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Thursday, February 14, 2008

Barack Obama's Jobs Plan

If anyone wants to why I oppose Barack Obama, we can start with his economic policy. He unveiled his plan to create jobs today.

Democrat Barack Obama said Wednesday that as president he would spend $210 billion to create jobs in construction and environmental industries, as he tried to win over economically struggling voters. Obama's investment would be over 10 years as part of two programs. The larger is $150 billion to create 5 million so-called "green collar" jobs to develop more environmentally friendly energy sources.

Sixty billion would go to a National Infrastructure Reinvestment Bank to rebuild highways, bridges, airports and other public projects. Obama estimated that could generate nearly 2 million jobs, many of them in the construction industry that's been hit by the housing crisis.

First of all, any plan that spends only 200 billion dollars over ten years is nothing more than window dressing and will likely have negligible effect anyway. (Bush's tax cuts came to roughly 1.3 trillion dollars over the same time period for instance) Let's put that to the side for just for a minute. Obama's philosophy is 180 degrees opposite of mine. I generally distrust the government, and I believe that jobs are almost always better created by the private sector. I believe the best way to create jobs is to simply cut taxes across the board. Obama clearly embraces government playing a role in more not less of our lives. He wants universal health care and now his plan to create jobs also has government taking the lead.

This plan is likely an homage to liberal icon FDR. It is still to this day debateable just how much his massive government spending helped create jobs. What isn't debateable is just how much bureaucracy that plan added. Working in mortgages, I know the corrossive effects of bureaucracy and thus I am turned off by any plan that creates an added layer. To me Obama's plan is frankly nothing more than sophisticated vote buying. He targets those that are struggling and then tells them the government will take care of them. This, like much of his economic policy, flirts with socialism. I envision private industry leading our economy whereas Obama envisions the federal government doing it.

Now, let's get back to the size of the plan. Any reasonable economist will point out that a ten year 200 billion dollar plan is minute. Our economy produces a GDP of about 13 trillion dollars per year. Obama wants to spend 20 billion per year to create jobs. Frankly, there are about one hundred people in America that can contribute their networth and spend more. The reason for this, I believe, is found here...

This agenda is paid for," Obama said as the Republican National Committee promoted an "Obama Spend-O-Meter" online to track his proposals and portray him as a tax-and-spend liberal. Obama explained that the money for his spending proposals will come from ending the Iraq war, cutting tax breaks for corporations, taxing carbon pollution and raising taxes on high income earners.

Obama like all Democrats has made ending the Iraq war, tax breaks for corporations, etc. their rallying cry. The dirty little secret is that the Iraq War and all their other cause celebre don't actually account for very much savings. That is why his jobs plan amounts to 150 billion dollars over ten years. It's because cutting all the demonized programs winds up creating something that is nothing more than window dressing. I have no doubt that his measly 150 billion dollar plan is paid for. Furthermore, he will raise taxes on the biggest income earners, the ones most in a position to stimulate the economy. Whatever jobs we will gain with his plan, we will lose that and then some by raising taxes on the wealthy.

Obama may in fact be able to sell the people on this plan. That's because most of the country is totally economic brain dead. To the average person 150 billion dollars is a lot. That's because less than one tenth of one percent knows the actual size of our economy. Long ago, I guaged Obama as all charisma and no substance. This supposed jobs stimulus is just one more example of his obscenely lacking set of substance.

Finally, here is how Barack Obama's jobs plan fits into an overall worldview that has lots of roots in the world view of Karl Marx.


rhbee said...

Hi Mike,

Here's a thought. Obama didn't choose the $210 billion figure because he wants to give people money for doing nothing. His plan is to use the funds saved by ending an irrational war financed by borrowing us into servitude to foreign powers like China, and financed by lowering taxes for the very people who are making a mint off extending this travesty. His plan isn't to have the government do it. His plan is to fund industries that design and create sustainable goods not consumable ones. His plan is to use the contruction skills our insane real estate market has created to rebuild our highways and byways. Not some highways, some byways, not some earmarked boondoggle that buys more lobbiest homes. His plan is for the whole country's roads and bridges. His plan is to give us, the US, a way to have jobs that last because they are not predicated on making war on some other country but on making our country the best it can be.

