Fines, taxes, fees, penalties, regulations, blame, and threats. This is how the president shows American manufacturers that he cares. When Mr. Obama discussed manufacturing jobs from a Seattle Boeing plant yesterday he wasted little time bringing up tax breaks received by companies sending jobs overseas, a threat and needless reminder of the enthusiasm with which his administration wields its anti-business stick. The companies destined to prosper are those that create the jobs of the future, a slogan that means whatever jobs the administration can use to justify billions in education and infrastructure spending.
We continue to suffer the fallout from what the Congressional Budget Office has characterized as “the longest stretch of high unemployment in this country since the Great Depression.”¹ The government’s sanitized jobless rate is 8.3%, but the real jobless rate in January 2012 was estimated by the CBO at 15%, a figure that includes those who gave up looking for work, or are forced to work part-time.² The president and congressional Democrats should have seen this one coming, but they opted to spend a year forcing Obamacare through Congress and down our throats instead of focusing their talents on the economy.
In July 2009 the president’s Council of Economic Advisors placed health care at the top of the list of jobs that would be added through 2016.³ An Affordable Care Act fact sheet provided by Harry Reid, The Health Care Law Creates Jobs, projected the creation of 250,000 – 400,000 positions per year for ten years, and takes credit for creating 1.4 million jobs since March 2010.4 The health care law has been passed, high unemployment remains, and manufacturing is back in the headlines.
There is a difference between supporting manufacturing by growing the economy and backing sectors the government decides are important. The free market steers the economy in the first instance, and bureaucrats and politicians call the shots in the latter. If you want to know where all of this is headed, look no further than Illinois.
Illinois recently lost out to Georgia when manufacturing giant Caterpillar decided where to build a new plant, opting for a state deemed to have a more business-friendly climate. Illinois’ obscene debt load and history of pandering to unions, public employees, and illegal immigrants has brought it to its fiscal knees, much as the national economy is being brought down by a president who came from Illinois, and is determined to win the support of the same special interests that helped drive Illinois into the ground.
How have the White House and Democrats in Congress shown manufacturers and businesses in general that they value their presence in the U.S., and want them to thrive? First, they allowed the economy to take a back seat to passing a health care law, introducing massive uncertainty, and the threat of new regulations and costs at the worst time imaginable.
The harangues and threats directed at big business for profiting at the expense of the middle class have been ceaseless. Releases with titles like Reid: Republicans Willing To Risk Economic Crisis to Protect Tax Breaks For Oil Companies, Corporate Jets.5 have helped get the message out. Punishing corporations, banks, and the wealthy for the recession has been a central theme of the Obama presidency, ironically helping to create an Occupy movement testifying to the failure of White House economic policy with its tent cities and adherents milling aimlessly in the streets.
Unions have been given as much ground as possible, beginning with Davis-Bacon wage mandates for Recovery Act projects (see: The Recovery Act Fraud You Don’t Know About). Boeing was an unlikely candidate for the president’s manufacturing speech, considering the company recently extricated itself from a National Labor Relations Board complaint over its facility in South Carolina. The NLRB closed 2011 by pursuing new rules to make it easier for employees to organize with “ambush” elections, something to be greeted with trepidation by struggling businesses already worried about the costs imposed by new regulations and the health care law.
The administration failed to follow through on promises to get capital flowing. The Congressional Budget Office observed last month that bank loans to small businesses are still “far below” the level before the recession.6 Initiatives to jump start lending failed to do the trick. 2010’s small business lending bill was little more than a community bank bailout that allowed banks to use money destined for small businesses to repay their TARP obligations.
The president claims that “manufacturers are hiring for the first time since the 1990s.”,7 a jab at George W. Bush that ignores the Clinton Recession. While the trend for manufacturing jobs has been downward, a sampling of employment reports shows that the president’s statement is not true. In October 2005 we added 12,000 manufacturing jobs, and continued gains in November 2005 and December 2005. 75,000 manufacturing jobs were gained between February and May 2004.8
Our free market economy continues to be dismissed as political opportunism targets Democrat-friendly sectors like clean energy and puts Republican favorites like the Keystone Pipeline on hold. The Obama administration’s efforts to pick and choose the businesses that will survive have beaten the slogan “jobs of the future” nearly to death. It would be unfair and incorrect to accuse the president of not caring about manufacturing or the larger business sector. He cares very much. Without companies to blame for our troubles and to use as excuses for education, job training, and infrastructure spending, there would be precious little to offer supporters in 2012.