The State of the Union? It Sucks!

Nancy Pelosi recently said “It is almost a false argument to say that we have a spending problem.” She went on to say that what we have is a deficit problem.  Conservatives have given Ms. Pelosi a lot of flack over her statement and maybe we have been too hard on the less than brilliant Congressman from San Francisco. After all she did use a qualifier; “almost”, which can mean “not quite”. And, she was spot on when she said the US has a deficit problem. Who could argue with that? By saying that we have a deficit problem instead of saying we have a spending problem, the loyal Democratic trooper was setting the stage for President Obama’s State of the Union address tonight. What she was saying is that if the problem is deficits, there are two ways (balanced approached) to reduce deficits: reduce spending investments and increase taxes revenue. Of course that is what you are going to hear from the president tonight, if you bother to listen to him. That plus he will blame the Republicans for his own “sequester” idea. The president has evolved once more and now he believes the cuts in the “sequester” would hurt national defense and could also hurt the great stagnation recovery we are all experiencing. He will tell his listeners that about his “balanced approach”, which is much better because it increases taxes on the evil rich.

So, Nancy Pelosi, with her double-digit IQ, did what little she could for the President. On Sunday, Lawrence Summers wrote an article in the Washington Post giving the President some advice on that “almost fake spending” problem. Mr. Summers was a past president of Harvard, he was Secretary of Treasury under Bill Clinton (bye-bye Glass- Steagall, hello bailouts for the Too Big To Fail banks), and he was an economic advisor to President Obama in 2009 and 2010. It is probably safe to say that larry Summers has a higher IQ than nancy Pelosi. So, let’s see how he would fix our economic woes.

Summers starts out sounding almost reasonable:

There should be little disagreement across the political spectrum that growth and job creation remain America’s most serious national problem. Ahead of President Obama’s first State of the Union address of his second term, and further fiscal negotiations in Washington, America needs to rethink its priorities for economic policy.

The U.S. economy grew at a rate of 1.5 percent in 2012. Last week, the independent Congressional Budget Office projected that growth will be only 1.4 percent during 2013 — and that unemployment will rise. While the CBO says that growth will accelerate in 2014 and beyond, it nonetheless predicts that unemployment will remain above 7 percent until 2016.

Later, he goes on to say:

A broader growth-centered agenda is needed to propel the economy to its “escape velocity.”

Wow! That sounds encouraging. Our Democratic pundit has four recommendations for the President.

First, as the president has recognized, the budget cuts implicit in the sequester scheduled to begin in March should not be reduced but spread over time.

As Ronald Reagan would have said; “There you go again”. Kick those spending cuts down the road. Let the next generation take care of the problem. Of course, cutting government spending will hurt the economy. Government spending is now 25% of GDP. What is it buying us? Nada!

Second, the president and Congress should fix a firm year-end deadline to address the international aspects of corporate tax reform.

It’s true that American companies have about $2 trillion in foreign earned profits that they won’t repatriate because those profits would be hit with a 35% US tax.  So, Summers’ plan is to wait a year to talk about reducing those taxes? Why wait, Larry?

Third, no American, regardless of his or her ideology, should be satisfied with the way the nation’s housing finance system is working.

Sure! Let’s see if we can create another housing bubble. Here is an idea for you, Larry. GET THE GOVERNMENT OUT OF THE HOME MORTGAGE BUSINESS!

Fourth, the transformation of the North American energy sector needs to be accelerated. This will have economic and environmental benefits. This will have economic and environmental benefits….approve the Keystone XL pipeline…Natural gas exploitation, too, could bring huge environmental benefits.

Bingo! One good idea out of four is pretty good for a Democrat. Way to go, Larry Summers.

The “State of the Union” sucks and I fully expect the Obama’s State of the Union speech will suck, as well.  The Republicans could better spend their time at home with their families tonight. It’s going to be more of the same-O, same-O: more taxes revenue enhancements and more spending investments in the future.

Well, now you know what I’m thinking. What are your thoughts?

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21 thoughts on “The State of the Union? It Sucks!

  1. A few hours before the SOTU Address, I’m opening a discussing thread at my blog. The discussion will remain open all the way through the speech — and afterwards, too, of course.

    Jim, I invite you to post information from this post in the comments section at my SOTU thread. Others here are invited too.

  2. Kerry voted against the pipeline when in the Senate, so I doubt he or the administration really want to fix anything. I doubt I can watch the idiots bounce up and down in their seats as Obama defines the way he plans on finishing off our Nation. I will retire early. It really is a scary moment when one discovers that the inmates are running the Asylum.

  3. You hit it on the head, Jim. It’ll be the “same-O” story. He’ll conveniently forget that we just raised taxes without cutting anything, and ask for more revenue. Clearly, the nation was in dire shape six years ago when government spending (bloated at the time) was almost a trillion dollars per year less than it is now. The answer is obviously that successful people aren’t kicking in enough to help the government thwart economic growth. If we just take enough money from the rich people who spend, save, and invest and use it to do more regulating, enabling of unemployment, and feeding it Democrat cronies, all will be well!

    On top of that, we can make a bunch of ephemeral “cuts” (that are merely promises to reduce the rate of growth of government, doubtlessly happening years from now when other Congresses are in charge and can’t be held to the promises of the current Congress) to satisfy the weak minded uninformed voter. There will probably even be a promise to, someday, look at reforming entitlements–but not Obamacare, which is such a brilliantly crafted solution to end the high cost of health insurance and the rising costs of health care delivery, but that is accidentally doing exactly the opposite of those two things.

    Plus, we’ll find that inanimate objects (guns) are responsible for violence (not crazy people bent on lawless, immoral, insane acts) so law abiding citizens will be asked to lose more of their freedom and fill out more paperwork which will have absolutely no effect on the lawbreakers (odd how new laws never have a large impact on people willing to break laws) and even less on the insane people who would commit mass murder. But we will hear how curtailing those rights of the law abiding and the new paperwork will protect children. At least it will protect them from people who would never think of doing them harm in the first place, while rendering them undefended against law breakers who will.

  4. I agree Jim, this is going to be nothing more than a call for more spending without any cuts and I for one am not going to watch it because I already know what he is going to say.

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