Friday, September 7, 2012

Quick Hits - September 7, 2012

Conventions are over - and we're 60 days out from the November elections.

This morning, the August jobs numbers were released by the Bureau of Labor Statistics - and the information cannot be seen as good news for the President.

In August, 96,000 jobs were created (seasonally adjusted), while the June and July job creation numbers, were adjusted downwards by an additional 41,000 jobs.  With the adjustment, the July numbers are barely at the level to match population growth, and the June numbers were only positive by about 40,000 jobs.

The 'official' unemployment rate decreased from 8.3% at the July jobs report to 8.1% - which reflects another major example of the Administration 'cooking the books' - as 398,000 were removed from the job seeking list, dropping the labor participation rate to 63.5% which is the lowest level in 31 years.  If the labor participation rate today was equal to that of January 2009, when Barack Obama was inaugurated, the 'official' unemployment rate would be 11.4%. (U-6 would be almost 20%)  Shrink the labor pool - the unemployment number drops.  'Cook the books' via this tactic, and the majority of the media elements will not call you on cooking the books - and the artificially low unemployment rate is what the average voter sees and recalls.

The standard response from the supporters of President Obama is to ignore the drop in labor participation, ignore the increases of those moving onto disability (and off the unemployment counts), and smile into the camera while spinning that this is the 29th consecutive month of positive job growth, that the President has added 4.5 million jobs (derived from adding all of the 'jobs created' over the last 29 months), and how much better off we are because in December 2008, we lost 800,000 jobs in just that one month.

After the 2003 legislation that accelerated the 2001 tax cuts pushed by George W. Bush, the reviled George W. Bush who, according to the Obama campaign and media killed the national economy, we had 54 consecutive months of positive job growth as well as increasing labor participation levels as the economy grew.

In September 1984 - during the Reagan recovery from the economy disaster that Jimmy Carter inflicted on the United States, 1.1 million jobs were created.  In ONE MONTH.

This remains the weakest, shallowest, slowest economic recovery since FDR's New Deal failed to deliver a viable economic recovery in the wake of the Depression.

Barack Obama has 2 more monthly jobs reports which will be released prior to the November 6th Presidential election.  Will they improve on this past one - where 4 more people were dropped off the unemployment roles than jobs were created?  Doubtful.  Even if the Federal Reserve launches a third round of QE - this is not an economy that showing strength or real growth.

Even worse - we are 4 months away from 'Taxmageddon' - a real fiscal cliff that we are speeding towards.  On January 1, 2013, if no action is taken by Congress and the WH, we are getting hit with massive tax increases across the entire economy - increases that Ernst & Young has estimated will drop GDP by 1.5% and cost us 750,000 jobs - at least.  We're struggling today to hold a 1.5% GDP growth rate - so the odds of a new recession in early 2013 is quite high.

In the face of this, President Obama delivered his acceptance speech at the Democrat National Convention. Unsurprisingly, the sycophants in the mainstream media and the 'left of lenin' rabid base in attendance loved Barack Obama's 40 or so minute long acceptance speech.  Of course, if 'The One' just stood there silent for 40 minutes, this same group would have told us what a great orator Barack is.

In reality, this was a dismal address by the President.  They could have just taken 6 or 7 minutes out of the last several State of the Union addresses and spliced them together to create this speech.  It was little more than a second rate SOTU address....except perhaps he was a little less focused on his 'achievements' or addressing his 2008 campaign promises.

Achievements?  Yes, giving the 'go' order for the SpecOps mission which resulted in the death of Osama Bin Laden was an achievement.  But what are we to make of the reports that three times previously, Barack Obama was unable or unwilling to give the 'go' order - talked out of it by Valerie Jarrett?

Ending the war in Iraq?  Didn't the agreement with Iraq that ended the US military operations get negotiated and completed under the Bush Administration?

Ending the war in Afghanistan?  This President, against the recommendation of his military, prematurely ended the Afghan surge and announced the US withdrawal date.  Our casualties are rising and the enemy is just buying time until we abandon Kabul.

Saving the auto industry?  How many remember that Ford didn't take the government bailout?  Rather than GM and Chrysler going through a proper chapter 11 bankruptcy which would have made both companies stronger (and with perhaps new owners), 60% of GM would not be owned by the UAW.  Over 20,000 non-union workers at Delphi would not have lost their pension, while the union workers didn't lose a penny.  The US taxpayer would not be sitting on $35 billion of paper losses on our ownership share of GM.  Is the US auto industry really better today - or does all that count is the fact that the United Auto Workers are better off.

