Obama's policies contributing to anemic private sector hiring

[Magox]

Recently I've been reading some articles and quotes from business leaders, economic policy makers and allies of Obama that are now beginning to blame the big man's policies for our anemic private sector hirings. Some of us talked about this many months ago, and I seem to remember poster Gene Frenkle doubting our concerns (of course).

 

So below I've compiled some quotes and parts of articles that support some of our arguments:

 

William Phelan, PayNet's president and founder, said the numbers suggest the economic recovery has stalled.

 

But impending regulatory overhauls in the U.S. healthcare and finance industries are making it difficult for small businesses to gauge what their costs will be in the future, and are holding them back from spending now, Phelan said.

But government spending can only be a bridge to private-sector investment. The key to a sustainable recovery and robust economic growth is to get companies investing in America. So why are they reluctant, despite having mounds of cash? I put this question to a series of business leaders, all of whom were expansive on the topic yet did not want to be quoted by name, for fear of offending people in Washington.

 

Economic uncertainty was the primary cause of their caution. "We've just been through a tsunami and that produces caution," one told me. But in addition to economics, they kept talking about politics, about the uncertainty surrounding regulations and taxes. Some have even begun to speak out publicly. Jeffrey Immelt, chief executive of General Electric, complained Friday that government was not in sync with entrepreneurs. The Business Roundtable, which had supported the Obama administration, has begun to complain about the myriad laws and regulations being cooked up in Washington.

 

One CEO told me, "Almost every agency we deal with has announced some expansion of its authority, which naturally makes me concerned about what's in store for us for the future." Another pointed out that between the health-care bill, financial reform and possibly cap-and-trade, his company had lawyers working day and night to figure out the implications of all these new regulations. Lobbyists have been delighted by all this activity. "[Obama] exaggerates our power, but he increases demand for our services," superlobbyist Tony Podesta told the New York Times.

 

There is one word being mentioned by business leaders and economists more frequently when the conversation turns to why jobs are not returning more quickly to the U.S. economy: uncertainty.

 

“By reaching into virtually every sector of economic life, government is injecting uncertainty into the marketplace and making it harder to raise capital and create new businesses,” said Verizon CEO Ivan Seidenberg at a speech in Washington in late June.

 

.

 

Federal Reserve Governor Kevin Warsh said in a recent speech in Atlanta: “Owing to a less-than-assured economic outlook and broad uncertainty about public policy, employers appear quite reluctant to add to payrolls.”

 

Roberton Williams, senior fellow at the Tax Policy Center, said in an interview, “The whole tax situation is very much in flux, very uncertain. It makes it hard to plan.”

 

“It’s clear that firms are not yet hiring. A lot of them are sitting on big bundles of cash,” Williams said, citing the examples of Google and Apple, which are both hoarding about $30 billion in cash instead of investing it or using it to expand.

 

Seidenberg’s comments last month were a significant political moment. The Verizon CEO has been one of President Obama’s strongest allies in the business community, and as president of the 170-member Business Roundtable, he had tried to cooperate with the Obama administration on its trademark agenda items – health care, financial reform and energy legislation.

 

But, Seidenberg said he was “troubled” by Obama’s agenda, so much so that he had “reached a point where the negative effects of these policies are simply too significant to ignore.”

 

Seidenberg was not the last major business leader and Obama ally to turn on the president in recent days. Jeffrey Immelt, CEO of GE, said in Italy late last week that Obama and the business community did not like one another and are not getting along with each other. Immelt said the U.S. is “a pathetic exporter,” according to the Financial Times.

 

“We have to become an industrial powerhouse again but you don’t do this when government and entrepreneurs are not in synch,” Immelt was quoted as saying.

 

The cascading comments have come as the economic recovery has slowed and fears of a double-dip recession have entered the mainstream lexicon.

 

“You don’t hire when you’re fearful,” former Federal Reserve Chairman Alan Greenspan said last week, on CNBC.

 

And remember, Jeffrey Immelt was business leader Obama nut sucker #1.... They are beginning to turn their back on his agenda...

[IDBillzFan]

And remember, Jeffrey Immelt was business leader Obama nut sucker #1.... They are beginning to turn their back on his agenda...

I was stunned to read this from Immelt. But then, I was stunned that Immelt didn't see it coming, so who knows.

 

Maybe America will remember all of this the next time they think it's a good idea to elect a president who's big accomplishment is getting people on the street signed up to vote.

[pBills]

Did you guys hear that this heat wave is Obama's fault too?

[Dante]

I was stunned to read this from Immelt. But then, I was stunned that Immelt didn't see it coming, so who knows.

 

Maybe America will remember all of this the next time they think it's a good idea to elect a president who's big accomplishment is getting people on the street signed up to vote.

These geniuses just figuring out this stuff now? The CEO for Verizon should and probably did know better but was counting on some favor from Obama in the future

[/dev/null]

Did you guys hear that this heat wave is Obama's fault too?

