Back in 2008, I had a difficult time detecting any substantive difference between the top-tier candidates — Barack Obama and John McCain — both of whom had surprisingly similar campaign themes: Regulate industry to control greenhouse gases through a cap-and-trade program; play a decisive role worldwide through aggressive foreign policy and generous foreign aid; institute “comprehensive immigration reform” (aka amnesty); ramp up the already huge amounts of deficit spending by backing such programs as the Troubled Asset Relief Program to boost the economy; and maintain the status quo with social welfare programs or even increase spending, etc.
The only key areas where the two candidates significantly differed were in healthcare (McCain called for tax breaks for healthcare spending, and for cutting healthcare costs by allowing the purchase of health insurance across state lines versus what would become ObamaCare) and corporate taxes (McCain wanted them lower, and Obama wanted them higher).
Since I was being promised great “change” from Obama supporters, I decided to consider Obama’s policies with an open mind. And I put together a list of questions for Obama about his policies — the thought being that if Obama, or someone intimately familiar with his positions, could sensibly answer the questions, I’d vote for Obama. No one accepted my challenge, not even Democratic friends and acquaintances who repeatedly sought my vote for their candidate.
It’s time to make the same offer for the 2012 presidential race — with a new set of questions — because I’m told repeatedly that Obama is pushing smart policy, but that his changes will take time to take effect. (The following should be read in order.)
Education Funding
Though taxpayers are pouring money into education, public schools are failing to properly educate students. The Heritage Foundation stated about the education of most minority students in America: “Among African American and Hispanic students … only 56 and 52 percent of students graduate from high school. This widespread failure imposes unquantifiable costs on individual lives and our communities.” Other demographic groups aren’t served a whole lot better: The Washington Times reported in August 2011, “Scores show [American] students aren’t ready for college — 75% may need remedial classes.” And “80 percent of college students taking remedial classes [in 2008] had a high school GPA of 3.0 or better.” In September the Times reported, “SAT reading scores for the high school class of 2011 were the lowest on record, and combined reading and math scores fell to their lowest point since 1995.” So even the best students aren’t learning what they should. This is nothing new; in 1995, SAT scores were “recentered” — artificially raised — to offset a growing number of low test scores.
And poor performance isn’t limited to teens who just don’t try. Lackluster performance begins with the little tykes: The U.S. Department of Health and Human Services found that the Head Start program is an across-the-board failure. Andrew Coulson summarized the finding in the New York Post: “In fact, not a single one of the 114 tests administered to first graders — of academics, socio-emotional development, health care/health status and parenting practice — showed a reliable, statistically significant effect from participating in Head Start.” About adults, the National Right to Read Foundation stated, “According to the National Adult Literacy Survey [of 1992], 42 million adult Americans can’t read; 50 million can recognize so few printed words they are limited to a 4th or 5th grade reading level.” The 2003 survey — renamed the National Assessment of Adult Literacy — found that high proficiency in reading declined between 1992 and 2003 among Whites and Hispanics. Blacks stayed the same; only Asian/Pacific Islanders saw increased ability — by three percent.
Making the situation worse, in the 1990s, the U.S. government estimated that states needed 13,400 employees to oversee federal education programs and that as little as 65 cents of each dollar leaving Washington made it to the classroom — and that was before an explosion of federal education regulations. So why, though federal spending has already increased from $33.52 billion in 1997 to $68.3 billion in 2011 (and total per pupil k-12 spending, adjusted for inflation, increasing almost 300 percent, to in excess of $151,000, since 1970), does Obama insist, without any empirical evidence of increased learning, that the federal government become more involved in education and spend more on education when worldwide test scores show no advantage to be gained from national standards?
