Posts Tagged ‘obama’
In my world the American Dream is the ability to pursue whatever personal and financial aspirations I may have with limited interference from governments, protection by our judicial system against those who intend to defraud, harm or infringe on the freedoms we are all born with (including our own governments), and eventually create a better future for my family as well as future generations of Americans.
I wasn’t born into money. I spent the first 5 years of my life in a trailer park and my entire childhood living off Hamburger Helper, clipped coupons, and food stamps. I started working at a very young age. I helped my older brothers with their paper routes for the local paper when I was 8. I aspired to have my own paper route when I turned 13. I knew there was an expanding neighborhood development nearby (within bicycle distance), and I wanted to have that new route! I got that new route! It was honest work every single weekday. Eventually I ended up working with my brother for an L.A. Time distributor. We inserted local advertisements into the Sunday edition of the paper. Again, honest work.
All that work allowed me to buy my own lunches in high school, purchase my first motorcycle, and enjoy a movie here and there. It also inspired to know that if I really put everything into what I was doing, I would succeed. After failing to become a Harley Davidson mechanic, I took training from my older brother on computer programming. I read and studied as much as I could to comprehend enough to get a job with upstart Internet companies. I worked ridiculously long hours, helped businesses succeed, and made a good/honest wage.
I moved on to working for a public company that eventually saw most of it’s top brass arrested for defrauding investors. I changed career paths and got into marketing, taking an entry level job for a product development company. Within a year I was running its catalog and direct marketing division. I started my own marketing company a few years and then was tapped by the owner of the current company I work for to come back and become a managing partner of a brand I had turned into a success. The business had completely fallen apart and was collapsing. I’ve spent the last 3 1/2 years turning it around. Again, not easy work, but I’ve always known that if I put everything into it: I’ll make it work!
So, when Obama dropped his famous line about business owners not being responsible for their company’s success, that somebody else made that happen, I was a bit baffled. Certainly, no job that I’ve had have I been the only contributor to that business (even when I had my own marketing company). My paper route required the printing of the local newspaper for me to have papers to deliver. My LA Times job required the LA Times. The computer programming jobs required computers, the Internet, other businesses, etc. The current job requires employees, customers, manufacturers, shipping companies, and so much more. Along the way, I have had the need for our judicial system to settle disputes and enforce contracts. That’s what the judicial system is there for.
I listened to the full Obama speech and that’s not what he was talking about. He was echoing the speech made by Elizabeth Warren several months earlier. Hers is about “the rest of us”. Obama’s is about “somebody else made that happen”. People claimed Obama was taken out of context, but what was taken out of context? I felt the context actually made it worse because it showed that Obama doesn’t understand the role of local government in our lives vs. federal government.
I was having a conversation with a liberal friend about the topic and explained the problems I saw with the Warren-Obama rhetoric (local/state vs federal government account for all the services they refer to). So, I asked my liberal friend (a devote Democrat) what the logic was. She was very passionate about it!
My liberal friend started talking about the American Dream and how Warren and Obama were talking about the American Dream. She even threw in a comment that “I might be too young to appreciate the American Dream” (she has 9 years on me). I was a bit taken aback. I thought *I was* living the American Dream… I was born in a trailer park. I now own my own house. I was born to an unemployed mother and a father who lost his job when I was about 9 years old. I’m now the managing partner of a small business.
Then something dawned on me… For Warren, Obama, my liberal friends, and millions of Americans who support the Warren-Obama doctrine the American Dream really is embodied in the whole “rest of us speech”. I’m still at a loss for exactly what the American Dream is in that world, but it made one thing clear to me. The Warren-Obama doctrine supporters are just as passionate as I am about the American dream. Rather than it being my ability to pursue whatever personal and financial aspirations I have with limited interference from governments so that I can succeed and make our country better for future generations, it’s something that “the rest of us built” or that “somebody else made that happen”. It’s something outside me.
