We have been away from the political landscape for a while now. Understandably we have been focused on the 2011 flood in Binghamton and the surrounding areas in New York and Pennsylvania. But we will try to reover some sense of naormalcy, and jump in with both feet.
The American Jobs Act of 2011.
There is a lot being said about this proposal from President Obama. Much of it from the White House itself. It is presented as non-partisan, and providing essential items for all political parties. It has been demanded that it be passed by Congress immediately.
But what does the plan actually propose? Can it actually do any good? Is there anything new? Seperating the hype from the fact, there are some immediate observations.
First, this is a combination of a multitude of ideas that are already in place and failing to do anything close to expectations. $140 billion is targeted to infrastructure, as the White House states,
Just a year ago that was touted as “shovel-ready jobs”, which have shown to be both non-stimulative and not useful in creating long-term job growth. Therefore this is money being shunted down a hole that already has gobbled a good portion of $814 billion over the last 2 1/2 years.
Not a benefit, but very positive for a President in need of something to stand on as he seeks re-election in 2012. Ultimately, more of the same and thus should be expected to result in more of the same – a waste of money.
Second, extending unemployment benefits. Seen as a “job creator” by Rep. Nancy Pelosi in July 2010, yet the official unemployment rate has marginally improved from the 9.8% when she made the statement. In fact, if you count the tens of thousands that no longer count because they are not receiving a check from the Government, its easily argued that unemployment has steadily INCREASED since the Stimulus was set in place.
Simply put, economist James Sherk (senior policy analyst for the Heritage Foundation) said,
Third, going back to the Withe House Fact Sheet, it will prevent 280,000 teacher layoffs. Correct us if we are wrong, but the Stimulus spent $100 billion on doing the same thing. Then in April 2010 another emergency $25 billion was spent on the same exact thing.
Again, as economist Sherk said, “It hasn’t stimulated the economy before. It’s not going to stimulate it now.”
“Allowing more Americans to refinance their mortgages at today’s near 4 percent interest rates, which can put more than $2,000 a year in a family’s pocket.” – White House Fact Sheet on American Jobs Act 2011
Yet another item that was tried previously. It was called Making Homes Affordable Act. It was such a failure it has been out of the White House talking points since 2010 – with good reason. In February 2011 we noted it’s “success” rate
“The Making Homes Affordable program has been a $75 billion waste of taxpayer funds; with more than half of those enrolled dropping from the program and 54% of those that were helped by the program redefaulting.”
Over 1.2 million applied, to date just over 400,000 have been helped in more than 2 years. But now President Obama wants to do it again. What are the odds doing the same thing again, for less money, will yeild a better result?
The fifth point is again a direct quote from the White House,
“Fully Paid for as Part of the President’s Long-Term Deficit Reduction Plan”
Of course there were no details on how this will be paid for at the time it was released. Which raises the questions if it will be “deficit nuetral” like the Health Care Reform, which we noted January 2011
“Since passage the CBO has revealed that any projected cost savings in healthcare for the nation were the faulty calculations due to incomplete data. Given the full scope of the law and it’s entire language the once projected $100 million gain has turned into a complete burden on the nation. It will in fact add billions to the national deficit in the first 10 years.”
To be precise on what the American Jobs Act of 2011 states, (as found by Andrew Stiles of The National Review)
If a joint committee bill achieving an amount greater than “$1,650,000,000,000″ in deficit reduction… is enacted by January 15, 2012, then the amendments to the Internal Revenue Code . . . shall not be in effect for any taxable year.
In other words, if Congress passes this Bill, and only funds about 1/3 of it via tax increases over 10 years, then the remaining roughly $350 billion will just be added to the deficit.
How does that fit in with “Fully Paid”? We have no idea either. We expect that like the Stimulus and Health Care Reform, the White House did not expect anyone to actually read the entire 155 pages of the Bill.
So there are 5 major problems with the proposal from President Obama. Reasons why it should not be passed immediately and should be broken apart and redone with ideas that are not simply politically advantageous to a President seeking re-election, but to the American public that is supposed to get a benefit from the Bill.
These are just 5 problems. There are more. There are also a few ideas that are actually new thoughts from the Obama Administration (mostly borrowed from Conservatives) and could potentially help the nation. We suggest Congress actually read the Bill, take it apart, and get it right. Honestly, if this were so important, and such a rush, wouldn’t the President have cancelled his vacation and called Congress into session to get it passed 3 weeks ago?
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