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Today, the Labor Department released its monthly jobs report showing that the U.S. economy added 216,000 jobs in March and unemployment fell to 8.8 percent. Despite these encouraging numbers, Americans still consistently tell pollsters that jobs and the economy are the most important problems facing the country. And yesterday, Gallup released a poll showing that the number one way Americans would like to see more United States jobs created is to stop sending new jobs overseas. That is a fabulous idea, and the simplest way to accomplish it would be to lower out nation’s corporate tax rate.
The United States was once a leader in tax rate reduction. In 1981, President Ronald Reagan passed a broad tax cut package to encourage economic growth. How well did it work? Just compare the drops in unemployment from both the Reagan and the Obama economic recoveries. Since the Obama recovery began 21 months ago, the national unemployment rate has fallen only 0.6 points, from 9.4 percent in July 2009 to 8.8 percent today. Contrast those anemic results with the robust job growth that occurred during the Reagan recovery in the ’80s. By the 21-month mark of the Reagan recovery, unemployment had dropped from 10.8 percent to 7.5 percent—a 3.3 point drop.
And Reagan didn’t stop there. In 1986 he went on to lower the federal corporate tax rate from 46 to 34 percent. The results speak for themselves: when Reagan left office in January 1989, the nation’s unemployment rate was just 5.3 percent. The world not only noted Reagan’s success but then went on to copy his successful tax cutting policies. In 1989 the developed nations in the Organization for Economic Cooperation and Development (OECD) had an average top marginal corporate tax rate well above the U.S.’s 34 percent rate. Since that time the world’s industrialized nations have dropped their average corporate tax rate to about 25 percent. The U.S., meanwhile, has gone in the opposite direction. We now have a 35 percent rate at the federal level that rises to 39 percent once the average of state corporate taxes are mixed in. And today, Japan is scheduled to implement its own corporate rate reduction, which will officially make our 35 percent rate the highest corporate tax rate in the world.
Owning the world’s highest corporate tax rate is a jobs killer. Imagine you are a global corporation looking to invest in a new factory that will produce goods for American consumers. Do you build your factory with hundreds of new manufacturing jobs in Canada, where the top central government tax rate is 16.5 percent? Or do you choose a location in the United States, where the top tax rate is 35 percent? Is that even a choice? Our high corporate tax rates are a huge manufacturing job repellent.
Liberals have long argued that corporate tax cuts are not necessary since the effective corporate tax rate (calculated by dividing the amount businesses pay in taxes by their incomes) is comparable to other OECD countries. But gaming the tax system to reduce your effective tax rate is not free. It requires a substantial investment in tax lawyers and lobbyists for major corporations to get your tax bill down. So again consider a foreign investor or medium-size corporation looking to expand production. Neither of the firms has the tax lawyers and lobbyists needed to lower their effective tax rate. Do they choose low-tax Canada, where they can focus on their core business and pay low taxes? Or do they choose the U.S., which requires significant resources devoted to tax law compliance and lobbyists in Washington to assure a low tax rate? Again, is this even a choice?
The U.S. economy is slowly beginning to finally add jobs to the economy. But so is the rest of the world, and many economies are growing much faster. If we want to stay competitive, if we want to stop sending jobs overseas, we must lower our corporate tax rate.
Quick Hits:
- Members of the NATO alliance have sternly warned the rebels in Libya not to attack civilians as they try to overthrow Muammar Qadhafi.
- At least 40 civilians have been killed in air strikes by Western forces in Tripoli, the top Vatican official in the Libyan capital told a Catholic news agency on Thursday.
- Undisciplined Libyan rebel forces are still proving no match for Qadhafi’s army.
- The Wisconsin Professional Police Association is circulating letters to businesses in southeast Wisconsin telling them to support collective bargaining for government unions or else.
- Morning Bell will be back, as always, on Monday. But today is this authors last day. It has been a pleasure serving all of you over these past three years.
In the shadow of the U.S. Capitol, children suffer in a public education system rife with violence and ranked among the worst in the nation. Yesterday, the U.S. House of Representatives took action to give those students some hope when it voted to reauthorize the D.C. Opportunity Scholarship Program (D.C. OSP), which provides scholarships to low-income children, allowing them to attend their school of choice. It was one of the most consequential education votes that Congress will make this year. The program empowers parents, and it rejects the notion that a child should be relegated to a failing public school because they were born in the wrong zip code. Yet, remarkably, the program faces opposition from President Barack Obama and Democrats in the U.S. Senate.
The D.C. OSP was first launched in 2004, and since that time more than 3,300 children have had the chance to escape the underperforming and unsafe D.C. public schools. The statistics are jarring. As The Heritage Foundation’s Lindsey Burke notes, the D.C. public school system ranks 51st in the nation. Only 14 percent of 8th graders are proficient in reading, and just 55 percent of students in D.C. public schools graduate. Under the D.C. OSP, though, students have blossomed amid otherwise unfertile ground. Burke writes:
Congressionally mandated evaluations of the D.C. OSP, conducted by the U.S. Department of Education, revealed that scholarship students were making gains in reading achievement compared with their public school peers. The gains in academic attainment, however, have been most astounding.
While just more than half of all students in D.C. public schools graduate, 91% of students who received a voucher and used it to attend private school graduated.
Despite the program’s success, Sen. Dick Durbin (D-IL) inserted language into a 2009 omnibus spending bill that brought about the program’s slow death and, without congressional reauthorization, no new students were allowed to receive scholarships. With the new Congress, Speaker John Boehner (R-OH) introduced a bill re-authorizing the D.C. OSP; in anticipation of its passage in the House, President Obama launched a pre-emptive strike against the program. The White House issued a statement of opposition to the D.C. OSP, ignored evidence of its success and claimed, “it has not yielded improved student achievement by its scholarship recipients compared to other students in D.C.” Yesterday, The Washington Post editorial board strongly rebuked the president and cited testimony by the principal investigator charged with evaluating the program, Patrick J. Wolf:
‘In my opinion, by demonstrating statistically significant experimental impacts on boosting high school graduation rates and generating a wealth of evidence suggesting that students also benefited in reading achievement, the D.C. OSP has accomplished what few educational interventions can claim: It markedly improved important education outcomes for low-income inner-city students.’
Sadly, despite the documented success of the program, the choice it offers parents and the opportunities it gives students in an otherwise failing school system, President Obama stands in opposition to its reauthorization, along with Democrats in the Senate. As Virginia Walden Ford, executive director of D.C. Parents for School Choice and visiting fellow at The Heritage Foundation said, “The president cannot claim to be an education reformer while rejecting a program that raises graduation rates, increases parental satisfaction and boosts reading achievement.”
The president and Members of Congress who oppose the D.C. OSP are committing another offense against D.C. parents, as well – depriving them of the very choices they enjoy. Nearly 40 percent of the Members of the 111th Congress sent a child to private school. As a child, President Obama was a scholarship recipient, affording him the opportunity to attend the prestigious Punahou School in Hawaii. On top of this, his daughters attend the upscale Sidwell Friends School in D.C. As Rep. Trey Gowdy (R-SC) said in a floor speech prior to yesterday’s vote:
I went to the public schools in South Carolina. My wife teaches in the public schools in South Carolina. And my son will graduate from the public schools in South Carolina. But I will miss his graduation like many of you have missed things in your lives because we will be in session. What I will not miss is the opportunity to throw a lifeline to kids who were born through the vicissitudes of life into poverty. We will give them the same choices and chances that we have.
