A Week of Horrid Headlines

By Alan Caruba

Journalism is often called “History written in a hurry.” If so, last week’s headlines from the front page of The Wall Street Journal reflected a period of our current history that will likely have future historians wondering how we made it through these times without completely losing our minds.

If fear sells newspapers, drives television news ratings, gets bad laws passed, and is useful for selling all manner of other goods and services, than last week must have been very good for business.

The weekend edition, Saturday/Sunday, September 3-4, began with “Job Growth Grinds to a Halt.” The sub-headline was “Lack of Hiring in August Roils Financial Markets; Gloom Ratchets Up Pressure on Obama.” The President would have to wait until the following Thursday to roll out his “Jobs” bill and to tell a joint session of Congress, “Pass this bill now!”

Reluctant to admit its role in the housing mortgage crisis that broke in late 2008 during the political campaign and largely due to Fannie Mae and Freddie Mac—both of whom own 50% of U.S. mortgages—the next article on page one was “U.S. Sues Big Banks Over Home Mortgages.”

Monday was Labor Day so there was no WSJ edition, but on Tuesday, September 6, the lead headline was “Europe Signals Global Gloom” with a sub-headline, “World Markets Fall as Continent’s Debt Crisis Fuels Worries of Lengthy Slowdown.” It reminded me of the cliché that, when the U.S. sneezes, the rest of the world gets pneumonia.” Under the lead story was a headline, “Voter Discontent Deepens Ahead of Obama Jobs Plan.”

By Wednesday, September 7, the headline was “Euro Woes Stir Currency Fears” with a sub-headline, “Older Americans Held Hostage by Mortgages.”

On Thursday, September 8, the headline was “Fed Prepares to Act” with a sub-headline, “Officials Consider Unusual Steps to Avert an Economic Stall.” The nation has been stalled since 2008 when gobs of taxpayer money was used to bailout banks, an insurance company, and two major auto manufacturers. Meanwhile, an accompanying headline said, “U.S. Hits Builders with Pay Probe” about a Labor Department investigation “of the top companies in home building, hitting them with a broad demand for records that has led to complaints of regulatory overreach.” You think?

By Friday, following Obama’s speech, the lead headline was “Obama’s Bid to Spur Growth." The sub-headline was “President Asks Congress for $447 Billion in Cuts, Spending; Tepid GOP Response.” With a $14 trillion national debt, I’d be tepid, too.

The proposed bill would be paid for with tax increases that would kick in after the next election in 2012. They are the same increases a Democrat-controlled Congress refused to authorize!

The Saturday weekend edition, led off with “Banker’s Exit Rattles Markets” and a sub-headline, “In Europe, Top ECB Economist Resigns, Seen as Policy Protest; Dow Industrials Fall 303.68 points.”

Obama speaks. The Dow tanks. Coincidence? I think not.

The other lead article headline was “Treasury Weighs New Tax Scheme.” It began “Treasury floats the notion of eliminating some, but not all taxes on overseas profits of U.S. multinational companies…”

Thus, the week’s WSJ headlines were a microcosm of the fears defining the economies of the U.S. and European nations whose socialist programs and massive over-spending had landed all of them in hot water.

We expect and we want government to exercise prudence in the management of public funds, but successive administrations and congresses did not, electing always to expand government. Let's hope the Fed does not want to print more money. It will cause a collapse of confidence.

It’s September 2011. Welcome to the 1930s.

© Alan Caruba, 2011

The More Obama Speaks...

By Alan Caruba

The most interesting thing happening in the world of politics and finance today is the way Barack Hussein Obama continues to lose traction every time he gives a speech.

After the “jobs” speech, Wall Street dropped three hundred points when the market opened the following morning.

When longtime, staunch supporters of Obama such as MSNBC’s Chris Matthews look and sound betrayed, it is clear that even Obama’s liberal base is in disarray. Matthews, presumably a seasoned political observer, had poured all his faith into Obama, believed in hope and change, and Obama only delivered a huge national debt, the first downgrade of the nation’s triple-A credit rating, massive unemployment, and the sad repetition of failed solutions.

Conservative commentators were openly disdainful of Obama’s use of a joint session of Congress as a stage for a purely political speech, but it was the public as always that had the last word.

Obama’s first speech to a joint session of Congress in February 2009 garnered 52.4 million viewers. By January 2010, the State of the Union speech drew 48 million and the 2011 SOTU attracted only 42.8 million.

