Obama's Economy Keeps on Humming

by John M. Curtis
(310) 204-8700

Copyright November 9, 2013
All Rights Reserved.                                      

            Getting more bad news, the GOP refused to acknowledge that President Barack Obama’s economy continues to put more distance from the Great Recession inherited from the past Republican administration.  While the obstructionist GOP-controlled House insists on more budget cuts, October’s job report showed the economy’s resiliency, adding 204,000 non-farm payroll jobs.  With former President George W. Bush’s $1.4 trillion budget deficit shrinking to under $600,000, the GOP continues to insist on slashing the budget.  Federal Reserve Board Chairman Ben Bernanke has warned the GOP that cutting government spending slows economic growth.  “The first thing we should do is stop doing things that undermine our businesses and our economy,” said Obama, referring to the GOP’s stubborn insistence on the “sequester,” a series of spending cuts that slows economic growth.

             House Budget Committee Chairman Paul Ryan (R-Wis.) insists on more cuts when the economy has consistently added jobs since early in Obama’s first term.  Since March 2010, the economy has added over 5.5 million private sector jobs, contributing to the expanded tax base, lower budget deficits and higher GDP, now running at about 2%.  Obama wants more infrastructure spending on technology, roads and schools, something China and Europe have already done. “It’s like the gears of our economy, every time they are just about to take off, somebody taps the brakes and says, “Not so fast,” said Barack, referring to GOP efforts to sabotage economic growth.  When former Massachusetts Gov. Mitt Romney and his VP pick Ryan ran in 2012, they tried to convince voters the economy was tanking.  All reliable government metrics showed otherwise, especially the Labor and Commerce Departments.

             Since Wall Street bottomed out in 2009, the Dow Jones Industrial Average more than doubled, closing Friday, November 8 at 15,761, another all-time high.  With Wall Street in an historic bull market, American businesses have been flush with cash to keep hiring more workers.  “We should be building, not tearing things down,” said Obama at the Port of New Orleans.  Louisiana’s conservative Gov. Bobby Jindal, often seen as a 2016 presidential candidate, ripped Obama over his health care law.  “We will not allow President Obama to bully Louisiana into accepting an expansion of Obamacare,” said Jindal, distorting the president’s plan to expand Medicaid spending for the state’s working poor.  Like other Southern governors, Jindal’s politics is about preaching to the choir, ripping Obamcare and pretending the economy hasn’t improved under the president’s policies.

             Gaining 204,000 jobs in October threw many economists for a loop, after watching the government shutdown toss 800,000 federal workers into unemployment.  It’s hard to stop hiring when the S&P 500 hit another all-time high at Friday’s close of 1,770, signaling more jobs strength in the months ahead.  Whether or not the latest numbers reflect a higher-than-usual participation rate of 83.5 in October because of the extra week, the economy continues to add jobs.  More economic good news bodes well for Democrats in next year’s Midterm elections.  GOP officials only pray, like Romney and Ryan did in 2012, that the economy tanks, helping their political fortunes.  As long as Obama’s economy remains strong, it’s going to be difficult for the GOP to sell their economic plan:  That the path to economic recovery involves cutting spending and shrinking the federal establishment.   

             Economic growth depends on whether or not Obama gets House Republicans to buy into his request to spend more on infrastructure.  With more “sequester” cuts coming online, the slowdown in government spending could create a drag on the economy.  House Republicans have little incentive to improve Obama’s economy, handing Democrats a real advantage in next year’s Midterm Elections.  “Businesses may have inadvertently counted employment for an extra week,” said Mark Zandi, chief economist for Moody’s Analytics.  After the two-week government shutdown, Zandi doubts that October’s jobs number were that high.  “That could juice up the number.  That may mean that we actually get surprised next month with a much weaker number,” hinting that unemployment could tick up.  Fed officials doubt whether or not employment could bounce upward.

             Obama can expect more of the same attempts to sabotage the economy between now and the Midterm elections.  Whether the GOP admits it or not, they’ve been trying to upend Obama’s economy since the 2012 presidential election.  Romney and Ryan had a hard time bucking rock solid government metrics, largely with the Labor and Commerce Departments, proving the economy was making progress.  Forcing more budget and spending cuts at a time growing employment, lower budget deficits, higher GDP shows just how out-of-touch the GOP has become in managing the U.S. economy.  All the bogus complaints about the debt ceiling exposed the GOP’s political agenda:  Tank the U.S. economy before the Midterm Elections.  Given Wall Street’s long bull market, lower unemployment, improved government tax receipts, shrinking budget deficits and growing GDP, it’s harder to believe the GOP.

John M. Curtis writes politically neutral commentary analyzing spin in national and global news.  He's editor of OnlineColumnist.com.and author of Dodging the Bullet and Operation Charisma.