This report is a mixed one. While it does say that the economy is growing (Something that Obama is not responsible for), it also portends troubled days ahead, as it shows a steep drop in manufacturing.
This does not speak about which president is responsible, for either the good or the bad, and I want to, at this point, concentrate on the bad, as that is where we are really headed, despite the rosy numbers on a growing economy (numbers which I believe are only temporary). I firmly believe that neither Obama nor Bush are responsible for the bad here. Should Romney win the election, and the numbers remain the same during his first term, I would not put the blame on him either. These are MARKET forces at work, which no president has control over.
However, this report does give proof to one theory - That it is not billionaires who create jobs. It is demand from consumers, and right now, consumers are just not buying.
So, my friends. How do we get consumers to start buying again? This is the question of the day. Please, no partisan hackery responses from either Democrats or Republicans. I would like this to be a serious discussion, so I don't want to hear any crap about how Obama is a Communist or how Romney hates people who are not millionaires.
Article is here.
At first, the argument was "a lack of investor confidence" was holding the economy at bay. Now, the argument seems to be it's "a lack of consumer confidence". Well, which is it?
This divergance in compelling arguments tells me that the financiers have gotten their acts together on Wall Street, but aren't quite ready to put money back into the pockets of consumers. But that time is fast approaching and the best way to do that short of going on a massive rebuilding phase which was how FDR was able to spur economic growth is to force the wealth class to live up to the theory of trickle down economics and start paying higher salaries.
Looks, it's very simple: Conservatism claims that the best way for businesses to function unhindered is to remove all (or most) of the obstacles on businesses and the free market system to use their profits to grow or expand their business. Well, most of the hurtles that were once hindering business have been removed, i.e., labor unions and collective bargaining rights being the top two. Taxes are still low (re: Bush tax cuts remain in tact) and the payroll tax cut has been extended. So, what happened? Why is the unemployment rate still hovering at 8.2%?
Answers:
1) The cost of consumer goods increased mainly due to high gas prices. Now that the price of gas is coming down, I expect the cost of consumer goods will also start to come down over time except for food. (See item #2)
2) Natural disasters also play a role in our nation's economy. People want to discount nature's impact, but you can't! A flood, a drought, a tornado, an earthquake - they all play a role in the ebb and flow of our nation's economy especially where our food supply is concerned. Folks tend to think it's just regional, but a drought across the heartland of American can have a devastating impact on food prices across the country. Same can be said of a hurricane that hits the Gulf of Mexico where fuel prices are concerned. (Thank God that hasn't happened yet.) And I havent' even mentioned how homes and businesses have been impacted as well. Consider for a moment how cities in the north-east were affected from the earth quake that hit last year, the tornados that hit along America's mid-section, the raging wild fires in Colorado or the heatwave and drought that's affecting the country right now. Natural disaster do have an impact on our nation's economy. And American has had more than its fair share over the last 2-years.
3) Of course, there's also the issue of free trade agreements between partner nations. Trade agreements between Europe (Germany, Spain, France), S. Korea, India and Central America have begun to kick in, but it's still going to take a few years before we see true benefits.
So, how do you break this gridlock?
It's a very unpopular stance w/Republicans but the wealth-class will have to come off some of their riches. It's just that simple.
Our national economy seems to be feeding from the same economic well called the middle-class. The poor and elderly are making many of their puchases on consumer goods at discount stores or using coupons to extend their purchasing power. But those wage earners in the middle - not yet poor but certainly not rich - aren't shopping too much. They're buying only what they need. You break that gridlock by improving wages thereby providing the middle-class with more disposable income. People will then go out and spend their money. Manufacturers will then be able to produce more goods. Businesses will then be able to expand to more areas.
Looking further into the enterprising side, people are trying to start their own businesses (i.e., homebased mostly) but it's difficult to do when you can't get a business loan or drive consumers to your "doors" (I use the term losely here since many home buinsesses are in eCommerce) to spend money. You want the economy to start moving again? Then you really do need to spread the wealth around some. This isn't a redistributive argument, folks. It's just a practical solution to the problem. Think of it like this: If wealthy millionaires and billionaires can sink millions of dollars into all these political campaigns, why won't they put this money back into their businesses or at the very least in their employee's paychecks?
You want consumers to start spending more, break the gridlock and give a man a raise because clearly the money is there as evidenced by the support Romney has received from the investor/business class. You could make that same argument against Pres. Obama, except he doesn't seem to be getting the same level of donations from the same class of folks, but he doens't get a pass here either. My point here, though, is the money is there for business owners to break this economic gridlock. People will just need to get really pissed off and see the hypocrisy taking place.
Again, if a wealthy individual has the audacity to claim that consumer confidence is low because ordinary people aren't spending money, the logical conclusion as to why that is the case is because people don't have enough disposable income to once again be impose shoppers. So, if you really want to bring back that "wreckless spending" habit and boost consumer confidence, increase salaries of those who do still have jobs.