His “jobs” speech was watched by 31.5 million. On the East Coast it was 7 PM, but in California it was 4 PM. Maybe it was just the time difference? Or maybe people have decided that listening to Barack Hussein Obama is just a great waste of time, no matter what the hour may be.

I know that the conventional political wisdom is that Obama has 14 months to go and that he’s a great campaigner, but to my eye his audiences following the “jobs” speech were composed mostly of union members or the very young.

Among the military, whenever he addresses them, the silence is palpable. Recall the sullen response he got at West Point when he announced his Afghanistan strategy, if one can even call it that.

There is a hard core of perhaps 20% who love Obama to the exclusion of his record of failure to focus on the economy. Others, though, from the black and Hispanic base are beginning to look for the exit. The Black Caucus is unhappy. Hispanics are unimpressed.

The race card is being played. Class warfare is being encouraged. These are the tools of a demagogue.

Obama, though, is convinced that if he just talks enough he can change opinion; thinks he is the master salesman, the ultimate campaigner. What he does not see, nor sense, is the derision with which his message is being received.

The public has had two and a half years to take his measure and while he cannot be fired until November 2012 and will not leave until January 2013, he is pure poison to any hope of economic recovery. He has the reverse Midis touch; whatever he touches turns to poop.

It was almost comical that the solar panel company he touted as the green jobs wave the future, Solyndra, received millions from the government, filed bankruptcy, and got a visit from the FBI that seized its records and computers. When it comes to picking winners and losers, Obama always manages pick a loser and stick the public with the bill.

Meanwhile his administration seeks to block Boeing from creating new jobs and raids Gibson guitars for using the same wood as every other guitar-maker in the nation. His administration shipped guns to the drug cartels in Mexico for reasons beyond comprehension. His Attorney General pleads ignorance.

His rhythmic phrase, “Pass this bill”, repeated seventeen times in the course of his speech to Congress ignored the fact that there literally is no bill. Out on the campaign trail a day or so later he was still saying it.

Obama is intoxicated with the sound of his voice, his staccato delivery, his hand gestures, and all the other elements of oratory upon which he has depended for his rise to the top. He just hasn’t figured out that it is not what you say, nor how you say it, that matters. What matters is the result of his policies. They don’t work.

Obama matters less and less in national affairs except for the destruction he and his minions continue to wreak upon a nation struggling to come back from a major financial crisis, fearful of his flawed judgment, not hiring, not spending, and waiting impatiently for November 2012 to arrive.

© Alan Caruba, 2011

Jobs? Obama? You're Kidding!

By Alan Caruba

America is dying a death by a thousand cuts in the form of hidden and explicit taxation, the insane generation of new regulations, and the resulting massive unemployment. Obama just selected a new economic advisor who is known to favor a value-added tax that would drive up the cost of everything you purchase.

It’s not like solutions to our economic disaster are not known. They are and the Obama administration will not implement them. They do know what they are doing and it is deliberate.

On September 7, in the guise of a jobs speech Obama will offer massive new spending programs. The money for them would have to be borrowed. The interest on that borrowing would sink the nation further into debt.

In the August 31 edition of The Wall Street Journal, an editorial revealed that, when Speaker John Boehner asked the White House to disclose any “major” federal rules in the works with estimated economic costs of $1 billion or more, he was informed that the Obama regulatory agenda for 2011 contains 219 proposed such new regulatory initiatives.

In 2010 the administration had 191 proposed regulatory initiatives in the works which combined with those proposed in 2011 add up to a total of 410. By contrast the first two years of the Bush administration rulemaking accounted for only 103 new, major regulations.

Of seven pending major rules estimated to cost more than $1 billion one includes the Environmental Protection Agency’s ozone regulations, estimated to cost $90 billion if Congress does not step in and put a stop to it. The EPA is trying to eliminate one tenth of all the utilities that provide the electricity the nation needs to function.

The Competitive Enterprise Institute’s experts on regulation have concluded that the present cost of federal regulation to businesses that must comply with them is $1.75 trillion annually.

If you visit USA Action News.com, you will find an issues section devoted to the Cloward-Piven strategy named after two socialist academics who spelled out just what it would take to economically destroy the nation. It is being implemented by the Obama administration.

Why would anyone at this point think that President Obama knows how to create jobs?

Isn’t this the first President in the nation’s history to be in office when its historic AAA credit rating was downgraded?

