HOUSTON, January 8 — President Obama’s economic policies have produced the worst economic recovery since the Great Depression. The good news is that he has vowed to fight against the poor conditions his policies have created. The bad news is he plans to do it by giving us more of the same.
Since becoming President, Obama’s redistributive policies have left the poor and the middle class in shambles. Over the last five years, the number of Americans living in poverty rose 31 percent to 49.7 million. The number of people on food stamps rose by 80 percent to a record 47.7 million people.
Economic growth — real GDP growth — during Obama’s first term was the worst of any president in the last 70 years. Middle-class real incomes have fallen every year, and Obamacare will begin in earnest this year to devastate the poor and middle class. It requires that the young, healthy, and generally poorer individuals subsidize the old, sick and often wealthy.
Obama took office during a recession, but there have been ten other recessions since the Great Depression. Forbes contributor Peter Ferrara explains, “In the 10 post depression recessions before President Obama, the economy recovered the lost GDP during the recession within an average of 4.5 quarters after the recession started. But it took Obama’s recovery 16 quarters, or 4 years, to reach that point. Twenty quarters, or 5 years, after the recession started, the economy (real GDP) had grown just 3.2% above where it was when the recession started. By sharp contrast, at that point in Reagan’s recovery from the 1981-1982 recession, the economy had boomed by 18.6%.”
As the poor and middle class suffer under Obamanomics, the wealthy have greatly benefitted. Obama’s friends on Wall Street have been well taken care of. The stock market had its best year in 17 years. The pertpetual campaigner must keep those who write the big checks happy, and he has certainly done so.
Obama and the Democrats are set to benefit politically from a bad economy because the lap dog mainstream media will never blame them for their failures.
Democrats have made clear that their 2014 agenda will focus on three issues, which will all be very damaging to poor and middle class Americans. Most important to Obama, however, is that these issues can be used to paint political targets on the backs of Republicans and distract Americans from the pain Obamacare will inflict.
1. Minimum wage increase from $7.25 to $10.10:
Raising the minimum wage by close to 40 percent during the slowest economic recovery since the Great Depression will kill almost as many jobs as Obamacare will. The most devastating impact on employers has been postponed; the employer mandate to provide health insurance to employees kicks in at the beginning of 2015, unless Obama’s imperial presidency steps in to delay it again. The threat this poses to employment is so terrifying that it could not be allowed to happen before the mid-term elections. This impact will be disproportionately harsh on poor and less educated Americans.
Stanford economist Thomas Sowell explains the real consequences of raising the minimum wage: “Unfortunately, the real minimum wage is always zero, regardless of the laws, and that is the wage that many workers receive in the wake of the creation or escalation of a government-mandated minimum wage, because they either lose their jobs or fail to find jobs.”
2. Extending the long-term unemployment benefits to a record of five or six years:
On January 7, 2013, Obama gave a speech advocating the extension of long-term unemployment benefits to a record five or six years. He strongly made the case that extending the amount of time that the government will provide free money to people who do not work would greatly benefit both recipients and the economy; by supporting the buying power of the unemployed, it would help preserve and create jobs.
This is contradicted by Larry Summers, who served as Secretary of the Treasury under President Clinton and as Director of the National Economic Council under Obama. In his textbook, “The Conscience Encyclopedia of Economics” he explains, without the partisan bias, the real effects of unemployment insurance.
“These government assistance programs contribute to long-term unemployment in two ways … First, government assistance increases the measure of unemployment by prompting people who are not working to claim that they are looking for work even when they are not … The second way government assistance programs contribute to long-term unemployment is by providing an incentive, and the means, not to work … Unemployment insurance also extends the time a person stays off the job. Clark and I estimated that the existence of unemployment insurance almost doubles the number of unemployment spells lasting more than three months.”
3. Immigration Reform and Amnesty:
To Democratic politicians who do not care about anything but power and control, providing amnesty, or “a path to citizenship,” to tens of millions of future Democrat voters is their key to permanent power and control. After the estimated 11-20 million illegals currently in America get legal status they will, via the chain migration policy, be able to bring members of their immediate families to America as well. The importation of tens of millions of legal, and mostly low-skilled, workers literally overnight will have a devastating effect on the economy, and will hurt the poor the most.
In April of 2013 members of the progressive Civil Rights Commission wrote a letter to the Congressional Black Caucus discussing this issue. They said that granting legal status to illegals “will likely disproportionately harm lower-skilled African-Americans by making it more difficult for them to obtain employment and depressing their wages when they do obtain employment.”
Additionally, the Black American Leadership Alliance (BALA), wrote an open letter to lawmakers regarding the impact of the immigration legislation that was signed by over a dozen very influential black leaders around the country. “If passed, the proposed immigration bill will be costly for all Americans, but will harm American workers more than any other group,” the group wrote. “If Congress fails to stop this irresponsible legislation, the United States will continue to see more and more blacks out of jobs and unable to support their families.”
Obama is a smart and cunning man. He is well aware of the repercussions these policies will have, and has deliberately chosen a chance for political advantage over the well-being of the most vulnerable among us.
Obama may continue to illegally alter and change laws by decree, but even an emperor cannot change the laws of economics. 2014 will be a difficult year for all Americans, but it will be worse for the poor and the least-skilled among us. Obama has guaranteed that.
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