Research Briefing

Obama Repackaging Same Old Binge Spending Agenda Despite Public Outcry For Fiscal Restraint

OBAMA TO CALL FOR NEW SPENDING IN THE STATE OF THE UNION

Obama To Call For More Stimulus Spending. “President Barack Obama will call for new government spending on infrastructure, education and research in his State of the Union address Tuesday, sharpening his response to Republicans in Congress who are demanding deep budget cuts, people familiar with the speech said.” (Damian Paletta, Jonathan Weisman And Laura Meckler, ‘Obama to Push New Spending,” The Wall Street Journal, 1/22/11)

• “The New Spending Could Include Initiatives Aimed At Building The Renewable-Energy Sector—Which Received Billions Of Dollars In Stimulus Funding—And Rebuilding Roads To Improve Transportation, People Familiar With The Matter Said.” (Damian Paletta, Jonathan Weisman And Laura Meckler, ‘Obama to Push New Spending,” The Wall Street Journal, 1/22/11)

BUT IN REALITY, OBAMA IS JUST RELAUNCHING THE SAME SPENDING STRATEGY THAT FAILED TO STIMULATE ECONOMY

“Beware Of Politicians Proposing Public Works And Government Purchases” To Stimulate The Economy.  “The implication of our empirical research and Gramlich's is not that the stimulus of 2009 was too small, but rather that such countercyclical programs are inherently limited. The lesson is to beware of politicians proposing public works and other government purchases as a means to stimulate the economy. They did not work then and they are not working now.” (John F. Cogan And John B. Taylor, Op-Ed, “The Obama Stimulus Impact? Zero,” The Wall Street Journal, 12/9/10)

In 2009, When Signing The Stimulus, Obama Touted It Has “The Largest Investment In Our Nation’s Infrastructure” Since Eisenhower.  “Because we know we can't build our economic future on the transportation and information networks of the past, we are remaking the American landscape with the largest new investment in our nation's infrastructure since Eisenhower built an interstate highway system in the 1950s.” (President Obama, Remarks At The Signing Of The Economic Stimulus Bill, Denver, Colorado, 2/17/09)

• Obama In 2010: “[M]r. Obama Reflects On His Presidency, Admitting That He Let Himself Look Too Much Like 'The Same Old Tax-And-Spend Democrat,' Realized Too Late That 'There's No Such Thing As Shovel-Ready Projects...’” (Michael D. Shear, "President Obama Looks Forward - And Back," The New York Times' "The Caucus" Blog, 10/13/10)

Since The Stimulus Was Passed, 2.1 Million Jobs Have Been Lost.  (U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 1/19/10)

• Obama Promised That His Stimulus Plan Would Create Or Save 3.5 Million Jobs Over Two Years. Obama: “Now, what makes this recovery plan so important is not just that it will create or save 3.5 million jobs over the next two years ...” (President Barack Obama, Remarks At The Signing Of The American Recovery And Reinvestment Act, Press Release, Denver, CO, 2/17/09)

Currently, The National Unemployment Rate Is 9.4 Percent.  (U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 1/19/10)

• Obama Promised Unemployment Would Not Rise Above 8 Percent With Stimulus. (Christina Romer and Jared Bernstein, "The Job Impact Of The American Recovery And Reinvestment Plan," 1/9/09)

AMERICANS WANT OBAMA TO CUT SPENDING, NOT INCREASE IT

64 Percent Of Americans See Reducing The Budget Deficit As A Top Priority. (“Economy Dominates Public's Agenda, Dims Hopes for the Future,” Pew Research Center, 1/20/11)

Since Obama Took Office, The National Debt Has Increased By $3.4 Trillion. (Department Of The Treasury, "The Debt To The Penny And Who Holds It," TreasuryDirect.gov, Accessed 1/19/11)

• Currently, The Total Debt Of The US Government Is $14.06 Trillion Dollars. (Department Of The Treasury, "The Debt To The Penny And Who Holds It," TreasuryDirect.gov, Accessed 1/18/11)

“The United States Just Passed A Dubious Milestone: Government Debt Surged To An All-Time High, Topping $14 Trillion — $45,300 For Each And Everyone In The Country.”  (Tom Raum, “Record $14 Trillion-Plus Debt Weighs On Congress,” The Associated Press, 1/15/11)

Fed Chairman Bernanke Said If The Deficit Is Not Addressed, It Will Result In “Severe Economic Problems And Financial Turmoil For The U.S.”  “Federal Reserve Chairman Ben Bernanke offered lawmakers a more hopeful outlook on the economy and another stern warning on the budget deficit, noting that failure to address long-run deficit problems would lead to severe economic problems and financial turmoil for the U.S.”  (Jon Hilsenrath, “Bernanke Brightens Outlook, Warns On Deficit,” The Wall Street Journal, 1/7/10)

Co-Chairman Of The Debt Commission Said Congress Has To “Face Up” To The Spending That The Country Is Facing And Our Debt Is Like A “Cancer.” “The co-chairman of President Barack Obama's deficit reduction commission says Congress has to ‘face up’ to a red-ink problem that threatens America's future. Democrat Erskine Bowles tells ABC's ‘Good Morning America,’ that he and Republican co-chairman Alan Simpson recommended sharp spending cuts because ‘the path we're on is unsustainable. The debt we are building up is like a cancer.’”  (“Debt Panel Head: Congress Must ‘Face Up’ To Issue,” The Associated Press, 11/15/10)