Isn’t this the President whose original “stimulus” plan is universally regarded as a costly failure?

Isn’t this the President who added more than $4 trillion to the national debt in just two and a half years?

At TheEconomicCollapseblog.com, you will find an article, “Wake Up America! 10 Very Obvious Reasons Why the Devastating U.S. Jobs Famine is Going to Suck the Hope Right Out of America.”

If you lack the time to delve into it, here are some of its highlights:

Citing a recent article in the Wall Street Journal, it turns out that there are more unemployed Americans than the combined populations of Wyoming, Vermont, North Dakota, Alaska, South Dakota, Delaware, Montana, Rhode Island, Hawaii, Maine, New Hampshire, Idaho, and the District of Columbia.

The number of unemployed Americans is larger than the entire population of Greece!

The number of Americans on food stamps has increased 74% since 2007.

Among the reasons cited or suggested by the article were that politicians in Washington, D.C. really don’t care that the nation is bleeding jobs and, to make matters worse, the Obama administration has instituted a “backdoor amnesty” that would make deporting illegal aliens that hold jobs virtually impossible.

As some U.S. States and local governments face the equivalent of bankruptcy, they are shedding jobs “at an unprecedented rate.” The Center on Budget and Policy Priorities estimates that more than half a million such jobs have been lost since 2008. It forecasts that nearly a half million more will be gone by the end of 2012.

U.S. corporations exist to generate profits and dividends for their investors. As such they must compete in a global marketplace where other nations like China pay pennies in salaries while they must undertake mandated costs over and above any salary they have to pay new U.S. employees. So jobs are exported. Unfair trade practices tip the scale of exports to nations like China that, in turn, do not import a comparable amount of U.S. goods.

As for taxes, businesses of all size in America are “being taxed into oblivion” with U.S. corporate taxes being the highest in the world. Between state and other taxes, Americans give up some 42% of their income before they can put their paycheck in the bank.

This is deliberate.

© Alan Caruba, 2011

My Advice to the POTUS about the SOTU

By Alan Caruba

Some of you will have more important things to do on Tuesday evening than to listen to President Barack Hussein Obama’s second State of the Union, commonly referred to as the SOTU and, of course, he is the POTUS.

Is there an acronym for B-O-R-I-N-G and P-R-E-D-I-C-T-A-B-L-E?

Here’s some free advice for the POTUS. The highlight of your first SOTU was the way you insulted the members of the Supreme Court seated in their robes right in front of you. Way to go, Barack!

A big time Harvard Law School grad like you surely knows gobs more about the law than they do and, don’t forget, you taught a course on the Constitution as an adjunct professor or some such position. At the time, you concluded that the Constitution was a “negative” instrument of government because it wouldn’t let the Congress or you go hog-wild and pass any law you wanted. As we all know, the Constitution is filled with too many phrases that begin “Congress shall make no law…” plus all that checks-and-balances stuff.

When you had a Democrat majority, you showed America what you wanted to do. You, crazy Nancy Pelosi, and the ever-cheerful Harry Reid, rammed Obamacare through even after a million people showed up to say don’t do it. Were the voters grateful? Hell, no! They voted out a ton of those Democrats, replaced them with Republicans, and those new members of the House just voted to repeal your beloved bill.

Well, after two years of waiting for those “shovel ready” and “Green” jobs to show up while you were creating a Marxist worker’s paradise, it’s clear that the SOTU will have to be all about J-O-B-S, with an emphasis on the last two letters.

Most of the genius economists who advised you in the first two years have since fled back to academia and even Rahm has left for the blessed streets of Chicago. So now it’s time to talk about J-O-B-S, with an emphasis on the last two letters.

Your own resume is a bit thin as regards anything most people would regard as a job. Remember when “community organizer” was considered a joke? It still is. Only no one is laughing because they are all out looking for J-O-B-S.

We all know you have to toss in some catchy phrases about foreign affairs, but other than blaming Israel for all the problems in the Middle East including flatulence and sand, no one cares about the rest of the world very much. They’re mostly trying to hold onto or get a J-O-B.

Word is you will also speak about the need for more spending. This is a really bad idea because you and the Democrats have spent us into virtual insolvency at this point and Americans really, really, really hate this.

Just stick to your script from those glorious campaign days in 2008. Remind everyone that everything wrong in the world is the fault of the unexceptional and arrogant U.S.A. Remind everyone that it is all Bush’s fault. Remind everyone that you cannot get out of Iraq or Afghanistan fast enough. Mention the troops. Everyone loves the troops.

