The chart compares recent GDP growth with the first nine quarters of the decade of strong economic growth, prosperity and job creation that began after President Reagan’s 1982 tax cuts and deregulation initiatives. [Continued below the chart]

In the third quarter (July, August, September) of 2011 Gross Domestic Product, the value of all the goods and services the economy produced, rose 2.5%, the Commerce Department reported.  This was better than the previous three quarters, but compared to typical post recession recovery periods it was disappointing at best.  Even President Obama’s Press Secretary, briefing reporters at the White House, agreed that 2.5% was unacceptable.

Over the past 50 years quarterly growth has averaged 3.2% but has always been above average during the initial quarters of recovery from recession.  This is the first post-recession period in 66 years, since the end of World War II, with such anemic growth.  The most visible result is the continuing tragedy of high unemployment.

The economy will not replace the millions of lost jobs until much more robust growth begins.

From the first day of his Administration President Obama and his advisers promised that the biggest Keynesian “stimulus” ever attempted, in the form of Trillions in deficit spending and massive government intervention in the private sector economy would somehow bring prosperity and jobs.  They promised 3.7 million additional jobs by the end of 2010.  Instead, there were 2.8 million fewer jobs.

If Keynesian stimulus worked as Obama and the progressives promised it would, America would now be enjoying prosperity with full employment and rising wages.  Instead this recovery from recession has significantly underperformed compared to previous recoveries, especially the Reagan recovery of the 1980s.  President Reagan’s strategy was to lower taxes, deregulate and allow liberty to work.

Presidents Reagan and Obama each inherited recessions that were similar in their length and severity.  By objective measures, including the unemployment rate, Reagan inherited a worse crisis in the 1980s than Obama inherited in 2009.  The current recession has become worse and longer lasting than the 80s recession because of government’s massive deficits and destructive interventions into the private sector economy.

The President has spent a month on the campaign trail trying to sell The People on his so-called American Jobs Act, yet another package of Keynesian borrowing and spending.  Once again, the same “economist” and media personalities who predicted dazzling results from the 2009 stimulus insist that if only recalcatrant Republicans would vote yes, Stimulus 2.0 would create millions of jobs.

The Bottom Line

As the chart shows, quarterly GDP growth is has been intolerable under the Obama-Keynesian approach.  There is no reason to believe that continuing to run massive deficits, threaten tax increases, hyper-regulate the health insurance business,  subsidize blue-sky “green” energy schemes and restrict the production of conventional energy will ever result in prosperity.

The urgent message in this GDP report  is clear.  Congress must put an immediate end to Obama’s Keynesian experiment.

Governor and candidate for the Republican nomination for President Rick Perry has twice made news in recent days with flippant remarks referring to speculation that President Obama was not born in the US and is therefore ineligible under the Constitution to be President.

Any candidate who claims identification with Conservatives or the tea party movement should refuse to be drawn into this controversy for two reasons:

1. The possibility that Obama was not born in Hawaii as he claims is simply too remote to take seriously.  He finally put a copy of his birth certificate on the internet for all to see, but predictably, the birthers claim it isn’t authentic.  At Liberty Works we’ve studied the matter and believe he was indeed born in Hawaii.  But even if, hypothetically, he wasn’t there is no agency or voice of authority with the credibility and universal respect to make a final determination that everyone would accept.  Thus there is simply no point in pursuing it even if one believes (and we do not) that he was foreign born.  Obama has more to gain than to lose if voters are distracted by an allegation that seems preposterous, can not be verified, is easily and credibly denied and thus looks desperate.
   
2. It constrains the Conservative/tea party/smaller government movement if our candidates to appear to be asking for votes based in part on the assertion that the incumbent was not born here.  Barack Obama must be defeated in 2012 because he represents a set of ideas and policies that are Unconstitutional, authoritarian, and require us to relinquish our liberty and our prosperity while failing to deliver the promised benefits.  The Congress has already passed legislation compelling us to live under some of those bad ideas.  Obama must be replaced so that legislation can be repealed, and we can become more free and more prosperous, not because some question his birth place.

