As election season 2010 draws near, the Obama administration has finally realized that the Democrats could actually lose both the House and the Senate in November. Suddenly all Obama wants to talk about is his wonderful new plan for the U.S. economy. Unfortunately, what he is suggesting is far too little and far too late. Anything Obama is proposing now will not be passed by Congress before the upcoming elections, and that is bad news for the Democrats. The American people tend to vote based on their wallets, and right now the American people are not happy. They desperately want someone to “fix” what is wrong with the economy. Obama is running around the country trying to convince people that he is the man to restore the American Dream, but at this point the American people have less faith in his economic policies than ever. The White House is insisting that Obama’s new economic plan is not a new “stimulus package”, and that is actually true. Obama’s new plan will not stimulate much of anything. The truth is that Obama’s new economic plan is really just a cruel joke on those who are willing to have faith in Obama’s ability to somehow turn the dying U.S. economy around. Unfortunately, throwing several hundred billion more dollars at the problem is not going to do anything to fix the foundational problems that are destroying our economic system.
Obama’s new proposals include 200 billion dollars in tax breaks for businesses that invest in new factories and equipment, a 100 billion dollar extension of the tax credit for research and development and 50 billion dollars over the next ten years to improve infrastructure throughout the United States. Obama is also touting his existing proposals to extend tax cuts to American households earning less than 250,000 dollars a year and to allocate 30 billion dollars to provide new incentives to get banks lending to small businesses once again.
So will these proposals bring about a miraculous turnaround in the U.S. economy?
Of course not.
The following are ten reasons why Obama’s “it’s not a stimulus” package is a cruel joke on the American people….
1 - There is very little appetite in Congress for any more “stimulus” spending. Anything that Obama proposes now is not going to get through Congress any time soon. Nothing Obama does now can really have a measurable impact on the economy before the upcoming elections. All he can do is try to convince the American people that he is the man for the job and that they should vote for Democrats in the fall so that they can help him implement these wonderful new ideas. But at this point Americans are rapidly losing faith in Obama.
2 - Obama’s proposals are essentially the equivalent of shooting a spitball at a charging bull. Spending a few hundred billion dollars over the next ten years is going to do nothing to change the momentum of this economy. Any American that is convinced that Obama’s new proposals are a “game changer” is completely and totally delusional.
3 - Obama’s proposals would essentially do next to nothing to solve the horrific housing crisis in the United States. Existing home sales plummeted 27 percent in the month of July. New homes sales dropped to the lowest level ever recorded in July. As you can see from the chart below, things look really, really bad right now, and nothing Obama is proposing is going to change the situation….
4 - Obama’s proposals are going to do very little to put Americans back to work, and Americans are not going to be happy until they have jobs. The “real” level of unemployment in America has been hovering up around the 20 percent mark for over a year. Millions of jobs have been lost to outsourcing and are not ever going to come back. Millions of other Americans have been forced to take low paying jobs in the retail and food service industries just to survive. As you can see from the chart below, in many ways this recession has been the worst recession for jobs since World War II….
5 - Obama’s proposals do absolutely nothing to solve America’s coming retirement crisis. Social Security is now running a deficit, dozens of state and local government pension programs are insolvent, hundreds of corporate pension plans are severely underfunded and most Baby Boomers do not have nearly enough saved up for retirement. Meanwhile, members of the Obama administration are sticking their heads in the sand on this issue and apparently they are hoping that the whole thing does not come crashing down until someone else is in the White House.
6 - Obama’s proposals do nothing about the massive student loan debt bubble that is destroying the lives of hundreds of thousands of young Americans. Hordes of recent college graduates find themselves ensnared in the student loan debt trap and they are horrified when they learn that there is no way out of it. For the first time ever, Americans owe more on student loans than they do on credit cards, and Obama is doing nothing at all to address this horrific debt bubble.
7 - Obama’s proposals will not do much at all to slow the massive increase in the number of Americans being forced into government anti-poverty programs. In 2010, approximately one out of every six Americans is enrolled in an anti-poverty program. That is an absolutely stunning figure. So just how bad are things out there right now? Well, over 40 million Americans are now on food stamps and the U.S. Department of Agriculture is projecting that more than 43 million Americans will be on food stamps by the end of 2011.
8 – Today, America’s middle class is being systematically wiped out of existence, and Obama’s proposals would not do a thing to remedy that. 61 percent of Americans “always or usually” live paycheck to paycheck in 2010, which is way up from 49 percent in 2008 and 43 percent in 2007. Meanwhile, more wealth than ever is being accumulated in the hands of the ultra-wealthy. The answer to this is not to tax the rich. Rather, the answer to this is to keep middle class jobs from leaving the United States.
9 - Obama’s proposals would do absolutely nothing to lower America’s exploding trade deficit. The truth is that most Americans simply do not understand the very high cost of free trade. Every single month, tens of billions more dollars goes out of the United States than comes into it. What that means is that at the end of each and every month the United States is poorer than it was at the beginning of the month. The rest of the world is literally draining us dry and our politicians are doing absolutely nothing about it.
10 - Obama’s proposals would actually make the U.S. national debt even worse. Debt is at the core of our economic problems, and it seems like everything that Obama tries to do makes our debt crisis even worse. The truth is that millions of people are starting to wake up to the horrific amount of debt that we have gotten ourselves into and they do not want the government to go into even more debt. Sadly, the Obama administration is projecting that we will not see anything less than a trillion dollar deficit for many years to come, and a large percentage of the American people is becoming quite upset about all this debt. In fact, the desire to get a handle on our runaway national debt is one of the primary motivations behind the Tea Party movement. But it seems like all Barack Obama can do is spend, spend and spend some more. At some point, all of this spending will catch up with us. In fact, it already is catching up with us. If something is not done quickly to control our skyrocketing national debt, it will not only plunge us into another depression, it will literally destroy our entire economic system.