President Obama and Congress have an opportunity to throw that lifeline. If they truly want to empower parents, improve education and help students succeed, supporting the D.C. Opportunity Scholarship Program would be a good place to start.
Quick Hits
- An 18-month congressional investigation into AARP reveals that the organization stands to make more than $ 1 billion over the next 10 years from Obamacare, a law the seniors lobby supported despite opposition among its core constituency.
- As NATO assumes full command of air operations over Libya, CIA forces are on the ground gathering intelligence and making contact with anti-Qadhafi forces.
- Ohio lawmakers have passed a bill limiting collective bargaining by public sector employees and requiring government workers to make minimum payments for health-care coverage and pensions.
- U.S. military advisers are seeking to limit a reduction in combat forces in Afghanistan this summer, contrary to President Obama’s wishes, The Washington Post reports.
- India’s population has hit 1.21 billion, up 181 million from 10 years ago. That accounts for 17.5 percent of the world’s population.
You would think liberals in Congress have nothing better to do with their time. Amid a war in Libya, an effort to aid earthquake and tsunami-stricken Japan, a continuing war in Afghanistan, rising gas prices and endless unemployment, Senate Majority Leader Harry Reid (D-NV) and the Democratic leadership in the U.S. Senate are refusing to accept a modest agreement to fund the federal government through the end of the fiscal year. And time is running short. What’s Senator Reid wrangling over? A mere $ 51 billion in additional budget cuts, which amounts to a few days of government deficit spending.
But Reid’s stonewalling isn’t just about dollars and cents, or saving federal funding for a Cowboy Poetry Festival. Reid and the Democrats in Congress are setting the groundwork for a partial government shutdown so they can attempt to lay the blame at the feet of the Tea Party and Republicans in Congress and gain politically. They’re simply putting electoral politics over the business of our nation.
As it stands today, Congress has until April 8 to reach an agreement on a long-term budget through the end of FY 2011, pass another short-term stopgap budget, or face a partial government shutdown. It might seem shocking that our representatives would cut it so close. But to understand how we got here, it’s important to know where we’ve been.
Last May, then-House Majority Leader Steny Hoyer (D-MD) announced that, for the first time since 1974, the House would not pass a budget resolution. Never in modern history had a Congress ignored this basic mandated responsibility. Rather than stem the tide of big government spending, liberals in Congress opted to burn through borrowed cash as they pleased with no end in sight. But with the rise of the Tea Party movement and the November elections, the American people voiced their opposition to the big spending ways. They wanted Congress to get control of the budget.
Enter the 112th Congress and H.R. 1, the House Republicans’ FY 2011 budget which cut spending by $ 61 billion. It passed the House some 39 days ago, and yet under Reid’s leadership, the Senate has done nothing to move that bill forward or offer any serious alternative, for that matter. In the meantime, the House has passed two stopgap spending measures to temporarily fund the government, waiting for Reid to get his chamber in order.
So what are the Senate Democrats really up to? One doesn’t need to read tea leaves, hire a psychic or consult a magic eight ball. Yesterday, Senator Charles Schumer (D-NY) gave America some insight into his party’s game plan. The Washington Examiner reports that on a conference call yesterday, Schumer, without realizing reporters were already listening, instructed his fellow Democratic senators to tell the reporters that the GOP is refusing to negotiate. According to the Examiner, Schumer ”told the group to make sure they label the GOP spending cuts as ‘extreme.’” That is what “the caucus instructed [Schumer] to do last week.”
The spending cuts, though, are anything but extreme. As House Majority Leader Eric Cantor (R-VA) said yesterday, “Chuck Schumer did us a favor, he exposed their tactic. … He’s basically instructing his members to deem any spending cut unreasonable — any spending cut … So clearly they are not serious.” The Senate Democrats’ inaction combined with their rhetoric means one thing: they want a government shutdown at all costs, and they want to blame it on Republicans. Their end goal: more spending and supposed political gain.
Yesterday, former Democrat National Committee (DNC) Chairman Howard Dean told the audience at a National Journal Insider’s Conference: “If I was head of DNC, I would be quietly rooting for it…I know who’s going to get blamed – we’ve been down this road before.” Dean continued: “From a partisan point of view, I think it would be the best thing in the world to have a shutdown.”
Reid’s inaction, Schumer’s political gamesmanship and Dean’s blunt honesty tell the whole story. This is not about putting America on a smart fiscal path, it’s about putting Democrats on a preferred political path. But it won’t work.
Reid and Democratic leadership in the Senate need to recognize that they have a job to do. As Majority Leader Cantor said: “We’ve got bigger things to deal with. Time is up here.” And with a $ 1.6 trillion deficit, cuts to non-defense discretionary spending are desperately needed. President Barack Obama, too, should show his face and weigh in on the stalemate. The president has been wrongly applauded for remaining silent by a complicit media; now is the time to show leadership. He can not continue to ’vote present’ as he has throughout his career. And in anticipation of a partial shutdown, Congress should pass a Department of Defense appropriations bill to ensure that our military is fully funded.
Last November, the American people cast their vote for fiscal responsibility and a limited government that lives within its means. The many voices of the Tea Party are not entirely satisfied with a modest $ 61 billion in cuts. But they know that we need to make these substantive cuts and move on to the business of the next year’s budget, where more reform will be possible. The Tea Party is not the problem.
For almost two months, they have watched many of their elected representatives play politics, rather than play ball. Senator Reid, it’s time to do the right thing. Stop the political games and get to work so the government can keep fully operating and Congress can get on with the people’s business.
Quick Hits
- Despite blocking domestic energy production and telling Brazil the United States is eager to import more of its oil, President Obama is today laying-out plans to supposedly curb U.S. oil imports and increase energy production.
- Just one day after President Obama’s speech on gains in Libya, Muammar Qadhafi’s forces recaptured the town of Ras Lanuf and pushed-back rebels, according to Reuters reports.
- A Wisconsin judge issued a second order on Tuesday blocking the implementation of Gov. Scott Walker’s plan to curb collective bargaining for public sector union employees.
- It’s not a magic trick. Six pages of the Obamacare legislation are about to turn into 1,000 pages of federal regulations when the Department of HHS releases its accountable care organization rules this week.
- President Obama’s approval rating is at an all-time low of 42 percent, with 48 percent disapproving of his job performance, according to a new Quinnipiac University poll.
Last night, nine days after U.S. military operations against Muammar Qadhafi began, President Barack Obama took to the stage at the National Defense University to finally explain his rationale for intervention in Libya’s civil war. He described the brutality of the Qadhafi regime, the United States’ interests in the conflict, the limited nature of U.S. military involvement, and the role the “international community” would undertake in finishing the job in Libya and rebuilding the country. It was a speech more appropriately delivered at the onset of Operation Odyssey Dawn, and unfortunately it’s a speech that leaves a fundamental question unanswered: what’s the way forward?
From the outset of operations in Libya, the best option was always “to minimize the commitment of the U.S. military, look after the best interests of Libya’s civilian population, and limit the spread of terrorism and instability throughout the region.” While the president promised last night to pursue such a course—the real challenge now begins—and there are still far too few details of how the White House will deliver on these promises.