Here in California we’re suffering from a lost opportunity to elect a governor who, like the governors of Ohio and Wisconsin, would have diminished the power of the entrenched political establishment that is systematically destroying our state’s economy.  Unfortunately, a majority of swing voters were persuaded that we should continue the ruinous business as usual in the state legislature by voting against Meg Whitman for Governor.   Why?  Because she had employed a maid who was an illegal alien  – in a state where almost everyone has been served by illegal landscapers, car washers, restaurant personnel, laborers and domestic help.

Next year will probably turn out to be America’s most consequential election since the Civil War.  If Obama and the Democrats prevail life in America will irrevocably change for the worse.  Eventually, everyone will have to rely on the grace of government bureaucrats for medical services.  Government will continue it’s drive to supplant the private sector in economic decision-making, reprising the failed results of all of history’s previous experiments in authoritarian economics.  And the ruinous deficit spending will roar ahead until the world finally refuses to loan the US government any more.

This election is too critical for the small government, pro-Constitution candidate to lose because swing voters perceive him – or us – to be trying to steal votes by questioning the authenticity of a fifty year old birth certificate on file in Hawaii.

Liberty Works reported the $529 million government loan guarantee granted by the Obama Energy Department to Fisker Automotive here and here in September, 2009.  Back then most of the establishment media were still enthralled with the new President they had so vigorously promoted into the White House and did not want to report anything that might diminish the Obama euphoria they had striven to create over the preceding two years.

But, after the Solyndra scandal and Obama’s slide in the polls the media are more interest in government loans for green boondoggles.

ABC news just published a long article examining loan guarantees for both Fisker and another, similar venture.  We reviewed the ABC News piece and found it to be consistent with our original reporting two years ago:

Fisker Automotive, Inc. is a start-up car company in California. Fisker has just begun to build the Karma, a hybrid/electric, luxury sports car that will sell for $97,000.  So far only two copies of the Karma have been delivered to retail customers.  According to ABC, production is running a year behind schedule.

Al Gore, former Vice President and grand ayatollah of the dogma of global climate change is a partner in Kleiner Perkins Caufield & Byers, a venture capital firm.  Kleiner Perkins Caufield & Byers is an investor in Fisker Automotive, Inc.  According to ABC other Fisker investors were large donors to the Obama campaign.

In 2009 The Obama Administration enhanced the value of Gore’s investment by loaning $529 Million to Frisker Automotive.  This money was, of course, borrowed from the private economy, leaving that much less to be invested in genuine, job creating business ventures.

Fisker Automotive predicts the Karma will be able to travel thirty two miles on a charge.  Then, it will have to be recharged, or it can continue, powered by its gasoline engine that delivers 20 miles per gallon, about the same as a typical SUV.

This utterly impractical, high-end, rich man’s toy is being built:

• Not in Fisker’s home state of California where the unemployment rate is 11.9%;
• Not in Michigan where the unemployment rate is 11.1% and 100,000 experienced auto workers are idle;
• Not in the politically critical, must-win Presidential swing state of Ohio where unemployment is 9.1%

Fisker Automotive is building it’s new car in Finland.

Well, if the labor cost is higher here in America, maybe it makes business sense to move the manufacturing offshore, right?  Wrong.  According to the Labor Department’s International Labor Comparisons manufacturing labor costs, including wages and benefits, insurance and taxes average $33.53 in the US.  But  in Finland the average is $43.77!

Like traditional auto companies, Fisker supplements engineering accomplishments with generous doses of hype.   Last week was the big introduction shindig for the Karma.  But it wasn’t at a high profile auto show or a race track.   Fisker picked a venue that would honor it’s most important financial patrons by unveiling the Karma at the Mandarin Oriental luxury hotel (rooms starting at $750 per night) in… Washington D.C.

Political deals like this used to be done in secret and were called “corruption.”  Sometimes government officials were caught and prosecuted for corruption.  That was when the political establishment worried that a majority of Americans would oppose such imperious defiance of the U.S. Constitution and of common sense.

But that was then.  Today’s openly corrupt Political establishment no longer fears the voters.  Instead, voters have begun to fear an increasingly authoritarian and powerful central government, led by arrogant and ruthless politicians, bent on imposing their will on the people – at the people’s expense.