In their world the American Dream is something outside of ourselves. It’s something that comes from being in a democracy where you are required to pay taxes for programs and wars that you don’t support. It’s something that comes from somewhere outside you. It comes from something that we don’t have to be accountable for as individuals or as a government when we fail (government bailouts, bankrupt social programs, unjustified wars, unemployment, social inequality, etc.) but can thank our government when we succeed.
I wasn’t going to argue with my liberal friend about this topic. This wasn’t a topic that either one of us were going to win. This wasn’t a topic that we were going to find legitimate common ground on at anytime in the near future. There is an abundant divide between these two ideas of the American Dream. The only thing connecting us is a commitment to bettering America for future generations. However, the means to the end differ so dramatically between mine of reliance on self and hard work and Warren-Obama or reliance on government and entitlement. It’s a divide of the American Dream as something that you dream for yourself or one that someone else dreams for you.
One of my favorite sayings is that when you point your finger at someone, you have four of them pointing back at you.
On Facebook, I’ve been seeing status updates along the lines of the following:
Remember when teachers, public employees, Planned Parenthood, NPR and PBS crashed the stock market, wiped out half of our 401Ks, took trillions in TARP money, spilled oil in the Gulf of Mexico, gave themselves billions in bonuses, and paid no taxes? Yeah, me neither. Re-post from a friend. Pass it on if you’re so inclined…
Salary of the US President…$400,000. Salary of retired US Presidents…$180,000. Salary of House/Senate…$174,000. Salary of Speaker of House…$223,500…Salary of Majority/Minority Leaders…$193,400……….Average US Salary…$33,000 to $77,000. HELLO! I think we found where the cuts should be made! If you agree… repost!
Addressing the second one first, sounds great! Now we’ve narrowed the annual deficit to $485 billion. What’s next?
Now, addressing the first posting…
First, nobody wants to cut anything. We have so many people in America living off of social programs that we’re stuck.
However, it’s not like we didn’t see this coming. Anyone alive when Ross Perot was running his budgetary infomercials knew this day was coming. Despite the cuts and tax increases by Clinton and Congress at the time, we have since erased them and have reached a mountain of debt that far exceeds anyone’s wildest imaginations. Yet, nobody wants to cut. And if you do want to cut, you’re a “cold-hearted out of touch with the plight of the people jerk.”
Second, Planned Parenthood, NPR, and PBS do not pay taxes at all. So, yes, I remember that part.
Third, as yourself the following questions:
- Did I borrow money from a bank over the last 10 years?
- Did I put money into savings accounts, bonds, and other forms of deposits?
- Did I invent something that changed an industry? Created an industry? Or created jobs?
- Did I vote for a politician who voted for the tarp spending? Invading Iraq? The automotive bailout?
- Did I return my government stimulus checks?
- Did I tell the IRS I didn’t want the Bush tax cuts and send in additional taxes anyway?
Chances are you did borrow money from a bank and didn’t put money into a savings account, bonds, or other forms of deposit. Based upon the lack of innovation in America, I’m betting you didn’t change an industry or even create jobs for people. People voted in record numbers for Obama who gave out the lion share of the TARP funds AND gave money to the automotive industry.
The vast majority of Americans supported invading Iraq back in the day. You can’t jump off the bandwagon and claim innocence now. That’s not how war works!
We all contributed to this mess. How many people purchased homes on interest only loans and/or 125% LTV loans? You can feign ignorance and that the evil banks fooled you into thinking it was a good idea, but I don’t believe that you’d give someone 125% of the value of something they wanted to purchase. You wouldn’t think that was a fair deal or even responsible. Yet, you took the money!
Let’s just face it. We all got greedy. We all got stupid. We all complained about products made in China but had no problem purchasing them when we saw how inexpensive they were.
Still, it’s easier to blame the rich guys or other groups that we aren’t part of. It’s easier to blame the teachers unions, banks, government, etc.