The tasks going forward that must be accomplished are clear: (1) keeping Qadhafi isolated until he is brought to justice; (2) maintaining a military presence to keep Qadhafi’s forces from going back on the offensive; and (3) identifying, supporting and sustaining a legitimate opposition that brings democracy to Libya, fights the spread of terrorism, and looks after the humanitarian needs and the human rights of the peoples under its control. We knew these before the president’s speech—it is still no clearer on how they will be accomplished other than to turn the responsibility over to the “international community.”
Though the president noted that on Wednesday NATO will assume greater responsibilities for operations in Libya, it remains that U.S. forces are still engaged in combat—and administration officials have acknowledged that will likely continue for months. The Administration has had ample time to develop its plans for the employment of U.S. forces and should be briefing leaders in Congress on them now so that a determination can be made if a resolution to employ force is now required or should be in the future.
While President Obama used last night’s speech to explain (or justify) his Libya rationale, he also used it to take a shot at President George W. Bush’s actions in Iraq, likely in an effort to assure his liberal allies that he is not his predecessor. “Regime change [in Iraq] took eight years, thousands of American and Iraqi lives and nearly a trillion dollars. That is not something we can afford to repeat in Libya,” Obama said. This dig on President Bush was gratuitous, unnecessary, and could well be a statement the president comes to regret as much as the “Mission Accomplished” banner draped on the carrier deck after the invasion of Iraq. The president has promised that the “international community” will do all the dirty work from here on out. Before the President takes a bow, he ought to be pretty confident he can deliver on this tall order.
There are some who are likening President Obama’s actions in Libya to President George W. Bush’s foreign policy—the Bush Doctrine. But unlike his predecessor, President Obama has not consulted Congress, has generally failed to communicate his mission, and has demonstrated a willingness to bow to the will of the “international community,” rather than act in the best interests of the United States. The president last night bent over backwards to describe his strong leadership on Libya, but the commander in chief protests too much and has promised a great deal. It will be no small task to build a coalition that can keep Qadhafi isolated until he is brought to justice, prevent his forces from going on the offensive, and bring stability and democracy to Libya while preventing the spread of terrorism. That will take more than a speech and rhetorical reliance on the “international community.” It will take real leadership to deliver on those promises.
Quick Hits:
- An onslaught by pro-Qadhafi forces has pushed-back rebels trying to advance toward the Libyan leader’s hometown of Sirte.
- Hundreds of thousands of supporters of Syrian President Bashar al-Assad took to the streets of Damascus in support of the regime following protests calling for more freedom there.
- As Facebook grows, it is seeking greater influence in Washington, hiring staff from both sides of the aisle. The latest possibility? Former Obama press secretary Robert Gibbs.
- An Ohio House committee is expected to vote today on a bill that would limit collective bargaining rights for public employees and ban them from striking.
- The Supreme Court is hearing arguments today on whether to permit a class-action employment discrimination lawsuit against Walmart involving as many as 1.6 million plaintiffs.
Last night, nine days after U.S. military operations against Muammar Qadhafi began, President Barack Obama took to the stage at the National Defense University to finally explain his rationale for intervention in Libya’s civil war. He described the brutality of the Qadhafi regime, the United States’ interests in the conflict, the limited nature of U.S. military involvement, and the role the “international community” would undertake in finishing the job in Libya and rebuilding the country. It was a speech more appropriately delivered at the onset of Operation Odyssey Dawn, and unfortunately it’s a speech that leaves a fundamental question unanswered: what’s the way forward?
From the outset of operations in Libya, the best option was always “to minimize the commitment of the U.S. military, look after the best interests of Libya’s civilian population, and limit the spread of terrorism and instability throughout the region.” While the president promised last night to pursue such a course—the real challenge now begins—and there are still far too few details of how the White House will deliver on these promises.
The tasks going forward that must be accomplished are clear: (1) keeping Qadhafi isolated until he is brought to justice; (2) maintaining a military presence to keep Qadhafi’s forces from going back on the offensive; and (3) identifying, supporting and sustaining a legitimate opposition that brings democracy to Libya, fights the spread of terrorism, and looks after the humanitarian needs and the human rights of the peoples under its control. We knew these before the president’s speech—it is still no clearer on how they will be accomplished other than to turn the responsibility over to the “international community.”
Though the president noted that on Wednesday NATO will assume greater responsibilities for operations in Libya, it remains that U.S. forces are still engaged in combat—and administration officials have acknowledged that will likely continue for months. The Administration has had ample time to develop its plans for the employment of U.S. forces and should be briefing leaders in Congress on them now so that a determination can be made if a resolution to employ force is now required or should be in the future.
While President Obama used last night’s speech to explain (or justify) his Libya rationale, he also used it to take a shot at President George W. Bush’s actions in Iraq, likely in an effort to assure his liberal allies that he is not his predecessor. “Regime change [in Iraq] took eight years, thousands of American and Iraqi lives and nearly a trillion dollars. That is not something we can afford to repeat in Libya,” Obama said. This dig on President Bush was gratuitous, unnecessary, and could well be a statement the president comes to regret as much as the “Mission Accomplished” banner draped on the carrier deck after the invasion of Iraq. The president has promised that the “international community” will do all the dirty work from here on out. Before the President takes a bow, he ought to be pretty confident he can deliver on this tall order.
There are some who are likening President Obama’s actions in Libya to President George W. Bush’s foreign policy—the Bush Doctrine. But unlike his predecessor, President Obama has not consulted Congress, has generally failed to communicate his mission, and has demonstrated a willingness to bow to the will of the “international community,” rather than act in the best interests of the United States. The president last night bent over backwards to describe his strong leadership on Libya, but the commander in chief protests too much and has promised a great deal. It will be no small task to build a coalition that can keep Qadhafi isolated until he is brought to justice, prevent his forces from going on the offensive, and bring stability and democracy to Libya while preventing the spread of terrorism. That will take more than a speech and rhetorical reliance on the “international community.” It will take real leadership to deliver on those promises.
Quick Hits:
- An onslaught by pro-Qadhafi forces has pushed-back rebels trying to advance toward the Libyan leader’s hometown of Sirte.
- Hundreds of thousands of supporters of Syrian President Bashar al-Assad took to the streets of Damascus in support of the regime following protests calling for more freedom there.
- As Facebook grows, it is seeking greater influence in Washington, hiring staff from both sides of the aisle. The latest possibility? Former Obama press secretary Robert Gibbs.
- An Ohio House committee is expected to vote today on a bill that would limit collective bargaining rights for public employees and ban them from striking.
- The Supreme Court is hearing arguments today on whether to permit a class-action employment discrimination lawsuit against Walmart involving as many as 1.6 million plaintiffs.
As a third temporary spending bill expires next week, the attention of Capitol Hill will once again be focused on producing a permanent spending bill to keep the federal government open and operating. The threat of a government shutdown would not exist had the Democratically controlled 111th Congress passed a budget for this fiscal year. In fact, not only did they fail to pass a budget, but for the for the first time in the history of the budget-making process, last year’s Congress failed to even vote on a budget. And now, even as the consequences of their failure are just days a way, the Democrats have still failed to agree on a plan that cuts spending.