In its defense Fisker offers the assurance that funds from the taxpayer backed loan were spent on design and development costs within the US, and the Finland operation is financed by private investments.  But this is an utterly specious rationalization because there would be no manufacturing in Finland or anywhere else had the taxpayers not first risked the investment in design and development!

ABC News quoted the following from a written statement it received from the Office of Vice President Biden who has been the Administration’s front man in promoting the Fisker investment:

the Office of the Vice President did not encourage the Department of Energy to choose any particular company over any other but, like others in the Administration, supported the Department’s loan program and the creation of car manufacturing jobs in the United States.

So, the Administration’s position is that all is fine as long as voters believe Biden didn’t order funding of a specific company.  The media seem to believe this deal would not be a problem if the factory were here in the US.

But Americans should be outraged because it’s immoral and Unconstitutional for government to use its power to force The People to risk tax dollars on development of a selected product, because the product is favored by the political elite and/or because an establishment good-old-boy (Gore) is an investor.  The Constitution does not allow and has never been amended to authorize the government to invest in any private business for any reason.

If $98,000 electric cars were desired by enough real customers who were able and willing to pay the price the private sector would gladly make the investment and produce them without any help from government.  Investors putting their own money at risk, would make the decision, not government officials tasked with promoting a political agenda, involuntarily funded by taxpayers.

That taxpayer funds will be sunk into foreign manufacture of this absurdly expensive and useless vehicle that will never sell enough units to recover the initial investment only supports our suspicion of de facto corruption.

Speaking on the Senate Floor, Majority Leader Harry Reid tried to make the case for President Obama’s so-called “Jobs Act” which, in part, would impose permanent tax increases on private sector  employers to pay for temporary federal subsidies that supposedly would enable state and local governments to rehire employees they have had to lay off.

Said Senator Reid:

The massive layoffs we’ve had in America today have, of course — are rooted in the last administration, and it’s very clear that private-sector jobs have been doing just fine. It’s the public-sector jobs where we’ve lost huge numbers.

Before this bit of “wisdom” is repeated so often by the media that much of the public begins to believe it, let’s look at reality.

We’ll skip past Reid’s attempt to blame Bush and ask, incredulously, are you sure the private sector is doing “just fine?”  Perhaps Senator, you’re ignorant of some facts that are easily available from the Bureau of Labor Statistics:

• In January, 2008 more Americans were employed than any previous month in American history.  In September, 2011 there were 6,662,000 fewer jobs than in January, 2008.
• In January, 2008 the public sector accounted for 16% of all jobs.  But as of September, 2011 only 6% of  lost jobs were from the public sector.
• The private sector started in January, 2008 with five times as many jobs as the public sector.  But since then the private sector has lost 16 times as many jobs.

The simple truth is that in hard times the public sector is better off than the private sector because it does not depend on voluntary customers for revenue.

Last week we published an analysis of Herman Cain’s 999 tax plan as it relates to taxation of individuals and promised a second article examining the proposal’s tax treatment of business and investors.  In the meantime Mr. Cain, and others purporting to have been informed by or to speak for the campaign have written editorials and made statements that contradict each other.  The campaign website lacks important details and the picture is not yet complete.  Following is what we know for sure.

Because of it’s simplicity the 999 plan would dramatically reduce the power of politicians to intervene in the economy, reducing political influence and interference in favor of market driven outcomes.  Cain’s vision is, in his own words is to get…

…Washington D.C. out of the business of picking winners and losers, using the tax code to dole out favors, and dividing the country with class warfare.

An October 4 Wall Street Journal article titled Hedge Funds Pay Top Dollar for Washington Intelligence provides insight into the counter-productive results of an over-regulating, over-taxing federal government.  The title includes a hilarious oxymoron, but the sobering article demonstrates the harm done to the private economy by the complexity imposed by overreaching government.

Instead of paying researchers to hunt for promising business opportunities, hedge funds and other Wall Street operators pay thousands of Washington insiders for advance knowledge of impending changes in laws, regulations and the corporate tax code.  Unfortunately, investors have learned that with their clumsy interventions politicians can often move stock prices as much or more than entrepreneurs and innovators.

