Welcome back to James Call: Expert!
Today, reader "Janelle" asks, "Let's hear all about the state of the Union address!" You got it, Janelle!
The State of the Union: Kinda Ok, Like, Whatever
FiveThirtyEight.com, January 27, 2010
Obama's first SOTU can be best described as "tepid," or, in polite terms, "Clintonian".
It was a smörgåsbord of small little concepts, some of which are nice but essentially harmless, and others of which are potentially dangerous and stupid, but appealling to lots of people politically.
First of all, the good stuff: smackin' the face of the Supreme Court over that corporate free speech ruling, calling the Senate on their BS, and calling the Republicans on their super-BS...
Now, the bad stuff. First of all, there's this "we should have 'done' jobs first rather than health care reform in the first year" meme that's floatin' around society right now. Everyone who's anyone is saying this. It's kind of like when everyone, including the majority of hipsters, starting saying, out of the blue a few years ago, that they hate hipsters. I mean, do you -really- hate hipsters? Or are you just saying that?
The bottom line is that the current health care system, in which employers provide health care to the vast bulk of the populace, is a burden on employers. Lift that burden, and there'd be much more money to HIRE people with. In other word, health care reform = jobs.
But people are freakin' the hell out, calling for health care reform to be killed right when it was almost at the finish line, and screaming about "jobs" instead. Obama in his SOTU sure doesn't help, waiting 'til more than half way through to make a half-hearted "health care reform will continue" pledge, which is really just meaningless lip service since he doesn't say HOW it's going to continue.
Instead, he's all "tax cuts! small business!" People love to hear these words, but you get 30¢ to the $1 on your average tax cut, especially capital gains tax cuts. Since we're all freaking out about the deficit, are tax cuts really the key forward?
Which brings us to the real stinker in Obama's SOTU - the "spending freeze". This is just about the stupidest possible idea in the world you could come up with. Ok, the vast bulk of "independents" in this country are worried about the deficit. But the vast bulk of "independents" in this country are also morons with short attention spans, who vote Republican, Democrat, Republican, Democrat, basically always with a "kick the bums out" mentality. Sure, kicking the bums out is easy to relate to, but also reminds me of a lot of drunk sports fans I know. Is pandering to these people really ever a good idea?
The bottom line is - the private sector is not investing right now. The government HAS to step in and fill that demand-gap because otherwise ain't nobody gonna have a job. In other words, a REAL jobs program, that will result in hiring, is directly incompatible with a deficit-cutting program. I will probably say this about 100 times in this blog over the course of this coming year: We are not Zimbabwe. We aren't even Japan yet. We don't need to worry about inflation; WE DO NOT NEED TO WORRY ABOUT OUR DEFICIT.
Besides, Obama isn't going to touch the big, huge, swelling programs like Medicare, Medicaid, Defense spending, and Social Security, because those are sacred cows - too much pork in those fuckers - so instead he's going to "freeze" lesser items. Let's assume for a second that cutting the deficit really IS important (probably is in the long run) - this little "spending freeze" is a drop in the bucket. It'll suppress demand and hurt hiring in the short term, but in the long term, we'll still have a ginormous deficit.
So, yeah, I was not blown away by the SOTU. It didn't really contain any surprises. Then again I'm a tough customer to please. I would have liked to hear "the day of negotiating with Republicans is OVER," and "I am pleased to announce my new government-as-employer-of-last-resort program," but then again, I would like a free backrub from Mariah Carey and a private jet made of gold.