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EDITORIAL: The Obama slowdown
Big-government policies continue to drag down the economy
Question of the Day
The experts at the National Bureau of Economic Research say the Great Recession ended in June 2009. After that, it looked for a brief period as if there might be a surge of economic growth as an oppressed private sector fought to break free of the malaise. It hasn’t happened, and the latest numbers are far from encouraging.
On Monday, the Federal Reserve Bank of Chicago released the monthly results for its broad measure of economic activity. The Chicago Fed national activity index tumbled from positive territory, a value of .32 in March, into negative territory, -.45, in April. The score is a weighted average of 85 measures of employment, consumption, sales and other factors that give a sense of where the economy is headed. In this case, production-related indicators that had been positive for nine consecutive months have stalled and are dragging down the figures. Likewise, inflationary pressures have begun to take a toll.
The news was equally bleak over at the Philadelphia Fed. On Friday, the bank’s general business conditions survey of the manufacturing sector reported that growth dropped from 18.5 on the index in April to a value of just 3.9. While positive, that score reflects a major slowing. A majority of firms that responded to the survey explained that they were facing much higher prices for supplies, cutting into each company’s bottom line. Uncertainty about the cost of health insurance was the third-most-cited reason for a company holding back on hiring.
That uncertainty emanates directly from the White House. After ramming his health care mandates through a heavily Democratic Congress, President Obama has created a situation in which even state governors are now complaining they don’t know what will come next. The administration has been less focused on restoring economic hope and more focused on rewarding its political allies. So instead of encouraging the creation of wealth and prosperity, Mr. Obama has demonized those responsible for putting America to work.
Under Mr. Obama’s anti-energy strategy, taxpayer money is lavished on Democratic donors who come up with scams that promise to power cities with bird-slicing windmills and solar cells that work only when the sun is out. The real sources of energy are hobbled by the refusal to grant permits for drilling basically anywhere in America. Other regulations threaten to drive coal-energy costs beyond sustainable levels. Overall, higher energy prices boost the cost of making and transporting goods, which makes everything more expensive.
The administration’s runaway spending has crippled the marketplace. On Mr. Obama’s watch, the Treasury has had to borrow $3,718,621,353,800 from individuals, banks and even foreign governments to bankroll the so-called “stimulus” and other budget-busting boondoggles. That’s capital not available to private-sector entrepreneurs who may have wanted to expand their businesses. Instead of abandoning these policies that have failed in every respect, the White House is doubling down on the idea that government outlays and controls will save the day. America’s fragile economy isn’t going to survive much longer without some change.
© Copyright 2013 The Washington Times, LLC. Click here for reprint permission.
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