I liked how the president has kept to his slogan... He has kept us hoping that the economy will improve, and at the same time has left us with nothing but a little loose change.
Seriously, I don't think he will win. Almost every election after his has gone to the republicans, including a few surprise elections in historically democratic districts. People are upset with the economy (always a losing issue for the incumbent). Although former president Bush did muck things up in terms of the economy, President Obama has had enough time (and a willing congress from his own party for the first two years) to make changes to correct those issues. However instead of trying to address the issue of the economy right away, he used his legislative leverage to ram Obama Care down our throats (when we have to pass a bill to know what's in a bill... I call that ramming down our throats).
And the policies that he is now employing to "fix" the economy are actually making things worse. the true Keynesian philosophy is to increase taxation during good economic times to increase government coffers such that when the economy turns south, the government can increase their spending to cause a stimulus in demand to the economy. However for quite some time, our country has incurred a debt, not a surplus, even during the good economic times of the Reagan and Clinton years. So to now try to increase government spending as a demand stimulus, we either have to increase deficit spending or have to raise taxes to cover the cost for the additional spending. This puts us in another predicament in that our debt is so large now that there is fear that the US may default on our loans (which is why the US credit rating was lowered even after the debt-limit was increased), so increased deficit spending may do more harm than good. On the other hand, increase in taxes decreases the amount of money that resides in the private sector, which is what we are trying to stimulate in the first place. The increased government spending may boost the demand for private sector goods and services, but the taxes are pulling the money right back out again (and since it goes through a bunch of red-tape in the process, less money makes it back into the private sector).
There is also a lot of concern in the private sector in that businesses don't know what to expect from the government. At first president Obama was saying that to repeal the Bush tax cuts would only hurt the struggling economy, but now that Obama is in re-election mode, he's singing a different tune. When companies see this uncertainty, it makes it even more difficult to hire workers. When a company hires someone, they are measuring how the asset will effect business not only now, but in the years to come. Workers are not an expendable resource like physical products: a new computer you pay $50K once, but a worker you may pay $50K every year that they are with the company. So it is always in the companies best interest when they are able to rely on what future expenses are going to be in order to project whether they should hire. If, however, a company has fears that they may not have the money in the future -- be it from increases in taxes, increased energy costs, regulatory costs, healthcare costs, etc. -- that company is less likely to hire new workers. Unfortunately, our current president has been increasing each of these costs, whether it be in taxes, his energy plan (esp. in light of the BP disaster), or Obama Care (esp. if the health insurance mandate is ruled unconstitutional as it has been in several lesser federal courts).
It's all well and good to claim that president Obama inherited a bad economy, but if the first driver pointed a car towards the edge of a cliff and a second driver says he'll fix the situation by stepping on the gas, I thinks it's time to get a third driver in there to stomp on the brakes and turn the car around.
Community Forum
Topic: Do you think Obama will win another four years (Read 13335 times)
November 03, 2009, 05:23:21 pm
