Research Briefing

The Big Fail - Obama’s Year: It Only Got Worse

December 2011

2011 In Review: It Only Got Worse

ECONOMY: JOBS, HOUSING, DEFICITS, DEBT

Obama’s Rosy Predictions Of Growth Failed To Pan Out In 2011:

The Washington Post’s Fact Checker Said “Obama Is On Track To Have The Worst Jobs Record Of Any President In The Modern Era.” “Unless the economy turns around in the next 18 months, Obama is on track to have the worst jobs record of any president in the modern era. That would be an accurate statement.” (Glenn Kessler, “Rick Perry’s Claim That Obama Has ‘Killed More Jobs’ Than Any Other President,” The Washington Post’s “The Fact Checker”, 8/22/11)

“Economic Growth Never Lived Up To The Expectations” Of The Obama White House. “And because economic growth never lived up to the expectations set early by different White House officials at different times – remember ‘the summer of recovery’? – voters simply don’t have the money or confidence to buy big things like they use to.” (Jim VandeHei and Mike Allen, “Obama’s Big Drags,” Politico, 8/4/11)

The Policies Obama Thought Were His Biggest Accomplishments Remain Deeply Unpopular. “A big hurdle for the president is the unpopularity of the very policies that his team thought would be big accomplishments in the first term. Polls show his economic policy, the health care law and the auto bailout gets positive reviews from fewer than half of voters. Hard to see how that changes.” (Jim VandeHei and Mike Allen, “Obama’s Big Drags,” Politico, 8/4/11)

Obama Admitted His Housing Policies Let Down Millions Of Americans Struggling To Keep Their Homes

“This Summer At The White House, Obama Offered A Rare Acknowledgment That His Response To The Housing Crisis Had Fallen Short.” (Zachary A. Goldfarb, “Obama’s Efforts To Aid Homeowners, Boost Housing Market Fall Far Short Of Goals,” The Washington Post, 10/23/11)

Obama Said That Housing Has Been The “Most Stubborn In Us Trying To Solve The Problem.” “Asked what mistakes he had made in handling the recession and what he would do differently, he said: ‘We had to revamp housing several times to try and help people stay in their homes and try to start lifting home values up. Of all the things we’ve done, that’s probably been the area that’s been most stubborn in us trying to solve the problem.’” (Zachary A. Goldfarb, “Obama’s Efforts To Aid Homeowners, Boost Housing Market Fall Far Short Of Goals,” The Washington Post, 10/23/11)
President Obama Said “I’ll Be Honest With You, [Housing] Is Probably The Biggest Drag On The Economy Right Now.” “‘I’ll be honest with you, this is probably the biggest drag on the economy right now,’ Obama replied to a questioner at an economic forum in Palo Alto, Calif., who lamented that the ‘housing crisis will not go away.’” (Abby Phillip, “Housing Crisis Back On President Obama’s Agenda,” Politico, 7/11/11)

PROMISE: President Obama Promised That His Housing Program Would Prevent 7 To 9 Million Families From Foreclosure. “And we will pursue the housing plan I'm outlining today. And through this plan, we will help between 7 and 9 million families restructure or refinance their mortgages so they can afford—avoid foreclosure.” (President Barack Obama, Remarks On The Home Mortgage Industry In Mesa, Arizona, 2/18/09)

FACT: Obama Has Only Helped 1.7 Million Avoid Foreclosure Of The 9 Million Homeowners He Promised. “President Obama pledged at the beginning of his term to boost the nation’s crippled housing market and help as many as 9 million homeowners avoid losing their homes to foreclosure. Nearly three years later, it hasn’t worked out. Obama has spent just $2.4 billion of the $50 billion he promised. The initiatives he announced have helped 1.7 million people.” (Zachary A. Goldfarb, “Obama’s Efforts To Aid Homeowners, Boost Housing Market Fall Far Short Of Goals,” The Washington Post, 10/23/11)

The Administration’s Foreclosure Prevention Programs “Have Had Little Impact On The Overall Housing Sector.” “The administration is already using taxpayer funds from its $700 billion bank bailout program to help prevent foreclosures and give struggling Americans a reprieve on their mortgage payments. But the programs have had little impact on the overall housing sector.” (“White House Says Needs To Deal With Housing Problems,” Reuters, 6/5/11)
“To Date, Administration Programs Have Permanently Reduced The Debt Of Just One Tenth Of 1 Percent Of Underwater Borrowers.” (Zachary A. Goldfarb, “Obama’s Efforts To Aid Homeowners, Boost Housing Market Fall Far Short Of Goals,” The Washington Post, 10/23/11)

