In his recent speech on the economy, Barack Obama made a number of good points, but his proposed solutions to the problems are a different matter.
In his recent Washington speech, which has already been reported on here uncritically, the President made a lot of good points and clearly means well, but he has allowed himself to be blinded by dogma, and what he didnít say was arguably more interesting than what he did.
The top 1% are now taking 10% of the wealth, yeah, we got that, but how important is this? The real gap in America is not racial, but economic. He got that right, and it will play well with his white supporters, whom one suspects are still in a big majority. Compared with men, women earn "only" 77c on the dollar. Oh no, not that mythical glass ceiling again. He threw in a bit about his own and his wifeís history, but neglected to mention the fact that she took time out to raise two daughters. Someone has to.
Then he spoke favourably of the minimum wage, there is no solid evidence that shows the minimum wage is counter-productive. This is total nonsense. It may be that in the stratosphere where clearly he lives it is not a problem; it may not ultimately be a problem for Walmart, but what about the greasy spoon on the corner or the small hot dog vendor? How does a burger bar with a small, transient and largely downmarket clientele pay the guy who clears the tables minimum wage?
The President wants more growth and to rebuild infrastructure - not a moment too soon for the latter, but why canít we have prosperity without growth? Certainly we need it, recall the words of the late Albert Bartlett.
He spoke of Obamacare, but not by its brand name, there was a heavy emphasis on this towards the end of his speech, fittingly so because it is a big problem, but there are those like Barbara Bellar who not only see it for what it is - an expensive, bureaucratic nightmare - but who propose affordable and practical alternatives.
Then there was investing in education - now that is a good thing! Start with yourself, dude. You want to empower workers, and streamline legislation, and you propose to do this how? Obamacare is one, a project that will recruit legions of bureaucrats and enforcers but not one new doctor; you want to bring in the Paycheck Fairness Act to address a relatively small pay gap that doesnít actually exist when things like lifestyle choices are factored into the equation. This and other measures would entail more "anti-discrimination" legislation, ie yet more bureaucracy to police these mythical disparities.
The service sector is growing faster than ever, he said, and this meant that a lot of people lower down the food chain were shut out due to poor qualifications, so the Government would take positive steps to assist the long term unemployed - for those who believe there is such a thing as unemployment.
Again he mentioned the minimum wage, which he said should not be an ideological question, even though he is making it one. But did he have to quote Adam Smith? Like 99.9% of mainstream politicians and 100% of economists, Obama is blind to the real solution because he is blind to the real problem. The real indeed the only solution is unconditional basic income, which would destroy the poverty trap and allow those at the bottom to take up those jobs below minimum wage. The real problem is not employers but the banking system, which was one of the two big desiderata in this speech. The other was the military. Unlike the British Empire, which was a force for good, pax Americana has increasingly become a pain, as much for Americans as for the rest of the world.
Every man in uniform unnecessarily is in practice unemployed; far better to bring the troops home, all of them, and allow the natives to get on with it. China is the rising super-power, but it is doubtful if the successors of Chairman Mao will be in any rush to take the place of Uncle Sam. Winding down the American empire and abolishing the Federal Reserve would allow the instigation of basic income or if not then at the very least would drastically reduce unnecessary and wasteful expenditure as well as providing cheap money for the people and the government instead of for the banks as at present. This is what Obama could have promised, instead Americans can face more bureaucracy and more attempts by his minions to plan the economy, and a planned economy is known as what? O tempora! O mores!
[The above article was first published December 5, 2013.]
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