Obama is betting that US firms are willing to gamble their future. Â I’m not making this up. Â He said so out loud in front of God and everybody at a ‘Town Hall’ organized by CBS News:
“American taxpayers contributed to that process of stabilizing the economy. Companies have benefited from that, and they’re making a lot of money, and now’s the time for them to start betting on American workers and American products.”
Now Obama has never had to earn an honest dollar in his life, and certainly does not understand business. Â Businessmen do not ‘gamble’ or ‘bet’ their companies’ future if they can help it at all. Â Why should a businessman gamble today when so many forced business decisions (forced by government mandate or forced to avoid those mandates) over the past 3 years felt like gambles, and certainly did not pay off?
Today, the government can swoop in on a business out of nowhere to force compliance, legal expenses and impose business rules that cost a company dearly.
It started before the election, during the campaign. Â When Candidate Obama said that energy prices would “necessarily skyrocket”, businessmen listened. Â Obama talked about redistributing wealth. Â Businessmen listened.
No sooner was Obama elected than federal agencies began telegraphing the body blows that were in store for US businesses. Â The EPA drafted regulations that would regulate dust raised by agricultural operations (farming). Â Businessmen were paying attention.Â When businessmen have their antennae up for government interference, they don’t just look at their own industries; they look at other industries as well to assess an administration’s overall intent.
Looking for clues to those intentions proved instructive. Â We saw how TARP and the stimulus continued with vast corruption under a new Obama administration.
We witnessed CRA become a (widely predicted) disaster and the bailouts of Fannie Mae and Freddie Mac. Â The market has still not adjusted to the distortions introduced by those poorly advised operations, and those foolish policies produced widespread loan industry corruption. Â And today Obama is pressuring banks to make more sub-prime loans to consumers. Â Of course, more shaky borrowing will solve all our consumer and fiscal problems.
We watched as the government took over GM, gave secured, senior bondholders a major haircut while giving the car company to the unions. Â That action, and the policy it implied, convinced a lot of businessmen that this administration was extremely hostile to business. Â Small wonder then that this week we see Treasury continuing bond auctions that will settle us into exceeding the Congressionally mandated debt limit when these bond sales settle on Monday, May 16.
What Obama didn’t know, and apparently still hasn’t learned, is that businessmen take statements and actions like this seriously. Â They listen carefully to what politicians say, and make their business plans accordingly. Â They don’t know from ‘political rhetoric’ intended for the masses. Â They know that $1 in benefits promised to the masses is $1 that will come out of their profits to pay for bigger government. Â And they plan accordingly.
All across and around the 360 degrees of the business horizon, businessmen see trouble coming. Â The Czars that the White House appoints. Â The obvious choices of picking business winners and losers (GE, Google, unions). Â The obvious choices of winners and losers made for political reasons (Texas). Â The refusal to enforce certain laws (DOMA, Immigration), and actively, vigorously combating states that insist on federal law enforcement (Arizona).
Businessmen hear Obama talk occasionally about cutting spending, but no specific proposals are ever put forward. Â Not a single bureaucrat ever runs to the cameras screaming that children are going to die because of budget cuts. Â Instead we see trial balloon after trial balloon floated about how our government might intend to raise our taxes in this way or that, such as taxing our vehicles by the mile. Â The ‘problem solving’ that gets all this administration’s energy is all around raising debt and revenues, and not around cutting spending.
Obamacare alone is probably the biggest factor weighing against hiring today. Â Who is willing to hire when we cannot assess the future costs of that new hire today? Â We can reliably predict that Obamacare will not be repealed until Obama is a ‘former president’, but what parts might get repealed before November 2012, and what impact will that have on hiring costs? Â Hard to predict, so better to play it safe.
Fiscal Â policies undertaken by Obama’s administration are well understood and calculated to allow Obama to spend, spend, spend while saddling future generations with unmanageable debt. Â While monetary policy is designed to ameliorate this somewhat, it’s at the expense of our currency’s value, and its usefulness as the world’s reserve currency. Â Both are under severe strain and challenge now. Â Obama does not yet realize the price he will force the country to pay for the coming fiscal disasters, and they will be disasters. Â Businessmen know this and anticipate this.
From new Consumer Product Safety Commission rules affecting yard sales, to EPA restrictions that won’t even allow politically correct solar energy facilities to be built, this government has ‘us walking in chains‘.
