25 May 2012

Capitalism: Obama's Greatest Threat

Rush Limbaugh has been talking about how Obama will be the first incumbent president to campaign against capitalism. I have nothing other than 100% agreement for that statement! When Mitt Romney was asked about this position by Fox, he said:
Well, it certainly sounds like that is what he is doing. There's no question but that he's attacking capitalism, in part, I think, because he doesn't understand how the free economy works. He's never had a job in the free economy. He either, as Vice President Biden, they spent their lives as either community organizer or as members of a political class, and frankly the American people understand that the free economy and free enterprise is tough, it's hard work. 
When they hear that a business like Bain Capital was successful 80 percent of the time and five percent of its investments only went bankrupt, they say, "You know, that's a pretty good record. If all the president wants to do is talk about their failures, why, he's misrepresenting the nature of free enterprise."
Jed Lewison on Daily Kos, in typical liberal leaning ways, refutes the premise and claims that Obama has been better for capitalism than George W. Bush. He uses this, rather weak and mis-guided argument, as his basis.
Second, the notion that President Obama is an anti-capitalist president is really, really nuts. Since Obama took office, the stock market has soared—the Dow is nearly double what it was on January 21, 2009. Compare that with President Bush, under whose economic leadership the market fell. Or take a look at private sector job growth: despite inheriting Bush's economic collapse, private sector jobs have actually grown since Obama took office, including four million over the last two years. Under Bush, we lost more than six hundred thousand private sector jobs.
I would say a few things against this.
  1. The market is hovering at 12,500-13,000. Numerically lower than it's peak of 14,093 in Oct of 2007. And really, if you use inflation adjusted dollars, it looks even worse for poor Obama (yes, that graph is a year old, but the Dow has been in the 12,500- 13,000 range for a good while now).
  2. Bush's 8 years ended with the start of a massive recession which can largely be blamed on democratic/liberal policies such as Fair Housing acts and has not recovered thanks to ideas by Dodd-Frank, Affordable Health Care Act, suspension of drilling in the gulf, no Keystone, uncontrolled spending, etc.
  3. Private sector jobs have not increased at all. See my plots here. Unemployment has "decreased" as people have left the market, but as a percentage of our population, the employment rate has not increased.
  4. Under Bush we had a net loss of jobs because of the financial crisis. Period. Otherwise, we maintained a rather nice 4-5% unemployment rate for most of his term.
  5. Denial much?
Finally, continuing from that lovely Limbaugh program (link to the transcript), I recorded the radio old-school style (audio link, I don't know how to embed an audio player, sorry) of their Obama against capitalism montage and managed to capture most of the sound byte. 

The quotes I recorded are:
  • If somebody wants to build a coal power plant, they can, it'll just bankrupt them.
  • The insurance industry is making this last ditch effort to stop reform, even as costs continue to rise and our health care dollars continue to be poured into their profits
  • Cost cutting has become embedded in their operations and in their culture. That may result in good profits, but it is not translating into hiring.
  • Speculators can reap millions while millions of American families get the short end of the stick.
  • If that same diabetic ends up getting their foot amputated, that's 30,000, 40, $50,000 immediately the surgeon is reimbursed.
  • The market will take care of everything.  Here's the problem.  It doesn't work.  It has never worked.
  • White folks' greed runs a world in need.
  • In this country, broad-based prosperity has never trickled down from the success of a wealthy few.
<sarcasm> So, yea, Obama is the most aggressive supporter of capitalism since Reagan. </sarcasm>

PS - If I have in anyway infringed in making this post, I apologize. Just trying to summarize Rush's on-going theory about Obama and capitalism and some of the left's ridiculous rebuttal. I am linking to all the original content and giving recognition.

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