The bottom line is that America really needs to look at ourselves. We really need to look and take responsibility and be accountable for our own contribution to the circumstances we find ourselves in. There are fundamentals of economics, banking, the stock market, foreign policy, business, and monetary policies that we ignored or thought we could work around or outsmart. We elect these officials. We patronize these banks. We drive vehicles that get 14 MPG. We are the ones who want lower taxes and complain when there is no money to fund our social programs.
We are the ones who caused this problem, and until we own up to that we’re going to continue to build up mountains of debt and point fingers. The Democrats will blame the rich and want to tax them more. Still, that falls short by hundreds of billions of dollars. The Republicans will blame the unions and claim “we have a spending problem”. Still, that falls short by hundreds of billions of dollars.
Our Federal government has both a spending and a revenue problem. It’s that simple! It spends more money than it makes, and it doesn’t get enough money to pay for what it wants to even if we cut hundreds of billions of dollars from the budget. Obama calls for $4 trillion, which sounds inconceivable to most but is hardly anything when you see that he build up that much debt in his first two years in office. Oh, by the way, those cuts are over 12 years… So, what he piled on in just two years is going to take 12 years to cut!
Still, nobody wants their share of the pie cut. And since we have so many people getting assistance and gaining from federal spending programs, it’s going to be hard to cut anything for a politician who wants to save his/her country but also stay in office.
We can’t be surprised by Obama & Co (aka George W. Bush) for wanting spend our way out of a recession. After all, we’ve been beaten over the head with the notion (myth) that massive federal spending and WWII allowed America to escape the Great Depression. When you look back on your public education text books, you’ll find most of them making the claim that massive government spending by FDR is what pulled America out of the Depression; most importantly spending on war. There are even those who suggest that FDR knew about Pearl Harbor and did nothing so that the US had a reason to enter the war. However, that’s not really what I want to focus on in this blog.
When you compare the “Great Depression” to the “Great Recession”, you see an awful lot of similarities: double-digit unemployment, reduced manufacturing, bank failures, calls for protectionism, the rise of Napoleon Hill and personal development, denial, and deflation…
WAIT… There’s no deflation going on in the “Great Recession”! The Federal Reserve has done a tremendous job at ensuring that there is no deflation. By devaluing the dollar beyond recognition, The Fed has all but ensured the USD won’t rise in value. Still, this isn’t why I wanted to write this blog.
The myth that massive government spending is what pulled America out of the Great Depression is perhaps the most dangerous economic myth we have ever pushed on ourselves. If we look at the massive amounts of debt America is taking on each year regardless of a Democrat of Republican in the White House and in control of Congress, it’s quite clear that massive government spending does not lead to economic prosperity. In fact, it is quite clear that irresponsible government actions and spending lead to economic turmoil. But what can we expect from a government filled with people who were raised to believe that FDR’s massive government spending was for the best?
When we look at our text books and look at the options chosen by our government and central banks, there are no surprises. They took all the textbook actions: try to stimulate spending, try to stimulate investment in the stock market, save the banks, and avoid tariffs. Of course, the excuse for the continued down economy??? Things would have been much worse if we didn’t take these actions!
There are no surprises. Our political and economic “leaders” have all been taught from the same textbooks. The actions and results are easily predictable given the circumstances. And when we look at the massive amount of social programs that a capitalist country like the United States has taken on, it further clarifies exactly how we got here.
The Federal Reserve and OBushma (the main difference between Bush and Obama is about half a trillion dollars in annual deficit spending) have taken us through ten years of US Dollar devaluation. It clearly doesn’t work. The manufacturing jobs are flowing back into the US. The economy isn’t producing massive tax surpluses that lead to the OBushma tax cuts.
There’s a real simple solution: impeach Bernanke from The Fed and take strong dollar monetary and fiscal policies. The policies over the last 10 years have not worked. There really is no need to even debate this.
