Congress returned in full force this week from its August recess, and President Obama finally will put forward much-hyped jobs and deficit-reduction proposals. After more than two years of sustained high unemployment and a perpetually sluggish market, it’s about time.
The devastating downgrade of America’s bond rating by Standard & Poor’s last month and the resulting market tumult underscored that this economic crisis is far from over. In advance of Mr. Obama’s coming recommendations, a few requests: Stop the blame game, take responsibility and show leadership.
“Owning” the economy entails accountability for outcomes.
To this day, Mr. Obama still blames his predecessor and Republicans for every problem facing our country. Yes, some of these gripes are justified. Yes, he did inherit an economic crisis. But let’s get beyond the juvenile finger-pointing.
Federal budgets are passed by Congress, not the White House. The party that controlled Congress during the Obama administration until January is the Democratic Party. Mr. Obama, as a matter of fact, inherited a budget that he supported as the junior senator from Illinois. As president, he has overseen an exponential increase in our deficit. He has advocated raising the debt ceiling four times since taking office, bringing the limit to $16.4 trillion.
The latest tallies show nearly 14 million Americans are without jobs - and the national jobless rate has reached or exceeded 9 percent for 28 straight months. The Labor Department just announced that zero net new jobs were added in August. Painting an even bleaker picture, the Office of Management and Budget projects the unemployment rate will stay near double digits through 2012.
As Mr. Obama presents his latest proposals to get the country back to work and shrink our massive debt, Americans should appraise his track record. Just this summer, the White House’s own Council of Economic Advisers released a report disclosing that the 2009 stimulus package cost taxpayers $278,000 per new job. Our gross domestic product and consumer spending remain stagnant, absent promising signals of growth. Now, additional key economic indicators reveal we may even be on the precipice of a double-dip recession.
Tone deaf, the White House proposed a $3.7 trillion budget for 2012, 40 percent of which is made up of borrowed money. Democrats further compounded our debt crisis in late July when they refused to tackle deficit reduction sincerely. The uncertainty surrounding the Budget Control Act and liberals’ accompanying plea for tax increases on American job creators led to the first-ever downgrade of our country’s credit rating since initially attaining a AAA score in 1941. Our credit rating was not lowered after World War II, after the recessions of the 1970s and 1980s or even after the financial crisis that wreaked havoc on Wall Street and the world markets in 2008. It happened on Mr. Obama’s watch.
In recent weeks, the White House has sought to draw ties between our current chief executive and former President Ronald Reagan. In a recent Wall Street Journal column, Stephen Moore shattered this comparison. While it is true both were heirs to stunted economies and both added to our deficits, Reagan made major tax cuts and reduced regulatory burdens, unleashing unprecedented economic growth.
Comparatively, three decades later, Mr. Obama’s American Recovery and Reinvestment Act has failed. Instead of lowering taxes and allowing the private sector to create jobs, he favored letting the government spend dollars to create jobs. Mr. Obama’s policies have grown the size and scope of government, unnerved the private sector and accelerated our decline.
Though the past is prologue too often, Mr. Obama has a real opportunity this week to reverse course and put the needs of American workers and the American economy before his failed, liberal big-government dogma.
The president has promised solutions with bipartisan appeal. If that holds true, he should embrace reforms offered by the House of Representatives: slashing wasteful programs, establishing real spending caps and balancing the budget - as leaders of all political stripes should strive for - preferably through a balanced-budget amendment. These measures hold the promise of restoring investor confidence. America’s job creators will get to work, rating agencies will re-evaluate our credit, and the global financial system will respond accordingly.
Leadership is about the fortitude to make the tough but necessary decisions - ones in the best interests of our economic and national security - not about foisting blame on others when it is politically expedient.
As we contemplate the next big debate in Washington, I am inspired by a quote in a previous debt-ceiling increase debate:
“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.” - Sen. Barack H. Obama, March 2006.
Al Cardenas is chairman of the American Conservative Union.
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