It is essential to throw in some reference to global warming, to electric cars, to wind and solar energy, and to take a moment to remind everyone how horrid Big Oil and Big Coal are. That’s pretty much been your energy policy anyway.

As for the business climate in America, it will probably be a good idea not to say bad things about Big Pharma, Big Insurance, Wall Street, or all the other engines of the economy that often employ people who are looking for J-O-B-S.

Mention “civility” and “public discourse” because they score well in focus groups. Also mention “bipartisanship” because it does too and, remember, in two years you will be looking for a J-O-B, so try to fake some humility.

© Alan Caruba, 2011

Strangulation by Regulation

By Alan Caruba

On Tuesday, January 18, I had the opportunity to participate in a conference call initiated by the Office of Management and Budget to roll out President Obama’s executive order regarding the revision of the federal government’s massive regulatory morass.

On the same day, the Wall Street Journal had published President Obama’s commentary “Toward a 21st-Century Regulatory System” in which, at one point, noting that the FDA had found saccharin to be safe, he lauded the Environmental Protection Agency for eliminating its ruling that saccharin was a dangerous chemical.

Steven Milloy of Junk Science.com noted that, while the Food and Drug Administration “considers carbon dioxide to be safe for human consumption in soft drinks, yet the EPA is regulating it as a threat to the public welfare under the Clean Air Act. How about rollin’ that one back?” The EPA has, in its short history, generated more regulations than any other comparable government agency. The EPA is not about science. It’s about power over every aspect of our lives.

EPA regulations regarding carbon dioxide will impose crushing financial burdens on any and all use of electricity and is utterly devoid of any scientific justification. The EPA’s justification is that CO2 causes global warming—which it does not—because there is NO global warming.

The conference call featured OMB Director Jack Lew and the president’s regulatory “czar” Cass Sunstein who has been described as a liberal activist judge who believes free speech needs to be limited for the "common good" and has ruled against personal freedoms including private gun ownership.

Both kept repeating the “talking points” for the executive order, emphasizing “opportunities for public participation and public comment" and “to make sure that regulations are driven by real science.”

This latter attribute has been sorely missing among the many Obama appointees such as his science “czar” John Holdren, his environmental “czar” Carol Browner, and his choice to head the Energy Department, is a true believer in global warming. Some of the opinions expressed by these appointees have bordered on lunacy.

The other meme repeated throughout the conference call was that of “jobs.” In the run-up to the 2012 elections, Obama will say “jobs” a million times despite or because of the obvious fact that the nation is at Depression-level rates for unemployment.

The Competitive Enterprise Institute that closely tracks the impact of federal regulations on business and industry in America was not taken in by the executive order or the rhetoric surrounding it. “This executive order is hardly a war on red tape, and no affected businesses or consumers are going to be able to sue anybody to force compliance—it’s just an ‘order’ to agencies to behave.”

The CEI noted that “Both balancing safety against economic growth and requiring a review of existing rules are features of President Clinton’s EO 12866, which Obama reaffirmed while repealing Bush’s EOs 13258 and 13422.”

CEI noted that “The number of rules in the pipeline at agencies has surged in the past year, from 4,041 at the end of 2009 to 4,225 now, as will be detailed in CEI’s upcoming ‘Ten Thousand Commandments’ report. ‘Major’ rules, those expected to cost over $100 million annually, have experienced an even greater surge.”

When one considers that Obamacare constituted a massive expansion of regulation and that the House has just voted to repeal it, Obama’s executive order looks like window-dressing to hide the fact that this administration, thus far, has engaged in piling on regulations that the public has, in poll after poll, rejected.

This executive order is as empty as all of Obama’s other many promises.

© Alan Caruba, 20011

Job Creation 101

It's Obama Time: Watching Jobs Disappear

Shoveling Borrowed Dollars

By Alan Caruba

You will not find much about “shovel ready” projects on the White House website, but there is an entire site, Recovery.gov, that extols the American Recovery and Reinvestment Act that was signed into law a year ago.

I generally do not spend much time on federal government websites and especially on those that are the creation of those around President Obama. For example, the White House in November 2009 put out an announcement that Vice President Joe Biden and Transportation Secretary Ray LaHood had “jumpstarted more than 10,000 transportation projects across America thanks to the swift allocation of Recovery Act dollars.” At the time of the announcement, “state agencies reported a total of 10,041 approved.”