How about the legislative 'achievements' of the first Barack Obama term in office?  Dodd / Frank financial reform?  The one that benefited the big Wall Street banks and damages the small banks?  Did it prevent Jon Corzine from misappropriating $1.6 billion in client funds in an effort to keep his MF Global operating?  Or result in Corzine's prosecution for embezzlement and malfeasance?  No.  It also didn't 'fix' the fundamental problems that contributed to the subprime mortgage crisis that sparked the 2008 recession - but locked the mindset into place via the Consumer Financial Protection Bureau.

The stimulus?  The one that promised us if it were enacted would make 2009, then 2010 the summer's of recovery?  Prevent the unemployment rate from exceeding 8%?  Promise by the summer of 2012, a 5.3% unemployment rate and a 4.6% GDP growth rate?  Again, we're at a 11.4% unemployment rate if we use the same labor participation rate as in effect in January 2009 - and GDP growth this year is an anemic 1.5%.

Health care reform?  A program that is going to spend $2.4 trillion over the next 10 years on insuring an additional 10% of the US population who weren't insured either privately or via existing government programs (Medicare / Medicaid)?  And this cost comes after significant tax increases (over 20 taking effect 1/1/2013) and pulling $716 billion from Medicare to help pay for the government's takeover of 1/6th of the US economy?  A program that only got passed via underhanded partisan methods - rammed through Congress - and remains having a majority of Americans preferring its repeal.

During the 2008 campaign, we were told that George W. Bush increasing the national deficit by $4 trillion over 8 years was 'unpatriotic'.  We were told that an Obama Administration would halve the deficit in 4 years.  What did we get?  This administration increased spending to 24% of GDP - a level of spending not seen since the depths of the Second World War.  4 consecutive years of a deficit over $1.1 trillion - and another trillion dollar plus deficit likely in 2013.  3 consecutive years without the Democrat majority controlled Senate passing a federal budget - even though federal law requires an annual budget.  An Administration that exceeded the total Bush addition to the national debt in 37 months - and in 44 months, added $6 trillion to the national debt.

Perhaps we are fortunate the the 2013 federal budget submitted by Barack Obama didn't receive a single vote - Democrat or Republican - in Congress, losing 0-414 in the House and 0-97 in the Senate.  It it passed, and Obama gets a second term, he would add to the national debt 2x what Bush did.

None of this was fully revealed by the President in his acceptance speech.  What we did get in that acceptance speech was little more than progressive boilerplate.  New promises (as well as some old promises restated) without any specifics as to how he would deliver on those promises.

We were told that the solution to our challenges is more and bigger government.  That collectivism, social justice, and 'fairness' are part of the solution.  Increase taxes on the wealthy - generating a projected $84 billion in additional annual government revenues, and that 'solves' the $1.1 trillion annual budget deficit.  Gut our national security - and redirect those borrowed funds to unions and 'shovel ready' infrastructure projects and we create 'full employment' and >4% GDP growth.

Increases of domestic oil production on lands not controlled by the federal government, while production on federally controlled lands are decreased, losing billions of taxpayer funds investing in not ready for prime time 'green energy companies' like Solyndra, and regulating coal industry nearly out of business (and massively increasing our energy / electricity costs) as the government picks winners and losers based on ideology worked so well in the last 4 years, we should do it even more in the next 4.

The same arrogant narcissist who told the GOP during 'negotiations' over healthcare reform, 'I won', reminded all who listened to his speech that, 'I am the President' in the same contemptuous tone that Marie Antoinette would have probably used if she had actually said, 'Let them eat cake'.

It's not surprising that the nattering progressive noobs in the mainstream media, in particular, MSNBC, as well as the hardcore progressives in the audience reacted as they did.  Strawmen were setup and slain.  The failures of the past 44 months were not because the progressive agenda leads to failure, but because it wasn't enacted strongly enough.  After all, who are we to believe, 'The One' or our own lying eyes?

This was an acceptance speech that did nothing to reach out to the middle - the independents and or the undecided.  This was a speech designed to motivate the hard left progressive base to turn out in numbers that, in the mind of the Obama team, overwhelm the numbers of conservatives and independents who will turn out on November 6th.  It's a trebling down on the same policies that we experienced in Obama's first term.

Will the American voter support this - or utterly reject it just as they utterly rejected Jimmy Carter in 1980?

Bottom line - this was not a good speech.  It was, as Charles Krauthammer described it, an 'empty' speech. It reinforces the need to remember what Barack Obama said in February 2009 - when he noted that if he couldn't correct the economy in 3 1/2 years, he deserved just a single term in office.

And we voters deserved a reminder that progressivism doesn't work and is against all that this country stands for.

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