Anonymous said...

Gosh, for a provocateur you sure seem like a 'fraidy cat. I posted a comment to your blog yesterday explaining the real ideas behind Obama's economic stimulus plan and I guess you didn't have the guts to deal with it or maybe you aren't smart enough but anyway you didn't enable it which I guess is all the real proof I need that you right wing nuts are all wind and no sail.

Anonymous said...

Mike, I owe you an apology. I just realized that what happened to my comment is the same thing that happens when someone comments at my blog. I have to okay it. And if I'm busy elsewhere then it may take a few days. So sorry about the impatience, but then we all live in impatient times don't we.

Meanwhile, my Sunday LA Times Real Estate section reported something that fits in with our current discussion about bribes. In an article entitled, Mortgage relief for service members, Tom Kelly explained that under a little known statute called the Soldiers and Sailors Civil Relief Act of 1940 which was rewritten and strengthened by the Service-members Civil Relief Act of 2003 serving military personel can seek and obtain relief from any credit debt incurred while in the military. Sounds like real useful help to me but some folks might call the whole program a mighty big bribe. What's curious to me is that this program's existence has only become known now the sub-prime mess is here and it is becoming more and more evident that the military is running out of recruitment options.

mike volpe said...

My apologies, I was under the weather all yesterday.

I think that I need to work on some of my skills in communicating because you are answering points I never made and not answering ones I did.

For instance, my main problem with the plan is that 200 billion over ten years is a joke of a figure to spend on jobs. You didn't even answer that point whereas you spent nearly a paragraph pointing out that the money would go to good works like fixing our high ways.

If Obama wants to fix our highways, that is fine, however this is his JOBS plan not his plan to save our infrastructure. We have had highway bills in the past so I will need to see the fine print, something Obama won't have for a long time, on any public works project before knowing if it will be worthwhile.

Then, you make this point which of course is factually inaccurate,

" the US, a way to have jobs that last because they are not predicated on making war on some other country but on making our country the best it can be."

No, actually if you create public works project jobs they will only be good for the duration of the project.

The point I made, which you clearly missed, is that all of the boogeyman things that Obama, and others like him, demonize Bush and the Republicans only add up to a weak 200 billion ten year jobs plan.

Obama has no sense of proportion. We have a thirteen trillion dollar economy and he wants to spend 20 billion per year to create jobs. (Not mention that some of that spending will be offset by tax increases)

The jobs plan has no chance of accomplishing its main purpose: creating jobs. Whether or not its well intentioned or not is beside the point. It will fail in its main objective. This plan is totally unrealistic. It's unrealistic because all the things that Democrats try and pounce Republicans over the head with don't add up to that much spending.

Anonymous said...

Okay, the point I am making is that the Obama plan is an incentive plan NOT a government will do it for you plan. He will use the money spread out over 10 years to fund the development of industries that provide sustainable products versus consumable ones. The figure seems low because you appear to be predjucdice to think that if the plan comes from a Democant then it automatically means bigger government and higher taxes. The same thing for the construction funds. The intent is to encourage and support not replace private industry with government. In this regard he is very much a small government thinker.

And I don't know where you live but in many parts of the country people are still utilizing buildings that were built with WPA and doing quite well thank you.

I understood your post from the start.

You might enjoy visiting the discussions at jon taplin's blog since you really do strike me as a thinker.

mike volpe said...

Again, you are responding to points I never made. The plan is woefully underfunded. You haven't responded to the obscenely lacking of funding this plan has. If it isn't going to provide enough stimulus to matter, what is the difference what else it may attempt to do? It won't do it on any scale that will make any difference.

He has a well intentioned jobs plan. I never said he didn't. I said it was misguided. I said he wasn't spending enough and he was off setting some of that spending with tax increases. Neither of those bodes well for the plan's success.

You can dress the plan up all you like however it requires that the government spend money to create jobs. This is 180 degrees from the way I see the world. I think that private industry not the government should lead in creating jobs. You can say that he is merely encouraging the right sort of investment, however he is encouraging it through government spending, which also means the size of government will expand.

I am against such a philosophy. That is a quasi socialist philosophy.