Obama’s Team Misreads Economy

Many people wonder why Obama selected Biden as the vice-president.  Biden does not bring much to the table.  When it comes to speeches, Biden seems to be full of gaffes and embarrasses the administration.  If you Google the words Biden and Gaffe, you end up with 350,000 results.  I believe Obama picked Biden so he could test out policies with Biden.  If the policies are successful, they are attributed to Obama.  If they are unsuccessful, the blame falls to Biden, and Obama can still be seen as the savior of the world.

Today we read an article where:

Biden acknowledged administration officials were too optimistic earlier this year when they predicted the unemployment rate would peak at 8 percent as part of their effort to sell the stimulus package. The national unemployment rate has ballooned to 9.5 percent in June — the worst in 26 years.

The Obama administration has had a history of underestimating a problem.  The above quote is not a surpise to many conservatives.  When Obama first took office,   Obama underestimated the changes needed to accomplish his goals to change the Whitehouse website.  Obama underestimates the financial impact of his Cap and Trade program.  Obama underestimates the detrimental effects his Health care plan will have on the economy.

In other words, Obama is full of himself.  He thinks he is all knowing where instead,  he proves how incompetent his is at his job.  Instead of being the executive and leader that we need, he continues to be the apologetic socialist, blaming the problems on someone else.

Obama promised to effect Change.  But the Change he brings is Change for the worse.  Since he took office, we have had the worst employment in a long time, a weakened dollar, and poor international relations.  If Obama continues on his course, he will bankrupt the United States.

Biden Offers Misleading Comments on Stimulus Success

Vice President Joe Biden issued a progress report on May 13, 2009 “detailing” the results of governmental spending from the funds set aside for the stimulus bill.  He made the report seem very promising, saying that the $28.5 billion that has already been spent has created results that have begun to turn the economy around significantly, including specific anecdotes about specific companies and/or state programs which have saved or created 150,000 jobs.  Here are a few of the comments and anecdotes he shared in his report:

[Biden:]  Across the nation, we are hearing of companies rehiring laid off workers, of new facilities with construction underway, of critical environmental remediation activities, previously on hold but now underway, and of first-time homebuyers driving increased activity in the home sales market, all due to an infusion of recovery funds…

[Anecdotes:]

A reopened Chicago window factory that had been a symbol of the plight of the American worker is now touted as an example of economic reinvigoration thanks to the federal stimulus….  The new owner, Serious Materials, has started rehiring some of the more than 200 laid-off workers to make energy-efficient windows at the plant… Serious Materials CEO Kevin Surace said his company is creating the green-collar jobs the nation needs to pull itself out of recession…”

Stimulus Funding Will Create 500 Jobs, Prevent Layoffs, and Clean Up Nuclear Waste That Threatens Snake River Aquifer. “Hundreds of new jobs, a cleaner environment and it’s all happening in our very own backyard. The Department of Energy approved $468 million in federal funding…Not only are they creating more than 500 new jobs, but this stimulus money is rescuing hundreds who were in jeopardy of being laid-off…

Employment Agencies Placing More Workers, Demand Up Since February; Mortgage and Title Companies Hiring More Due to Stimulus Tax Credit for First Time Homebuyers. “Linda Castanza, area branch manager for the Adecco Employment Services… said Adecco placed 1,400 people into jobs in the New Orleans area and is on a similar pace this year…  ‘Mortgage companies and title companies are also starting to hire again because of the first-time homebuyer incentives in the stimulus bill,’ Elliott said.

The real story, however, is much more complicated.  For every specific encouraging anecdote, there is more discouraging news, none of which is reflected in the progress report submitted by Biden.

[T]he report cites a newspaper article about workers being rehired at a factory in Chicago. That account is true, but is no more an accurate snapshot of the nation’s economy than a story, not cited in the report, about a Roanoke, Va., railcar factory closing…

It’s true, buyers are taking advantage of the $8,000 first-time homebuyer tax credits. The IRS said more than 567,000 tax returns claimed the credit in just the first weeks of the program. But that hasn’t provided an immediate turnaround in the market.  Since February, sales of existing homes have fallen 3 percent and new home sales are down .6 percent.  And the number of jobs in the real estate industry has declined by about 20,500, according to the Department of Labor.  There are signs that the housing market is improving. But the numbers suggest that if the market bottomed out, it did so in January, before the stimulus was passed…

[New Orleans] has lost more than 200 jobs since February. Overall, Louisiana lost 16,085 jobs over the same span, according to the Department of Labor.

THE WHITE HOUSE SAID: The stimulus has created or saved 150,000 jobs.

THE FACTS: Since February, the nation has lost more than 1.3 million jobs, according to the Department of Labor. To make the case that the country created jobs over that same stretch, the White House has put forward a benchmark of jobs created “or saved.” The argument is that the job numbers would have been even worse had it not been for the stimulus, and the difference between those numbers is a net positive.

To visualize that disconnect, consider this: The administration has promised to create or save 600,000 more jobs in the next 100 days. Even if the nation loses another 5 million jobs during that span (a highly unlikely prospect) the White House could still claim success.

Most of the government spending so far has gone into Medicaid and other government run programs, but for spending $28.5 billion, 150,000 jobs “saved or created” when so many are still currently being laid off across the country seems like a small number; in fact, even a number of jobs this large has yet to be verified.