Categorized | CPA, Economy, Politics

Obama jobs message failure

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Obama’s approval rating on the economy is at a new low. (GOP approval rating and Tea Party approval ratings are also at new lows).

There is real economic fear now after the debt ceiling debacle.

Obama has a new “jobs” message, emailed from the White House.  Here are the bullet points (my comments in parentheses):

1.  Pass new trade agreements (which offshore major U.S. industries);

2.  Payroll tax cut to allow more consumption (instead of production, which we need to revitalize the economy);

3. Extend unemployment benefits (no comment);

4.  Patent reform bill must be passed (which allows Microsoft an advantage over small inventors);

5.  Pass a road construction bill (actually, infrastructure is a pretty good return on investment as per the data);

6.  Help veterans returning from Iraq and Afghanistan find work (umm, we need job availability to do that).

So the economy is tanking and Obama’s approval ratings are tanking.  This list is a disgrace.  The people surrounding Obama have zero ideas on jobs.  The head of Obama’s Jobs Council, Jeff Immelt, runs a major offshoring company (GE).  Other members of the Jobs Council are financial leaders that think a new, albeit dicey, mortgage product is “innovation”.

Then we have Boehner and Tea Partiers with the tax cut message to create jobs.  If tax cuts created jobs, we would be rolling in new jobs after the Bush income tax cuts.  But companies receiving a $300 or $3000 tax benefit can hire no new workers, as compared to companies that get more orders for their products that value $300,000, for example.  You can’t hire if you can’t sell products due to foreign mercantilism.  If you want tax reform, consider a value added tax like successful trading nations have.

The debt ceiling debacle took all the air out of the room.  We shouldn’t even have heard about the debt ceiling being raised.  Reagan and Clinton both raised the debt ceiling.  Reagan raised it 18 times.  I don’t know how many times Bush II raised it, but he did.

We need a dynamic strategy to produce more in this country.  Capture major value add in major industries… the full supply chains.  We need to not only innovate but deliver the technology to companies that produce here in the U.S.  We need to neutralize the state managed capitalism that is cherry picking our industries.

Leaders of the past created great industries in this country.  Boeing and RCA all were built as part of a national defense strategy.  We were a net exporter of goods because of home grown mercantilism, overcoming the Brits with their failed, newfound free trader mentality that tanked them.

Now our leaders feed us red herrings.  Every day.

We need to lead our leaders.  You all should join CPA so we can do this together.

3 Responses to “Obama jobs message failure”

  1. Joseph wawrzyniak says:

    Didn’t we try this once before? Remember shovel ready jobs and the summer of
    Recovery. Before any more money is spent let’s figure out what happened with the first
    Stimulis money so that those projects , those programs and those not so shovel ready jobs
    That didnt work and were wasted in the billion are blocked .

    Thanks
    Joey W

  2. China Watcher says:

    Joey W., look around you and you’ll see the results of decades of neglect of America’s infrastructure. Whatever the shortcomings of the “stimulus” package — a legislative pork-rolling monstrosity to be sure — the need to rebuild our bridges, highways, railroads, waterways, ports and electric distribution systems is palpable. American businesses are hampered by our Third-World infrastructure, and American consumers pay extra as a consequence. The price tag for fixing that runs to several trillion dollars, and it rises daily. Public investment is the public’s business, and it’s been left undone for a generation while we overindulged.

  3. Dr. Bob Goldschmidt says:

    The dot com and housing bubbles along with unsustainable federal deficits of 10% of GDP are all just ways to temporarily mask the underlying problem — the deterioration of worker purchasing power over the past four decades.

    The voters in 2010 had it exactly right when they asked for more and better paying jobs — unfortunately the politicians had nothing to deliver but austerity.

    In order to reverse this loss of purchasing power, we must first look at the causes:

    Outsourcing — The mean wage in the US is $3,333 a month while the mean wage in China is less than $200 a month. This means that when we outsource a job to China, over $3,000 a month of demand is destroyed from the US and the world economies. Repeat this tens of millions of times and it is understandable how we are ripping the heart out of our economy.

    Automation — The cost of the production and maintenance of equipment to eliminate a job is a tiny fraction of worker pay so, again, each job lost to automation destroys about $3,000 a month of demand from the US an world economies.

    Worker Glut — The result of all these people being thrown out of work by outsourcing and automation is that there is a glut of labor which means that wages do not keep up with inflation and even drop.

    Dependence on Imported Oil — The US imports well over 0.5 trillion dollars of oil each year, which would otherwise go to pay for wages. In addition we spend over 0.5 trillion dollars a year in military costs to secure the world oil supply in the Middle East. This investment has no long term return as it would if we alternatively invested in infrastructure projects or education.

    These trends are being seen worldwide, Here in the US, Ford has outsourced all of the Fiesta mfg jobs to Mexico. GM’s Hamtramck, MI plant employees only 1100 workers in a 3,500,000 sq ft automated plant to produce 200,000 cars a year. The UAW has recently agreed that half of the workers in GM’s new MI subcompact plant will make $12.50/hr.

    China has outsourced much of its garment mfg to countries with lower wages like Bangladesh. Foxconn, the largest employer in the world with over one million employees in China has recently announced that they are moving production from the $200/month Eastern areas to inland areas where wages are $130 a month. They have also announced that they plan to eliminate a significant portion of these jobs through Automation.

    We cannot continue down this path unless we are willing to accept the failure of the world economy, the loss of our democracy followed by the rise of a new age of demagogues as in the 1930s. Here are the actions we need to take ASAP to reverse demand destruction and restore worker self reliance:

    Phase in tariffs on everything except raw materials, food and clothing of over 30%.

    Reduce the work week to compensate for job loss from automation

    Finance the conversion of our transportation system from oil to natural gas, electric and renewable energy

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