Cain’s tax plan is designed to support his vision of a liberated private sector, free from political interference and political determination of winners and losers through subsidies, tax breaks and tax punishments.

This chart compares current tax law with the changes President Obama wants to impose beginning in 2013 and with what we know so far about Cain’s 999 plan.

At 35% the current corporate tax rate is one of the highest rates in the world.  But, thousands of special tax preferences help companies with the wealth and power to influence Congress pay little or no tax (GE, whose CEO is an economic adviser to President Obama paid zero last year) while smaller companies that can’t afford lobbyists pay the full 35% rate.

The net result is the worst possible tax outcome, a high tax rate that serves as a barrier to investment in smaller start-ups and expansions, while at the same time not collecting very much tax revenue from larger, established companies.  Cain’s 999 plan would reduce the rate to a competitive 9% and strip out all the tax avoidance preferences in the thousands of pages of the current tax code.

America is the only industrialized nation to tax “repatriated profits” earned by American companies from operations in foreign countries, when those profits were already taxed by foreign governments.  To understand how this works, consider two car companies:

• The German company Diamler manufactures Mercedes Benz cars at a plant in Alabama and sells them in the US.  Diamler pays corporate income tax to the US Government on profits generated here from making and selling cars.
• General Motors manufactures and sells it’s Opel brand of cars in Germany.  GM pays corporate income tax to the German government on profits generated there.

So far both companies are treated the same way, and each government has a source of tax revenue.  But the equal treatment ends when profits are brought home.

Germany, and virtually every other first world nation, recognizes that profits generated in a foreign country have already been taxed and welcomes those profits back, to be invested at home without additional tax burden.  But the American corporate tax code requires GM and other corporations that operate internationally, such as Apple, Microsoft and Google, to pay US corporate income tax on profits that are brought home or “repatriated,” even though those profits were already taxed by a foreign government.  The result is profits that could be brought home and invested in America instead pile up in foreign jurisdictions waiting for foreign investment opportunities.  Cain’s 999 plan would eliminate this stupid policy with a tax rate of 0% on repatriated profits.

Cain’s corporate tax would apply after payment of dividends.  This is a clean, simple way to eliminate the double taxation of corporate profits in the current tax code.  Stockholders would pay personal income tax – at 9% – on dividend income.  President Obama would dramatically increase the tax on dividends bringing the combined tax on corporate profits to a stunning 78%.  In a world where capital flows freely from country to country seeking the highest return this tax regime would drive thousands of companies and the jobs they provide out of America.

Unfortunately, the lack of answers to some questions raised by the incomplete information published so far by the campaign make any further analysis more speculative than factual.  We’ll publish more analysis as soon as the Cain campaign provides more clarification.

Mr. President, If “revenues” are the problem, How can your Government gobble up a 21% increase in income tax revenue and still run an even larger deficit?

President Obama and the Democrats insist that the government’s continuous, yawning deficits can not be closed by spending cuts alone, that “revenue!” must be part of a so-called “balanced approach.”

But just published Treasury Department data show the Bush tax cuts did not cause the government’s fiscal problems, and that the 2011 deficit is slightly greater than the 2010 deficit even though revenues from income tax rose dramatically. (continued below chart)

The Treasury Department just published it’s final report for the government’s fiscal year 2011, that ended September 30.  The chart above focuses on one part of that report, revenues from the individual income tax.

Because the President and the Democrats so incessantly blame deficits on the Bush tax cuts and demand increases in income tax rates, many Americans believe income tax revenue went down after the Bush tax cuts.  But, as the chart above shows, tax revenue was declining before the Bush tax cuts of 2003 established the current tax bracket rates, and then spiked up 47% in four years.  In 2007 more income tax revenue was collected by the IRS than any previous year ever.

Revenue went down in from 2008 to 2010 because the rich, who pay most of the income tax, were hammered by the recession.  According to latest IRS statistics available, almost half of  “Millionaires and billionaires,” the group Obama targets for a tax hike in every speech, disappeared from 2007 to 2009.

But in 2011 income tax revenue bounced back, rising by $193 billion or 21% over 2010.

