Is Obama Doing Right Economically?

We are all connected to the economy and that’s just a fact. There is a lot of what the current administration done that has created a lot of jobs. The numbers don’t lie (unless you are watching Fox News) and they are very good. Despite all that our economy, and the economy of the world could be sensing a false sense of a true recovery when there are still a lot of things that could and should be better.

We live in a global economy where what happens in one country affects some things in other countries. We have to face that fact. The world is an ever-changing place.

The problem is that the United States and other countries with leading economies are starting to make some of the same mistakes that were made prior to the collapse of 1929. We are not at that point, yet. What we can see is that things haven’t changed that much from the way they were before the 2008 downturn (I use that word cautiously).

The United States cannot still be the masters of the world economic status like they have (sometimes) been in the past. The U.S. has a lot of debt and even though the deficits (by ratio) are less than they were previously, the fact remains. Also part of this is the unnecessary (in my view) Iraq war which conservatively cost us about 3 trillion. I could go into how so much was wasted mostly through no bid contracts (think Haliburton), but that is for another article.

Then is comes to global trade. The rest of the world has come to the realization that their economic recovery will come sooner and easier by selling exports to the U.S., creating a lopsided trading system. So while these economies are dependent on American demand, at the same time America is losing (good paying in many instances) jobs to industry overseas. We cannot continue in this manner and think we can get away with it.

One way our trading partners are gaining ground is that these countries are devaluing their own currencies so their exports will be cheaper than American products. The U.S. trade deficit is on the rise as a result.

The president might be oblivious to this as he is looking at another so-called free trade agreement , the Trans-Pacific Partnership or TPP. The president (through his advisers) is claiming it to be a job creator when that may be just a pipe dream. The claim is that it would create 650,000 jobs but the true number is much less and could even be zero or even a negative number. It’s based on faulty math.

As he takes this bill to congress for approval (the fact remains that he might not ask for its approval, given the correct motive, which could be public outcry) there are some in congress (on both sides of the aisle mind you) that are resisting approval unless we stop our trading partners from currency manipulation.

That might just be the deal breaker we must have, but could make the agreement unworkable for the others. This has its own ramifications. So what else is blocking a true recovery? Fundamentally it’s a lack of consumer demand and the large debt, not just here in America but everywhere. We need to write off a lot of private debt. We bailed out Wall Street, now it might be time to help homeowners  and credit card holders too.
The financial community caused this but if you think they are the ones to solve it, we should talk. I have some very attractive deals for you (large smile).

By listening to them I and others believe Mr. Obama is getting bad advise. Much like letting the fox tend the hen-house. Reforms are necessary. There are big problems in the global economy and it must be taken seriously.

I guess that will be for another time as well. I would sure hate to see this as the President’s legacy and even with his success with the ACA, it could overshadow him.

Probably much of the needed reforms will not be accomplished given the tenuous situation between the President and this (narcissistic, obstructive) congress.

For now all we can do is sit and watch as it is going to be a difficult two years (for everyone, but especially the President) and then the next band of “leaders” will inherit this.

Jerry Bierens

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