Obama Abandoned His Commitment To Cut The Deficit In Half:

PROMISE: In 2009, Obama Pledged To Cut The Deficit In Half By The End Of His First Term. OBAMA: “And that's why today I'm pledging to cut the deficit we inherited by half by the end of my first term in office.” (President Barack Obama, Remarks At The Fiscal Responsibility Summit, Washington, D.C., 2/23/09)

“President Barack Obama Plans To Cut The U.S. Budget Deficit To $533 Billion By The End Of His First Term …” (Hans Nichols, “Obama Plans To Reduce Budget Deficit To $533 Billion By 2013,” Bloomberg, 2/21/09)
One White House Official Told Politico “We’ll Cut It At Least In Half.” “Under White House projections, this year’s inherited budget deficit of $1.3 trillion will be cut to $533 billion by fiscal year 2013, the end of the first term. ‘So we’ll cut it at least in half,’ the official said.” (Mike Allen, “Obama Vows To Cut Huge Deficit In Half,” Politico, 2/22/09)

FAIL: Even If Every Part Of Obama’s Deficit Reduction Framework Were Enacted, The Deficit At The End Of His First Term Would Still Be $1.33 Trillion, Over Double What He Promised. (“The President’s Plan For Economic Growth And Deficit Reduction; Table S-3,” Office Of Management And Budget, 9/19/11)

Politifact: “Obama Made A Pledge To Cut The Deficit In Half By The End Of His First Term. And He’s Falling Short So Far.” (Gregory Trotter, “Tim Pawlenty Says President Obama Is Going To Break Promise On Deficit And Will Double It,” Politifact, 6/10/11)

Treasury Secretary Timothy Geithner Said Even If Congress Enacted The President’s Budget “We Would Still Be Left With A Very Large Interest Burden And Unsustainable Obligations Over Time.” (Treasury Secretary Timothy Geithner, Remarks Before Senate Budget Committee, Washington, D.C., 2/17/11)

Rather Than Live Up To His Promise, Obama Amassed His Third Straight Record Deficit:

President Obama Has Racked Up The Three Largest Deficits In U.S. History. “The U.S budget deficit for fiscal year 2011 is $1.299 trillion, the second largest shortfall in history. The nation only ran a larger deficit for the 2009 fiscal year, which included the dramatic collapse of financial markets and a huge bailout effort by the government.”(Erik Wasson, “Treasury Announces 2011 Deficit Is Second Highest In History,” The Hill’s “On The Money”, 10/14/11)

FY2009: The Federal Budget Deficit Was $1.413 Trillion, The Highest In U.S. History. (“Monthly Budget Review: November 2011,” Congressional Budget Office, 11/7/11)
FY2011: The Federal Budget Deficit Was $1.299 Trillion, The Second Highest In U.S. History. (“Monthly Budget Review: November 2011,” Congressional Budget Office, 11/7/11)
FY2010: The Federal Budget Deficit Was $1.294 Trillion, The Third Highest In U.S. History. (“Monthly Budget Review: November 2011,” Congressional Budget Office, 11/7/11)

Obama Is Number One As The “Undisputed Debt King Of The Last Five Presidents”:

Politifact: “Obama Is The Undisputed Debt King Of The Last Five Presidents.” “So by this measurement -- potentially a more important one -- Obama is the undisputed debt king of the last five presidents, rather than the guy who added a piddling amount to the debt, as Pelosi’s chart suggested.” (“Nancy Pelosi Posts Questionable Chart On Debt Accumulation By Barack Obama, Predecessors,” Politifact, 5/19/11)

Since Obama Took Office, The National Debt Has Increased By Over $4.5 Trillion, An Increase Of Over 42 Percent. (Department Of The Treasury, “Debt To The Penny And Who Holds It,” Treasury Direct, Accessed 12/20/11)

