Economic Outlook: Day Of Reckoning
November 6, 2012 by UPI - United Press International, Inc.
So, what has Washington done for us lately?
That can be answered easily starting with the $831 billion stimulus bill, a bailout of General Motors and Chrysler and management of the Troubled Asset Relief Program which, popular or not, put the country’s financial institutions back on their feet after a frightful crisis that came to a head in the summer of 2008.
In fact, each of those programs worked admirably, but the flaw in the ointment is the word “lately.” Stimulus spending would have worked far better had reactionary Republicans not gotten cold feet and forced a turn of direction midstream.
One way to guarantee a failure for an economic strategy is to stop in the middle and pull the plug on whatever plan is in effect. President Obama should have said, “We’re not going to do this if you just spend $831 billion and then just leave me out in the cold.” But that’s exactly what Congress did.
Stopping mid-stream is bad for tax-cutting austerity programs as well. If the plan is to cut spending and lower taxes, the one option that is off the table is to get halfway there and then give up.
Clearly, there is a measure of discourse that election campaigns always seem to miss. GOP presidential candidate Mitt Romney pronounces stimulus spending flawed, then stands up to announce he will “keep America strong” with spending on defense. Year after year, Republicans get to declare this cronyism is patriotism and defense spending is somehow exempt from the label of stimulus program.
It seems similarly moronic to hear Romney bad-mouth efforts to develop solar energy or electric cars. The complaint seems to be the country is not ready yet to turn these ideas into moneymakers. At one point, however, the country was not ready for indoor plumbing and electricity in rural areas.
Leadership in some neighborhoods includes looking out for the future, which might include making some odd choices now.
Romney has waffled on so many statements and famously failed to provide details on so many others, he is like that tireless guest at a party who is so eager to agree with everyone in the room that he has no notion of what he said 5 minutes ago.
In some regard, Romney has some good ideas. The Frank-Dodd overhaul bill is in need of overhaul itself. It should be 10 pages long and scare bankers to death; instead, it is 600 pages long and has spawned more lobbyists.
Too many restrictions on big oil is doing Venezuela, Mexico and Saudi Arabia a favor, not U.S. companies. That’s too bad. A U.S. president should be on America’s side even in the unpopular business of looking for oil.
The trade gap with China is a major job drain and a problem that needs a tougher response. In China, the joke is that the United States does not want to start a trade war — but they called Vietnam a police action, too.
By and large, it is elitist to pretend we are not already in a trade war with China. Like the statement that someday billions of dollars will start to add up to real money. With regard to China, someday several million jobs is going to dawn on the United States that the trade war was declared 50 years ago — but since it was not said out loud, the United States failed to show up.
When did the United States become so squeamish about protectionism? With 23 million Americans out of work, when is it OK to vote for a little protectionism once in a while?
Those out of work might have a different answer to that than those who have a job.
Unfortunately, you can’t have Obama’s leadership skills and a bit of Romney’s hard-hotheadedness as well.
In international markets Tuesday, the Nikkei 225 index in Japan shed 0.36 percent while the Shanghai composite index in China lost 0.38 percent. The Hang Seng index in Hong Kong lost 0.28 percent while the Sensex in India added 0.29 percent.
The S&P/ASX 200 in Australia added 0.24 percent.