Hope and Change: The Mulligan

    One can dream. President Obama has an opportunity to give the greatest speech of his career when he returns from his visit to the Ganges with his entourage of 2000.

    "My fellow Americans, the strength of our democracy rests on the ability of the citizens to express their views as they select their leaders. As we turn from the recent campaign season to the task of governing, I would like to lay out my administration's priorities for the next two years:

    1. Jobs. The painfully high level of unemployment is unacceptable and requires a set of policies which embrace the people and institutions which create jobs. I will ask the Congress to immediately pass legislation which extends the current income, capital gains, and dividend tax rates through 2012, and that inheritance tax rates be set at 2009 levels (45% for estates over $3.5 million). We will extend the Research and Development tax credit through 2015. Regulatory changes affecting energy will be deferred until 2012. We will urge Congress to approve the pending free trade agreements with Columbia, Panama, and South Korea. Measures to increase lending to small businesses will be a priority.

    2. Budgets. I will work with the Congress to develop a plan to get the budget deficit to international standards (no greater than 3% of Gross Domestic Product) by 2015.  This will begin with a return of any unspent TARP and stimulus funding. We will incorporate many of the ideas of my Deficit Reduction Commission, and may well include a return of departmental budgets to pre-2008 levels, adjustments to Social Security (particularly for younger workers), and reductions in military spending.

    3. Healthcare. While retaining the expansion of coverage contained in the landmark 2009 legislation, we will turn our focus to cost reduction. This will include provisions such as buying insurance across state lines, negotiation of prices with pharmaceutical companies, tort reform, reduced payments for doctors and hospitals, and insurance pools for small businesses. Regulatory requirements will be streamlined.

    4. The Washington Climate. I have asked the Senate and House leaders of both parties to participate in a bi-weekly meeting at the White House on shared priorities, including any significant regulatory changes. The new leader of my Council of Economic Advisers will be a prominent business leader. I will call for the elimination of all earmarks.

    The American people have spoken. I encourage the leaders of both parties to join me in seeking common sense solutions which address their priorities. God bless America. Our best days lie ahead."  

    Why is it so easy?

                                        -----

    This week's video is Mitch McConnell's  reaction to the election - he who was not invited to the White House for 18 months by the post-partisan president. He has commented that his primary objective is to be sure that Obama does not get reelected - matching Obama's primary objective of getting reelected. Not a great starting point for either.

                                     -----

   Here's the link to my nuclear terrorism novel, The Target.

bill bowen - 10/5/10

Comments

[Harrycat]

Well Alright !!!
All other discussions should be off the table so that we, as a nation, can read and digest the Simpson-Bowles Committee draft proposals. This is a once in a lifetime opportunity to change the direction of the country.

Anyone who is the left 10%, or the right 10%, needs to take a deep breath and decide if their narrow views should trump the welfare of us all. If anyone can't honestly engage in this discussion they should be led away from the table and ignored. I don't think it would be hyperbolic to say that long term spending is an existential threat to us, far more that anything Al Quida can do.

I will very willingly take whatever hit is required. Will you?

[Bill McCormick]

It's 2 AM this morning and for some unknown reason I wake up and turn on the TV. A little while later they announce the President of the US and the Prime Minister of India. The PM talks for a little while in english and announces the agreements between the US and India with regard to trade deals, security deals and the elimination of technology sharing restraints on US - India trade. He is followed by The President who discusses the strategic importance of India in the new golbal society, climate change, the war on terror (yes he is suddenly starting to use the word terror in preparation for 2012 elections) and the trade agreement that will bring 22,000 new jobs to the USA. Then the press gets a chance to ask either man a single question. After a somewhat aborted attempt by the first questioner to ask the President three questions in one and the PM an additional question the conference continues. In each question the PM is short and to the point even armed with facts in some cases. In each of his questions the President goes on and on often uncomfortable and almost unable to find a place to end his justification of his positions or ambiquity. To his credit the PM of India refused to answer the question of why the US would not support the call for Pakistan to be listed as a terrorist nation thus protecting the President from having to answer that tricky one especially since he stayed in the hotel attacked by Pakistan based terrorists a year ago.

The President was asked what India was getting from their purchase of $10B of American products? The President clearly uncomfortable with the question went through his view of the strategic importance in the world of the US-India alliance and once again repeated his opening speech. He ended with the elimination of technological export restrictions and the benefit they would give to India's manufacturing base in the production of new products. His justification was that these restrictions were left over from the cold war. Hmmm just the day before I saw Donald Trump saying that every time he visits Asia he is privately told by Chinese businessmen that they cannot believe how long the US has allowed them to produce copies of our products with no protection. And, Trump calling for a 25% import tax on Chinese goods. So now we will give access to our technology in return for 22,000 jobs?

Let me digress for a minute on the amatuerishness of this Administration. Last year the stimulus plan granted a $527M. Yes, 1/2 a billion dollars to a company in California to develop and sell solar panels. Part of our new energy jobs creation/global warming/world leader policy. The company is about to declare bankruptcy because they cannot compete with the new Chinese solar panels produced at 50% of their cost. during his news conference one of the benefits Obama sited for India was the sharing of US solar panel technology with a new India business that produces solar panels. HELP!! No wonder I wake up to watch the smoke and mirrors man in action. He will be on again today at 1 PM after his address to India's Parliment. His comment on India's call centers taking American jobs away? "That's passe' "

Going back he was asked specifically the question I posed in this comment section a day or two ago: Is the $650B devaluation of the US dollar an economic war with China or simply more liberal spending? His answer began with I cannot comment on actions by the FED becasue they are independent from the Executive and Congressional branches of government? Huh? You are President of the US and on a 10 day Asian economic trip and you cannot comment on the actions of the US FEDS? But, in true Obama fashion he rambled on for at least ten minutes thereafter and I cannot tell you what he said. It was obviously smoke and mirrors for the Chinese. But, let's look at the signals to China: 1. We are devaluing our currency to apprciate theirs. 2. We are giving solar panel and other technology to India--to give them na advantage over China in return for 410B in trade perhaps? 3. We go to India first on the Asian tour rather than China? 4. We engage India in a new discussion of world nuclear disarmament? 5. We declare the US-India Strategic alliance between the world's two largest democracies the most important in the new global economy. Perhaps China will get the message and will that initate a good or bad response?

