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Sunday, August 05, 2012

Did Obama Flunk Economics 101?

We'll never know.  He refuses to release his college transcripts and the mainstream press refuses to ask.

But there's a clear indication that the man hasn't the first clue as to how the economy functions.  That indication?  The words that come out of his mouth.

From Loudoun County yesterday, CNS reports:
"Look, nobody is satisfied with our pace of growth,” Obama said Thursday in Leesburg, Va. “Nobody is satisfied.”

While mentioning “all the jobs” created by his administration, Obama said it was nonetheless necessary to create more jobs by, for example, getting more money to construction workers and hiring more teachers.

If construction workers had more money, they might buy new cars, the president said. If we had new teachers, they could go out to restaurants and eat.

“Even with all the jobs we’ve created, we’ve got to create more,” said Obama. “But if you look at our history, if you look at the facts, every time we’ve grown, it hasn’t been by the top down. It’s been from the middle out. It’s been from the bottom up.

“When middle-class families are doing well, lo and behold, everybody does well,” said Obama. “If that construction worker has got a little extra money in his pocket, he goes and spends it maybe on a new car. When we’ve got new teachers doing great work with our kids, then you know what, they go to a restaurant and spend that money. And so suddenly businesses are doing well, the economy is doing well, and we get into a virtuous cycle. And we go up.”
Give more money to construction workers and teachers and they'll spend it and the economy will improve.

Seems so simple.

Only one - make that two - problems:

1) He tried it in a massive way - think "stimulus" - think three trillion dollars a year in federal spending - and he failed to move the needle.

2) A few questions this guy never asks himself, and will certainly never be asked by an equally ignorant press:

Where's that money we give to construction workers and teachers supposed to come from?

Where does that teacher get the cash that she takes to the restaurant and spends on a nice meal?

Answer: The restaurant owner pays for the meal in higher taxes. So the restaurant owner foregoes a meal so that the teacher can have a nice meal.

It's a zero-sum game, genius.

By the same token, what happens when the government reduces the restaurant owner's taxes?

Answer: He has enough on the balance sheet to hire someone. And in return for the wages he expends, he gains productivity. A win-win. His lot in life improves and his employee's situation amends as well.  An employee who will - lo and behold - buy a meal!

When someone steals your purse and your weekly earnings, you're going to cut back until you make it up. Until you're able to get back on top. Same with a business owner.

Barack Obama taking money from taxpayers - whether they be rich or middle class = is no different.

Nobody is hiring. And he doesn't even know why.

With ObamaCare looming on the horizon ...

- - -

"And so suddenly businesses are doing well ... and we go up.” This from a Harvard graduate. The smartest man on the planet. The most gifted orator to grace this land since William Jennings Bryan.

"We go up."