Thirty-eight days ago, on February 19, the House of Representatives passed a budget that would keep the federal government open for the rest of this fiscal year. Responding to the overwhelming mandate from the American people delivered last November to cut federal spending, that House budget cut $ 61 billion in spending from 2010 levels. The Democrats then produced a plan that they said “cut spending,” but even The Washington Post Fact Checker found no real cuts.
And they will not even go on record identifying which cuts in the House’s bill they are willing to accept. The Post explains why: “Such a move would force Democrats to go on record defending programs that Republicans had identified as wasteful.”
It is understandable why the Senate is so afraid to offer its own spending plan. When the President offered his own budget for next year, he claimed that it would produce only a $ 7.2 trillion deficit over the next 10 years. At the time, we predicted that the Congressional Budget Office (CBO) would produce vastly different numbers, since the President’s proposal included audaciously hopeful economic forecasts and fake spending cuts. Sure enough, on March 18 the CBO scored the President’s budget as causing $ 9.5 trillion in deficits over the next 10 years. That is more debt than the federal government accumulated from 1789 to 2010 combined. Heritage analyst Brian Riedl surveys the damage:
These large deficits will persist because the President’s steep tax hikes cannot keep up with his runaway spending. Relative to the historical averages (which were also pre-recession levels), President Obama would raise taxes by 1.3 percent of GDP yet increase spending by 4 percent of GDP. The main drivers of runaway spending—surging Social Security, Medicare, and Medicaid costs—would not be reformed at all. Accordingly, the annual cost of interest on the national debt would quadruple.
…
Under President Obama’s budget proposal, taxpayers would see large tax increases, bigger government, and slower economic growth. The President who declared that “I didn’t come here to pass our problems on to the next President or the next generation—I’m here to solve them” would, over the next decade, drop an additional $ 80,000 per household in debt onto the laps of our children and grandchildren.
The White House spent all of 2010 deflecting criticism about its deficit spending by pointing to the President’s debt commission. Then when the commission finally produced a report that included actual spending cuts, the White House couldn’t run from it fast enough. Congressional Democrats have no plan to cut government this year, next year, or any year. Conservatives should hold firm to their $ 61 billion in cuts and force Democrats to produce their own spending cut plan.
Quick Hits:
- Secretary of Defense Robert Gates said that Libya did not pose a threat to the United States before the U.S. began its military campaign and was not a vital national interest.
- President Obama’s war in Libya could continue for months, Obama Administration officials admitted yesterday.
- Libyan rebel commander Abdel-Hakim al-Hasidi has admitted that his fighters have al-Qaeda links and fought against allied troops in Iraq.
- Last week, Obama Administration officials locked a designated pool reporter in a closet, preventing him from covering a $ 500-a-head fundraiser featuring Vice President Joe Biden and Senator Bill Nelson (D–FL).
- Billions in secret earmarks remain tucked into the funding measure that would keep the federal government running for the remainder of the fiscal year.
President Obama’s hometown of Chicago is nearly 1,000 miles from the Gulf of Mexico. But like many other communities across the country, it is suffering the consequences of his administration’s anti-drilling agenda.
Illinois accounted for $ 376.2 million in shallow-water drilling expenditures over the past three years, according to an analysis by 14 oil and gas companies that spend money on vendors and subcontractors. The bulk of that money — $ 242.2 million — was spent in the Chicago district represented by Rep. Danny Davis (D-IL).
It’s fresh evidence that Obama’s anti-drilling agenda is having a ripple effect across America since last year’s oil spill, claiming jobs not just in Louisiana and Texas but also in communities far removed from the shipyards in the Gulf of Mexico.
The study from the Shallow Water Energy Security Coalition paints a picture of the nationwide economic ramifications. Obama can’t even be blamed for playing politics. Five of the states that benefit most from shallow-water drilling backed him as a candidate in 2008. And Democrats represent many of the congressional districts that stand to lose millions.
The cost in jobs is startling. A new analysis by Louisiana State University professor Joseph Mason projects national job losses at 19,000 from the drilling moratorium, with wage losses at $ 1.1 billion. About one-third of those jobs are located outside the Gulf region.
Nearly a year after imposing his anti-drilling agenda, it’s quite clear that Obama is carrying out misguided policies causing widespread harm.
And job losses aren’t the only consequence. The Obama administration’s deliberate delay in issuing permits for both deepwater and shallow-water drilling has led to a sharp decline in oil production for the Gulf of Mexico this year. The U.S. Energy Information Administration puts the figure at 240,000 fewer barrels every day.
With gas prices hovering around $ 3.56 nationwide, now is not the time to lower production. The only way to reduce America’s dependence on foreign oil is to produce more of it here at home.
The recent approval of new drilling permits for the Gulf of Mexico is a welcome and long overdue move by the administration, but it’s nothing to celebrate. The pace of permitting is far below the historical average and there’s no indication the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) has any desire to return production to a pre-spill level.
Until that happens, expect more grim news like the unfortunate circumstances facing Seahawk Drilling, which was forced to declare Chapter 11 bankruptcy, a direct result of the bureaucratic delays at BOEMRE. Seahawk’s president and chief executive Randy Stilley, writing in The Washington Post, painted a dire picture:
The government’s drastic slowdown in the issuance of permits for shallow-water drilling operations — in which companies work in familiar geological formations, typically in less than 500 feet of water, mostly seeking to produce natural gas — has all but crippled the industry. The survivors (for now) like Hercules are staying afloat largely thanks to revenue from operations outside U.S. waters. Put another way, a once-proud industry born in the gulf during the Truman administration can no longer survive on operations in its own back yard.
Unless things change soon, Seahawk Drilling won’t be alone. Businesses located in Illinois, Pennsylvania, Wisconsin, California and New York — top recipients of shallow-water drilling spending — will all face economic consequences as well.
It’s time for lawmakers to take notice. Rep. John Sullivan (R-OK), who represents a district with $ 87.2 million in shallow-water expenditures over the past three years, recognizes the impact. He told us: “Continuing to keep American sources of energy under lock and key by failing to issue drilling permits only serves to place American jobs at risk, drives up costs at the pump and deepens our dependence on foreign oil.”
Things don’t have to be this way. The House of Representatives must continue to conduct rigorous oversight of the Obama administration, challenging the administration’s excuses and applying pressure when necessary. America’s energy future depends on it.
Quick Hits:
- President Obama’s inchoate coalition attacking Muammar Qadhafi is split on both the goal and exit strategy of the mission in Libya.
- President Obama is refusing to deliver an Oval Office speech to the American people on Libya because he doesn’t want to equate his war with the wars in Iraq and Afghanistan.
- According to a Reuters poll, only 17 percent of Americans see President Barack Obama as a strong and decisive military leader.
- General Electric, whose CEO Jeffrey Immelt is also the head of President Obama’s Council on Jobs and Competitiveness, not only paid no taxes on their $ 14.2 billion in profit last year, they even claimed a $ 3.2 billion benefit.
- According to Gallup, nionized state government workers are twice as likely to be Democrats than Republicans.
What happens when a city buys the liberal dream hook, line and sinker? Just take a look at the City of Detroit. The once-great city lost 237,493 residents over the last decade according to the 2010 Census, bringing it to 713,777 – a population plunge of 25%. That’s its lowest population since 1910, and it marks the city’s fall from a 1950s peak of two million, over 60%. And that’s just the people who can afford to leave.