Yet the 2011 deficit, at $1.3 Trillion was slightly higher than in 2010.  Why?  Revenue from other taxes went down by about 48 billion, mostly because of a temporary, one-year discount in the payroll tax.  But the deficit would still have been reduced substantially were it not for irresponsible spending increases.  While the media whine about Republican budget cuts, it turns out that the President and the Democrats won the budget fights of 2011.  Total spending increased by $145 Billion over 2010.

The Bottom Line:

The media and Republican candidates should demand that the President answer the obvious question: If his “balanced approach” is the answer, how can Government can gobble up a 21% increase in income tax revenue and still run an even larger deficit?

Please scroll down for an UPDATE

Candidate Herman Cain has proposed a plan for revolutionary tax reform.  In this article we analyze the effects of this plan on individual taxes.

When comparing various tax plans one must remember that every possible form of tax is disagreeable in some way.  So rather than holding out for something that feels good, one must look for a tax regime that is least harmful.  The best tax system:

• Has no purpose other than funding the government.   It should not include levers to reward or punish businesses or individuals for compliance or non-compliance with the desires of the politically powerful;
• Is simple enough for everyone to understand so politicians can’t use it to deceive us;
  
• Makes virtually every adult a taxpayer, even if the poorest pay only a token amount.  When the cost of government goes up every taxpayer should have to contribute to the increase and when the cost goes down every taxpayer should receive some benefit.

The table compares the status quo with tax increases President Obama indicates we can expect if he is reelected, and with Mr. Cain’s 999 plan.

What hasn’t been widely reported is that Cain presents 999 as a transition step from the current system to the final destination, which is “The Fair Tax,” a consumption or sales tax that would replace all other federal taxes.  The Fair Tax goal is to tax consumption rather than taxing income, investment, risk-taking and success.

The 999 plan is designed to lower rates, broaden the base of taxpayers and remove elements in the current code that politicians use to divide Americans into opposing groups.

The 999 plan would completely eliminate the existing payroll tax a scheme that afflicts politicians with a malady commonly called “talking out of both sides of his mouth.”  One side tells us the payroll tax is the virtuous mechanism by which workers pay for and earn their Social Security and Medicare retirement benefits.

But, to support the notion that it’s “fair” to tax the rich even more, while 47% of households pay zero income tax, the other side of the politician’s mouth characterizes the payroll tax as an ordinary tax obligation, like the income tax, and a millstone around the necks of “working families.”

The 999 plan would eliminate the double-speak and put “workers” and “the rich” on the same side by eliminating the payroll tax and funding retirement benefits from general revenues collected from the broadest possible base of taxpayers.  Everyone with income from work would pay the same flat 9% income tax with no deductions except for charitable contributions.

The existing income tax scheme starts with high tax rates and then gives deductions and credits that effectively reduce the rates to those of us who order our lives in ways the political elite believe we should.  For example, we pay less tax if we borrow to buy a home than if we pay cash for the home or rent.  The 999 plan eliminates all credits and all deductions except for charitable contributions in return for the low, flat, 9% rate.

Perhaps the most controversial element of the Cain plan is the 9% national sales tax. Cain’s campaign website does not mention any non-taxable products or services.  He has said in TV appearances that the poor would get a break because the tax would not apply to used merchandise, used cars or used homes.  He has not said that groceries or drugs or services would be exempt as they typically are in state sales tax regimes.  Questions about whether the tax would apply to rent or utilities or insurance premiums or health care have not been answered.

Critics from the left complain that ending the payroll tax would not offset the combined burden of a 9% income tax and a 9% sales tax and the plan would amount to a substantial tax increase on low to middle income workers.  We did some analysis and found that they are partly right.  Because the current tax code is so complex two taxpayers with the same income can have very different tax bills.  If nothing is exempt from the sales tax, and no income is exempt from the 9% income tax then a lot – maybe as many as half – of low to middle income people would see a substantial increase in their federal tax obligation.  For the rest the change from the current payroll tax plus income tax to 999 would not significantly change their federal tax obligation.

According to the Cain campaign additional 999 provisions that will provide relief to low income taxpayers will be published soon.

