Time for an ‘American Reset’

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The Obama administration made a big deal about its “Russian Reset”—a policy aimed at emphasizing U.S.-Russian relations by basically starting over. The fact that the Russian Reset yielded little more than some embarrassing moments for the secretary of state is a subject for another essay. What’s relevant here is that after some 40 months of President Barack Obama, it’s time for an “American Reset.”

Reset federal spending

President Obama has added $5 trillion in debt. The federal government has spent more than 24 percent of GDP in each of President Obama’s years in the White House, far above the historic average of 20 percent. The federal debt, as a share of GDP, is the highest it has been since World War II—when we had a much better reason to run up record debt. And each and every year he has been in office, President Obama has carried a deficit above $1 trillion—an unprecedented feat.

Not even the president’s friends in the mainstream media can ignore the reality that the Obama administration has engaged in the most profligate spending spree in American history. The Washington Post, for instance, notes that “the compound annual growth rate for President Obama’s spending starting in 2009 is 5.2 percent” and “in every case, the president wanted to spend more money than he ended up getting.”

In other words, Congress actually reined the president in—but not before he spawned the Affordable Care Act. According to his own numbers, the president’s healthcare behemoth will cost $1 trillion. That number will surely grow larger than his actuaries predict. It pays to recall Washington’s poor track record when it comes to out-year projections. The Wall Street Journal reminds us that in 1965, Congress estimated Medicare would cost $3.1 billion in 1970. The actual cost was $6.8 billion. Two years later, Congress predicted that Medicare would consume just $12 billion in 1990. In fact, it was $110 billion.

Given that the president found a way to grow the federal government by 25 percent—with little to show for his stimulus programs, bailouts and government takeovers—returning spending to 2008 levels seems eminently sensible.

Reset regulations

Contrary to the president’s recent slip of the tongue, the private sector isn’t doing fine. One of the reasons is the vast web of regulations he has spun in the banking, financial, healthcare and energy sectors. A Heritage Foundation study found that the Obama administration has issued four times as many major regulations—regulations costing $100 million or more—as its predecessor. The result: taxpayers and industry have been forced to cough up $46 billion to comply with new regulations—more than five times the cost of Bush-era regs.

Some of President Obama’s most costly regulations are not even fully realized yet. Take the EPA’s regulations on coal, for instance. As The New York Times reports, 100 of the 500 coal-burning power plants in the United States will be closed in the next few years largely “because new pollution rules have made coal plants more costly.” Retrofitting a coal-electricity plant in Kentucky in order to meet the Obama administration’s coal-killing regulatory requirements will cost $1 billion and has triggered a 30-percent increase in electricity rates, according to the Times.

“This EPA is fully engaging in a war on coal,” as Sen. Joe Manchin (D-W.Va.) argues. The EPA’s war is killing coal-derived electricity, which will have a long-term effect on consumers and their pocketbooks. “Coal-fired power plants,” the pro-market group American Commitment reports, “are now generating just 36 percent of U.S. electricity, versus 44.6 percent just one year ago”—thanks to regs handed down during the Obama administration.

Speaking of long-term effects, the drag ObamaCare will place on the economy is only now beginning to show. The CBO projects that the IRS will need 17,000 new employees to enforce elements of the healthcare law. The president’s healthcare entitlement creates 159 new sub-agencies, committees, bureaus and commissions, each with a regulatory role. All told, according to a Washington Post analysis, between 100,000 and 250,000 new government employees are needed to meet the growing demands of President Obama’s supersized government.

Reset the social contract

The Heritage Foundation reports that “more people than ever before—67.3 million Americans, from college students to retirees to welfare beneficiaries—depend on the federal government for housing, food, income, student aid or other assistance once considered to be the responsibility of individuals, families, neighborhoods, churches and other civil society institutions.” Government dependence didn’t start under President Obama, but it has certainly accelerated. The Heritage Foundation’s Index on Government Dependency concludes that dependence on government has jumped 23 percent since 2008.