Detroit, once known as “the great arsenal of democracy,” has made headlines of late for its notorious fall from grace. The “Big Three” automakers are no longer the biggest, falling behind their overseas rivals, and the Michigan economy lost 450,000 manufacturing jobs over the past 10 years all while Detroit lost population. And while the Motor City suffers unemployment from a decimated automotive industry, it suffers crime, high taxes, poor city services, plummeting home values, and a public education system in shambles with a $ 327 million budget deficit and a 19 percent dropout rate. Is it any wonder people are leaving in droves?
But to understand why folks are really leaving Detroit, its worth looking where they’re headed. As Detroit suffered a population loss, its neighboring suburban counties with lower crime, better schools and an improving economic outlook saw their population increase. One former Detroiter told The Detroit News, “Detroit just got too messy for me … I was not getting the benefits of those tax dollars. The city services are poor and I could not use the school system. And you look at the cost of living and the corruption, we had to leave.” In other words, bad government drove her out, and she’s seeking greener pastures elsewhere.
For the record, Detroit has been under liberal leadership for decades. And the city’s big problem today is that its road forward is blocked by the very same political machine that helped deliver it to its state of ruin. Case in point: the state’s powerful teachers unions. In 2003, a philanthropist pledged $ 200 million for the creation of 15 charter schools in the city. Despite the city’s tragic public school system, the plan failed and the offer was withdrawn following protests by the Detroit Federation of Teachers. Little has changed, eight years later. A state-appointed emergency financial manager has proposed sweeping changes to the city’s public school system, including a plan to convert 41 of the city’s schools to charter schools. Guess who’s opposed to the reforms? That very same union.
The newly elected governor of Michigan, Rick Snyder (R), is finding opposition to his efforts at reform, as well. Following eight years of Democrat Gov. Jennifer Granholm’s rule, Gov. Snyder has embarked on efforts to change the way the state does business, including tax reform, spending cuts and empowering emergency financial managers to tackle problems in cities and schools. Who’s opposed to his reforms? Unions, once again, in Wisconsin-style protests. William McGurn of The Wall Street Journal writes:
Michigan today is not a struggling state like California or New Jersey or even Wisconsin. It is a basket case, with worse to come if things do not change quickly—especially in the relation of the public to the private sector.
“Many of the protesters seem to think the war is between rich and poor,” says Michael LaFaive, director of the Morey Fiscal Policy Initiative at the Michigan-based Mackinac Center. “But the real class war today is between government and the people who pay for it. And the government’s been winning.”
And the problems that plague Michigan and Detroit are the problems with liberal policies. The promise doesn’t live up to the results. The Washington Examiner’s Michael Barone writes: “When people ask me why I moved from being a liberal to being a conservative, my single-word answer is Detroit. The liberal policies which I hoped would make Detroit something like heaven have made it instead something more like hell.”
And now, after living in that liberal nightmare, Detroiters have voted with their feet in record number.
Quick Hits:
- Deep divisions among President Obama’s Libya coalition worsened today as the German military announced it is pulling forces out of NATO over continued disagreement on who will lead the campaign.
- Adm. Gary Roughead, the Chief of Naval Operations, admitted yesterday that he has received no guidance on the path ahead for command and control of the Libya no-fly zone, no-drive zone, no-sail zone, arms embargo enforcement, and any other missions currently being managed by the United States.
- U.S. Defense Secretary Robert Gates said on Wednesday there was no “timeline” for when UN-backed military operations in Libya would end, and that the outcome of the conflict remained unclear.
- On the first anniversary of Obamacare, Crossroads GPS filed a lawsuit seeking transparency on the Obamacare waiver process.
- Rep. Anthony Weiner (D-NY) predicted yesterday that the Supreme Court will find Obamacare unconstitutional, allowing him to push for single-payer health care.
“I think that health care, over time, is going to become more popular,” then-White House senior advisor David Axelrod promised David Gregory about Obamacare last September. That same month, the Health Information Campaign, founded by high-profile leftist activists including former Senate Majority Leader Tom Daschle and former White House Communications Director Anita Dunn, spent $ 2 million on a national television ad campaign touting Obamcare’s first insurance mandates. Now, six months after Axelrod’s promise, and a full year after the bill was signed into law, the results are in: Obamacare is more unpopular than ever.
Look at any poll and you’ll see that Obamacare has only gotten less legitimate. Last year at this time Newsweek showed 40 percent of Americans supporting Obamacare and 49 percent opposing it. Today, only 37 percent support it while 56 percent oppose. According to Quinnipiac, after Obamacare passed last year, 44 percent of Americans approved of President Obama’s handling of health care while 50 percent opposed. Today, only 44 percent approve while opposition has grown to 56 percent. And according to the Kaiser Family Foundation, after Obamacare passed, 62 percent of Americans thought the law would either have no effect on them or make them worse off. Today that number is up to 69 percent.
The reason why President Obama and his liberal allies have failed to turn public opinion around is simple: The major claims made by the President in the effort to pass Obamacare have all been exposed as frauds, and the early implementation by his Administration has been a complete disaster.
Center for Policy Innovation Senior Fellow and Why Obamacare is Wrong for America co-author Bob Moffit details just some of the Obamacare claims that have been exposed as fictions:
- “Obamacare will bend the cost curve downward.” Not according to the Centers for Medicare and Medicaid Services (CMS), whose April 22, 2010, report shows Obamacare adding more than $ 310 billion more in health care spending;
- “People who like their health plan can keep it.” Not according to CMS, which estimates that 14 million Americans will lose their current coverage if Obamacare is not repealed;
- “The middle class will not see tax increases.” Yes, they will. In fact, most of Obamacare’s tax increases hit the middle class.
On the implementation front, Heritage analyst Brian Blase surveys the early returns:
- Benefit Mandates Drove Up Costs. The generous benefit packages mandated by Obamacare are not free. Insurers across the country raising rates at record paces and unequivocally is part of the reason why. For example, Celtic Insurance Company in Wisconsin and North Carolina has attributed half of its 18 percent rate increase to Obamacare mandates.
- Preexisting Condition Mandates Destroyed the Child-Only Market. Just one year after Obamacare forced all insurers to sell coverage to all applicants—no matter what—insurers in 34 states have exited the market entirely, and 20 states now have no insurers that offer child-only plans.
- Shallow High-Risk Pools. The Obama Administration predicted that 375,000 previously uninsured Americans would benefit from Obamacare’s high-risk insurance pools. In reality, only 12,500 people (just 3 percent of the initial estimate) obtained coverage through this program.
And the worst of Obamacare hasn’t even been implemented yet. Starbucks CEO Howard Schultz told the Seattle Times yesterday: “I think as the bill is currently written and if it was going to land in 2014 under the current guidelines, the pressure on small businesses, because of the mandate, is too great.” Putting some hard numbers on that prediction, International House of Pancakes franchise owner Scott Womack told Heritage’s Tina Korbe: “Our average revenue per employee is $ 58,000. Our typical profit per employee is $ 3,000 and this legislation is going to cost anywhere from $ 7,000 to $ 10,000 per employee.” America’s businesses simply cannot afford Obamacare. It is, and is going to continue to be, a huge job killer.
