Whether or Not Obama Focuses on Economy, It Gets Worse
The usually astute Mickey Kaus misses the mark with his comment about Robert Reich jumping the Obama ship on health care:
If Obama had focused on the economy, what measures, exactly, could he have taken to avoid a midterm massacre? A larger stimulus? Obama got as big a stimulus as he could last spring, no?
Yes, it was (I’d like to think) as large a one as he could have gotten. In fact, it was much too large, given how wasteful, economically ignorant, and larded with goodies for Democrat constituencies it was. But certainly there were things that could have been done which would have been much more stimulating. And in fact there were things that could have been done even before he became president.
The most straightforward thing would have been a payroll tax holiday. It might have added even more to the deficit this year than the porkulus, but it would have had the benefit of actually encouraging businesses -- particularly small businesses -- to retain and hire people. He could also have promised to keep in place the Bush tax rate cuts, due to expire next year, providing more confidence in the future of the economy. He could have let his campaign promises about nationalizing health care and dramatically raising the costs of energy with cap 'n' tax expire, as all of his statements and promises eventually do.
But something he could have done -- that would have cost nothing at all -- would have been to not scare the bejesus out of business in the first place during his campaign.
Obama talked of increasing capital gains taxes for reasons of “fairness,” even if it actually hurt government revenue. He talked of “spreading the wealth around.” He gave soaring speeches exalting the glory of the state and public service, while the contributions of business and capitalism were ignored. He treated “profit” like a four-letter word and promised to “raise taxes on the rich.” He made economically insane and historically ignorant arguments blaming the meltdown of the financial system on “capitalists” and “deregulation.”
Obama persuaded many small business people to pull in their horns and make plans to keep a low profile (including laying people off) in order to avoid the wealth confiscation of the populist, socialist, economic storm they saw coming with his election.