Karen and the Obama economy

Your Editor probably should have checked the numbers and done the math a few days ago, but better late than never. Under President Barack Hussein Obama, the man who had told us, in June of 2008, that it was “irresponsible” and “unpatriotic” for President Bush to have presided over a $4 trillion increase in the national debt in eight years, has himself presided over an increase of $5,805,742,375,789.98 increase in the national debt during his first four years in office, from $10,626,877,048,913.08 to $16,432,619,424,703.06 on January 18, 2013, the last business day of his first term.

Of course, we have been told by our friends on the left that we just have to engage in deficit spending right now, because the economy is so weak, and that we need the stimulating effects. Well, after four years under our 44th President and his policies, just how well has that been working out for us? From THE WALL STREET JOURNAL:

U.S. Economy Unexpectedly Contracts in Fourth Quarter

By Josh Mitchell | Updated January 30, 2013, 2:05 p.m. ET

The U.S. economy shrank for the first time in more than three years in the fourth quarter, underscoring the halting nature of the recovery. But the strength of consumer spending and business investment suggested that the economy will grow, albeit slowly, this year.

Gross domestic product—the broadest measure of goods and services churned out by the economy—fell at a 0.1% annual rate in the fourth quarter of 2012, according to the government’s initial estimate out Wednesday.

The details weren’t as discouraging as the headline. The drop, a surprise, was driven by a sharp fall in government spending and by businesses putting fewer goods on warehouse shelves, as well as by a decline in exports. The mainstays of the domestic private economy—housing, consumer spending and business investment in equipment and software—were stronger.

Research firm Capital Economics called the report “the best-looking contraction in U.S. GDP you’ll ever see.” Forecasters didn’t see the decline as a harbinger of recession. They predicted the U.S. will expand at around a 2% pace in the current quarter, though the mood could shift Friday when the government releases its monthly snapshot of the job market.

More at the link; hat tip to Karen.

“The best-looking contraction in U.S. GDP you’ll ever see,” huh? Were I to be polite, I’d call that silver-liningism; were I to use one of my best friend’s stock expressions, I’d say, “Other than that, Mrs Kennedy, how was Dallas?”

So, the professional economists project that the current quarter will see an annualized expansion rate of 2% in the current quarter. Well, perhaps that will happen, but, if it does, that will mean that the last half year saw an expansion in GDP at an only 1% annualized rate. At what point, your Editor would ask, will we start to see some actually good economic news under President Obama and his Administration? A 1% or 2% annualized growth rate will not lead to sufficient job creation, will not lead to enough new jobs being created to reduce unemployment significantly.1

Karen also linked to this video from Fox News. Of course, Karen and her favorite husband are paying rather close attention to the economy, and she related two letters that they have received, one from a materials supplier noting significant price increases and another notifying her that her family’s group insurance coverage premiums would be increasing by 10% starting in April:

Mr. LC and I purchase our health insurance through our family business. I just received a notice informing us that the cost of the group plan that covers our family is rising by 10% a year beginning in April. A separate letter indicated that part of the increase is due to federal mandates regarding women’s reproductive services. We pay more for health insurance than we do for our mortgage.

Note that her insurance company specifically stated that part of the increase is directly due to higher costs due to federal regulations. Why, it’s almost as though nothing about health care coverage is free.

I really recommend looking at Karen’s brief article concerning material price increases. The letter she quotes has substantial percentage price increases listed, and that means the costs to contractors doing jobs will increase . . . which means that fewer people will be able to get work done that needs to be done. Some jobs that need to be done simply have to be done: if you need a new roof, you have to get that done, or the rain will destroy your house. But if you were considering new vinyl siding to upgrade an existing older home, well maybe you can live with the old stuff a while longer; if you were hoping to improve your home by adding a deck, maybe you’ll just have to put off that deck for another year or four. This means less business for home improvement contractors, and higher prices for new home construction. Those are things which, in the aggregate, slow down the economy and slow job creation, which is just what we have seen. yet, at the same time, Obama Administration regulations are directly increasing costs for things like health insurance.

The election is over, and we can’t somehow unelect President Obama; we are stuck with him and his cockamamie economic policies for another four years. But we can urge our Republican congressmen to do everything that they can to block his policies: don’t fund his new programs, and don’t pass any enabling legislation to authorize his policies. The Republicans won’t be able to help the economy, but maybe they can stop the Democrats from hurting it so much.

  1. The official unemployment rate might decline somewhat, as it has been through most of the Obama Administration, but that has been primarily due to so many people leaving the workforce rather than jobs being created.

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