UPDATE:

Economist Art Laffer, purporting to represent Herman Cain, said in an October 19 Wall Street Journal editorial that:

…the [999] plan exempts from any tax people below the poverty line.

Mr. Laffer did not explain how below-poverty-line people would be identified or how it would be possible to exempt someone from a sales tax, collected by private businesses.

Conservatives are wary of granting sales tax authority to Congress.  Those who support the Fair Tax insist that it’s appeal and success depends on completely eliminating the income tax, not adding “an additional tax stream.”  They have a point.  Introducing a sales tax before eliminating the income tax would empower a corrupt Congress to continuously increase both rates.

But, Cain also has a point.  The Fair Tax proposal to replace all federal taxes with one simple national sales tax has been around for 20 years without ever gaining enough traction to win popular acceptance or a serious hearing in Congress because it’s a radical change from the status quo.  A Constitutional Amendment nullifying the 16th Amendment that created the income tax would have to be enacted.

Cain’s 999 transition stage would be a chance for The People to experience the national sales tax and feel some of the benefit Fair Tax supporters promise.  At that point, resistance to dropping all income taxes in favor of one sales/consumption tax would be far lower.  Cain’s claim that 999 would have the effect of uniting now disparate factions around the Fair Tax is valid.  Critics say, correctly, that one major tax policy change would be more efficient and less disruptive than Cain’s two step process.  But lowering resistance probably requires giving people a chance to partially experience the new regime before they commit to it.

The critics are right that a future, corrupt Congress could increase the rates.  But there is no tax scheme that’s immune to political threat.  The current Obama Vs Republicans tax debate, which is typical of every tax debate of the past century demonstrates that tax increases to expand the power of government are politically salable only when most voters are led to believe – usually falsely – that only a small minority, “the rich” will feel any pain.  An increase in the sales tax that would directly affect everyone would be much harder to sell.

The combination of a low flat income tax plus the business and investment related tax changes Cain has proposed would ignite a new era of strong economic growth, high employment and prosperity.  Just as no politician is today calling for a direct tax hike on the middle class, few would want to go on record calling for change to a proven success formula.  And raising one or all of the legs of 999 which is easy to understand and thus, easy to for The People to monitor would be a particularly unappealing idea.

Next: The 999 plan for business and investors.

As a life-long political activist old enough to remember the 1960s I predict the Occupy Wall Street rabble will do for Barack Obama what their similarly clueless progenitors did for 1968 Democratic Presidential Nominee Hubert Humphrey.

As in the sixties, the slovenly protesters are perceived to be Democratic/liberal/progressive followers.  Their only coherent position, opposition to “the top 1%” is consistent with Democrats’ current campaign themes and legislative agenda.

President Obama, Vice President Biden and Minority Leader Pelosi have all made supportive comments to reinforce the perception that they are united with the protesters.  Thus, disgusted voters will will link the Occupy Wall Street hordes with Democrats even though the protestors have voiced complaints against recent policies and actions of Obama and the Democrats.

In 1968 similar mobs poisoned the Democrats’ Presidential nominating process first by driving incumbent President Johnson to retire instead of seeking a second term and then with violent demonstrations all across the nation.  The ugliness and violence peaked at the Democratic Convention in Chicago, where demonstrators fought with cops who worked for Mayor Daily and the Democratic machine.  Here’s a video.

The result: Republican Richard Nixon won the Presidency by a 110 electoral vote margin even though Conservatives didn’t like him, most voters didn’t trust him, and a third party candidate won most of the South.

Any of the current Republican contenders would be more appealing to independent voters in 2012 than the mercurial Nixon was in 1968.   It doesn’t seem likely that Occupy Wall Street will persuade independents to reject the Republican nominee in favor of Obama.  Occupy’s most likely accomplishment will be to discourage and demoralize Obama’s liberal base and further alienate independents who have already begun to abandon him, even though they don’t know who the Republican nominee will be.