Rules and Regulations
The Code of Federal Regulations, which merely codifies existing federal rules, now exceeds 165,000 pages. Medicare’s laws and regulations run in excess of 132,000 pages. Present regulations are causing an unbearable burden on businesses, stifling their competitiveness. For instance, according to the Competitive Enterprise Institute, as of 2008, just figuring out taxes and complying with tax rules costs businesses $160 billion per year. Altogether, abiding by federal regulations costs $1.752 trillion per year, while the government spends “$55.4 billion (on budget) to administer and police the regulatory enterprise,” according to CEI. And “of the 4,225 regulations now in the pipeline, 224 are ‘economically significant’ rules wielding at least $100 million in economic impact … 845 affect small business, an 11.5-percent increase over 758 in 2009.”
Even the Obama administration has yielded to the truth about this anchor on the economy: In January and August of 2011, officials declared that the administration would work to streamline or eliminate red tape weighting down workplaces. But, overall, the burden is growing, not shrinking. The Washington Times noted after Obama’s first mission to cut regulations: “Since that order, more than seven months ago, the administration has repealed only one rule — a rule that effectively treated spilled milk like an oil spill. By contrast, since the start of the year, the administration has proposed more than 340 regulations at a cost of more than $65 billion to job creators.”
Also, by definition, “regulations” impose or forbid certain behaviors on individuals and companies, meaning that the Obama administration is erasing rights and freedoms at a frenetic pace. Ironically, the fact that the government passes so many new rules means that the previous rules it passed didn’t accomplish the claimed objectives.
Considering the costs in the way of money, jobs, and lost liberties of these new regulations, at what point will you say that we have enough laws, or even too many laws?
Jobs and Government Stimulus
Obama favors boosting government spending through “shovel-ready projects” to pull America out of its recession/depression. He contends that cutting government spending is a proven failed remedy. He insists that increasing government spending works to boost jobs.1 But abundant evidence seems to prove just the opposite. Japan, which suffered a burst economic bubble from much malinvestment owing to artificially low interest rates — interest rates set by the Bank of Japan (BOJ), rather than by free-market forces’ assessments of risks on loans — has tried since 1992 to spend its way to prosperity. The Ludwig von Mises Institute explained in 2004:
Japan spent 65.5 trillion yen between 1992 and 1995. In 1995, the BOJ dropped its discount rate to 0.5%. In 1998, two spending packages worth 40.6 trillion yen were revealed. In 1999, came yet another fiscal stimulus package, this one worth 18 trillion yen. In 2000, another 11 trillion. Much of this deluge of money was put into public works projects or funneled through to politically favored businessmen. Japan’s finances weakened as its debts grew.
Its economy has not recovered, and it has the highest debt-to-GDP ratio of all industrialized countries (at 201 percent of GDP). Likewise, the economies of Greece, Portugal, Ireland, Spain, and Italy are on the brink of insolvency though each of the governments spent money on government programs at an unsustainable rate.
In the United States, Presidents Herbert Hoover and Franklin Delano Roosevelt increased the size and scope of government to end the Great Depression. Under Hoover, who Progressives often claim took a hands-off approach in resolving the Depression, “Federal spending increased by almost 50 percent over the two years following the crash (during a period of significant price deflation). During that same period, the federal budget went from a small surplus to a deficit of approximately 4 percent of GDP. Meanwhile, the Federal Reserve reduced interest rates from 6 percent to 1.5 percent — the lowest level in US history.” And that was just the beginning of his intervention.
Under FDR’s New Deal programs, government spending and programs flourished, yet “U.S. Census Bureau statistics show that the official unemployment rate was still 17.2 percent in 1939 despite seven years of ‘economic salvation’ at the hands of the Roosevelt administration (the normal, pre-Depression unemployment rate was about 3 percent),” according to economist Thomas J. DiLorenzo. Under Obama, even using the Obama administration’s figures for the amount of jobs it saved through its 2009 stimulus spending, each job cost taxpayers $160,000. More credible numbers show each job costing $646,000.