In the end I returned to sleep confident and knowing that this President will not let his base down. While he will make jestures to his "enemies" toward taxes, cuts,jobs and perhaps even healthcare Tweaks that he now says "may be necessary because the Republicans would not let us pass the proper bill" (It's now all their fault that the bill doesn't balance), he is still focused like a laser on his role as the leader of a world hellbent on reducing poverty abroad at the expense of American's wealth, reducing global warming at the expense of American's jobs and what is so alarming now is that he is trying to level the world's playing field not just ours. This is a mission that should be played out over several generations and not at the expense of America. It should be economically driven not government driven or it will not work for America--it will be at our expense. I could not wait for 2010 elections and 2012 cannot get here fast enough.

[Bill McCormick]

Lisa: We are all in this boat for a while I'm afraid. I think it can be predicted that the tax cuts will be extended until we are out of this recession so I think our business plans and those of our clients must plan that way. It would be political suicide for either party to let them expire.
A bigger question is the costs of healthcare. I think we are planning for the near future on higher premium increases than in the past. And, we will have to adjust employee contributions and benefit modifications to adjust until the "smoke" clears politically. On this issue I believe we are headed for a big battle. Despite the President in his lawyerly way saying the American people do not want to see this issue "litigated" another two years he is likely to defend most of the provisions to the death against repeal. Ultimately, Republicans will likely cave in and begin a series of negotiated adjustments.
We are telling our clients that the best thing to do is invest in gaining competative advantage if you can afford it. Invest in technology and add R&D as well as sales and marketing people if you can. the economy is improving but slowly and the last to act will surely be behind their competitors. If clients are cash poor then they have to be careful and pick their spots. Hiring is picking up but confidence is still low. But, historically, those who expand early in a recovery do best. Those are our thoughts.

[lisainstlouis]

As a consultant, here is what concerns my clients. "IF" you continue the Bush tax cuts for another two years and then re-evaluate, my clients are still left with no idea what is to come. How can they plan not knowing if what is said today is not going to be true tomorrow? Do you really want to begin to hire not knowing if any breaks that go to businesses, will be taken away in two years?

I would love to understand how any of you out there would advise my clients. I am basically saying, "Hunker down because there are no certainties except for very high debt on the part of the US government which will need to translate into higher taxes". And that advise will not bring more jobs but, I believe, is the prudent thing for any business to do.

[Bill McCormick]

Bo,when can you start as his speech writer? If only it would come to pass we could lay down our electronic pencils. But, here is what I see happening already:

1. Democrats learned nothing. Based on Pelosi, Obama and Reids' speeches I see nothing to indicate that Democrats are going to change colors just operating tactics. And, this is not because they learned anything. It is because they lost their power to implement legislation. And the are lawyerly people where winning is everything.

2. Republicans did not get the message either. Alarming? The Republican leaders think the message was to repeal Healthcare, to roll back government spending, to stop Cap & Trade and to defeat Obama. Those are the Tea Party priorities. The Republicans won this landslide elction because the independents flipped. Period. And, the Independents flipped because Obama dropped the ball on the JOBS priority. Obama was given his mandate in 2008 because of JOBS. Not healthcare, environment or energy. And, he blew it. Now the Republicans have, too, gotten the wrong message. Their leaders are already focused on repealing the healthcare law and defeating Obama in 2012. Focus on JOBS or pay the price once again.

3. Once again the parties are controlled by the 20% fringe elements: the ultra Liberals in the Democratic party and the ultra conservative in the Republican party. Bipartisanship is not even in the picture just the sound bites. Obama will protect his healthcare plan with Reid and the veto. He will use EPA to implement energy restraints and CAP and trade. The Tea Party will drive the Republican leaders to focus on healthcare repeal, budget constraints, earmarks and defeating the liberal policies. JOBS will be forgotten once again as the battle lines are drawn. And, the middle will once again be forgotten. 60% of us vote somewhat in vain, simply to slow down the fringe currently in control. At least it is likely that the tax increases will not come about. That alone will help with jobs. Perhaps more than anything.

4. What is the with the Feds infusion on $600B into the economy? Why would any sane economic leader want to reignite inflation and devalue the dollar 20%? Is this another liberal spending spree? Or is this an economic war with China? Devaluing the dollar if I understand it correctly will raise the cost in American dollars of all the commodities that the Chinese are currently buying up in the world with American dollars to use in their products they manufacture. This strategy will make Chinese products more costly and perhaps give American industry a break. But at what price? Inflation---did not Jimmy Carter bring us that one? Inflation takes money out of the economy, drives up interest rates and cost JOBS. I do not believe you can devalue your currency and win long term. The key is technological efficiency and increasing the supply of commodities on the world market. Drill for oil, mine coal, invest in IT and technological efficiency in production,etc. Stimulate small business in America, get Americans back to work and increase the number of tax payers. Stop extending unemployment benefits. Slow government hiring and pay raises. Outsource government functions.

There is much to do but the focus must be on JOBS. Does either party remember the political key to victory: "It's the economy--stupid?" I hope I am wrong in what I see coming. I could and likely will go deeper in the days to come.