Most recently the NLRB decided it would oppose Boeing opening a new plant in SC, a right-to-work state. Spakovky and Sherk at PJM note:
If the NLRB succeeds it will do serious damage to American workers and the economy. Businesses do not have to make capital investments or create new jobs. They will invest less if the government tells them they cannot take advantage of their best opportunities.
It’s yet another brick in the wall that Obama is erecting to form a barrier between private corporations and honest profits. Â Plus, the Obama regime harvests the additional benefit of becoming more dictatorial each day.
Again, businessmen take action like this very seriously. Â A given initiative does not have to be successful in order to serve as a dire warning to businesspeople. Â That intent is signaled is enough for most cautious investors.
We’ve seen the Obama Interior department and EPA vigorously oppose new oil development – so much so that our existing infrastructure is threatened. Â The BP oil spill became a convenient excuse for Obama to levy a drilling moratorium in the Gulf of Mexico and even a court order cannot dissuade his administration from sustaining it.
Obama’s actions in the gulf are not just about opposing a business activity for political reasons, it’s about a government obeying its own mandates and yielding to the mandates of a US federal court. Â But as we’ve seen already, lawlessness begets lawlessness.
Businessmen looking forward always assess their potential markets and the disposable income of their potential buyers. Â What are they seeing? Â Embattled consumers who are spending a larger and larger share of their income on essentials such as food and energy – prices of both which are shyrocketing as promised. Â That leaves little left over for the non-essential products and services most companies provide. Â Â It’s not just Obama who simply doesn’t get it about business and consumers who are hurting. Â Democrats in general have stated openly over and over again that they feel the nation’s wealth belongs to the government first, and they just don’t care about the pain liberal policies are inflicting on citizens. Â From a Â Senate Republican Communications Center press release:
SEN. MAX BAUCUS (D-MT): â€œYou know, this is not going to change the price at the gasoline pump. Thatâ€™s not the issue.Â I donâ€™t see that as an issue at all. The issue I see is who shares.â€ (U.S. Senate, Finance Committee, Hearing, 5/12/11)
SEN. MARY LANDRIEU (D-LA): â€œIt will not reduce gasoline prices by one penny.â€ â€œI would just like to add my strong voice to urging my colleagues to read this bill, to look at it and understand the inherent unfairness in it, the lack of significant deficit reduction, and the fact that it will not, although it is being touted as, it will not reduce gasoline prices by one penny.â€ (Sen. Landrieu, Floor Remarks, 5/11/11)
SEN. MARK BEGICH (D-AK): â€œIt won’t decrease prices at the pump.â€ â€œThere is a lot of talk right now about ending tax incentives for oil and gas industry, but the high profits right now of these companies are easy targets. But one thing Alaskans know, just because you have an easy target doesn’t mean it is the right thing to shoot. It won’t decrease prices at the pump for our families and small businesses. It will discourage companies, especially the independents, from domestic investment and job creation.â€ (Sen. Begich, Floor Remarks, 5/11/11)
SEN. CHUCK SCHUMER (D-NY): â€œThis was never intended to talk about lowering prices.â€ (CNNâ€™s â€œThe Situation Room,â€ 5/11/11)
SEN. ROBERT MENENDEZ (D-NJ): â€œNobody has made the claim that this bill is about reducing gas prices.â€ (â€œMcCaskill: Savings From Cutting Oil Tax Breaks Should Be For Deficit Reduction,â€ The Hillâ€™s E2 Wire Blog, 5/10/11)
This is what happens to a country when you govern based on a fixed, liberal ‘narrative’, and ignore reality. Â The free market, and Adam Smith’s Invisible Hand will always find a way to some kind of market balance and efficiency, based on the regnant rules of doing business. Â Businesses will save rather than employ. Â And the economic disaster they are saving for is real and coming. Â I suggest it’s much nearer than we think since we just saw Treasury take us over the legally mandated debt limit this week. Â Businessmen look at the fact that the White House must have informed or instructed the Treasury Department to go ahead and continue auctioning new debt, in spite of the law, Â and wonder just when the rule of law ceased to have any effect on the actions of this administration.
As they are saying today, Obama can’t run on his track record or his performance – he’ll have to run on values (which his campaign declared illegitimate in 2008). Â I guess that would be values like socialism and racism.
Sorry, Obama. Â We’re not taking that bet.
Although you’ve already been called the worst president in the history of our country, I am willing to bet that history will prove it undeniably before election day 2012. Â I’m betting that Â the major economic disasters you have set in motion will arrive before that date.
So no, I’m not hiring.