By Jeffrey Folks January 26,2011 American Thinker
On January 25, the President delivered his State of the Union address. Speaking with vigor and aplomb, the President demonstrated once again that he can look serious, act like a president, and read the words that have been written for him. But so far he has not demonstrated his ability to be a president, create jobs, or do anything else.
In his well-scripted address, Obama spoke of the "accomplishments" of his first two years in office. Surprisingly, healthcare and financial regulation reform were not at the top of the list. In fact, they were barely mentioned. Instead, the President boasted of "his" extension of the Bush tax cuts. These are the same Bush tax cuts that the President consistently opposed extending until after his party's "shellacking" on Nov. 2.
If the Bush tax cuts are a good thing for the economy, why not make them permanent instead of blocking that proposal? If tax cuts are what it takes to spur growth, why not permanent tax cuts accompanied by spending cuts?
Instead, at the same time that he speaks of fiscal restraint, Obama proposes more spending. He calls this "encouraging innovation," but by that very phrase he shows how little he understands the free market. The American economy does not need the "encouragement" of government to engage in innovation. It is government "encouragement" that got us in the current housing mess, the deficit mess, and the regulatory mess. Government encouragement will only lead to further misallocation of the nation's resources.
Obama understands so little of capitalism that he actually thinks that businesses need more government oversight and "investment." He simply can't get beyond the idea of statism: the belief that every aspect of life, from what sort of car the public drives to how much profit a business is allowed to retain, must be decided by government planners in Washington. Now, at the desperate hour when America needs free-market capitalism above all else, Obama's response is more regulation.
The President, it seems, has experienced a "Sputnik moment." He now realizes, after 112 weeks in office, that America needs to compete with China and India rather than grow jobs, as Nancy Pelosi helpfully suggested, by handing out unemployment checks. The problem is he still thinks that government grows jobs by handing out stimulus checks.
The State of the Union address, in fact, was a perfect reflection of policy-making based on political expediency. The address has been cobbled together in a continued attempt to placate the left wing of the Democratic Party, which Obama cannot abandon if he wishes to be reelected. The left is ideologically opposed to economic development of every kind, so there is nothing in this speech about removing environmental regulations and fast-tracking exploration and production of conventional fuels. Not only does Obama ignore the promise of the vast new natural gas reserves within our borders, he asks Congress to eliminate whatever subsidies now exist for conventional fuels and turn them over to less efficient producers of alternative fuels. And this at a time when the free market is turning its back on alternatives.
Then there is the President's plan for more spending on education. Spending on education has increased more rapidly in the past two years than any sector other than alternative energy. Yet the President reports that America continues to fall behind its competitors. There is no measurable evidence that Obama's injection of funds has had any effect other than enrich teachers' unions, which are then able to contribute to the political campaigns of Democratic candidates. Obama's call for more spending on education is nothing more than another payoff for his political constituency.
Making America greener and smarter is just a start. How about giving 98% of Americans access to high speed internet? Giving 80% of them access to high-speed rail? Giving them new roads and bridges so as to create more of those "shovel ready" jobs that weren't quite ready two years ago?
How about free-trade agreements with Korea, Columbia, and Panama? Fine, as long as the union bosses approve. Less regulation? Great, but not from EPA, SEC, FCC, and the thousands of other agencies that are doing such a fine job of strangling the economy.
And finally, let's talk about that little problem with the national debt. Let's freeze discretionary federal spending for five years at 2010 levels -- the highest levels of government spending in absolute terms and as a percentage of GDP since World War II. An effort of that magnitude will only add another $6 trillion dollars to the national debt, bringing it up to $20 trillion ahead of schedule. What a sacrifice!
Toward the end of his address, the President began to repeat the mantra "We do big things." There was nothing in his speech about big businesses doing big things -- nothing about the very real accomplishments of IBM, Microsoft, Boeing, Apple, Exxon Mobil, Wells Fargo, or America's other large and productive corporations, even his admirers at GE. So I assume he was speaking of government doing big things. That's certainly what he talked about for nearly all of his 65 minutes.
America's economy has already been wounded by Obama's politically inspired stimulus spending, healthcare bill, and financial regulation reform act. Now he wants to kill it off with two more years of "encouragement." Republicans in the House would have to be barmy to support any of it.
What we saw Tuesday night was not a new Obama. It was the same old Obama, a calculating politician schooled in the Chicago patronage system. Obama pretends to be a unifier speaking to the country as a whole. But on Tuesday, once again, he was speaking only to his political base. Obama will never turn his back on the political elite, greens, unions, trial lawyers, and the urban underclass. And yet he can never unleash the power of the free market to create jobs until he abandons these anti-growth constituencies.
Obama's solution: Pretend that he has shifted toward a more business-friendly, free-market stance while changing nothing. It's still the unions, environmentalists, lawyers, and welfare clients who matter -- not the middle class.
In reality, the State of the Union had nothing to do with creating jobs or competitiveness. Obama knows that he has lost the war on both of these fronts. Realistic economic projections indicate that the nation's unemployment rate will still be over 9% well into 2012. Obama will not win reelection on his job creation record. Nor will he win on competitiveness-a nebulous term that can mean just about anything, and does when the President uses it.
To win reelection, the President must re-ignite his political base-and raise a great deal of cash . Shamefully, and unabashedly, Obama devoted his second State of the Union address to these two goals. Winning reelection seems to be the only competition he is interested in.
Jeffrey Folks is author of many books and articles on American culture and politics.