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Tag Archives: economics

Really? Obama Has “Scratched and Clawed” for the Middle Class?

One moment of unintended – and unnoticed – levity occurred near the end of the White House briefing Tuesday, when White House Press Secretary Josh Earnest claimed that President Obama has been “a president of the United States that for the last six and a half years has scratched and clawed to protect the interests of middle-class families all across the country.”

Not sure about who or what he has scratched and clawed. Because the markings are difficult to discern.

The White House is careful to dress up its policies as “middle class economics.” Because the middle class is where the votes are. But the Obama presidency is not about the middle class.

You can agree or disagree with Obama’s methods and policies. But his chief enthusiasm has been helping the lower classes by expanding the welfare state and regulating businesses. The middle class stuff is camouflage for the real agenda.

The proof is in the pudding. Here’s the pudding.

According to Reuters:

Barack Obama enters the final two years of his presidency with a blemish on his legacy that looks impossible to erase: the decline of the middle class he has promised to rescue.

Federal Reserve survey data show families in the middle fifth of the income scale now earn less and their net worth is lower than when Obama took office.

In the six years through 2013, over the recession and recovery that have spanned Obama’s tenure, jobs have been added at the top and bottom of the wage scale, a Reuters analysis of labor statistics shows. In the middle, the economy has shed positions – whether in traditional trades like machining or electrical work, white-collar jobs in human resources, or technical ones like computer operators.

Between 2010 and 2013, as recovery took hold and stock markets soared, the average net worth of families in the top 40 percent of income earners grew. For all others average net worth shrank, declining 19 percent for the middle fifth.

These results stem from specific policies. Obama’s chief domestic initiative, Obamacare, is not a middle class program. It’s an effort to get health insurance to the lower class, including a massive expansion of Medicaid. Expanding health insurance is a good goal, but the way he has done it involves turning insurers effectively into wards of the state and raising the price and lowering the quality of healthcare for everyone else.

Among his other battle cries are raising the minimum wage and legalizing illegal immigrants. He pushed and signed legislation containing massive new regulations on the banks, wants to regulate carbon emissions by fiat, and has enlarged the government’s share of the economy while running up trillions in debt.


Meantime the WEALTHY have benefited during Obama’s tenure for the zero-interest rate Fed policies needed to keep the economy afloat in the absence of any serious presidential leadership on expanding the economy. The low rates have grandly goosed everyone’s stock portfolios and made the rich richer.

These things he scratches and claws for. Not private sector expansion and business-friendly policies that would promote middle class expansion.

And the results speak for themselves.

Obama Touts “Inclusive Capitalism”

In an interview with Ezra Klein of Vox, President Obama said traditional market forces that used to redistribute income are failing and the time for government to do it instead has arrived.

The interview, which ran today, was conducted January 23.

Touting what he referred to as inclusive capitalism, Obama made the case for what actually sounds a lot like socialism.

So part of our job is, what can government do directly through tax policy? What we’ve proposed, for example, in terms of capital gains — that would make a big difference in our capacity to give a tax break to a working mom for child care. And that’s smart policy . . .

We also still have to focus on the front end. Which is even before taxes are paid, are there ways that we can increase the bargaining power: making sure that an employee has some measurable increases in their incomes and their wealth and their security as a consequence of an economy that’s improving. And that’s where issues like labor laws make a difference. That’s where say in shareholder meetings and trying to change the culture in terms of compensation at the corporate level could make a difference. And there’s been some interesting conversations globally around issues like inclusive capitalism and how we can make it work for everybody.

Capitalism, Obama indicated, is no longer working to get enough money out of the hands of the rich and into the hands of workers:

I think that part of what’s changed is that a lot of that burden for making sure that the pie was broadly shared took place before government even got involved. If you had stronger unions, you had higher wages. If you had a corporate culture that felt a sense of place and commitment so that the CEO was in Pittsburgh or was in Detroit and felt obliged, partly because of social pressure but partly because they felt a real affinity toward the community, to re-invest in that community and to be seen as a good corporate citizen.

Today what you have is quarterly earning reports, compensation levels for CEOs that are tied directly to those quarterly earnings. You’ve got international capital that is demanding maximizing short-term profits. And so what happens is that a lot of the distributional questions that used to be handled in the marketplace through decent wages or health care or defined benefit pension plans — those things all are eliminated. And the average employee, the average worker, doesn’t feel any benefit.

Obama, singing from the traditional Leftist hymnal, said we must “make sure” that “folks at the very top are doing enough of their fair share.” He complained about the “winner-take-all aspect of this modern economy” and the need to be “investing enough in the common good.”

Because, you see, you didn’t build that. And you don’t own it either.

White House Suggests Combating Deficit with More Spending

No, it’s true. This is not one of my satire pieces. That’s what they did, in a statement released this morning, and White House Press Secretary Josh Earnest even flagged the statement for reporters traveling with President Obama in Asia so they didn’t miss it.

The news was that the Congressional Budget Office released a report stating that the deficit had come down a little bit more, to the lowest point of the Obama presidency and to a place that is just below the average for the last 50 years.

Buhhhht . . . the average for the last 50 years is pretty bad and has resulted in our current $18 trillion in debt. The estimate also doesn’t include a bunch of spending and tax cuts that routinely get “extended” by Congress, to the tune of more than $1 trillion over ten years.

And the deficit is set to start rising again in just a couple of years, to heights rivaling the levels of the last recession. And that’s all assuming we don’t have another recession.

The White House acknowledges this, and suggests a fix:

CBO’s longer-term budget and economic projections confirm the need for Congress to act to strengthen our economy for the middle class while putting our debt and deficits on a sustainable trajectory, including by making the investments that will accelerate economic growth and generate good new jobs for our workers to fill.

Investments. Get the joke? Investments are what liberals call spending. That will cure the deficit.

And so I’m headed out right now to Dairy Queen to work on my diet.

The Redistribution Recession

There are reasons why five and a half years into the Obama presidency things are still crummy and uncertain. As I’ve mentioned before, specific statist and redistributionist policies have kept a lid on growth. It’s not an accident that President Obama has been unable to bounce the economy out of recession like Reagan or either… Continue Reading

Why Employment is Really Declining

Every month, we get some kind of increase in the jobs numbers – often lackluster and barely ahead of population growth – and every month, the White House effuses that we’ve seen 20 months in a row of job growth while carefully adding, in case those without jobs start bitching about it, there’s more work to… Continue Reading

Economy Posts Modest, but Deceptive Growth

The economy expanded at a rate of 2.8 percent during the third quarter, but the higher-than-expected growth is not as good as it seems because the improvement from the previous quarter was due to inventory building. From the Wall Street Journal: The stronger overall growth was a result of businesses restocking their shelves, a factor… Continue Reading

Obama Wins; Market Tanks

Because people who have skin in the game understand economics. The country voted for higher taxes – including higher capital gains taxes – and more regulation. And so, the stock market reacted rationally, plummeting 350 points in the first two hours of trading. As of 11:35 am ET, the Dow Jones Industrial Average stood at… Continue Reading

Boy, This is Getting Old

From the White House Council of Economic Advisers Chairman: The Employment Situation in May Posted by Alan B. Krueger on June 1, 2012 at 9:34AM EDT Problems in the job market were long in the making and will not be solved overnight.  The economy lost jobs for 25 straight months beginning in February 2008, and over… Continue Reading