Monday, June 08, 2009

How is all that spending going Obama?

( Source: The Economist-KAL’s cartoon )

All over the television news channels we saw Obama's talking heads explaining why the news, the economy and the massive spending bills passed can work, even though it isn't working, and the news reporting that all the spending is actually having the opposite effect of what was intended isn't really as bad as it appears.

Get that? Clear as day huh?

They can spin the news all they want, but the bottom line is still going to be the bottom line.

The Obama's big spending policies are hurting the economy, not helping it.

AP reports:

The Federal Reserve announced a $1.2 trillion plan three months ago designed to push down mortgage rates and breathe life into the housing market.

But this and other big government spending programs are turning out to have the opposite effect. Rates for mortgages and U.S. Treasury debt are now marching higher as nervous bond investors fret about a resurgence of inflation.


A little further down in that same article:

The White House estimates that the government will rack up an unprecedented $1.8 trillion budget deficit this year - more than four times last year's all-time high.

"The bond market is calling the Federal Reserve out," said Mike Larson, a real estate analyst at Weiss Research Inc. in Jupiter, Fla. "Investors are saying that the Fed can't just print money out of thin air to finance a massive deficit."


Vodkapundit plays the headline game. I have done this myself a time or two, because when looking at all the headlines (he uses Drudge to line them all up and put context to them) they seem to mesh together to tell a story and show the bigger picture.

He explains:

Well, duh. Some of us have been warning you about this since before Obama was even sworn in. Look, stimulus spending can’t work, because of one of three things happens:

1. That extra spending means extra taxes which means the whole thing is a wash. (Government spending having some “multiplier” effect unknown to consumer or business spending is a big, fat lie.)

2. That extra spending means extra debt, which drives up interest rates, which chokes off growth.

3. That extra spending means extra money being printed, which means inflation which means any growth is illusory.

Of course, there’s no rule saying you can pick only one result. Mix and match up to all three to suit yourself! If I had to bet, I’d say we will indeed get all three.


He points to a VOA article showing "US Unemployment Rate Gallops Ahead of Expectations."

Austan Goolsbee spoke on Fox News Sunday:

"It is going to be a rough patch [difficult period], not just in the immediate term, but for a little bit of time [in the future]," he said. "You have to turn the economy around, and jobs and job growth tends to come after you turn the economy around."

But Friday's employment news was not all bad. Although the U.S. jobless rate continues to spike higher, the actual number of Americans who lost jobs during the month was the smallest since last September, the fourth consecutive month in which the pace of job losses slowed.

How can the unemployment rate continue to rise sharply while job losses are growing milder? Goolsbee says recent indicators showing improvement in some sectors of the U.S. economy are encouraging Americans who had stopped looking for work to re-enter the job market. With a larger pool of workers comes higher unemployment when the economy continues to shed jobs.


Again, Vodkapundit cuts through the doublespeak of Goolsbee:

Here’s the missing context: The Obama people are the ones making it worse, those stupid idiot dumb-dumbs. What, with the printing of the money, the driving up of the interest rates, and the impending raising of the taxes.

Look. When you hire an employee, you’re betting on the future. You’re betting your own money that there will be enough new business to justify your new hire. And to put a human face on it, you’re making a commitment to another human being who will be counting on the power of your judgement to put food on his table.

Are you going to take that risk and make that commitment when the dumb-dumbs are in charge?


More on Goolsbee's incorrect statements from Keith Hennessey, who remembers what Goolsbee either doesn't or pretends not to.

He has more, go look, but there are some headlines and stories that he didn't include, such as "Obama Promises More Than 600,000 Stimulus Jobs," the subheader is the kicker in that article though."

President promised Monday to deliver more than 600,000 jobs through his $787 billion stimulus plan this summer, with federal agencies pumping billions.


Just ask yourself one question before reading the "fine print," and that is... where is all this money Obama is spending, coming from?

But Obama now promises an accelerated pace of federal spending over the next few months to boost the economy and produce jobs.

"We have a long way to go on our road to recovery but we are going the right way," Obama said in a written statement prepared for his public announcement of the additional summer stimulus activity. "Our measure of progress is the progress the American people see in their own lives. And until that progress is steady and solid, we're going to keep moving forward. We will not grow complacent or rest. Surely and steadily, we will turn this economy around," the statement said.