All the bogus debates about tax cuts for the middle class vs low income vs millionaires is laughable. The tax brackets with or without the OBushma tax cuts screw the middle class the most. All one needs to do is take a look at the tax rates to see that the middle class didn’t really get much of a “break”. What really needs to happen with taxes is a complete overhaul of what is tax deductible (see my blog about making US Bonds 100% tax deductible).
Of course, I think everyone has forgotten about the Economists’ statement opposing the Bush tax cuts. Guess what? They were right! But who really wants to be the President with Steel cahones that tells everyone they have to pony up an additional 2% to the IRS next year!
Obama is talking a talk that sounds great on the surface but can ultimately lead to a massive loss of jobs in America rather than creating jobs. Bernanke is helping to speed along this economically devastating Administrative policy with equally rash monetary policy. I understand where Obama is coming from. He wants to create jobs in America. The thinking by the Fed is that by the Fed devaluing the USD (US Dollar), American goods will become more affordable to China and other nations. Sounds great! On paper…
However, it is a clear indication that Obama and Bernanke don’t understand the United States’ position in the world economy. An import economy does create jobs, contrary to what the Obama Administration makes it sound like. Yes, manufacturing jobs have been lost in America. However, importing still creates jobs. A lot of jobs for that matter, and higher paying jobs! The major key to being a strong importing nation is having a strong currency. The stronger the USD, the greater the ability to import products from other countries.
The Federal Reserve, under Bernanke, has weakened the USD significantly over the least several years. The Obama administration is trying to create more manufacturing jobs in America on the backs of the import industry. Yes, import jobs will be lost as the USD continues to decline, but the result isn’t going to be layoffs, it’s going to be import businesses going bankrupt.
Now, this isn’t a too big to fail claim about the import industry. This is a claim that America doesn’t have the ability to produce all the same products that China does. What has taken decades to build in China is not going to happen overnight in America. Additionally, the typical Chinese worker makes a fraction of what an American worker would make for the same product. So, either American’s are going to have to take lower paying jobs or the cost of products are going to skyrocket!
Some argue that China is manipulating the RMB (Renminbi/Yuan) so that it’s export business continues to thrive at the detriment of America. There may be some validity to the claim the claim of currency manipulation, but it isn’t much unlike Bernanke’s QE and QE2, which are just fancy terms for devaluing the dollar. That is what Bernanke has done. He was devalued the USD. You can call it Quantitative Easing all you want, but a rose by any other name…
There is a large trade deficit between America and China, but it’s not across the board. For instance, where are Chinese airliners getting their planes? Where are they getting their MRI equipment? The advanced technology comes from America. A weaker dollar will lead to lower real profits by Boeing, GE, and other leading American businesses. Here’s the reality of a weaker dollar. So what if your widget sells for $500 when that $500 is only the equivalent to $300 from just 10 years ago!
A weak currency policy is a terrible monetary policy for America. An Administrative policy supporting exports is a good one when the focus is on exports that those other countries can’t make. Is the US really going to compete with the Chinese with making knock off MP3 players and cell phones that get thrown away every 2 years? Those will only be high paying jobs because the value of the USD will have declined to much to make America competitive with China that we’ll have gotten to the status of a 3rd world economy.
I’m being dramatic for a reason. The world economy has been centered on a strong America and strong USD for decades. The result of a devalued USD and trade restrictions with countries we’ve been importing from for decades is not what anyone in America is going to want. Enormous amounts of wealth has made its way to other nations like China, Mexico, and others. Those countries are seeing improvements in their quality of life. The US should continue to lead the world economy with a strong USD position and strong import position. The whole idea behind imports and exports is that countries export what they do/make best and import what other countries do/make best. The US still does and makes many products, services, and technology better than any other country.