And our nation’s taxpayer’s can’t afford Obamacare either. Last year, our nation’s oldest entitlement program, Social Security, paid out $ 37 billion more in benefits than it collected in taxes. This year, it will pay out $ 45 billion more than it collected. Over the next 10 years, Social Security will run a $ 600 billion operating deficit. Instead of making our existing entitlement programs solvent, President Obama created a brand new trillion-dollar entitlement in Obamacare. This trillion dollars in new spending is paid for by half-a-trillion in higher taxes and another half-a-trillion in stolen funds from the existing Medicare program. And the CBO just upped Obamacare’s final price tag by 8.6 percent to $ 1.44 trillion. This is simply unsustainable.
Two hundred and thirty-six years ago, while making the case for Virginia to enter the Revolutionary War, Patrick Henry said: “Give me liberty or give me death!” After just one year, it is already clear that President Obama’s failed health care policies are a betrayal of the founding sentiment.
Quick Hits:
- After four days of bombing, the Obama Administration has failed to either stop Muammar Qadhafi from killing civilians or shift the balance of power in favor of the rebels.
- President Obama is now telling NBC News that Qadhafi can stay in power if he changes “his approach” and starts “significant reforms” of his government.
- President Obama has killed at least 19,000 jobs worth $ 1.1 billion in lost wages with his Gulf oil drilling moratorium.
- Detroit’s population plunged 25 percent in the past decade to 713,777, the lowest count since 1910.
- Border Patrol agents recently arrested 13 illegal immigrants who were disguised as U.S. Marines and riding in a fake military van.
On March 2, President Barack Obama anointed Vice President Joe Biden as his lead negotiator on coming to an agreement with congressional conservatives on this year’s federal budget. Biden then spent half a day on Capitol Hill talking with Republicans before jetting off to Europe. The next week, Senator Joe Manchin (D–WV) attacked the President on the Senate floor: “Why are we doing all this when the most powerful person in these negotiations—our president—has failed to lead this debate or offer a serious proposal for spending and cuts that he would be willing to fight for?” What Manchin doesn’t seem to realize is that failure is Obama’s plan.
After an unprecedented two-year spending spree, President Obama is not looking to change Washington’s bad habits anytime soon. However conservatives got the message in last November’s elections. The American people want them to take substantive steps towards scaling back an out-of-control government. House Republicans passed a seven-month continuing resolution to keep the government operating that cut $ 61 billion in spending and blocked funding for a host of terrible policies, including Obamacare. This was a good first step. A modest step Senate Majority Leader Harry Reid (D-NV) and President Obama are unwilling to take. In response, Reid and Obama have offered only the status quo.
The White House strategy is clear as day: It knows the American people do not currently trust President Obama on federal spending. Not only do 62 percent of Americans currently disapprove of President Obama’s handling of the federal budget deficit, but for the first time in recent memory, more Americans say they prefer the approach of Republicans in Congress (47 percent) on “cutting programs to reduce the budget deficit and still maintaining needed federal programs” than President Obama’s (43 percent) approach. The White House knows it has to improve these numbers before President Obama can negotiate short- and long-term spending deals that protect his big-government spending priorities. So how is the White House planning to change these numbers? Two words: government shutdown.
The plan goes like this: President Obama does nothing now and allows the existing continuing resolution to expire. The White House and its media allies then portray the resulting government shutdown as the end of Western civilization as we know it (remember the TARP debate!). Americans’ faith in the Republican approach on “cutting programs to reduce the budget deficit and still maintaining needed federal programs” tanks. President Obama then emerges as the centrist peacemaker balancing the spendthrift congressional Democrats with the mean-spirited congressional Republican spending-cutters. President Obama’s base then pretends they’re offended at some very minor cuts, centrist Republicans cut a deal, and the President’s popularity soars like it did after the December tax legislation. Conservatives then go into the deficit ceiling and 2012 budget debates as untrusted losers. That is the White House plan.
Conservatives can’t allow this to happen. They should fill the void that President Obama’s failure to lead has created. After all, this debate is occurring because the previous Congress failed to even try and pass a budget, one of their basic responsibilities. They must make sure their constituents understand that President Obama and Senator Reid are not acting in good faith. The time for more continuing resolutions is over. This is about much more than cutting $ 61 billion from this year’s budget. If we cannot trim a meager 2 percent now, what hope do we have of tackling entitlements? We must make the tough decisions now because we know President Obama won’t.
Quick Hits:
- The Obama coalition is showing signs of strain as the U.S., Europe, and Arab nations fight over who will take charge of operations in Libya after the U.S. gives up control.
- While congressional Republicans have managed to cut spending by more than $ 285 million per day since the beginning of March, President Obama’s war in Libya is spending well over $ 100 million a day on missiles alone.
- Fact: President Bush had two times more coalition partners in Iraq than Obama has in Libya.
- More Americans see Obamacare making things “worse” (44 percent) than see it making things “better” (39 percent).
- A San Francisco superior court judge has put California’s global warming plan on hold, saying the state did not adequately evaluate alternatives to its cap-and-trade/energy tax program.
Yesterday, American B-2 stealth bombers, F-16s, F-15s, and Harrier attack jets bombed both Libyan air and ground defenses including Colonel Muammar Qadhafi’s massive residential compound in Tripoli. “We judge these strikes to have been very effective in significantly degrading the regime’s air defense capability,” Vice Adm. Bill Gortney, director of the Pentagon’s Joint Chiefs of Staff, said Sunday.
But the fact that these operations could be successfully undertaken by coalition forces was never in doubt. The problem is that these operations by themselves will not be decisive in either eliminating the regime or fully protecting civilians. Defense Secretary Robert Gates said Sunday that the U.S. expects to turn control of the Libya military mission over to a coalition (headed by the French? the British? or by NATO?) “in a matter of days.” What happens if Qadhafi is still in power by that time? The United Nations mandate authorizing these strikes is extremely broad, permitting anything but “occupying” Libya. The coalition has yet to state specific goals for the operation. What does protecting civilians mean?
Qadhafi’s next move will be to try and exploit the ambiguity the Obama Administration’s leadership failure has created. Within hours of the attack there were already signs that support from the Arab League was weakening. “What is happening in Libya differs from the aim of imposing a no-fly zone, and what we want is the protection of civilians and not the bombardment of more civilians,” said Arab League Secretary General Amr Moussa. These fissures will only grow if Qadhafi retains power and operations become protracted.
A simple and quick decisive outcome in Libya is unlikely. If the U.S. wants to safeguard its interests in the region, it is going to need a long-term strategy. The U.S. must: 1) Identify, aid, and muster support for a legitimate opposition that is free of terrorist elements; 2) Support responsible efforts to isolate the regime in Tripoli; 3) Support humanitarian operations to safeguard the lives of innocents; and 4) Prevent the regime from reacquiring weapons of mass destruction technologies, supporting international terrorism, or establishing terrorist sanctuaries in the country.
Conditions could always change (e.g. Qadhafi could sponsor another terrorist attack on the U.S.), but the U.S. contribution must be limited to avoid mission creep. Otherwise, a once limited U.S. involvement could grow into something more costly like Somalia and Lebanon. Unlike Iraq and Afghanistan there simply are no vital American interests that would justify wider intervention.
