great economists of the 20th century, Joseph Schumpeter, described entrepreneurs as “gap-fillers and input-completers,” meaning that they brought together everything that is needed to create output and jobs in one place, basically by partnering with various groups.
Having entrepreneurs as central to this process is better than having government or academics, because entrepreneurs typically have the knowledge to get things done and have their own money at risk, thus creating real consequences if they fail.
“While the president often talks about having ‘created’ jobs … he didn’t,” explained Lindsey. “Such jobs that have been gained have been produced by risk-taking entrepreneurs.”
All of that “shovel-ready” government stimulus money filled many state budgets but not so many private-sector job rolls.
The president’s resume does not include much indication that he knows how to create jobs – which may, in the end, contribute to him losing his job.