Friday, January 29, 2010

Obama's politicized and counterproductive policy toward business.

****Perhaps it's a lack of understanding of economics, or of history or just I-don't-care political opportunism (and narcissism), but the President is doubling down on folly.****
http://tinyurl.com/yc87dcc
Bonfire of the Populists The president's anti-Wall Street rhetoric is not good for the economy, and may hurt his party politically. By KIMBERLEY A. STRASSEL
The problem with fires is that they can blow in any direction. Consider the White House, which is seeing a backdraft from the anti-Wall-Street flame it has been dousing with gasoline.His agenda on the ropes, President Obama made a calculated decision to pivot to populism. The Massachusetts Senate race highlighted a fed-up public. The White House strategy: Channel that anger away from itself and to easier targets. Its opening shots were a new tax on banks, new restrictions on banking activities, and Mr. Obama roaring, "We want our money back!"
The president fed the fire with his State of the Union address. Americans are angry at "bad behavior on Wall Street." It is time to "slash the tax breaks for companies that ship our jobs overseas." Lobbyists are trying to "kill" financial regulation. American "cynicism" is the result of "selfish" bankers, CEOs who "reward" themselves "for failure" and lobbyists who "game the system." (No mention of Cornhusker Kickbacks or backroom union deals, but never mind.)
For an administration that claims to know its political history, the White House appears to have misread at least one decade. FDR was re-elected in 1936 for many reasons, but among them was his fiery denunciations of "economic royalists," "economic tyranny," and "economic slavery." Business knew it was in the president's crosshairs and put its capital on strike. The economy didn't recover until the war. Team Obama is already witnessing a repeat...A venture capitalist recently remarked to me that the uncertainty the administration has created is "nothing short of paralyzing." Nobody will invest in an industry that might be the next to be overtaxed, overregulated, or publicly disemboweled...."People in the economy are thinking about whether to invest or take risks when what they are seeing are early signs of Hugo Chávez economics," says Wisconsin GOP Rep. Paul Ryan....this populist fire is an act of self-immolation.
...The administration made the mistake of leaking that its new strategy was pure politics,...robbed it of its authenticity. Americans have also watched this White House prop up moribund auto makers, float Fannie Mae and Freddie Mac, and cut deals with pharmaceutical companies....The country's growing investor class is not impressed by the sort of business mau-mauing that pummels their 401(k)s.
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