Obama Is Responsible For “The Most Rapid Increase In The Debt Under Any U.S. President.” “The latest posting by the Treasury Department shows the national debt has now increased $4 trillion on President Obama's watch. The debt was $10.626 trillion on the day Mr. Obama took office. The latest calculation from Treasury shows the debt has now hit $14.639 trillion. It's the most rapid increase in the debt under any U.S. president.” (Mark Knoller, “National Debt Has Increased $4 Trillion Under Obama,” CBS News, 8/22/11)
Congressional Budget Office: “The Amount Of Federal Debt Held By The Public Has Skyrocketed In The Past Few Years …” “The amount of federal debt held by the public has skyrocketed in the past few years, rising from 40 percent of GDP at the end of 2008 to reach an estimated 67 percent by the end of this year.” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)

OBAMACARE: INCREASED COSTS, NO CHOICE FOR COVERAGE, MORE SPENDING

Cost Of Health Insurance Increased Despite Obama’s Promise For ObamaCare:

PROMISE: Obama Promised His Plan “Would Save The Average Family $2,500 On Their Premiums.” (Sen. Barack Obama, Remarks Of Senator Barack Obama’s Plan To Fight For Working Families And Take On Special Interests In Washington, Indianapolis, IN, 6/20/08)

FAIL: “The Cost Of Health Insurance Skyrocketed In 2011 After Several Years Of Relatively Small Increases.” (Jane M. Von Bergen, “Health Insurance Costs Skyrocketing,” The Philadelphia Inquirer, 9/27/11)

Workers Paid An Average Of $132 More For Family Coverage This Year. “Although premiums rose, employers kept the percentage of the premium workers pay about the same: An average of 18 percent for single coverage and 28 percent for family plans. Still, with rising costs, workers paid more, up an average of $132 a year for family coverage. Since 1999, the dollar amount workers contribute toward premiums nationally has grown 168 percent, while their wages have grown by 50 percent, according to the survey.” (Julie Appleby, “Cost Of Employer Insurance Plans Surge In 2011,” Kaiser Health News, 9/27/11)

Cost Of Single Employee Coverage Grew 8 Percent According To The Survey. “Family plan premiums hit $15,073 on average, while coverage for single employees grew 8 percent to $5,429, according to a survey released Tuesday by the Kaiser Family Foundation and the Health Research & Educational Trust. (KHN is an editorially-independent program of the foundation.)” (Julie Appleby, “Cost Of Employer Insurance Plans Surge In 2011,” Kaiser Health News, 9/27/11)

Whatever Happened To “If You Like Your Health Care Plan, You Will Be Able To Keep Your Health Care Plan”?

PROMISE: President Obama Promised That “If You Like Your Health Care Plan, You Will Be Able To Keep Your Health Care Plan. Period.” OBAMA: “So let me begin by saying this: I know that there are millions of Americans who are content with their health care coverage - they like their plan and they value their relationship with their doctor. And that means that no matter how we reform health care, we will keep this promise: If you like your doctor, you will be able to keep your doctor. Period. If you like your health care plan, you will be able to keep your health care plan. Period. No one will take it away. No matter what. My view is that health care reform should be guided by a simple principle: fix what's broken and build on what works.” (President Barack Obama, Address To The American Medical Association, Chicago, IL, 6/15/09)

FAIL: Survey Found That Only 60 Percent Of Employers Offered Medical Coverage This Year, A 9 Percent Decrease From 2010. “Sixty percent of employers said they offered medical benefits this year, a decrease from 69 percent in 2010.” (Jeffrey Young, “Health-Benefit Costs Rise Most In Six Years,” Bloomberg, 9/27/11)

GALLUP: “The Percentage Of American Adults Who Get Their Health Insurance From An Employer Continues To Decline, Falling To 44.5% In The Third Quarter Of This Year.” (Elizabeth Mendes, “Employer-Based Health Insurance Continues To Trend Down,” Gallup, 11/11/11)

Health Care Spending That Continues To Go Through The Roof:

PROMISE: Obama: “This Legislation Will Also Lower Costs For Families And For Businesses And For The Federal Government, Reducing Our Deficit By Over $1 Trillion In The Next Two Decades. It Is Paid For, It Is Fiscally Responsible, And It Will Help Lift A Decades-Long Drag On Our Economy.” (President Barack Obama, Remarks On Signing The Patient Protection And Affordable Care Act, Washington, D.C., 3/23/10)