The Labor Department released its jobs report for September:

• Employers added 103,000 jobs in September.  While this was an improvement over August it was less than the monthly growth in the working age population.
• The Unemployment rate remained unchanged at a tragically high 9.1%.
• If the 2011 job growth rate continues it will take five more years to replace the jobs lost in 2008 and 2009.  Even then we’ll be 14 million jobs short of normal employment because the working age population grows by about 125,000 per month.

The chart contrasts the current recession and anemic recovery with the recession and robust recovery of the early 1980s. (continued below chart)

Ronald Reagan’s strategy for economic growth and job creation was simple, and had been history’s proven prosperity formula:

More liberty = Greater prosperity and more Jobs

Like President Obama, President Reagan inherited a deep recession as he took office in 1981. By some measures it was worse than the current downturn.  The initial unemployment rate was higher and interest rates soared into double digits driving down home prices.  Reagan’s economic program, based on his commitment to liberty, was the opposite of Obama’s:

• Enact sweeping tax cuts that were phased in over three years, beginning 1982.  Each of the 16 income tax bracket rates was reduced by at least 25%.  Tax cuts left capital in the hands of those who had earned it and were best equipped to invest in job creating enterprises;
• Release the creative and productive energies of The People by eliminating the restraints of excessive government regulation.

Unfortunately, 2011 is the third year of high unemployment because President Obama simply ignores history, adhering to the seductive, “progressive” promise of prosperity through expanded central government power and intervention.  Obama’s agenda of deficit spending, new regulations, more government intervention and promises of future tax hikes began within days of his inauguration.  Some of the highlights are displayed in the chart above.

President Obama’s latest “Jobs Act” offers employers temporary, one-year tax cuts, followed by large, permanent tax increases, that deliberately target small business employers. Apparently, he thinks business owners are dumb enough to be hoodwinked by such a transparent bait-and-switch scheme.

The chart below compares monthly unemployment rates during the Obama and Reagan administrations, beginning at the moment of highest unemployment.  Reagan faced even higher unemployment during Obama.  But as a result of his tax cuts and deregulation Reagan’s unemployment rate declined rapidly.  The People rewarded Reagan with a 49 state landslide reelection, the largest Electoral College margin in American history.  Even Obama’s most loyal supporters in Congress and the media admit his reelection is in doubt, and if he does win it will be by a slim margin.

Most Americans have heard that in a TV interview our self-righteous President said:

..the way I think about it is, you know, this is, you know a great great country that had gotten a little soft and we didn’t have that same competitive edge that we needed over the last couple of decades.

The video clip seen on TV and the Internet is only 22 seconds and ends in the middle of a sentence raising the possibility that it may not be an accurate representation of what the President meant.  The full six minute interview is on the web site of WESH-NBC Orlando.  A transcript of the relevant exchange, beginning with the interviewer’s question is at the bottom of this article.

However, it turns out that added context is Obama’s standard, continuously repeated boiler-plate and doesn’t change the apparent meaning or make “gotten a little soft” any less offensive.

This is yet another installment in Barack Obama’s self vendication opera, the continuous effort to deflect blame away from himself, hoping the buck to stop elsewhere.  As always, it’s “the last decade” (blame Bush) or “the last couple of decades” (blame Bush, or  Clinton, or whoever you want.  Just don’t blame me.  That was the hazy past I don’t talk about, when I was an organizer or something in Chicago politics.)

Are Americans soft?

Some are.  The Hollywood celebrities who helped propel this appallingly inexperienced and petty man into the Presidency disclose their softness as they sashay across the screen to be pampered at their silly awards shows.  The authoritarian agenda of the progressive movement they support encourages the softness of dependence and disdains the virtues of self-reliance and tenacity.

Obama’s progressive supporters are too soft of character to step up and offer direct, in person help or even donations to the needy and the distressed.  Instead they demand more of government’s impersonal “programs” to shield their soft psyches from any pang of conscience they might feel for callously turning away.

Soft indeed are the political hacks endlessly chattering about “fairness” and demanding that government support their causes by seizing the earnings of others, mostly entrepreneurial business owners.  If they were more sturdy they’d try to earn support in the free market, either by producing and exchanging value for value or by presenting a case persuasive enough to elicit voluntary donations.