As we have learned, news out of the White House has in the past involved state districts that don’t even exist, so I tend not to get too excited by such announcements. The projects mentioned included several stretches of new highway in Florida, Kentucky, North Carolina, and Pennsylvania. So far, good news.

The bad news in November was that, while more than $2 billion in federal highway funds had been allocated to California, only $837 million had been awarded for highway projects. “Even more surprising,” reported Eric A. Morris of The New York Times, “only $51 million, or about 2.5 percent of the total, had actually been disbursed.”

While Joe Biden and Ray LaHood were busy patting themselves on the back, Morris reported that “Overall, the U.S. Department of Transportation has managed to disburse only $5.5 billion to the states out of the $30.5 billion in available transportation funds.”

I don’t want to be too hard on the White House because, realistically speaking, major capital investments like highways require a lot of bureaucratic hurdles to jump before they ever begin. These are in place to ensure that the public doesn’t get ripped off and that those undertaking the projects meet fundamental industry standards.

Still, I recall President Obama telling Tom Brokaw on “Meet the Press” back in January 2009 that he had met with several governors “and all of them have projects that are shovel ready.”

Shovel ready became the instant buzzword of 2009 and it evoked visions of crews of newly employed workers drawing paychecks as opposed to the ten million or more (much more) unemployed workers in the nation a year later.

It turns out that a lot of the “stimulus” money went to states that were in serious trouble meeting pension, Medicaid, and other obligations. By October of last year, reportedly the U.S. Department of Health and Human Services had received $33 billion, the Labor Department $28 billion, Education $21 billion and the Social Security Administration $13 billion. That accounted for 86% of the spending to that point.

So, in fact, the American Recovery and Reinvestment Act essentially authorized the borrowing of more billions of dollars to largely fund various government agencies. If any money falls off the edge of the table and some states get the scraps, well that’s a bonus.

A year later, however, most people have figured out that programs like the Recovery Act and “Cash for Clunkers” are just so much White House smoke and mirrors.

They have figured out that the U.S. simply cannot go on borrowing and spending. And they have begun to suspect that a few tax cuts that would put money back in the hands of consumers and investors would have done a far better job of getting the economy on its feet again.

Obama's First Year Ends

By Alan Caruba

After the assassination of John F. Kennedy one of the books about his brief administration was “A Thousand Days” by Arthur M. Schlesinger, Jr. Even so, he had set America on a trip to the Moon, helped advance the Civil Rights movement, and, with Jackie Kennedy, brought a brief era of grace and sophistication to the White House.

January 20 will mark a year since Barack Obama took the oath of office. As this is written, the entire nation awaits the outcome of the special election in Massachusetts and many want to see an end to the Democrat control of the Senate. There are any number of ironies, not the least of which that it was Massachusetts that gave us JFK and his bloated little brother, Teddy.

It is hard to recall a more brutally partisan administration and Congress. Bribery and thuggish uncivil behavior has become the hallmark of the Democrat controlled political process; weakness and appeasement the nation’s foreign policy.

“Yes, we can” has transitioned into a public panic regarding the massive expenditures, the billions spent to take over the auto industry, banks, insurance companies, and an insulting “stimulus” bill devoted more to “green jobs” than real jobs. The final injury as the first year comes to a close would be the passage in the Senate of a widely hated Medicare “reform” that reeked of unconstitutional elements and which will surely be challenged in the courts.

It is astounding that a single Senate vote could end the reign of terror that characterizes Obama’s first year.

The answer Barack Obama gave over and over again was that it was all the fault of George W. Bush. By summer, that excuse had lost its power to influence all but Obama’s most stupid supporters.

Obama’s “first thousand days” will prove critical to the future of the nation. Profligate debt and possible default haunts most of the States and the nation as a whole. Moody’s Investor Services has warned that the nation is barely three years or less away from losing its prized triple-A rating for its securities. China has warned that America cannot assume it will continue to purchase its debt.

On Christmas Day, al Qaeda reminded Americans that all are considered targets in its terror war on the nation and the West. If they wanted to scare us, they succeeded. Perhaps they were encouraged by a President who took three months to make up his mind whether to continue to wage war on them in Afghanistan and three days before he made a public response to the Christmas attack.