On the other hand, after WWII, when the federal budget plummeted “from $98.4 billion in 1945 to $33 billion in 1948, that brought forth economic recovery. Private-sector production increased by almost one-third in 1946 alone, as private capital investment increased for the first time in eighteen years,” according to DiLorenzo. Similarly, the economies in Canada, Chile, and New Zealand burgeoned when they cut spending and shrank government. (Unfortunately, Canada’s government-run, universal healthcare system2 is now on the verge of eating up all its revenues, undoing the benefits of past cuts.)
Why should America continue to take money from the wealth-creating private sector, causing wage stagnation and job losses, and give it to the public sector to invest — passing Obama’s jobs bill (aka stimulus package) — when such policies have not been shown to work?
Taxing the Rich
President Obama shows no inclination to cut U.S. spending. During his administration the federal debt has increased from $10.626 trillion to above $15 trillion. And the evidence he cites to prove that he is serious about cutting spending — his proposals for $2.2 trillion in spending cuts — demonstrates exactly the opposite. In reality, his proposed cuts are merely proposals to limit future planned spending increases, not cut present spending. If the U.S. government were to merely freeze spending at present levels, it would cut more than Obama’s proposals.
Instead of making real cuts, Obama says he wants to “tax the rich” and make them pay their fair share. But as David Burge pointed out on his Iowahawk blog, if government attempted to pay for our country’s 2011 budget of $3.7 trillion by taking every penny of the Fortune 500 companies’ 2010 global profits ($391 billion); every penny of all major league sports’ salaries, along with NASCAR and PGA salaries ($9.4 billion); every penny made in every household above $250,000 ($1.412 trillion); the money and assets of all billionaires and of the next 100 almost billionaires ($1.43 trillion); and we stop all warmaking ($264 billion) and eliminate foreign aid ($50 billion), it would fall short ($3.556 trillion).
Too, even increasing federal taxes to pay for current spending wouldn’t leave much surplus for states and local governments to survive on and would demolish the productive sector in this country.
Unless Obama redefines the word “rich” to mean everyone who actually earns an income in this country, where does Obama think more tax money is going to come from to implement his plans?
Size of Government
President Obama claimed in December 2009 that the federal government “will go bankrupt” if we don’t drastically cut healthcare spending. (A country goes bankrupt when it cannot pay debts based off its capital creation and instead relies primarily on printing new money to pay debts, causing hyperinflation.) And he appears to have been correct about his bankruptcy prediction. The U.S. national debt is over $15 trillion, more than $131,000 per taxpayer; the unfunded liabilities just for the government’s prescription drug plan, pushed by the Bush administration, and Medicare are in excess of $100 trillion, according to USDebtClock.org; and just U.S. spending on Social Security, Medicare, Medicaid, and interest on the national debt will consume all of our national revenue before the year 2035, according to the Congressional Budget Office — that’s minus defense spending, outlays for federal prisons, federal employee payments (and retirement payments), and every other type of federal spending.
And spending on the Big Four items will likely consume all of the budget long before 2035 because the CBO’s projected yearly deficits of $800 billion a year are likely far understated, higher interest payments demanded by foreigners would quickly burgeon U.S. debt (according to a 2010 study by the Congressional Budget Office, a four-percent increase in interest on the debt would increase debt payments in excess of $100 billion in a year and by $460 billion in five years), and even a one-percent rise in inflation equals $700 billion in additional debt over 10 years.
Between now and 2035, to pay for all federal spending that isn’t covered by tax receipts, our politicians plan to print money or borrow money from other countries — even when money is borrowed, we’ll print money to make the interest payments on the debt.
Considering that there aren’t enough “rich people” in America to even balance the budget, let alone pay off the debt, and that more taxes mean less start-up money for jobs-producing, wealth-creating businesses, how does Obama expect our country to avoid fiscal ruin while inflating the size and cost of government?
A Dollar Crash
If the government could create wealth by printing more money, then why not print enough to give every citizen (say) $5 million and make everyone wealthy? It wouldn’t work that way, of course. The U.S. dollars would essentially turn into Monopoly money, worth only as much as the paper they’re printed on (essentially worthless) because there are so many of them. The devaluing of the dollar in such a circumstance would be similar to what would happen to diamond prices if diamonds became as common as sand.
