Thursday, August 11, 2011

Seinfeld Economics: Obama's nonexistent economic policy

The distinguishing feature of the Seinfeld show, it has been said, is that it was not about anything. If you scratched just slightly below the surface, there was nothing there. It is becoming increasingly clear that the Obama administration's economic plan suffers from the same problem: there isn't one.

Even the liberals are beginning to express the worry that the man they bowed the knee to as "the One" are wondering "one what?" As my good friend Mike Allen has pointed out, if a liberal president can't even maintain Maureen Dowd's support, he's in trouble.

Let's take ourselves back to the new Reagan administration of the early 1980s for a moment. The Reagan administration took the national helm at a time of high inflation and high unemployment. When it took office, it announced a plan to deal with the problems, which included:
  1. Reducing the growth rate of government spending
  2. Reducing the marginal tax rate and the capital gains tax
  3. Reducing government regulation of private business
  4. Controlling the money supply.
The plan did not work immediately, resulting in criticism from his political detractors. Reagan's response was that his plan would take time to work. For months, Reagan urged the country, "Stay the course." It became the theme of his communication strategy in 1981 and 82.

Now let's contrast the early 80s with the current economic crisis. If Obama were to hold a press conference tomorrow and said to reporters, "We need to stay the course," would anyone know what he was talking about? What course? What could he say he was referring to?

People worried in the early 80s. But whatever you think of Reaganomics, everyone knew what the then president was going to do about it. He could give you a detailed, point by point plan. If it worked, everyone would breath easy; if it didn't, then we would have to try something else.

But the problem with the Obama administration is that there are no details. There is no point by point plan. In fact, there is no plan at all. There is nothing about which we can say, "Yes, it worked," or "No, it didn't work" so we can try something else.

Here is Obama's Economic Plan:
  1. ???????????????????????
  2. ???????????????????????
  3. ???????????????????????
  4. ???????????????????????
The only thing the Obama administration has done is to throw money at the problem. But throwing money at the problem is not an economic policy.

I think the reason the U. S. stock market is now so volatile, and world economy so skittish is not because the Obama administration's plan is no good. The reason for the fear and uncertainty in the United States and around the world is not that the Obama administration's plan is not working. The problem is that the Obama administration has no plan.

And the lack of a plan to deal with the problem is a part of the problem.


One Brow said...

Comparatively speaking, Reagan worked with a cooperative congress that passed a good deal of his agenda, and the economy inherited from Carter was not nearly in the sorry shape that Bush it in.

However, even when the Obama's congress was majority-Democratic, he could not get his agenda passed without making serious compromises, like the stimulas being 40% tax cuts..

Lee said...

Best comment on that era was by Thomas Sowell in his Liberal Lexicon...

Reaganomics - n. liberals' explanation of a weak economy

robust economy - n. liberals' explanation of a robust economy