I congratulate everyone who plays a vital role in determining the health of the US economy. Preliminary indications suggest that US GDP grew at an annualized rate of 5.7% in Q409. After accounting for the Barack Obama exaggeration functional transform, 60% of this number is still a solid 3.5%. .
If a GOP President were in office, I’d be beating chest and calling out all the playa-haters. Growth like that is enough to get my TSP and my 429 plans to stop resembling emaciated victims of a famine. Three more quarters of this and Osauma Bin Ladin will have to declare jihad against us all over again because of our contributions to anthropogenic Global Warming. (HT: [email protected])
So how come nobody has created new jobs? In fact, lots of people are losing them. When Wal-Mart decides that their payroll needs to be cut, the economic street level reality is not matching the official statistics churned out by the maundering mediocrities of the Bureau of Labor Statistics.
The reason no one is hiring anybody is that they have no clue what rules they will operate under four years hence. Four factors potentially drive this uncertainty. These factors are environmental policy, healthcare regulation, stimulus plan format and corporate and business tax rates. Until the decisions that drive these potentially major economic influence factors have been made, the unemployment rate will stay unusually high, and more tellingly, the average American work hours available per week will remain pegged at 30 hours out of a possible 40.
Environmental policy remains subject to question. Senator Kerry still tells us that the planet hangs in the balance. He offered the following sentiments about the current state of America’s environment.
"You know if the Tea Party folks can go out there and get angry because they think their taxes are too high, for God's sake, a lot of citizens ought to get angry about the fact that they're being killed and our planet is being injured by what's happening on a daily basis by the way we provide our power and our fuel and the old practices we have. That's something worth getting angry about." (HT: Climate Change Fraud)
However, there are also serious issues with how Senator Kerry and other backers of CO2 output regulation have arrived at their conclusions. Questions of whether this science is truly settled include doubts about IPCC reports on impacts of water vapor on temperature change, the predominance of forest fires in rain forests, and numerous others that my three constant readers wouldn’t ant to chase after links to.
While Congress has yet to pass the sweeping Cap and Trade bill that Senator Kerry would like to see adopted, other government organizations have increased executive regulation with what some see as dubious Constitutional and statutory authority. Even in the absence of scientific certainty that Global Warming is occurring, the SEC still moved to order US corporations to disclose climate risks in their SEC filings. The EPA has ruled that CO2 constitutes a toxic atmospheric pollutant. Whether this requires them to develop synchronicity with the English 80’s Pop Group The Police and monitor Every Breath You Take, remains unsettled.
The House has passed a healthcare bill, the Senate has passed a healthcare bill, the President wants some unified bill to emerge from Congress. The American people and the private sector firms that many of them work for despise all current forms of this legislation.
The manner in which the bill was rammed through the Senate was so overtly hostile to the GOP minority that even Senator Olympia Snowe doesn’t want to work with Senate Majority Leader Reid on this issue ever again. The election of Scott Brown, if the Democrats ever choose to permit his seating, makes filibustering a possibility. The impacts of this bill could double what the average worker pays for health insurance and will collect taxation for four years before the first dollar of actual benefits gets paid out.
The President invested much of his STFU Address this week on pushing Stimulus II. Questions abound on how large this bill will be, how it will be allocated and how much of the credit market will be sponged up by US Treasury Bond auctions to pay for this plan’s largesse. Each of these things impacts what will happen at businesses across America.
Because of this uncertainty, questions abound. Will they or won’t they get tax credits? How must they modify their behavior to be considered “good.”? How much will private firms have to pay in interest to borrow, if the float of Treasury Bonds at market grows even larger than it is today?
Finally, the legislatures in Washington face the looming expiration of the Bush tax cuts. This one really is at least partially ALL BUSH’S FAULT®. Should the rates be allowed to default under current statute, capital gains, businesses and upper middle class taxes will all appreciably increase. Investors, businesses and wealthy suburbanite consumers can be predictably expected to reduce consumption.
That can cut in two ways. They can buy it all now and make hay while the sun shines. This could work as accidental stimulus. People could eat, drink and be merry today and really not care what the IRS thinks of their hangover tomorrow. Particularly if they can write some of it off as a deduction. Or, they could keep consumption level and then drop it off the cliff when their disposable income gets dispensed with by Uncle Sam.
Thus, the GDP news is good, but the employment possibilities remain stagnant. They remain stagnant because the environment remains uncertain. This makes buying labor too risky an expenditure. Therefore, the GDP grows well, but the labor market remains uncertain until Washington, DC makes a lot of decisions. Congress must lead, follow or watch much of America’s workforce continue to sit on their cans.
X-Posted At: THE MINORITY REPORT