Since paper money’s initial creation, the overprinting of money has led to hyperinflation again and again, destroying the paper currencies: China experienced repeated currency crashes from about 1150 A.D. to 1455 A.D., a time when China abandoned its paper money experiments and began using silver for currency. By overprinting their money, 21 countries have experienced runaway inflation — essentially destroying their currencies — in just the last 25 years, including Russia, Argentina, Zimbabwe, Brazil, Poland, Turkey, Yugoslavia, often leading to horrible repercussions for the people in those countries. (In Russia, money that had been enough to buy a three-room apartment within a few months devalued and would buy only a pair of boots, leading to rampant malnutrition.3)
Knowing that the entire eurozone is on the brink of disaster from an insolvent euro caused by overspending and that U.S. spending will soon push our country to the point where it can’t afford to pay for its programs and the interest on its debts, why has Obama continued to increase spending and debt, speeding the U.S. dollar to destruction?
Renewable Energy
In one year a nuclear power plant provides the same power as 2,200 30-story wind turbines covering 300 square miles of America’s countryside or seascape. And according to an article in the very liberal Washington Post, Energinet.dk, the operator of Denmark’s natural gas and electricity grids, has admitted that Denmark, “the poster child for wind energy,” did not reduce the amount of greenhouse gases released into the environment: “Denmark … more than doubled its production of wind energy between 1999 and 2007. Yet data … show that carbon dioxide emissions from electricity generation in 2007 were at about the same level as they were in 1990, before the country began its frenzied construction of turbines.”
Carbon dioxide releases did not go down because when wind turbines are producing electrical power, conventional electric plants — nuclear, coal, or natural gas — must always continue to run near zero efficiency, ready to immediately take over the electric load in case the wind dies off. In fact, because the back-up power plants, termed “spinning reserves,” must constantly increase or shed heat in their boilers to match wind fluctuations, more CO2 is often created by adding wind power to the energy mix. This is true because industrial amounts of electricity cannot be readily stored as back-up — batteries aren’t good for such storage — and electricity is used at the moment it is generated. Knowing this is true, we can logically infer that wind power doesn’t replace any conventional power sources; instead, it merely causes electricity prices to rise to cover the costs of building and operating the wind turbines — according to Wikipedia, Denmark has the most expensive electric rates in Europe, almost four times as expensive as in the United States. So why would you consider the administration’s funding of wind power to be beneficial to the United States?
ObamaCare Costs
Obama’s Patient Protection and Affordable Care Act, called ObamaCare, was passed ostensibly to save the U.S. healthcare system. But ObamaCare is virtually identical to RomneyCare, the healthcare plan passed in Massachusetts in 2006, which has resulted in, according to an April 2011 Blue Cross/Blue Shield report, Massachusetts having the highest healthcare costs in the nation (which are expected to double by 2020). And these costs aren’t caused by insurers’ excessive profits: The six largest insurers sued to raise insurance rates because they lost $200 million in Massachusetts in 2009.
In 2010, Medicare’s chief actuary Richard Foster stated that healthcare spending would rise with ObamaCare’s passage by $222 billion, not fall as claimed, over 10 years because ObamaCare is predicated on Medicare payment cuts to doctors that will never take place. In 2011, Medicare’s Office of the Actuary predicted that healthcare spending will begin increasing significantly, largely as a result of ObamaCare. As Michael Tennant wrote for The New American online on July 30, 2011: “By 2020 the United States will be spending $4.6 trillion — nearly a fifth of the gross domestic product — on healthcare, almost half of which will come from government…. Spending is really expected to take off in 2014, the year major provisions of ObamaCare go into effect, with overall healthcare spending projected to rise by 8.3 percent.” And that projection was made before ObamaCare’s Community Living Assistance Services and Support (CLASS) Act — which was supposed to provide long-term care to the elderly — collapsed in October 2011, because the law stated that the Obama administration must demonstrate that CLASS would be fiscally solvent for 75 years, and the administration couldn’t do that. The CLASS Act had been used to bolster claims that ObamaCare would reduce the deficit because CLASS was supposed to collect funds for at least five years before it dispersed any funds for care, building a trust fund of sorts. Despite the fact that in its first 10 years ObamaCare adds a half trillion dollars in new taxes — on items such as health insurance, tanning beds, and pharmaceuticals — the Congressional Budget Office says that ObamaCare will raise the national debt $1.36 trillion in seven years after full implementation of just two of its crucial mandates.