The announcement comes days after the government reported that the number of unemployed continues to rise; the unemployment rate now sits at 9.4 percent, the highest in more than 25 years. Hundreds of thousands of Americans continue to lose jobs each month, although fewer jobs were lost last month than expected.

Just how much of an impact Obama's recovery program had on the pace of job losses is up for debate. Obama has claimed as many as 150,000 jobs saved or created by his stimulus plan so far, even as government reports have shown the economy has lost more than 1.6 million jobs since Congress approved funding for the program in February.


Obama keeps talking, his talking heads keep excusing, explaining or outright lying and his initial promises and expectations have already failed.

A little lower in that article:

Obama initially offered his stimulus plan as a way to put people back to work, a promise that 3.5 million jobs would be saved or created. The administration's predictions that unemployment would rise no higher than 8 percent already have been shattered, leaving Obama's advisers to caution that job growth takes time, even as recovery spending intensifies.


Put it all together and what do we have? Team Obama spends like a drunk on binge making promises that cannot be kept to get his $787 billion stimulus bill passed, then he and his talking heads say they overestimated the short term good it would do, but he has another brilliant idea, spend MORE, faster.

When the news reflects his policies failure, start ramping it up again and pitching, excusing, blaming others and explaining why what we see is not what is really happening.

The Politico:

While the administration is sensitive to criticism that stimulus spending has been too slow, a new Gallup Poll shows danger in the other direction. For the first time, a majority of respondents disapprove of Obama on the issue of “controlling federal spending” (51 percent to 45 percent), compared with the 67 percent who view him favorably overall.

Could “deficit politics” return as the economy steadies? The poll suggests that the nation’s exploding red ink could be an issue in next year’s midterm congressional races.

Obama also will face increasing questions not only about the deficit explosion, but uncertainty about the effectiveness of the $787 billion stimulus bill. Republicans say the “save or create” metric for jobs is meaningless, since it’s impossible to prove or disprove.

Senate Minority Leader Mitch McConnell (R-Ky.) said in a quote provided to POLITICO: “I’m very skeptical that the spending binge that we’re on is going to produce much good and, even if it does, anytime soon.”


A little tidbit from Gallup, way down at the end, under implications:

This latest Gallup Poll shows that the U.S. public has significantly differentiated views on various dimensions relating to Obama. Americans are most positive when asked about their basic opinions of Obama as a person. They also are positive when asked to assess his overall job performance, and on aspects of his performance relating to foreign and international issues. Americans have become increasingly less positive about Obama's handling of the economy in recent months, and are most negative when asked to say whether they approve of his handling of the federal deficit and federal spending.


He rates well when the question is generic, about him personally or his overall performance, but when the questions get specific... not so much.

All that and we haven't even touched on "Obama's Health Care "illusion", make sure to read all of the Wall Street Journal's piece to understand that bit of irrational logic.

Yup, spend even more.

So, where does this leave us and what is the next move?

Well for team Obama, that is very easy..... more money, to spend more.

Any guesses on when he starts pitching his NEXT stimulus plan and asking for even more than $787 billion and making promises that any rational, thinking person will know cannot be kept?

Oh that is right... the groundwork for the next massive spending package was laid already by Nancy Pelosi, back in March.

Flashback:

House Speaker Nancy Pelosi said Tuesday that Congress needs to "keep the door open" to a another stimulus package -- raising the question of how much the government could eventually spend on top of the $787 billion already allocated to rescue the country from dire economic straits.

"The word of the day is confidence. Confidence in our markets, confidence in lending, confidence in our financial institutions," Pelosi said before suggesting the need for another rescue package during a press conference Tuesday following a meeting with top economists.

Mark Zandi, chief economist and founder of Moody's Economy, took a more definitive stance than Pelosi, telling reporters a second stimulus bill is necessary.

"We are going to need more taxpayer money ... I think another stimulus package is a reasonable assumption because of the way things are going," Zandi said.


They knew, while making all those false promises, that this wasn't going to work.
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