The Solution: The Obama Administration should focus on leading technology industries (instead of rehashing dying industries in America) and creating greater tax incentives to grow those industries (just like Clinton did with the Internet)! Congress should act as well to impeach Bernanke. It is fully within the power of Congress to do so. Further, the Obama Administration can take action in the Treasury Department by not selling bonds to The Federal Reserve. These actions would send a sound message to the world economy that the United States is standing for a strong USD, strong US consumption, and leading the world economy out of this depression with swift action. These actions would take about 9 months to catapult the US economy and world economy out of this depression. The message to the rest of the world is that America wants to continue to *lead* the global economy rather than play a reactive role in the global economy.
I’m sitting here, reading the Letter from the Obama Campaign to the McCain campaign about potential voter fraud issues, and it dawned on me… We need a war on voter fraud!
We’ve got a war on drugs
We’ve got a war on terror
Let’s bring a war on voter fraud into the mix. Let’s have our government busting down doors of vote criminals. We might even be able to win the war on voter fraud! How could we measure whether we are winning the war on voter fraud? Good question, but not really necessary to answer since we don’t have the answer for the other two wars mentioned above.
John McCain, looking to gain support for his gas tax holiday, reached out to Hillary Clinton supporters in a stunning speech stimulating the lives of all the “bitter” voters of Pennsylvania. While most of the media focused on the bitter voter aspect of the McCain speech, I found it damning for the McCain campaign that his advisers believe his gas tax holiday is a winning argument. God help us if we have an administration that believes this idiotic economic policy will do anything more than severely damage the US economy.
Often cited as having a better grip on economic issues, Barrack Obama surprisingly proposed a $50 million subsidy for big oil on Monday. Where have you spent your tax rebate check? My guess is that you’ve spent it (will spend it) at the gas pump. Guess who is making the money on higher gas prices? It isn’t your local (independently owned and operated) gas station. Obama tears into McCain for offering up a gas tax holiday (yes, a stupid idea), but his proposal to expand the tax refunds is no different: a subsidy for big oil.
How about we get politicians offering up real economic solutions. Solutions that are going to create more jobs rather than get us to spend more money on gas and useless crap from Walmart. How about some financial incentives for anyone who wants to solar panel their house! How about some tax credits for small businesses and entrepreneurs who are the heart of the American economy! What about spending that $50 million on helping people start or grow their businesses! Give me some real fiscal stimulus, Obama, not some watered-down version of McCain’s gas tax holiday.
I’ll keep it really brief:
- Bring more attention to the “gas tax holiday”
- Point out how both of your opponents support it even though it would just put more money into the already fat pockets of oil companies
- Remind people that both Clinton and McCain support this ridiculous economic gimmick, and ask the public to decide who we think Clinton and McCain are really supporting
- Ask America if we want more of the same flat economy over the last 8 years with failed fiscal policy after failed fiscal policy
- Win handedly, so you are officially running against John McCain and then keep bringing up the fact that McCain supported this very, VERY bad economic gimmick
Free as a courtesy to democracy in America!
I have my fair share of critical remarks for economists in general. I’ve mentioned before that my econ professor a few years ago gave me a B on a paper where I theorized that constantly increasing energy prices would leader to inflation that could not be controlled by the Federal Reserve. He, like many economists, is misguided. That’s part of the reason I disliked my economics degree program. It was mostly a bunch of bologna.
However, there is one other segment of the public policy industry that is even more… well, they are just idiots when it comes to economics. This group is known as politicians, particularly presidential candidates. In an article today, Reuters reported that McCain and Clinton both support a “gasoline tax holiday“. The idea would be to suspend the federal tax on gasoline over the summer.
Folks, it doesn’t get much more idiotic than this! This would drive the demand of the gasoline up, while nothing would happen to the supply. The net result is a continued rise in gas prices, putting more money into the pockets of Exxon and friends (to give them even greater profits). Then gas prices would shoot up almost 20 cents instantly after Summer.
Obama’s points should have just shot up at least 10-20% since he didn’t support this moronic policy!