Since high costs are the number one healthcare problem, causing people to not be able to afford medical care (and bankrupting the United States), how will ObamaCare improve healthcare in the long term?
Healthcare Accessibility
A main rationale behind universal, government-run healthcare is that there would be more-abundant, better-quality care available for everyone if greedy insurance companies could be cut out as the middle-men in the medical equation. This claim is made because healthcare costs must be picked up by taxpayers through Medicaid, Medicare, and other government programs when private health insurers don’t pay for them, such as when, as Obama said, insurance companies “deny coverage or drop coverage or charge fees that people can’t afford.” In other words, it’s all about saving money.
This makes some sense: At my chiropractor, treatments cost $55 if insurance companies get involved, but only $32.50 if cash is paid up front.
But if saving money is a key to expanding medical care, what good reason can there be for ignoring the implementation of free-market reforms that would bring about huge cost savings — initiatives that have the side benefit of allowing individual choice and freedom in healthcare decisions? Such reforms include encouraging, through tax breaks and other methods, the opening of cash-for-care clinics that do not take Medicare, Medicaid, or private health insurance, since all of those programs require large amounts of paperwork — and dollars — so that the doctors get reimbursed for their care. The government and insurance companies require doctors to “code” all medical billing using Current Procedural Terminology codes, a system patented by the American Medical Association for which providers must pay user fees, and code the condition of the patient using the International Classification of Diseases (ICD). ICD alone, which now has 18,000 codes, will soon have 140,000 codes. Paperwork takes up about a third of a doctor’s time each day, and just wasted administrative costs are estimated at about $210 billion a year — total costs are far higher — out of about $2.5 trillion in total U.S. healthcare spending. Moreover, government-run “health insurance” programs like Medicare and Medicaid are very inefficient: A survey by the Association of American Physicians and Surgeons found that “Medicare claims cost on average 26% more to process and handle than private claims.”
Without the unnecessary administrative burden, cash-for-care clinics can charge extremely low rates for care: The Surgery Center of Oklahoma posts online the cash prices for the surgeries it does, and many are less than a typical insurance deductible. If cash-for-care were available for both primary and specialized care, only very inexpensive ($50 a month is not unusual) catastrophic-care insurance would be needed, saving households thousands of dollars per year.
For those Americans who can’t afford even inexpensive healthcare, free healthcare could be abundantly provided through either eliminating or reducing all federal taxes for those hospitals and doctors who donate 10 percent of their time to giving free care. Prior to Medicare, according to Lawrence R. Huntoon, M.D., Ph.D., treatment to the poor was assured in a similar manner: “Under the Hill-Burton Act, hospitals agreed to provide free care to anyone who needed it in return for government grants and loans.” Donated free primary care for the poor would likely generate great savings, both through efficiency and through less use by the poor of hospital emergency rooms (up to $14 billion per year), which must treat everyone under federal law whether the patients can pay or not. The Zarephath Health Center in Somerset, New Jersey, a primary-care clinic, treats patients — whom it sees for free, using donated funds — for a cost per visit of $13 per patient, while the cost of care at a federally qualified clinic is $140 per visit. As things stand now, many doctors lose money by treating Medicaid patients, and so have little incentive to treat them, and Medicare pays upwards of $75 billion a year on procedures that have no proven benefit.
