Obama’s Continuing Economic Delusion
By Larry Johnson on September 14, 2009 at 9:00 PM in Current Affairs
I do not hate nor despise Barack Obama. I do believe he is ultimately a well-meaning person. But he also is an opportunist who lacks the experience, judgment and knowledge to be an effective President when it comes to managing economic and fiscal policy. He is a fuzzy headed mix of academia and social work with no grounding in what it takes to form and run a successful business. Running an effective political campaign, which he did, is not the same as running a financially profitable business.
Consider for example Barack’s persistent whining about the terrible deficit he inherited, which he routinely cites as one of the primary causes of the economic troubles we face. I agree with him. But then he continues to yammer and cites his quadrupling of the deficit and the dramatic expansion of Federal Government spending as the prescription to solve our economic problems. That’s like a person who complains about being fat because he ate chocolate covered donuts everyday for breakfast and announces his new diet plan–eat four times the amount of chocolate donuts.
Did you catch his chutzpah on Wall Street today?
Today young Barry Soetoro aka Barack Obama demonstrated his skill as the master of chutzpah. He went to Wall Street to pat himself on his back for rescuing Wall Street firms who had engaged in the equivalent of massive deficit spending. Here’s a key snippet:
Unfortunately, there are some in the financial industry who are misreading this moment. Instead of learning the lessons of Lehman and the crisis from which we are still recovering, they are choosing to ignore them. They do so not just at their own peril, but at our nation’s. So I want them to hear my words: We will not go back to the days of reckless behavior and unchecked excess at the heart of this crisis, where too many were motivated only by the appetite for quick kills and bloated bonuses. Those on Wall Street cannot resume taking risks without regard for consequences, and expect that next time, American taxpayers will be there to break their fall.
They made loans and financial bets they could not cover. Okay. Wall Street was out of control. But what is your excuse Mr. Obama? Who bails out Barack Obama’s fantasy world of economic wonderment when we the printing presses start smoldering from having printed too much funny money? The American people, that’s who. Our quality and standard of living will decline. The money has to come from somewhere. You can’t keep running up a debt forever. You either go bankrupt, figure out a way to make more money to cover your nut, or you cut back your expenses. There is no other way.
I was in Florida last week and chatted with the President of a company that provides a critical building material. I asked about “green shoots” of recovery. He laughed and said things were as bad as ever and not looking up. Now that’s just Florida. But we are seeing similar warning signs in other states. Hell, here in the Washington, DC region, you know, the seat of Government where Obama is spending like a drunken sailor on liberty in Manila, there is this cheery news:
With amenities such as blast-resistant curtains, an environmentally friendly heating-and-cooling system and sweeping views of city attractions, Constitution Center in Southwest Washington seems the ideal place for a federal agency or security-minded company to locate. So says an online sales pitch.
But property managers for the 1.4 million-square-foot building, which is scheduled to be completed in November, have yet to land any tenants, according to data compiled by Delta Associates, an Alexandria-based real estate and economic research firm.
Constitution Center is just one of several dozen existing, newly constructed or soon-to-be-completed office buildings in the Washington region that had vacancy rates in the 80 to 100 percent range as of midyear.
A lack of tenants in the late stages of a project was rare during boom times but is becoming more typical now, commercial real estate experts say, as businesses retrench operations and reduce their need for additional office space. In June, according to Delta’s analysis, the amount of vacant space in the region soared nearly 24 percent, to 47 million square feet from 38 million during the same month a year earlier.
If you can’t rent office space in Washington, DC when the Federal Government is quadrupling deficit spending then I would suggest we are seeing a canary pass out in the mine shaft. Time to run boys and girls. Run for your lives.
But wait, there is more. Barack also has decided to go down the protectionist route and provoked the start of a trade war with China. Pretty damn stupid when you consider the fact that the Chinese hold an enormous share of the U.S. debt. Here’s what the Financial Times reported today:
A full-blown trade row erupted between the US and China after Beijing accused Washington of “rampant protectionism” for imposing heavy duties on imported Chinese tyres and threatened action against imports of US poultry and vehicles.
Trade relations between two of the world’s biggest economies deteriorated after Barack Obama, US president, signed an order late on Friday to impose a new duty of 35 per cent on Chinese tyre imports on top of an existing 4 per cent tariff.
In his first big test on world trade since taking office in January, Mr Obama sided with America’s trade unions, which have complained that a “surge” in imports of Chinese-made tyres had caused 7,000 job losses among US factory workers.
Chen Deming, China’s minister of commerce, condemned the decision, saying that it “sends the wrong signal to the world” at a time when Washington and Beijing should be co-operating to deal with the worst economic and financial crisis in decades.
“This is a grave act of trade protectionism,” Mr Chen said in a statement. “Not only does it violate WTO rules, it contravenes commitments the US government made at the [April] G20 financial summit.”
Here’s the good news–some on the right have speculated that Obama is a “communist.” He ain’t. But he also is not an economic genius. In case you do not recall, it was trade protectionism that exacerbated the Great Depression in the 1930s. Deja vu all over again?
by Ronald Scott
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