 

The heat wave was caused by a low pressure front created by all the hot air coming out of Capitol Hill combining with the Smug Cloud over the White House

[Alaska Darin]

The heat wave was caused by a low pressure front created by all the hot air coming out of Capitol Hill combining with the Smug Cloud over the White House

I just figured it was Climate Change. We'll need a commission and several billion dollars to study the causes/effects. It'll create jobs for the new "Green" economy.

[Magox]

The heat wave was caused by a low pressure front created by all the hot air coming out of Capitol Hill combining with the Smug Cloud over the White House

[3rdnlng]

Did you guys hear that this heat wave is Obama's fault too?

 

 

Sadly, this was one of your most intelligent comments..............ever.

[DC Tom]

Recently I've been reading some articles and quotes from business leaders, economic policy makers and allies of Obama that are now beginning to blame the big man's policies for our anemic private sector hirings. Some of us talked about this many months ago, and I seem to remember poster Gene Frenkle doubting our concerns (of course).

 

So below I've compiled some quotes and parts of articles that support some of our arguments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

And remember, Jeffrey Immelt was business leader Obama nut sucker #1.... They are beginning to turn their back on his agenda...

 

Obama's already on top of this. He's directed the Department of Commerce to find a way to reach out to the Muslim world and help them feel good about their historic contribution to economics.

[keepthefaith]

Did you guys hear that this heat wave is Obama's fault too?

 

Once again, an objection to the policies of this adminstration has been raised and your only response is to sidestep it.

[keepthefaith]

Obama's already on top of this. He's directed the Department of Commerce to find a way to reach out to the Muslim world and help them feel good about their historic contribution to economics.

 

No, you have it all wrong. NASA is charged with reaching out to Muslims and the Department of Commerce is in charge of border security.

[Dave_In_Norfolk]

Wow, what a stupid post! So, after the financial crash the government isn't suppose to make changes to try and stop some of the worst aspects because business leaders may or may not be perfectly clear on exactly how the changes will pan out? And when all else fails, blame the health care bill!

 

This sounds like business leaders trying to pass the buck to government for the failures of the free market.

[Dave_In_Norfolk]

I feel like garbage digging, gotta like for this trash?

[drnykterstein]

Many economists that said the stimulus was too small. It's seeming likely that they were correct.

[IDBillzFan]

Many economists that said the stimulus was too small. It's seeming likely that they were correct.

Oh, so THAT's why it failed to keep unemployment below 8% as promised. It was too small. Got it.

 

By the way...who are these "many economists?" I mean, beyond Paul Krugman, who is presently the laughing stock of the "many economists" world.

 

So assuming that "many" means "more than one," what other "economists" say it was too small?

[GG]

Oh, so THAT's why it failed to keep unemployment below 8% as promised. It was too small. Got it.

 

By the way...who are these "many economists?" I mean, beyond Paul Krugman, who is presently the laughing stock of the "many economists" world.

 

So assuming that "many" means "more than one," what other "economists" say it was too small?

 

Mark Zandi wants to double down too. But now he's spinning the Stimulus III as a way to avoid the double dip. I guess when your reputation is now tied to the stimulus, you increase your bet. Never mind that people who actually do the hiring and make investment decisions are staying on the sidelines for a while.

[....lybob]

Oh, so THAT's why it failed to keep unemployment below 8% as promised. It was too small. Got it.

 

By the way...who are these "many economists?" I mean, beyond Paul Krugman, who is presently the laughing stock of the "many economists" world.

 

So assuming that "many" means "more than one," what other "economists" say it was too small?

 

"REPORT: Despite warnings from many economists that stimulus may be too small, network news rarely raised the issue

March 06, 2009 3:58 pm ET

SUMMARY: A Media Matters review of the ABC, CBS, and NBC evening news programs from January 25 through February 15 found that of the 59 broadcasts that addressed the economic stimulus package and debate in Congress during the three-week period leading up to and immediately following its passage, only three of those broadcasts included discussion of whether that package was big enough, despite statements from many economists that it may not be.

 

Comments

 

A Media Matters for America review of the ABC, CBS, and NBC evening news programs from January 25 through February 15 found that of the 59 broadcasts that addressed the economic stimulus package and debate in Congress during the three-week period leading up to and immediately following its passage, only three of those broadcasts -- one on each network -- included discussion of whether that package was big enough, despite statements from many economists that it may not be and may have to be followed by additional measures. Although the size of the stimulus package was referenced during at least 48 of the broadcasts that addressed it -- with anchors and reporters, in many cases, characterizing the bill as "massive," "enormous," or "giant" -- rarely was the concern raised that the package's size may not have been adequate.