Additionally, allowing the option for patients to form contracts with doctors to limit the amount doctors can be sued for in case of doctor error could save up to $210 billion a year because it would eliminate defensive medicine, while lowering doctors’ insurance premiums. (OB/GYNs in Florida pay up to $200,000 a year in malpractice premiums.) Changes in drug patent laws could also save many billions a year. In the United States, patents can be extended on drugs merely by changing non-active ingredients in the drugs — such as adding a new coating — yet expiring patents could save tens of billions per year. For those who still want typical health insurance that pays for routine visits to doctors, exempting all individuals’ medical-care payments from taxation would create new markets for inexpensive individual insurance. This would tie the insurance to the individual rather than a job, making the insurance portable. It would be a far cry from the present system that causes Americans to rely on group insurance provided through the workplace. Finally, as with any desired product, shortages cause prices to rise, so working to increase the number of doctors in the United States — of which there are shortages in many specialties — by stopping government empowerment of the American Medical Association to determine the number of medical schools and medical students would be sure to mean ample cost savings.
Foreign Policy
The rebel insurgency in Libya that ousted Moammar Gadhafi, which President Obama aided with munitions, training, and air power, has slaughtered large numbers of innocent blacks in that country — even wiping out the black village of Tawergha and its 10,000 residents. And not unexpectedly, Libya’s draft constitution is based on strict adherence to sharia law. In other words, we’ve helped install a repressive regime along the line of Iran’s.
In Egypt, where the United States encouraged dissidents to defy its dictatorial leader Hosni Mubarak (whom, ironically, the United States supported with foreign aid right up to the end), Coptic Christians have been slaughtered by the new government and have had their churches burned. Meanwhile, the authoritarian Egyptian military is vying with sharia adherents for control of the country.
In Afghanistan, President Hamid Karzai said that if war broke out between the United States and Pakistan, he would back Pakistan. After more than 10 years of U.S. warmaking and occupation in that country, we are no closer to seeing a Western-friendly government that upholds human rights and has the support of the people than we were at the beginning of nation-building operations there.
In Iraq, where the Christian population — numbering 1.4 million at the beginning of U.S. occupation — has suffered slaughter or has been forced to flee the country because of Islamic attacks, the constitution is also based on sharia, and Iraq’s government has very friendly relations with Iran, the United States’ avowed enemy.
Vietnam became a communist nation after our many years of involvement there.
WWII was initiated with the invasion of Poland by Germany and Russia. FDR did his utmost to involve America in the conflict,4 including instigating harsh trade sanctions against the Japanese. When the war ended, the brutal Soviet regime, which killed an estimated 61 million of its people, controlled 15 countries, including Poland.
Likewise, U.S. foreign policy was responsible for China going to Mao’s communists, who killed a reported 35.2 million of their own people, rather than to Chiang Kai-Shek and his troops — who fled to Taiwan and installed a free society. And though many Americans don’t realize it, the United States government also supported Castro in his bid for control of Cuba, as well as the Ayatollah Khomeini in his takeover of Iran from the Shah, who was, by the way, a man whom the United States also installed in power. (Feel free to check my facts.)
The aftermath of U.S. participation in WWI included President Woodrow Wilson’s Treaty of Versailles, which harshly penalized Germany with war reparations and led to the impoverishment of that country and the rise of Hitler — U.S. military victories have rarely been followed by freedom-enhancing diplomacy.
And even as the United States has tried to impose its will on the world for the sake of “democracy,” nearly the total landmass of South America has fallen to communist, or otherwise equally authoritarian, regimes.
Since, with the possible notable exception of South Korea, the United States’ interventionist foreign policy has been an unmitigated disaster since its implementation, why does Obama insist on spending hundreds of billions of dollars for foreign interventionism, rather than bringing our troops home and rigorously controlling our borders to keep our country safe?
Aiding the Poor and Middle Class
In President Obama’s 2012 State of the Union address, he stated bluntly, “If you make under $250,000 a year, like 98 percent of American families, your taxes shouldn’t go up. You’re the ones struggling with rising costs and stagnant wages. You’re the ones who need relief,” implying that his administration was supplying that “relief.” He also said, “In the last 22 months, businesses have created more than 3 million jobs” — jobs that he claimed his administration’s policies were responsible for.