Libya is just one country in a region going through world-historical transformation. The U.S. needs proactive long-term strategies that look ahead of events rather than trail them. Unfortunately we are getting the exact opposite from our Commander in Chief. President Obama is putting the U.S. military to work at the behest of the world rather than leading the world. Brit Hume accurately described this yesterday: “This is not leadership, this is followership.” In two major areas now the President has voted “present” in the last two weeks: on the budget, where he is AWOL, and on Libya, where he has purposely chosen to follow even as our troops do the heavy lifting.
Quick Hits:
- Voters in Egypt’s first referendum after Hosni Mubarak, backed constitutional changes that may favor the Muslim Brotherhood in future elections.
- Sales of U.S. previously-owned homes dropped in February to a three-month low.
- According to a new poll sponsored by Obamacare proponents, California small businesses are still confused about how the 2,700 page law effects them.
- Democrats are in disarray over whether or not reforming Social Security is necessary for deficit reduction.
- While Americans believe President Obama is better at protecting the environment than allowing for economic growth, Americans increasingly prioritize the economy over environmental issues.
Yesterday the United Nations Security Council voted 10–0, with five abstentions, to authorize military action in Libya. Specifically, the resolution “authorizes member states … to take all necessary measures … to protect civilians and civilian populated areas under threat of attack.” Celebrations erupted across Benghazi after news of the vote reached rebels. A 17-year-old rebel told The Wall Street Journal: “I give Qadhafi a maximum of two days.” If only.
In reality the U.N. resolution is nothing more than a “feel-good” palliative measure that is not likely to decisively affect the fighting on the ground in Libya. As Secretary of Defense Robert Gates testified last week: “Let’s just call a spade a spade. A no-fly zone begins with an attack on Libya to destroy the air defenses. That’s the way you do a no-fly zone. And then you can fly planes around the country and not worry about our guys being shot down. But that’s the way it starts.” But is that what the Obama Administration is planning? Even if the Administration has a plan on Libya, it certainly has not communicated it to the American people. Here are just some of the fundamental questions the Administration has failed to answer as our military stands on the brink of a new and costly commitment:
- So far, the only firm commitments are a naval blockade, AWACS for air traffic control, and signal-jamming aircraft. U.S. officials said that it would probably take several days for a full operation to be undertaken and that President Obama had not yet approved the use of U.S. military assets. Will he? Will the U.S. be using military force against Libya?
- If establishing a no-fly zone in Libya is so vital to U.S. national security, why did the Administration waste a week getting approval from the U.N.?
- Imposing a no-fly zone entails substantial costs for U.S. armed forces and risks diverting scarce U.S. military and intelligence assets. Will the vital missions in Afghanistan, Iraq, Yemen, and the Horn of Africa suffer?
- Are the rebels free of terrorist elements, and what precautions will we require them to take to ensure that weapons we supply are not sold or diverted to other groups?
- Will we rule out supplying arms (“Stinger” anti-aircraft missiles, for example) that could pose a potent threat to U.S. forces if they end up in the hands of terrorists?
Until these questions are answered, it is impossible to endorse proposals for the use of force based solely on a U.N. resolution. Circumstances could change. The use of military force in Libya could be justified. But what is of great concern here is the fog of confusion the Obama Administration is emitting on Libya. After the U.N. resolution passed, France said that military strikes could come “within hours.” They haven’t. What did come was the heavy bombardment of the rebel held town of Mistrata by loyalist forces. President Obama should be working hard to identify a legitimate opposition to Qaddafi that is not Islamist and can be given U.S. and European support with conditions that protect against the transfer of weapons to terrorists.
Quick Hits:
- The Food and Drug Administration warned Thursday that people in the U.S. shouldn’t be taking “anti-radiation” potassium iodide pills flooding the Internet because no radiation from Japan has been detected in the U.S.
- Michigan Governor Rick Snyder (R) signed into law a measure giving a state-appointed manager the power to set aside government union contracts.
- The House approved legislation yesterday that would block federal funding from reaching NPR.
- According to Gallup, union workers are less happy at work than their non-union counterparts and are also more likely to consider their supervisors to be bosses rather than partners and less likely to say that their supervisors create a trusting and open work environment.
- Senator Rand Paul (R–KY) introduced legislation yesterday that would balance the budget in five years and eliminate the Departments of Education, Energy, Commerce, and Housing and Urban Development.
Which American politician said the following? “The lessons of history, confirmed by the evidence immediately before me, show conclusively that continued dependence upon relief induces a spiritual and moral disintegration fundamentally destructive to the national fibre. To dole out relief in this way is to administer a narcotic, a subtle destroyer of the human spirit.” Had to be a mean-spirited Tea Party conservative, right? Wrong. President Franklin Roosevelt included these words in his 1935 State of the Union Address.
Twenty-nine years later, the American welfare state was still relatively small, consuming only 1.2 percent of U.S. gross domestic product (GDP). The American family was also still intact, with 93 percent of children born into stable families. But then President Lyndon B. Johnson’s War on Poverty happened. Forty-five years and $ 16 trillion later, thanks to big government, poverty is winning. Thanks to over $ 900 billion a year (over 5 percent of GDP) of spending on over 70 means-tested welfare programs spread over 13 government agencies, more than 40 million Americans currently receive food stamps, poverty is higher today than it was in the 1970s, and 40 percent of all children are born outside of marriage.
Since he moved into the White House, President Barack Obama has only doubled down on the War on Poverty’s failure. His fiscal year (FY) 2011 budget would have increased spending on programs for the poor 42 percent above FY 2008 levels. Looking past the current recession, President Obama’s budget would spend over $ 10.3 trillion on means-tested welfare programs over the next 10 years.
But didn’t we already “end welfare as we know it” in the ’90s? No. As successful as the 1996 welfare reform law was (and it did decrease welfare roles and child poverty rates), it reformed only one of the more than 70 federal anti-poverty programs. Worse, President Obama’s failed economic stimulus bill completely gutted the 1996 welfare reforms. If conservatives are serious about reducing federal spending in a way that protects families and encourages self-reliance, it is high time they turned their attention back to welfare reform. A common-sense approach to reform would include:
- Account for welfare spending. Congress should require the President’s annual budget to detail current and future aggregate federal means-tested welfare spending. The budget should also provide estimates of state contributions to federal welfare programs.
- Get costs under control. The next step in welfare reform is to control the explosive growth in spending. Once the current recession ends (when unemployment reaches 6.5 percent), aggregate welfare funding should be capped at pre-recession (FY 2007) levels plus inflation. This could save Congress $ 1.4 trillion over the next 10 years.
- Promote work, not government dependence. Building on the successful 1996 model, welfare reform today must continue to promote personal responsibility by encouraging work. For example, food stamps, one of the largest means-tested programs, should be restructured to require recipients to work or prepare for work to be eligible to receive benefits.
Today the chairman of the Republican Study Committee Representative Jim Jordan (R–OH) will introduce a bill that incorporates many of these principles. Among other items, it would require disclosure of total means-tested welfare spending, place an aggregate cap on welfare spending, and extend work requirements to the Food Stamps program. If we want to avoid becoming a European-style welfare state, we must abandon President Obama’s War on Poverty surge and return to the type of common-sense welfare reform that proved so successful in the ’90s.