 

Indeed, The Washington Post reported on February 17, "[A]s big as it is, the final bill is smaller than what initially passed in the House and Senate, and it falls well short of filling the $2 trillion gap in demand that many economists foresee." Economist Mark Zandi wrote in an op-ed on February 15, "[M]y most significant criticism of the current stimulus plan is that it is too small." He added: "Our struggling economy will produce nearly $1 trillion less than it is capable of this year and will underperform again by at least as much in 2010. The $789 billion in spending and tax cuts to be distributed over those two years is not going to fill this expected hole in the economy. I would thus not be surprised if policymakers are forced to consider a second stimulus plan soon." (Zandi added, "Nonetheless, when combined with other aggressive policy steps, including efforts to shore up the financial system and stem foreclosures, this fiscal-stimulus plan will go a long way toward relieving the current economic crisis.") Zandi was not alone. Other economists -- including Paul Krugman, Dean Baker, James Galbraith, Eileen Appelbaum, and J. Bradford DeLong -- also assessed the stimulus package as too small"

 

You may think all the economists who thought the stimulus package too small are all fools- but please don't pretend they didn't exist.

[IDBillzFan]

You may think all the economists who thought the stimulus package too small are all fools- but please don't pretend they didn't exist.

Oh, we know they exist because every time another economic indicator surfaces that suggests the stimulus was a waste of money primarily designed to pay off Obama supporters, someone in the WH reminds us what Obama recited in Racine, WI recently, "Now, every economist who has looked at it has said that the recovery did its job. It put a brake on the collapse of the economy. We avoided a Great Depression. We are now growing again. The problem is, number one, it's hard to argue sometimes, things would have been a lot worse. Right? So people kind of say, yeah, but unemployment is still at 9.6. Yes, but it's not 12 or 13, or 15. People say, well, the stock market didn't fully recover. Yeah, but it's recovered more than people expected last year."

 

That's awesome. So the only economists who believe the stimulus bill didn't work are those who haven't looked at it.

 

Things are so bad in DC that they're actually taking credit for avoiding things that could have happened, while ignoring the things that actually ARE happening.

 

I'd call all of this bush league, but the pun would be undervalued.

[keepthefaith]

"REPORT: Despite warnings from many economists that stimulus may be too small, network news rarely raised the issue

March 06, 2009 3:58 pm ET

SUMMARY: A Media Matters review of the ABC, CBS, and NBC evening news programs from January 25 through February 15 found that of the 59 broadcasts that addressed the economic stimulus package and debate in Congress during the three-week period leading up to and immediately following its passage, only three of those broadcasts included discussion of whether that package was big enough, despite statements from many economists that it may not be.

 

Comments

 

A Media Matters for America review of the ABC, CBS, and NBC evening news programs from January 25 through February 15 found that of the 59 broadcasts that addressed the economic stimulus package and debate in Congress during the three-week period leading up to and immediately following its passage, only three of those broadcasts -- one on each network -- included discussion of whether that package was big enough, despite statements from many economists that it may not be and may have to be followed by additional measures. Although the size of the stimulus package was referenced during at least 48 of the broadcasts that addressed it -- with anchors and reporters, in many cases, characterizing the bill as "massive," "enormous," or "giant" -- rarely was the concern raised that the package's size may not have been adequate.

 

Indeed, The Washington Post reported on February 17, "[A]s big as it is, the final bill is smaller than what initially passed in the House and Senate, and it falls well short of filling the $2 trillion gap in demand that many economists foresee." Economist Mark Zandi wrote in an op-ed on February 15, "[M]y most significant criticism of the current stimulus plan is that it is too small." He added: "Our struggling economy will produce nearly $1 trillion less than it is capable of this year and will underperform again by at least as much in 2010. The $789 billion in spending and tax cuts to be distributed over those two years is not going to fill this expected hole in the economy. I would thus not be surprised if policymakers are forced to consider a second stimulus plan soon." (Zandi added, "Nonetheless, when combined with other aggressive policy steps, including efforts to shore up the financial system and stem foreclosures, this fiscal-stimulus plan will go a long way toward relieving the current economic crisis.") Zandi was not alone. Other economists -- including Paul Krugman, Dean Baker, James Galbraith, Eileen Appelbaum, and J. Bradford DeLong -- also assessed the stimulus package as too small"

 

You may think all the economists who thought the stimulus package too small are all fools- but please don't pretend they didn't exist.

 

 

If the goal was to reduce unemployment with no regard for the debt it creates, then I would agree it was too small. A $5 trillion dollar "stimulus" would have allowed us to hire far more new government employees and gotten every idle union worker engaged in some kind of work. Heck, we could have put big rebates on everthing from food to flat screen TVs, not just clunkers.

[DC Tom]

Indeed, The Washington Post reported on February 17, "[A]s big as it is, the final bill is smaller than what initially passed in the House and Senate, and it falls well short of filling the $2 trillion gap in demand that many economists foresee." Economist Mark Zandi wrote in an op-ed on February 15, "[M]y most significant criticism of the current stimulus plan is that it is too small." He added: "Our struggling economy will produce nearly $1 trillion less than it is capable of this year and will underperform again by at least as much in 2010. The $789 billion in spending and tax cuts to be distributed over those two years is not going to fill this expected hole in the economy..."

 

So the stimulus bill was too small because it wasn't intended to completely replace shortfall in demand, but rather intended to be a stimulus?