On the other hand, there are no soft entrepreneurs.  These men and women have proven themselves through hard work, determination and risk taking.  Many have come back from failures that made them even stronger.  These virtuous men and women earn honest profits by meeting the needs and desires of voluntary customers while providing employment opportunities so that others can experience the self-esteem that comes from working, earning and supporting their families.

Perhaps Obama has forgotten that he supported Wisconsin’s egocentric union mobs.  Theses softies continue to demand limitless coddling, funded by taxpayers who generally receive lower wages for comparable work, make do with far less generous benefits and have no retirement fund except what they can accumulate through their own effort and gratification-postponing discipline.

At the other end of the socio economic spectrum are the politically connected Wall Street softies.  They massaged political connections to secure bailouts that spared them from the hard landings they deserved as consequences of their own mistakes and malfeasance.  As a Presidential candidate Barack Obama enthusiastically supported the bailouts when they were launched by the Bush Administration and as President he expanded them.

The latest example of wretched, parasitic softness was on display at Solyndra, the symbol of Obamanomics.  At the expense of taxpayers who had to earn whatever they have, this company’s executives indulged themselves in luxury and compensated themselves lavishly while producing nothing of value to voluntary buyers in the marketplace.

Last week the men of Solyndra were too soft to accept accountability and answer questions in a Congressional hearing.  Instead they ducked behind their right to silence, a right enshrined in the Constitution by brave men who took enormous personal risk to launch this greatest of all nations.

At the end of the Declaration of Independence the founders added a pledge that today’s politically supported softies would not understand and would never join:

And for the support of this Declaration, with a firm reliance on the protection of Divine Providence, we mutually pledge to each other our Lives, our Fortunes, and our sacred Honor.

Many of them did lose their lives and/or their fortunes but none surrendered their sacred honor.  Through the centuries the Solyndra softies’ right to silence has been preserved by the blood of tough and morally superior soldiers, sailors, airmen and marines.

Fortunately, most Americans are not soft.    How can we tell?  There are lots of indicators including:

• Americans with real grit who, while the Wall Street and Fannie/Freddie softies were bailed out, have quietly accepted the loss of their homes as the consequence of overextending and/or not realizing that rising house prices were the product of a government induced bubble.
• Tough men and women who have had to accept the loss of promising careers, and have gone to work at menial, lower paying jobs to faithfully meet their responsibilities and provide for their families.
• Our phenomenal, volunteer military is still the finest, most dedicated, most awe inspiring in all human history;
• Millions of tough, nimble, innovative and tenacious small businesses have managed to survive the financial catastrophe with no political connections to secure government money extracted from involuntary taxpayers
• Hundreds of millions of solid, determined men, women and children with stiff spines who are consistently honest and virtuous and always do the best they can with whatever hand they are dealt.
• Obama’s sinking poll numbers indicate that more and more Americans realize how much we have lost by falling for his exhortations to be soft and depend on him and his ever expanding government instead of on ourselves and each other.  Even those who still support his ideas have come to realize that he is merely a small man of limited ability, not the majestic leader or messiah of his campaign hype.

Here’s the transcript:

Interviewer Jim Payne: “My [23 year old] son just moved back in to our house…I’m starting to worry that maybe our kids aren’t going to have the same opportunities that we did when we were younger.  Do you share those concerns?”

President Obama: Absolutely.  First of all this is the worst financial crisis and recession that has existed in our lifetimes…so it’s challenging for young people who are coming up…But even before the financial crisis, one of the reasons I ran for President was wages, incomes had flat-lined at the same time costs we’re going up.  I think people felt that opportunities were becoming more constricted for the next generation.  And that’s why making sure that we’re revamping our education system, making sure we’ve got world class infrastructure, investing in basic science, research and technology, making sure that we are moving manufacturing back to the united states and that we’re being tough with our trading partners, and I mean there are a lot of things we can do.  And the way I think about it is, you know, this is, you know a great great country that had gotten a little soft and we didn’t have that same competitive edge that we needed over the last couple of decades. We need to get back on track. But i still wouldn’t trade our position with any other country. we still have the best universities, the best scientists, and best workers in the world.  We still have the most dynamic economic system in the world.  So we just need to bring all those things together.