Thursday, July 25, 2013

A Bitter Bargain

Yesterday President Obama gave his much anticipated speech on the economy.  Since I am on the White House's email list (a hold over from my days as chair of the El Paso Hispanic Chamber of Commerce when I was on the email list of every politician who might need a vote from El Paso) shortly after the speech I received an official White House email, with President Obama's name in the address line, explaining the high points of his new focus on jobs and the economy, which he calls, "A Better Bargain."

"The basic bargain of this country says that if you work hard, you can get ahead--you can build a secure life for your family, and know that your kids will do even better someday. But for more than a decade, that bargain has frayed, and a devastating recession made it worse....In the weeks ahead, in towns across the country, I'll be talking about my ideas for building on the cornerstones of middle-class security: Good jobs with good wages. An education that prepares our children and our workers for a new economy. A home to call your own. Affordable health care when you get sick. A secure retirement even if you're not rich. A better bargain for the middle class and for all who are striving to join it."

As I read the email, I had to wonder whether Obama actually remembers that he has been president four and a half years out of the last decade.  I also have to ask whether he and his cronies in DC are even remotely aware of how hollow his words sound when Americans who are paying any attention at all know that his policies have cost us jobs and incomes.

As a small business owner of fifteen years who had to close my mortgage company April 1st of this year because it was crushed under the weight of regulations imposed by the Dodd Frank bill, I know firsthand that Obama is not only not helping the middle class, he is annihilating it.  So today I want to point out some inconvenient truths about how the Obama Administration is handling the economy in each of the areas he stressed yesterday:


Remember when the Obama White House was supposedly focused like a laser beam on jobs?  Or was that a DeathStar?  The June 2013 jobs report revealed that America is sinking further and further into unemployment and under employment under the weight of massive regulations which make it difficult and expensive to keep the doors open and which disincentivize companies from hiring.

The facts of the current job market are these:

Although the Labor Department recorded 195,000 net new hires in June, it also recorded 247,000 "discouraged workers" who have stopped looking for work.  The U.S. labor participation rate is now 63.5% and more than 20 million Americans are either unemployed but have quit looking for work or are working part-time and can't find full time work.  The rate of under employed and unemployed--no longer looking--jumped to 14.3% of Americans in June.  Over eight million of those were part-time workers who cannot find full time work.  Only 47% of adult Americans are working full time right now.  More than any other single statistic, the 47% figure really speaks to the true state of the economy.  Part-time workers are not eligible for the benefits that Obama touts.  And of course, since Obamacare labels employees full time at a 30 hour week, more and more Americans are seeing their hours cut so that their employers don't have to pay insurance for them.  This is true not only of private employers, but also of quasi-government entities, like state universities and community colleges who are cutting the class times they allow their part-time contract instructors to teach to make sure that nobody exceeds the 30 hour threshold. 

Even though the Obama White House has delayed the employer mandate for a year, employers have already begun to redefine "full" and "part" time.  Successful companies plan their hiring and expansion strategies well ahead of time, so a one year delay in the implementation of Obamacare may cause certain employers to postpone layoffs but it is unlikely to cause any employer to go on a hiring spree.  So unemployment and under employment will remain high in a crisis that the president created by forcing liberal policies that don't work on America's employers.


And speaking of Obamacare, Obama seems to be blissfully unaware of the fact that Americans now know that the law that bears the president's name does not actually cut costs by $2500 a year as he had promised but is instead causing insurance premiums to skyrocket.  In some states, premiums are increasing by 80%.  Young people who had affordable catastrophic care coverage will no longer be able to maintain such coverage because it does not align with the requirements of Obamacare.  And every individual, including those 8 million part-time Americans who cannot find full time work or are seeing their hours cut, will be required to start paying a fine if they can't afford to purchase health insurance in 2014.  Small wonder that critics have now renamed Obamacare the Unaffordable Care Act.


The White House email references that all Americans should have "a home to call their own," but the Dodd Frank legislation that he championed will regulate almost 60% of Americans who qualified to purchase a home in 2010 out of the housing market.  The qualified mortgages and qualified residential mortgages will transform our nation from a nation of home owners to a nation of permanent renters--many of whom will never be able to purchase a home.  And the Obama Administration's love of Smart Growth, Smart Code and Sustainability ultimately endangers the future of all homeownership in the U.S. as the Administration promotes New Urbanism and policies designed to force Americans out of their suburban homes and into tiny apartments above retail shops.