FAIL: Health Care Spending To Hit $4.6 Trillion In 2020. “The nation’s health care tab is on track to hit $4.6 trillion in 2020, accounting for about $1 of every $5 in the economy, government number crunchers estimate in a report on Thursday … Including government and private money, health care spending in 2020 will average $13,710 for every man, woman and child, says Medicare’s Office of the Actuary.” (Ricardo Alonso-Zaldivar, “Health Tab To Hit $4.6 Trillion In 2020,” The Associated Press, 7/28/11)

ObamaCare To Increase Costs More Than Had It Never Been Enacted. “Despite President Obama’s promises to rein in health care costs as part of his reform bill, health spending nationwide is expected to rise more than if the sweeping legislation had never become law. Total spending is projected to grow annually by 5.8 percent under Mr. Obama’s Affordable Care Act, according to a 10-year forecast by the Centers for Medicare and Medicaid Services released Thursday. Without the ACA, spending would grow at a slightly slower rate of 5.7 percent annually.” (Paige Winfield Cunningham, “Health Care Law Won’t Rein In Costs, Study Says,” The Washington Times, 7/28/11)

Health Care Spending “Doesn’t Seem To Be Slowing Down." “The report from Medicare economists and statisticians is an annual barometer of a trend that many experts say is unsustainable but doesn’t seem to be slowing down.” (Ricardo Alonso-Zaldivar, “Health Tab To Hit $4.6 Trillion In 2020,” The Associated Press, 7/28/11)

CMS Chief Actuary Rick Foster: “If implemented as written, the health care law will ‘create a whole new world of health care spending,’” (Brett Norman, “CMS: Health Law Will Lead To Rise In Spending,” Politico, 7/28/11)

MAJOR SCANDALS: Solyndra’s $535 Million Bankruptcy Hit To Taxpayers And MF Global’s Missing $1.2 Billion

Obama’s Poster Child Solyndra Cost Taxpayers $535 Million:

Obama’s Poster-Child For “American Ingenuity And Dynamism,” Declared Bankruptcy. “The California-based Solyndra, which employed more than 1,000 people, declared bankruptcy earlier this month. President Obama visited the company in May of 2010, saying it was a prime example of ‘American ingenuity and dynamism.’” (Alexander Mooney, “White House Beats Back Claim It Pressured Loan To Now-Bankrupt Company.” CNN, 9/14/11)

Solyndra Was Offered The First Recovery Act Loan Guarantee, Receiving $535 Million From Taxpayers In March 2009, And Went Bankrupt In August 2011. (Solyndra, “Solyndra Offered $535 Million Loan Guarantee By The U.S. Department Of Energy,” Press Release, 3/20/09; Joe Stephens And Carol Leonnig, “House Republicans Step Up Solyndra Investigation,” The Washington Post, 9/1/11; George Avalos, “Fremont Solar Tech Firm Solyndra To Shut Down, Lay Off 1,100 Workers,” The San Jose Mercury News, 8/31/11)

“The Leading Investors In Solyndra Were Two Investment Funds With Ties To George B. Kaiser, A Major Campaign Fundraising ‘Bundler’ For Obama.” (Carol D. Leonning And Joe Stephens, “Solyndra Employees: Company Suffered From Mismanagement, Heavy Spending,” The Washington Post, 9/21/11)

George Kaiser's Argonaut Ventures Is The “Single Largest Shareholder Of Solyndra.” “Kaiser's Argonaut Ventures and its affiliates have been the single largest shareholder of Solyndra, according to SEC filings and other records. The company holds 39 percent of Solyndra's parent company, bankruptcy records filed Tuesday show.” (Ronnie Greene And Matthew Mosk, “Obama Officials Sat In On Solyndra Meetings,” iWatch And ABC News, 9/9/11)
George Kaiser Bundled Between $50,000 And $100,000 For Obama’s 2008 Campaign. (Center For Responsive Politics, opensecrets.org, Accessed 9/9/11)

The Obama Administration Ignored Warnings That Solyndra Was “Not Ready For Prime Time.” “One e-mail, uncovered by the House Energy and Commerce Committee and reported by ABC News, is from a White House budget analyst warning then-Vice President Biden’s chief of staff, Ron Klain, that the 2009 Department of Energy loan was ‘not ready for prime time.’”(Alexander Mooney, “White House Beats Back Claim It Pressured Loan To Now-Bankrupt Company.” CNN, 9/14/11)

