The head of the DNC points to a soaring economy that isn’t.
The news continues to get worse. On jobs, housing, debt and energy, the American people are suffering under the weight of the Obama economy. Yet, if you listen to the head of the DNC, Debbie Wasserman Schultz (D-FL), under Obama, Democrats “were able to turn this economy around.” So laughable is this assertion that even a card carrying member of the mainstream media couldn’t hold back. Stating the obvious, Meet the Press moderator David Gregory reminded Wasserman Schultz that “clearly the economy has not been turned around” and “Americans don’t believe that’s the case.” Indeed, they don’t.
According to a recent Washington Post/Abc News poll, nearly 60% of Americans disapprove of the president’s handling of the economy. Among young people (18-29), another survey found that only 31 percent approve—the very same voting bloc that Obama carried by 34 points in ’08. But this should come as little surprise given his dismal economic record.
Nearly 14 million Americans are out of work today. Long term unemployment is now worse than during the Great Depression. 2.1 million have given up looking for work. Inflation is running at an annualized rate of 6.6%. Our economy is wind-bound with an anemic growth rate of 1.8%.
When Obama took office, unemployment stood at 7.3%. It is now 9.1%, a 25% increase. Factor in the underemployed—that is, those who seek full time work but find only part-time employment—and the figure more than doubles, approaching 20% of the American workforce.
The national average for a gallon of gas was $1.83 on inauguration day. Currently the average pump price is $3.76, a whopping 104% increase. The president remains unwilling to expand drilling for new and existing energy resources here at home. Instead, his policies weigh companies down with undo bureaucracy, moratoriums, permitoriums and regulation. This is economically derelict. To reduce cyclical consumer pain at the pump, expanding access to our known resources makes sense, and it would create jobs.
Our debt was 10.6 trillion in January 2009. It is now 14.3 trillion, up 35% and ever rising. So unsustainable is our mounting debt, so catastrophic the consequences, our very nation is at risk. Remember that Standard and Poor’s (S&P) reduced its long term outlook on U.S. debt to negative—a shot across the bow against the profligate spenders in Washington.
Americans have too long experienced the impact of reckless spending and borrowing. Debt is a drag on job creation.
Yet, it is precisely more debt that the public will bear if Democrats have their way. According to The Hill, Senator Tom Harkin (D-IA) is preparing another spending package proposal because, in his words, “We really do need some economic pump-priming by the federal government.”
Never mind that such a call betrays confusion and dissention among Democrats. Wasserman Schultz would have us believe that the economy has turned around. Senator Harkin, on the other hand, claims our struggling economy needs more government spending.
Well, Harkin is half right. The economic outlook is grim—albeit thanks to the ruinous policies of the administration. But Americans have already witnessed a failed 830 billion dollar stimulus that grew government but not the economy; the very same package that did not keep unemployment below 8%, as Obama claimed it would.
In fact, it is the obtrusive arm of government that continues to kill jobs and slow growth by perpetuating uncertainty amongst our innovators and job creators. Simply put: government should get out of the way. The engine of growth is, and has always been, in the private sector.
The degenerative effect of Obama’s government-centric policies acts as a corrosive agent undermining the U.S. economy, imperiling its future competiveness.
Last month, only 54,000 non-farm jobs were created. Woefully short of what is needed to keep pace with those entering the workforce. For recent high school and college graduates this is unwelcome news. But as far as top Obama re-election insider David Axelrod is concerned, the discussion of these figures is “meaningless” to the “average” American. What matters, he claims “is what they experience in their own lives.” With so many struggling, few will buy this sophomoric spin.
It is worth noting that more than half of jobs created in May came from McDonald’s, as many as 30,000, in fact. McDonald’s is a fine corporation, but this figure is representative of weakness, not of recovery.
In key states, such as Nevada, Florida and Michigan, unemployment remains north of 10%—12.5%, 10.8% and 10.2% respectively. In others, like North Carolina, Georgia, California, Kentucky, New Jersey and Arizona, the jobless rate is above or near 10%. How well do you think Wasserman Schultz’s remarks will play in these states? Despite her willful spin, the voters aren’t fooled. As the Wall Street Journal notes, such anemic job growth only adds to the fear “that a more protracted and dangerous downturn could be in the offing.”
For America’s homeowners, the news is also bleak. As it stands, home prices have dropped over 5% in the past year. According to the S&P/Case-Shiller Index, we are now experiencing a double dip in housing. Robert Shiller himself recently warned that an additional plunge of 10 to 25% in home values is quite possible. We haven’t seen the bottom.
Americans have watched their home equity collapse. In fact, as a matter of percentage it is the lowest since World War II. Of the 74.5 million homeowners in the U.S., nearly 25% are "underwater." In other words, they owe more on their mortgage than their home is worth. In some states, the numbers are much worse than the already unsettling national average.
In Nevada, for instance, 63% of homeowners are upside-down; in Arizona, 50%; in Florida, 46% and in Michigan, 36%. Adding insult to injury, CoreLogic, a real estate research company, notes that an additional 25% of U.S. Homeowners are nearly upside-down on their mortgage. They may be soon as home prices fall further still.
An S&P report makes clear the risks ahead. It suggests that the ill-effect from “rising foreclosures and delinquencies…higher volume of home modifications and redefaults” could “drive credit losses higher by $30 billion to $35 billion.”
On housing, debt, energy and jobs—mostly jobs, President Obama will bring his disastrous economic record before the voters next year. And though he may claim his actions “stabilized the economy,” most Americans do not see stability. Rather, they see decline.
Brendon S. Peck holds a Master of Arts in History and Political Science from the College of Saint Rose and has completed graduate work at Columbia University. He is a freelance writer. Reach him at [email protected].