Obama’s Misguided Policies Lead to Job Destruction

Obama’s Misguided Policies Lead to Job Destruction

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As long as president Obama has occupied the oval office, Americans have listed job creation at the top of their priority list. Not healthcare, not climate change, not poverty – jobs. And, as long as Mr. Obama has been president, he has dismissed that mandate. This will be President Obama’s legacy – ignoring job creation and stifling growth in the aftermath of the greatest economic collapse in our lifetimes. 

Today, creating jobs still ranks as our nation’s top priority, according to Gallup. Nevertheless, Obama continues to push policies that depress job creation – Obamacare, extended unemployment compensation, and -- most recently -- a higher minimum wage, to name just the most egregious. The latest CBO report details the likely impact of Mr. Obama’s push to raise the federal minimum wage to $10.10 per hour (a 39 percent increase) – 500,000 fewer jobs.

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That’s on top of last week’s report that Obamacare will reduce employment by 2.5 million jobs. If he really gets rolling, maybe President Obama could eliminate job growth altogether. 

And, he might. For instance, the Obama administration published new rules last fall that effectively prohibit the building of new coal-fired power plants. A new set of rules is expected this June that The New York Times says “could shutter hundreds of facilities”-- regulations that threaten to put coal miners out of work. 

Global Trade and Jobs

It’s not just Mr. Obama’s programs that are job-killers, his leadership failures are taking a toll as well. Consider his trade agenda. Every country in the world is signing up trading partners as fast as they can; the U.S. is an increasingly isolated outlier. While President Obama talks up trade, knowing full well the possible benefits to the country, he has so little clout with members of his own party that Congressional leaders Harry Reid and Nancy Pelosi have signaled the effort is all but dead in the water. 

This is a costly lapse. China just signed trade deals with the U.K. worth an estimate $1.4 billion pounds. Canada and the EU have signed trade agreements; Japan is discussing deals with Australia and South Korea. Everyone appears to be negotiating pacts with their global counterparts. Meanwhile, Obama is negotiating with Democrats. 

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And then there is the Keystone Pipeline, which has become a battered totem of Obama’s indifference to jobs. Even the Obama-supporting unions are mad about his continued resistance to allowing the controversial project to move forward. They want the 42,100 jobs needed to build the pipeline over 2 years. Who can blame them? 

President Obama flunks basic economics over and over again. At a time when we have tens of millions out of work or unemployed, the president wants to raise the cost of labor. Call me crazy, but when I majored in economics we learned that hiking the price of a commodity leads to lower demand. The principle applies to labor as well as any other product. Which is why the CBO rightly concluded that the president’s pitch to push up wages for our least skilled workers – and by a hefty amount, from $7.25 to $10.10 by 2016 – may increase the incomes of those at that pay level, but it will also eliminate jobs. 

President Obama is a prisoner of outdated priorities and philosophy. Our biggest issue is not income inequality. It is not pushing more people to go to college. Our biggest issue is that we have dangerously few Americans at work, supporting a growing number of retired, disabled or unemployed people. The workforce participation rate is 63 percent today, down from 66 percent in 2007 and at a 35-year low. The CBO recently predicted it would remain low, and that poor job growth would stifle growth, in part because of Obamacare.

This is unsustainable. Even under the best of circumstances it has long been clear that the impending retirement of baby boomers was going to be a heavy load for the next generation. In 1950 there were more than 16 workers paying for each retiree receiving Social Security. Now, we have fewer than three carrying the load, and that figure is trending down. There are other reasons job creation is essential – many have concluded that people are happier when they are productive. Also, the best way to narrow income inequality is to provide a healthy job-producing economy.

We need this president to understand that work is more important than welfare, that jobs trump food stamps. We need to make President Obama finally pay attention to the number one concern of most Americans – jobs.

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