After reflection on Barack Obama’s State of the Union address, I am left with one overarching conclusion: while boring, preachy, dull, overly serious, then flipping to overly jocular tones while trying to balance pandering to the middle class with holding his base — Barack Obama’s State of the Union address was a declaration of war on the free market.Barack Obama said, “Now, the true engine of job creation in this country will always be America’s businesses.”But prior to that, he said, “Because of the steps we took, there are about two million Americans working right now who would otherwise be unemployed. 200,000 work in construction and clean energy. 300,000 are teachers and other education workers. Tens of thousands are cops, firefighters, correctional officers, and first responders. And we are on track to add another one and a half million jobs to this total by the end of the year.”Review the list. Every job listed is either a government job or a job so connected to government that it would not exist but for government. The clean energy industry? It would not exist, but for government subsidy. Construction? He is talking about roads and other infrastructure — jobs that will go away once the project is done and the whole way through is dependent on the government.All of these are government jobs.The President also said, “Talk to the small business in Phoenix that will triple its workforce because of the Recovery Act. Talk to the window manufacturer in Philadelphia who said he used to be skeptical about the Recovery Act, until he had to add two more work shifts just because of the business it created.”But, what businesses are these? And who bought the windows? I bet it was related to the government in both cases.That was just the beginning of his speech, wherein he also referred to the bank tax as a “fee,” which it is nothing of the sort. But his speech got much worse and when the independent voters consider the other points herein, Barack Obama will see his poll numbers fall even further.The adults are clearly not in charge.After these initial statements, the President said, “I’m proposing that we take $30 billion of the money Wall Street banks have repaid and use it to help community banks give small businesses the credit they need to stay afloat. I am also proposing a new small business tax credit – one that will go to over one million small businesses who hire new workers or raise wages.”First, if the money flowing back to the government is flowing right back out, there is no net savings. Second, why community banks? They generally have less capital to lend to small businesses, thereby limiting growth. Third, why a tax credit, i.e. money back off taxes? Why not actually cut the tax rate on small businesses? Why not end the corporate income tax, which is now higher than most every single one of our international competitors. After all, the President did say, “If America sits on the sidelines while other nations sign trade deals, we will lose the chance to create jobs on our shores.” Many countries are competing with the United States through sharply reduced corporate income taxes.The President also said, “we can put Americans to work today building the infrastructure of tomorrow. From the first railroads to the interstate highway system, our nation has always been built to compete. There’s no reason Europe or China should have the fastest trains, or the new factories that manufacture clean energy products” and “You see, Washington has been telling us to wait for decades, even as the problems have grown worse. Meanwhile, China’s not waiting to revamp its economy. Germany’s not waiting. India’s not waiting.”This again assumes a dependence on government jobs and infrastructure. The comparison to China is, in fact, frightening. China is a command and control economy. What the communist leaders want, the communist leaders get. China was able to build its high speed train in record time by ignoring every law on the books pertaining to worker safety, environmental hazards, etc.Additionally, the comparison to Europe is inapt. We are a vastly larger nation that the bulk of the European continent. Air travel makes more sense in this country because of the vastness of traveling distances. Oh, and Germany and India are both cutting government.But perhaps the biggest non sequitur of the entire speech was this passage:
To make college more affordable, this bill will finally end the unwarranted taxpayer-subsidies that go to banks for student loans. Instead, let’s take that money and give families a $10,000 tax credit for four years of college and increase Pell Grants. And let’s tell another one million students that when they graduate, they will be required to pay only ten percent of their income on student loans, and all of their debt will be forgiven after twenty years – and forgiven after ten years if they choose a career in public service. Because in the United States of America, no one should go broke because they chose to go to college. And it’s time for colleges and universities to get serious about cutting their own costs – because they too have a responsibility to help solve this problem.
Barack Obama wants to create a new entitlement that will drive the costs of collegiate education through the roof. If a student knows that only ten percent of their income will be used to pay their student loans and no matter what those students loans are they will be forgiven after 20 years, neither the student nor the college has any incentive to save money. It is basic free market economics.That the President of the United States would say such a thing and think it a good, responsible idea suggests the man is truly ignorant of or an enemy of the free market.Beyond that, note the preference for government work. Job creators are given a disincentive. Job regulators are given an incentive. This is both perverse and noxious.One cannot read through the State of the Union address and come to any other conclusion than that Barack Obama is declaring war on the free market. It is more and more clear that Barack Obama does not have an American world view.