It has become conventional wisdom that President Obama tries very hard to be all things to all people when he gives a speech these days. While it often makes for excellent oratory, it rarely inspires action or advocacy on his behalf. In fact, after his recent address on Afghanistan, given at West Point, there was widespread criticism from both sides of the aisle over some of the policy, and most of the substance. Simply put, the nation cannot be led through a war or a recession by simply filling in the blanks, Mad-Lib style, to suit every audience. In a fact check of the President’s economic speech delivered at the Brookings Institute headlined “Obama Likes Both Sides of an Argument,” the Associated Press said the following:
Under law, any paybacks to the bailout known as the Troubled Asset Relief Program must be used to reduce the deficit. But in an economic speech on Tuesday, the president sought to have it both ways. Increased repayments from banks to the Treasury will reduce the deficit all right, but it will give Congress the budgetary room to spend more—and the president encouraged just that.
President Obama would like you to believe that Congress has the room to spend more money simply because money borrowed in the first place is statutorily being repaid to the loaning U.S. taxpayer. So on the one hand, TARP works because the money is getting repaid, and on the other hand Congress has money to spend because TARP money is being repaid. President Obama said: “There are those who claim we have to choose between paying down our deficits on the one hand, and investing in job creation and economic growth on the other. But this is a false choice.” But there is nothing false about the difference between spending money and not spending money. You cannot reduce the deficit by spending more money, plain and simple. This is a far greater danger in the face of Rep. Barney Frank’s (D-MA) plan to create a permanent TARP.
Thankfully, the AP also called out the President for some other misnomers in today’s economic speech saying: “It wasn’t the president’s only attempt at having his cake and eating it, too, in his speech.” President Obama, the blamer-in-chief, also echoed his favorite line that these problems are inherited, and he’s simply trying to solve them. However, this ignores his own votes and positions of support as a U.S. Senator and presidential candidate and his party’s control of Congress between 2006 and 2008 when most of the current economic plans were put in place.
President Obama then spoke of how his stimulus package had created 1.6 million jobs, citing a CBO report. The AP correctly points out that the CBO report was not so rosy, and offered “numerous caveats.” In reality, since President Obama took office, U.S. employment has dropped by 3.3 million jobs. The President’s promises at the time of the Stimulus debate set a target of 138.6 million jobs in the U.S. by 2010. The President is 7.6 million jobs short of this goal according to data provided by the Bureau of Labor Statistics (BLS).
Finally, the AP called out the President for taking credit for a rosier education economy. Obama said he had made “college more affordable.” In fact, his proposals in Congress would slow the historical growth rates of Pell Grants and shift money away from prospective college students and into other education priorities for his administration. To be sure, these priorities do not include 1,715 extremely disadvantaged children residing in Washington, DC. President Obama chose to cut the funding for the D.C. Opportunity Scholarship Program which allowed these kids to choose schools that aided their education rather than schools that only offered a dangerous environment that didn’t support their efforts to someday make it to college. An opportunity that President Obama himself had and chose for his own family.
The President would like you to leave every speech thinking that he spoke directly to you through the glare of his TelePrompters. However, when reality meets rhetoric, the speeches leave much to be desired, as the AP ably pointed out today.
This week, the Senate Environment and Public Works Committee began debate on comprehensive climate change legislation, S. 1733, otherwise known as cap-and-trade. This legislation represents a new tax in the order of more than $1,700 per American household annually, and, if it’s passed, American families can expect to see considerable increases in the cost of electricity, gas, food and utilities. It is clear that most Americans families’ standard of living will be reduced if this cap-and-trade bill is approved by Congress.
Every legitimate economic analysis says that this bill is a bad idea ? the Energy Information Administration, the Congressional Budget Office, the National Black Chamber of Commerce, the National Association of Manufacturers, the Brookings Institute and the Heritage Foundation are all in agreement on that point. The impact of these new regulations on American jobs and energy prices cannot be marginalized or ignored.
The CBO has stated that mining and refining jobs will be among the industries most impacted by the proposed cap-and-trade program. However, nearly every product manufactured requires some derivative from oil and natural gas or other minerals. How can it be a strategically sound idea for the United States to become more dependent on mined and refined products from foreign countries?
A critical point in this whole debate is that China, India and Russia have made it unequivocally clear that they have no intention of agreeing to a cap on carbon emissions, and all three are aggressively pursuing natural resource assets around the world and increasing energy production from fossil fuels. It would be naïve for us to think that U.S. businesses will be able to effectively compete on the international level when they are subject to carbon caps and regulation, increased energy costs and an easily manipulated market scheme. Secretary Chu mentions in his testimony that China is spending $9 billion a month on clean energy. They are also building two coal fired power plants a week, increasing nuclear power generation and securing oil and other mineral resources across the globe.
Despite my concerns with the idea of a cap-and-trade program, I do support investment and research in renewable technologies. And I do believe that a robust plan for investment should be in place, but to do so should not borrow money from China or steal money from American families under the guise of global warming.
The greatest opportunity for investment in new technologies is revenue generated from increased domestic energy production. Recent analysis suggests that increased domestic resource production could generate $8 trillion in GDP, $2.2 trillion in incremental tax receipts and perhaps two million jobs or more ? all without borrowing a dime or increasing taxes even a penny.