After the Fort Hood assault, it was former President Bush who quietly visited the wounded, not President Obama, though he did stage an earlier photo opportunity of his greeting the returning war dead from Afghanistan.

There is no question that, in the first year- of Obama’s first—and likely his last-—term in office, Iran will achieve its goal of becoming a nuclear power with the ability to put warheads on top of missiles capable of hitting anywhere in the Middle East and as far away as Europe. Diplomacy has failed. Only one option remains.

At this writing, very nearly half of the voters express disapproval for Obama’s conduct of the nation’s affairs and they will focus on November’s midterm elections in an effort to politically neuter his administration with a transfer of congressional power to the Republican Party.

If the off-year election of Republican Governors in New Jersey and Virginia was an indicator, the steady stream of announcements by Democrat legislators that they intend to retire or change party affiliation suggests that the writing is clearly on the wall.

The leading indicator, however, remains the unemployment rate, officially at ten percent, but widely considered to be closer to fifteen percent and higher.

The President’s State of the Union speech on January 27 will be parsed and examined like a doctoral dissertation on economics, a subject Obama seems to understand only in terms of Marxist orthodoxy.

Worse for him will be the increasingly widespread view that he lies virtually all the time. He lacks credibility with everyone except the slavish drones of the mainstream media and brain-dead supporters.

Well before the end of his first thousand days, Obama has joined former President Carter among the pantheon of Presidents forever known for their failures.

The Economic Recovery Fantasy

By Alan Caruba

I freely confess that I regard it as a triumph if I can balance my checkbook. My Father was a Certified Public Accountant and surely despaired of his second son (the first became a CPA!) who had no head for numbers.

Like most Americans, though, I find it laughable, if not outright mockery, when the White House and the lapdog media tell me that the nation is now recovering from the recession. The media, as just one example, is bleeding thousands of jobs that are not likely to ever return.

What I do know is that, as of November 1st, 115 banks have failed this year. They represented combined assets of $19.5 billion at the end of September. Most have been gobbled up by larger banks. In 1989, at the height of the savings and loan crisis, the FDIC closed 534 banks or about ten a week.

Rep. Ron Paul, a Republican congressman from Texas, flatly says, “A false recovery is under way. I am reminded of the outlook in 1930 when the experts were certain that the worst of the Depression was over and that recovery was just around the corner. Instead, the interventionist policies of Hoover and Roosevelt caused the Depression to worsen, and the Dow Jones Industrial average did not recover to 1929 levels until 1954.”

It took ten years and a World War for America to dig out of the Great Depression.

The President’s economic team, Christina Romer, Peter Orszag, Larry Summers, Timothy Geithner, and Jared Bernstein scare the heck out of me.

I would much rather have Ben Stein running Treasury and Larry Kudlow overseeing the national economy.

The waste of billions of taxpayer dollars in the bilious “stimulus” bill was the ultimate wet dream of legislators, the opportunity to tap the treasury for every “pork” project they had been promising the voters.

Far worse, however, is the healthcare “reform”, if passed. As reported recently in the Weekly Standard, Medicare fraud now costs Americans an estimated $60 billion a year. Compare that with the annual $8 billion in profits of all the private insurance companies combined!

The Pelosi-Reid bill is Medicare on steroids, but the yet unanswered question is this: If Congress can require you to buy insurance even if you don’t want to, what else can you be compelled to do?

Christiana Romer recently testified before Congress that the stimulus bill has accomplished little at this point. The abortive “Cash for Clunkers” program has been calculated to have actually cost the government six times the rebate whose effect lasted all of a month.

Meanwhile, when its treasury notes are not bought by foreign investors, the nation buys its own debt, a scheme that is impossible to maintain. I do not loan money to myself. I either save it or spend it.

Congress should be reducing taxes—the U.S. tax rate on corporations is among the highest in the world—and taking steps to relieve the tax burden on small businesses which are the heart of employment and the economy in general.

Congress is also getting ready to raise the cost of energy for every American family and enterprise with the hideous “cap-and-trade” bill.

Energy in America has long been one of the most affordable elements of the economy, but the Obama administration is throwing billions at the least productive elements called “clean energy”, solar and wind, while declaring war on coal that provides just over half of all the electricity we use every day.

The figures cited for unemployment are a bad joke. Officially set at 9.5 percent, it is actually likely to be closer to 14 percent, about the same amount as during the Great Depression of the 1930s.