While lower taxes and more jobs are good things, there’s more to this story. For instance, while it may be true that under Obama’s lead Congress did not pass legislation to raise the amount that people in the lower tax brackets must pay, it is not true that the Obama administration isn’t imposing new financial hardship on lower-income people. As stated earlier, the administration enthusiastically requires “renewable energy” from wind turbines, though this requirement simply raises electricity costs (the same is true for solar power) without replacing any conventional electric generation facilities. Meanwhile new fuel-economy standards will raise the price of vehicles, and electric rates are set to go up as Obama’s EPA is causing the premature closure of coal-fired electric plants.
Also as stated earlier, ObamaCare is raising taxes on health insurance, tanning beds, and some pharmaceuticals. Not mentioned is that ObamaCare, as noted by the Heritage Foundation, “limits [health savings accounts and flex-spending accounts] … in two ways: it restricts the types of health products you can purchase with your HSA money, such as prohibiting using HSAs for most over-the-counter medicines, and it reduces the amount of money you’ll be able to put into your FSA.” The American Spectator found that “tax-free dollars that can be put aside for medical expenses in a flex account [dropped] to just $2,500 per year. Especially for large families, this is in effect a marginal tax hike on health expenses of as much as 40 percent!” ObamaCare also adds new taxes for medical devices and makes it more difficult to get tax deductions for medical expenses.
Then there’s the tax of inflation. (Inflation is defined as the increase in the money supply, which results in increased prices to consumers.) Because as money is printed to pay U.S. bills the value of all money decreases, deficit spending leads to price inflation, and price inflation devastates the poor. Just the price of food for a moderate-spending family of four has increased $525.60 per year between January 2009 and December 2011, according to the USDA. And that’s just the hit for food; figure in the price increases for all other products, owing to inflation, and the picture tells the true tale of the dire predicament of Americans. The elderly may suffer the most: Because of the way government determines price inflation, Social Security payments don’t keep up with real price increases — a process that has continued for many years.
In September 2011, the U.S. Census Bureau reported that the real median household income for 2010 was $49,445, a decline of 2.3 percent from 2009. Household income has dropped 7 percent since 2000. The poor and minorities were hit hardest: The median household income for blacks fell 3.6 percent to $32,206 in 2010. Meanwhile, poverty in the United States hit its highest level since 1993. And food stamp usage hit an all-time high in May 2011.
The jobs picture isn’t as rosy as it seems, either. Though some hiring is happening, unemployment is higher than official statistics show and many of the new hires are paid poorly — or underemployed. As Bill Wilson of Americans for Limited Government explains:
Since Barack Obama assumed office, according to the Bureau of Labor Statistics, the total population over age 16 has grown by 5.845 million to 240.5 million, and yet, since then, the civilian labor force has actually shrunk by 349,000 — from about 154.2 million to 153.8 million….
The problem is that the measured civilian labor force participation rate has fallen from 65.7 percent to 64 percent since Jan. 2009, reflecting people who have lost hope and simply stopped looking for work….
Instead of 8.5 percent, the effective unemployment rate should be closer to 10.9 percent, and the underemployed closer to 17.4 percent, or 27.3 million.
Knowing that all of the above is true, why does Obama think the poor and middle class are better off because of his policies and why, as he claimed in an interview prior to the Super Bowl, does he believe he deserves a second term in office?
1. Reiland, Ralph. “Not Just Another Speech.” The New American.” January 23, 2012.
2. Thornton, Fr. James. “Sick and Sicker.” The New American. January 23, 2012.
3. Satter, David. Darkness at Dawn: The Rise of the Russian Criminal State. September 10, 2004.
4. Thornton, Fr. James. “Naïve or Negligent?” The New American. March 5, 2012 (cover date) — book review of Freedom Betrayed: Herbert Hoover’s Secret History of the Second World War and Its Aftermath.