An Obama Fundraiser, Who Obama Hired To Help Oversee The Loan Guarantee Program, Pushed For Solyndra Approval Even As His Wife’s Law Firm Was Representing The Company. “An elite Obama fundraiser hired to help oversee the administration's energy loan program pushed and prodded career Department of Energy officials to move faster in approving a loan guarantee for Solyndra, even as his wife's law firm was representing the California solar company, according to internal emails made public late Friday.” (Matthew Mosk, “Obama Fundraiser Pushed Solyndra Deal From Inside,” ABC News, 10/7/11)

Steven J. Spinner: “I Have OVP And WH Breathing Down My Neck On This.” "’How hard is this? What is he waiting for?’ wrote Steven J. Spinner, a high-tech consultant and energy investor who raised at least $500,000 for the candidate before being appointed to a key job helping oversee the energy loan guarantee program. ‘I have OVP [the Office of the Vice President] and WH [the White House] breathing down my neck on this.’"(Matthew Mosk, “Obama Fundraiser Pushed Solyndra Deal From Inside,” ABC News, 10/7/11)

Obama’s “Wall Street Guy” Loses $1.2 Billion:

President Obama: Jon Corzine Is “Our Wall Street Guy.” “The rollout also provided a showcase for Corzine, the former Goldman Sachs CEO whom Obama referred to as ‘our Wall Street guy’ at a meeting of Democratic governors in Chicago on Friday.” (Claire Heininger, “Corzine Profile Rises In Obama Camp,” The Star-Ledger (NJ),6/23/08)

President Obama: “Jon Corzine wasn't just the first governor to pass an economic recovery plan for his state; he was an ally with the Obama administration in helping us develop a national recovery plan.” (President Obama, “Remarks By The President At New Jersey Rally For Governor Jon Corzine,” Holmdel, NJ, 7/16/09)
Watch Obama’s Comments Here

October 31^st: Jon Corzine’s Wall Street Firm, MF Global, Filed For Bankruptcy. “Broker-dealer MF Global, headed by former New Jersey governor and Goldman Sachs chairman John Corzine, has filed for bankruptcy protection, apparently because of holdings of European debt.” (“Broker-Dealer MF Global Files For Bankruptcy,” USA Today, 10/31/11)

The Eighth Largest Bankruptcy In US History “Has Shaken Faith In The Markets.” “The case -- the eighth-largest bankruptcy in U.S. history -- has shaken faith in the markets and put business on hold for many owners of the roughly 38,000 securities and commodities trading accounts at the firm, from big-city traders to heartland farmers.” (James O’Toole, “The MF Global Money Chase,” CNN Money, 12/6/11)

Up To $1.2 Billion Is Missing From Customers Of Jon Corzine’s Firm. “The court-appointed trustee overseeing MF Global's bankruptcy says up to $1.2 billion is missing from customer accounts, double what the firm had reported to regulators last month.” (Marcy Gordon, “MF Global Trustee Says $1.2B Or More Missing,” The Associated Press, 11/21/11)

“The Money May Be Gone Forever” If MF Global Used It To Cover Losses On Its Own “Risky Bets.” “It is unclear what MF Global did with this money or whether it can be recovered. Investigators are checking whether MF Global used some of the cash to pay off its own debts, which means the money could be sitting in an account at another firm. But if the firm used it to cover losses on some of its risky bets, the money may be gone forever.”(Ben Protess, “MF Global Is Said To Have Used Customer Cash Improperly,” The New York Times,11/17/11)

“The Firm's Primary Regulator At The Exchange Level, CME Group Inc., Has Suggested Mr. Corzine Knew About Certain Transfers Of Funds That May Have Been Improper.” (Aaron Lucchetti And Scott Patterson, “Corzine Knew Of Fund Transfer,” The Wall Street Journal, 12/16/11)

Corzine Played A “Central Role” In Obama’s Wall Street Fundraising Efforts. “His new legal troubles, sparked by the bankruptcy filing of his investment firm, MF Global, could complicate the president’s efforts to raise money from the financial community given Corzine’s central role in those efforts.” (Michael Isikoff, “Corzine, Top Obama Fundraiser, Under FBI Investigation,” MSNBC, 11/2/11)