While we are on the subject of Dodd-Frank, I would be remiss in not addressing the fact that the same legislation that will put the American dream out of reach for millions of Americans has also destroyed myriad small businesses and will destroy myriad more.  The real estate and housing industries have been solid economic drivers for many decades.  The housing crash of 2007 and 2008 did a lot of damage, but the Dodd Frank bill ensures that these industries will never recover.  Ironically, the bill creates the Consumer Financial Protection Bureau, an elite army of some of the highest paid civil servants in U.S. history, who work for a director who is answerable to no one but the President himself.  This behemoth is now bringing federal civil lawsuits against private businesses who compensate their employees in ways that the CFPB doesn't like.  Where does that fit into the "good jobs with good wages" model that the president rolled out yesterday?

Of course, the CFPB is not the only enemy of business.  We must not forget Obama's EPA and his war on coal which will destroy the jobs and businesses of many Americans across the nation in the name of improving our country.


The educational system in America is a mess--no doubt about it.  And the failure of the educational system is one reason that the rest of our country is failing as well.  Forty-six percent of adults in Detroit are functionally illiterate, according to an article published last week in the National Review.  And we can see the results of this ignorance in poor choices at the ballot box that have led to Detroit's financial ruin.  But Obama's answer to this catastrophe is more big government--Common Core Standards that emphasize textbooks with social justice messages and revisionist history.  The solution to education in America is to get the Department of Education out of the way and to have each local community hold its own school boards accountable.  And yes, parents are going to have to get involved in their own children's educations.  The government does not force any person to have a child, and people who do have children are not "victims" that the rest of us need to feel sorry for.  Parenting is a responsibility and a privilege, and people who sign up for it need to take ownership of their children's futures.  We don't need a massive bureaucracy to get education straightened out.  We need to scale back the big government and give parents the tools they need to make the right choices for their own families and their own kids. And we need to hold schools accountable for their results.  If we don't we are going to continue pumping money into a system that graduates high schoolers who can't read but are completely fluent in the key points of socialism.  Then again, that type of "education" does fit perfectly into a new economy where everyone is dependent on the government and less than half of the population are able to find a full time job.


With $17 trillion dollars in national debt staring back at us, looming shortfalls in Social Security, and $700 billion in cuts to Medicare to fund Obamacare, the very thought of retirement seems ridiculous.  The President could assure Americans a prosperous retirement by letting them work full time during their most productive years and allowing some privatization of Social Security tax funds, but that would not mesh well with his "cradle to grave" big government mindset.  In The Planner, I envision an America in which the government asks seniors to sign all of their assets over to the federal government in exchange for life long care in a Smart community.  In real life, in the world of Obama speak, "a secure retirement" might mean just about anything, but we can be sure that it does not mean anything good.

Consider this:   When Obama vents about the distinctions between the wealthy one percent and the middle class, he ignores the very blatant fact that each policy he has championed has benefited the wealthy at everyone else's expense.  The very Wall Street crowd that he pretends to despise have made untold millions off of Bernanke quantitative easing policies that forced stocks high by keeping interest rates and Tbond rates artificially low.  But these same policies tend to hurt seniors and retirees who are more likely to have their homes paid for and are living on the interest on their investments.  Further, while the Wall Street crowd is seeing record highs, fewer and fewer Americans can invest in the stock market, which means that Wall Street's record breaking profits are being enjoyed by a shrinking class of people.  The Christian Science Monitor highlighted this disparity in a May 8, 2013 article pointing out that while U.S. stocks have doubled since the lows of 2009, only about 52% of Americans now own stock--either outright or as part of a mutual fund or self-directed retirement account.  This is the lowest level of stock ownership since Gallup has been tracking these statistics since 1998.  By contrast, in 2007, 65% of Americans owned stock.  That ownership represented many Americans who were "not rich" but who had been able to invest in something for their futures.  And the greatest decline in stock ownership is in the 30-64 age bracket--those Americans who are "not rich" but are looking forward to making an investment in their own secure retirement rather than depending on the government to decide what they can and cannot have.

When Obama makes speeches like the one he made yesterday, he is insulting the intelligence of every one of us who is actually watching what is happening.  If he truly had any concern for the middle class he would reverse his job killing, business killing, prosperity killing policies and allow the engines of economic growth to begin to work again.  But that's not about to happen. The American people voted for four more years of Obamanomics, and we are on the receiving end of a very bitter bargain indeed.

Cities across America are going bankrupt from liberal, progressive policies.  Find out why and what you can do about it in this informative presentation.  Agenda 21: Bankrupting America into Utopia, One City at a Time.


Alexandra Swann is the author of No Regrets: How Homeschooling Earned me a Master's Degree at Age Sixteen and several other books. Her novel, The Planner, about an out of control, environmentally-driven federal government implementing Agenda 21, is available on Kindle and in paperback. For more information, visit her website at


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