Consider some specific examples: Investor’s Business Daily reports that the number of Americans on food stamps, which now eclipses 45 million, is the highest on record. The Wall Street Journal adds that nearly 50 percent of Americans live in a household that receives some form of government assistance—up from 44 percent in 2008, which was up from 30 percent in the early 1980s. The Washington Post reports that some 4 million out-of-work Americans have stopped looking for work, choosing instead to take early retirement (if they are 62 or older) or to try to ride out the worst of the recession on unemployment (which, at up to 99 weeks, is more generous than it’s ever been).

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  • PhillipGaley

    Considering the sociology of it all, would our hardcore criminal part of the population, yield to some kind of a 'reset'–or are the nation's problems all bureaucratic, political stuff?

  • Robbins Mitchell

    Hopey changey = horsey crappy

  • Judas

    Great article.

  • joy52

    Good points, though I thought before reading the article you were going to name names–starting with Obama.

  • tagalog

    Yes, an American reset. One major step in resetting would be to repeal the Fourteenth Amendment.

  • rbla

    How about this for a reset. Stop the immigration of hordes of third worlders which by altering the demography guarantees a permanent future hegemony of the Democrat evil party and will prevent any of these other resets from taking place. Or is that beyond the intellectual ability of assorted neocons, libertarians and most members of the Republican stupid party to recognize?

  • aharris

    One way or another, we're headed for it. We can do it the mature, responsible way by tightening our belts, or we can do it the chaotic way by bankrupting our country. I prefer the first because we can then do it with some semblance of stability in society. If we do the second way, what emerges may not resemble the free America we think we cherish. I think there more people than we know who are actively working toward the second way because they envision themselves as people in power in the "new" Amerika.

    • dmw


  • wctaqiyya

    Repeal the 16th amendment.

  • BLJ

    Obama sucks at EVERYTHING.

  • Tatersalad

    Flag Day in America before Barack Obama:

    Flag Day in America with Barack Obama:

    "All this for a F'ing Flag"! (Michelle Obama) – http://video.search.yahoo.com/search/video?p=mich

  • Amused

    " We're going to close the unproductive tax loopholes that have allowed the truly wealthy to avoid PAYING THEIR FAIR SHARE . In theory, some of those loopholes were understandable, but in practice they sometyimes made t possible for millionaires to pay NOTHING , while a bus driver was paying 10 % of his salary ,AND THAT'S Crazy . It's time we STOPPED it .

    _President Reagan 1985

  • Amused

    Boy that man must be a commie/marxist /leftist /liberal huh ?

  • WilliamJamesWard

    A Reset to a better time, I think a new generation of poliicians is what is needed, the professonal
    politician aka crook…….needs to be made a thing of the past and as soon as possible. Real people
    with the agenda of what is good for American life and prosperity, economic America loosed from
    insane regulatons that are not for the public good but to stultify progress and betterment in markets
    and insure employment for job seekers. Reset our Nation and quit the nonsense of being the
    upholders of other Nations, ours is our responsibility and our's alone. Let the world emulate us and
    not suck the life blood out of our people.Use American resources, espescially oil and all forms
    of energy. We can do it, our parents did, return to our moral vision and patriotic heart getting rid
    of fad Presidents and anti-American courts along with our disgraceful Congress………We have
    the best Constitution in the World and need to take it seriously and never waiver in upholding
    and revering it………..then eliminate every vestige of the left root and branch………William

  • stevef

    Reinstate Glass-Steagal to keep the banks from using deposts in the financial casino….For other financial/economic rules suggested by the great conservative economist Martin Hutchinson’s ” Alchemists of Loss”. Please remind the GOP, a free market is not a market with no rules or regulations, in spite of the fact that Dodd-Frank needs to be stopped.

  • Beatrix

    From what I read, the majority of Americans blame our economic problems on Bush, not on Obama. Romney needs to compare Obama's policies to Bush to show that our current economic problems belong to Obama, not to Bush.

  • SKIP

    Obama has been the best Guns-N-Ammo salesman in American history.