There was a time, at the end of the GW Bush’s first term, when the media helped the Democrats advance the ludicrous notion that the economy was worse than it was during the Depression. Today every positive economic movement, no matter how slight, is trumpeted as a sign of a new boom. The truth is, while the U.S. has been caressed with slight breezes of progress, the winds of real economic change have yet to fill her sails.
Every uptick in economic activity or rise in the stock market is seen by many as a sure sign things are getting better. Each time, like a mirage or a subtle breeze, the promise of brighter days fades away. Such was the case when just a couple of weeks ago the payroll numbers came out from payroll giant ADP. They claimed there were 238,000 new jobs created in December. Not an extraordinary number but, when combined with similar employment data from the previous months, a sign of economic movement. In response, the financial world was abuzz with optimistic furor. Finally a sign of consistent, even if mediocre, sustained growth. Unfortunately, when the official numbers came out just a couple of days later what appeared too good to be true, was. The Bureau of Labor Statistics (BLS) also said that employment grew, but at the much more anemic rate of 74,000. Adding insult to injury, BLS said 347,000 dropped out of the work force all together.
Clearly things have not turned the corner just yet. By all accounts, the U.S. economy is in the type of malaise that gripped the nation during the 1930’s. In fact, the recovery has been slower than even during the Great Depression. One of the few real bright spots is the energy sector, it continues to explode due to fracking. Service jobs have grown as well but goods production has languished as has median incomes.While the White House can trumpet the subsiding unemployment rate to a mal-informed public, it can’t escape the fact it has been almost entirely due to people dropping out of the workforce. The War on Poverty has not only been set back under Obama, it is in full retreat. The worker participation rate is at a 35 year low and shows signs it could move even further back in time. The BLS under employed/underemployed rate is over 13%, a number that would be closer to 20% if the same percentage of people were in the workforce as there were under Bush. Numbers that do not inspire confidence, which is likely they are not heard much.
In a world where incomes are falling, multi-generational households are on the rise and home ownership continues to fall, the strategy it seems is to change the subject. Instead of attacking the economies shortcomings, President Obama has turned his attention to the growing income disparity to champion more of the same policies that have created the same. Income equality, is the Bastian of fools and the folly of dreamers, has replaced economic opportunity in the new darker world of Obamanomics. Never mind the fact that those countries that have attempted income redistribution have languished economically and became hell holes of despair, it sounds good to the ignorant. What the president should be doing instead of talking about some utopian fantasy of equality, is asking why is the U.S. economy not exhibiting its famous elasticity and bouncing back?
The United States has been the economic center of the world for most of its existence. An exceptional feat based on exceptional economic freedom. If one were to ask the question the President seems to be avoiding, the answer might startle some. The United States is not the freest state when it comes to Economic freedom, it is not even in the top 10. The latest Economic Freedom Index published by the Heritage Foundation ranks the U.S. 12th in the world for economic freedom. It’s lowest ever ranking! It now ranks behind such places as Lithuania, Georgia and Chile. Given its deteriorating business climate, uncertain regulatory environment and spiraling compliance cost, the United States current situation is perfectly understandable. How can a country that built itself on the entrepreneurship of its people continue to be on top if it is attacking the very thing that made it great?
What seems apparent is the liberal elites, who like to champion the end of the American age, seem determined to make their predictions come true. As America falters and its prestige is tarnished, it is not the natural outcome of some historical cycle, it is suicide by design.
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