The Obama Administration's 'Sidam Touch'
According to the Urban Dictionary, a person with "the Sidam Touch" has an ability that is "[t]he opposite of The Midas Touch, which turns everything to gold." A person with the Sidam Touch "breaks and/or ruins everything."
To say that President Barack Obama and his administration, especially what's left of his economic team, have the Sidam Touch is the understatement of the 21st century.
In early February 2009, in the run-up to the passage of the American Recovery and Reinvestment Act (ARRA), known to most as "the stimulus," the newly sworn-in Obama flexed his Sidam Touch muscles, repeatedly telling the nation: "Doing nothing is not an option." Fittingly, Obama flew Ohio's Sherrod Brown in on a government plane from the funeral of Brown's mother so that the Buckeye State senator could cast the deciding vote.
So how has it worked out? In December 2010, James Cogan and John Taylor at the Hoover Institution overestimated the impact of the stimulus plan by saying that it accomplished "zero." On May 12, Professors Timothy Conley and Bill Dupor released more precise results demonstrating that ARRA really "created/saved 450 thousand government-sector jobs and destroyed/forestalled one million private sector jobs." For the math-challenged, that's a net loss of 550,000 jobs. A bit over two years later, it is abundantly clear that doing nothing would have been vastly preferable.
It may be lip service, but the president and his advisers continually tell us that private sector growth is important. On May 10, White House economic adviser Austan Goolsbee said: "You want the private sector to be the source of growth because that's where the sustainable job creation is." That's interesting, because, as seen below, after almost three years, largely thanks to the Sidam Touch employment results just noted, the private sector's inflation-adjusted size is barely back to where it was before the recession as normal people define it began, while the federal component of gross domestic product (GDP) has grown by 12%:
The situation is much worse than it appears, because personal consumption expenditures, which are part of the private sector total above, include money spent by those who receive their "income" from government transfer payments. Such handouts have exploded, even after the recession's end in June 2009. From that point until February of this year, the number of food stamp recipients ballooned to over 44 million, an increase of more than 9 million. Shoot, you can have over $80,000 in the bank or win a $2 million lottery prize and still receive food stamp benefits. Overall, government payments as a percentage of all income hit 18.3% in 2010, an all-time high.