Everyone is aware that the economy is not recovering. It is reflected in reduced inventories. It is reflected in continued layoffs. It is reflected in retail advertisements offering two-for-one deals. It is reflected in less consumer spending. On Halloween, my local mall already had a big Christmas tree on display.

I find it insulting that the government is eager to give money to people defaulting on their mortgages because they couldn’t afford them when the government was pressuring mortgage lenders to make them.

I find it insulting to be told about jobs “created or saved” by the White House when this is a pure fantasy. Only private enterprise creates real jobs. Government jobs add nothing to the economy except another layer of bureaucracy. What America needs is productivity.

I find it insulting to be told that the recession is over when it is just taking a breather before the mounting debt from White House initiatives overwhelms us all, rising unemployment continues, and senseless legislation is still in the pipeline.

None of this is good news, but it is, at least, the real news.

Signs of U.S. Decline

By Alan Caruba

Let me begin by saying I am not an economist, but I have had a rather unique “education” in the way American’s make a living, thanks to a long career as a public relations counselor working with corporations, trade associations, and others across a broad band of manufacturing and other activities, including agricultural.

My working philosophy was that, if I could understand what they were doing, anyone else could as well. Along the way I learned that farming has got to be one of the hardest ways to make a living. It is just dawn to dusk work. Next to that is manufacturing anything.

So, naturally, when Business Week magazine asked on its cover, “Can the future be built in America? Inside the U.S. Manufacturing Crisis”, it caught my eye. As Pete Engardio, the reporter, put it “The good news is that the U.S. is at or near the cutting edge in most of the emerging product areas,” particularly high tech, the bad news is that “Unless the U.S. can magically resurrect its manufacturing base, the good-paying jobs from these breakthroughs will be offshore.”

The irony is that the high tech breakthroughs were paid for with billions of U.S. taxpayer dollars that funded research at federal and university science labs, going back to the 1960s when the new products were just in the idea stage.

The numbers, too, tell the story. “In 2000 the U.S. exported $29 billion more high-tech products than it imported”, but “by 2007 that had turned into a $54 billion trade deficit.”
This is attributed to “two decades of unconstrained out-sourcing to Asia” that has “hallowed out much of America’s base of suppliers, factory managers, and skilled technicians.”

Not mentioned in the article is the way America’s schools have since the 1960s been turning out students with poor math and science skills, along with writing and reading skills. The average freshman college student spends time in “remedial” courses for things earlier generations routinely learned. Add to that the crushing costs of a college education and you have a recipe for a dumbed down and debt-ridden work force.

While we’re being told that the recession is “technically” over and jobs are a “lagging indicator” of recovery, my own worst suspicions are that jobs in general are going to be lagging for a long time to come, especially the skilled ones that nations like China and India are developing with rigorous educational systems.

“Nations in Asia and Europe aggressively court strategic high-tech industries with generous tax breaks, cash grants, cheap credit, low-cost utilities, and speedy regulatory approval.”

“By comparison, the U.S. has been indifferent to manufacturing; even when tax breaks are factored in.” Philosophically, the Obama administration appears to regard both Wall Street and corporations as an enemy that must be subdued with greater and greater regulatory oversight.

The fact that the existing oversight agencies failed in their duties does not seem to be understood. That’s why ponzi schemer, Bernie Madoff, and others were able to get away with it for years.

“Also, it can take two years to obtain all the environmental, health, and safety permits for a modern electronics plant—a lifetime in the tech world.” It’s a lifetime in any business enterprise. The U.S. manufacturing base may be the most heavily regulated segment of society of any nation with which we must compete.

Consider, too, the guiding philosophy of the Obama administration. Anything that contributes to the provision of energy is bad. Coal mines, bad. Offshore oil and natural gas drilling, bad. Anything, too, that uses energy is bad.

America’s auto manufacturers (the federal government and the unions now own General Motors and Chrysler) are being told they must get more mileage out of a gallon of gas, forcing them to modify automobiles in ways that simply make them more dangerous to drive.

In response to a survey by Deloitte Research and the Manufacturing Institute, U.S. executives said they believe that America’s competitiveness will decline further by 2012. An overhaul of the corporate tax code would be a good place to begin to reverse that. U.S. corporations pay higher taxes than just about anywhere else in the world!

These and other indicators are signs of decline in what used to be the greatest economy the world had ever seen. Other nations have watched and learned the lessons we have forgotten or reject. They are going to eat our lunch.