Quick Hits:
- Almost 30 months after TARP’s birth, more than 550 banks, AIG, GM, Chrysler, and others still owe taxpayers more than $ 160 billion.
- U.S. banking regulators have paid out nearly $ 9 billion to cover losses on loans and other assets at 165 failed institutions that were sold to stronger companies during the financial crisis.
- The House on Wednesday passed legislation that would terminate $ 1 billion in slush funds for local government real estate speculating.
- Union thugs are ripping up recall petitions and threatening arson in Wisconsin.
- The headquarters for the Washington, D.C. Republican National Committee was shot up early Wednesday morning.
President Barack Obama invited ESPN into the White House yesterday so that The Worldwide Leader In Sports could tape his picks for the 2011 NCAA basketball tournament. The President picked all frontrunners. Good for him. Meanwhile, 5,000 miles away, a Libyan rebel defending the town of Ajdabiya from Muammar Qadhafi loyalists told The Washington Post: “These politicians are liars. They just talk and talk, but they do nothing.” One hundred miles north, in the rebel stronghold of Benghazi, rebel spokeswoman Iman Bugaighis told The New York Times that Western nations had “lost any credibility.”
President Obama cannot be blamed for the failure of the rebels to hold off advances by Qadhafi’s army. But he can be blamed for raising expectations for U.S. military action beyond what he was prepared to commit. On March 3, President Obama said: “With respect to our willingness to engage militarily, … I’ve instructed the Department of Defense … to examine a full range of options. I don’t want us hamstrung. … Going forward, we will continue to send a clear message: The violence must stop. Muammar Gaddafi has lost legitimacy to lead, and he must leave.” Heritage Vice President for Foreign and Defense Policy Studies Kim Holmes writes: “This is the worst of all worlds. People in the Middle East (not to mention Americans) are rightly confused by the mismatch between the Administration’s rhetoric and actions.”
The tragedy unfolding in Libya is just another example of why the Obama Doctrine was destined to fail. The Obama Doctrine is ill-suited to dealing with the world as it is. It assumes that big problems can be solved with big words while the messy details take care of themselves. It places far too much confidence in international entities, disregards for the importance of American independence, and fails to emphasize American exceptionalism.
Diplomacy is fundamental to the conduct of American foreign policy. That is why the Founders removed the conduct of diplomacy from the states of the Union and placed its practice under the President of the United States. But the Obama Doctrine misunderstands how diplomacy ought to be practiced. Heritage Senior Research Fellow Ted Bromund explains:
“The purpose of American diplomacy never changes: It is to secure the national interests of the United States. … Irresponsible diplomacy comes in many forms. Diplomacy without strength does not even merit the name of diplomacy. Treaties that fail to respect President Ronald Reagan’s dictum of ‘trust, but verify’ are reckless. Treaties that are negotiated merely to encourage foreigners to think better of the United States are unwise.”
Far too often, President Obama has hoped that fancy words, grand apologies, and supplicant treaties would strengthen our security by making the world think better of us. They do not. This does not mean that the Obama Administration should do something rash, like implement a no-fly zone in Libya, just so it looks like it is doing something. It does mean that to save his presidency and protect the interests of the nation, business as usual in the White House has got to stop.
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Quick Hits:
- A deeply divided House of Representatives agreed Tuesday to provide enough money to keep the government open for three more weeks.
- Illinois still can’t figure out how to make its 45 percent underfunded pension plan solvent.
- According to Gallup, Americans, by a 50–41 percent margin, say the nation should prioritize the development of energy supplies over protecting the environment.
- The TARP Congressional Oversight Panel concluded today that the program virtually guarantees future taxpayer-funded bailouts.
- Is America ready for an earthquake-tsunami disaster? Review Heritage’s Disaster Preparedness research here.
Did you know that it is Education Month in the Obama White House? Neither did we. But apparently it is, and accordingly the President crossed the Potomac yesterday to visit an elementary school in Arlington, Virginia, where he pushed for reauthorization of the unpopular No Child Left Behind (NCLB) program. It was a classic President Obama performance. First he denounced the “stale debates” over whether education needed “more money” or “more reform.” Then—surprise—he said what the country really needed was both: “We need more resources for the schools, but we’ve got to reorganize how our schools are doing business in order to assure success for our young people. … Let’s seize this education moment. Let’s fix No Child Left Behind.” No, let’s not.
NCLB is actually the eighth reauthorization of the Elementary and Secondary Education Act of 1965 (ESEA). Passed as part of President Lyndon B. Johnson’s War on Poverty, this first federal intervention into what was originally a state responsibility included just five titles in 32 pages. The effect of the ESEA was felt quickly across the country—but not by the nation’s school children: after passage of ESEA, state education bureaucracies doubled in just five years. Now NCLB spans more the 50 programs, 10 titles, and 600 pages. The bureaucrats are winning.
According to the Government Accountability Office (GAO), in 2010 there were 151 K-12 and early childhood education programs in 20 federal agencies totaling $ 55.6 billion annually. NCLB alone cost states an additional 7 million hours in paperwork at a cost of $ 141 million. A 1999 GAO study of 10 federal education programs found that by the time a taxpayer dollar reached a local school district, up to 17 percent of the funding had been drained by administration.
And President Obama has only made the problem worse. Forty-one states wasted millions of taxpayer dollars and administrative man hours trying to persuade Obama Education Department bureaucrats to give their states Race to the Top stimulus money. Louisiana’s application alone was 260 pages with a 417-page appendix. And in the end, the Obama Administration just wound up giving the cash to their government union political allies. What a colossal waste of time and money.
And what have federal taxpayers gotten for all this federal education spending? Nothing. Federal education spending has more than tripled since 1970, yet academic achievement has remained flat. Heritage Foundation Director of Domestic Policy Studies Jennifer Marshall will testify before the House Education Committee today:
A half-century of always-expanding and ever-shifting federal intervention into local schools has failed to improve achievement. But it has caused an enormous compliance burden. The damage isn’t just wasted dollars and human capital that could have more effectively achieved educational excellence. It has also undermined direct accountability to parents and taxpayers while encouraging bureaucratic expansion and empowering special interests.
Since 1965 our nation has chosen to direct more of its education dollars through Washington, D.C. This has empowered bureaucrats, weakened parents, and been a disaster for our students. We need to change course. States should have the freedom to opt out of federal education programs and should be allowed to consolidate federal funding to direct resources to any lawful education purpose they see fit. Bottom-up education reform will only really occur when local governments are free from federal paperwork and don’t have to beg federal bureaucrats for education dollars.
Quick Hits:
- After a third reactor building explosion was confirmed, Japanese Prime Minister Naoto Kan delivered a nationally broadcast message today, acknowledging a much higher risk of releasing radiation into the atmosphere.
- Despite Japan’s crisis, India and China and some other energy-ravenous countries say they plan to keep building new nuclear power plants.
- According to Gallup, support for offshore drilling and oil exploration in Alaska are at all time highs.
- Senate Republicans say they will block the confirmation of a new Commerce Department secretary until the administration submits three free-trade agreements to Congress.
- A former chief executive of the California public employee pension fund has been accused of pressuring subordinates to invest billions of dollars of pension money with politically connected firms.
