400 Capitol Street, NW
Washington, DC 20001
- Toll Free 1.888.564.6273
- Local 202.783.3870
Democracy and Power 108: Obfuscation
Wherever politics intrudes upon economic life, political success is readily attained by saying what people like to hear rather than what is demonstrably true. Instead of safeguarding truth and honesty, the state then tends to become a major source of insincerity and mendacity. – Hans F. Sennholz
Fearing failures, the politician’s speech is seldom precise or logically reasoned. Seeking a favorable image, the politician talks in generalities, exaggerates and obfuscates.Debt and President Obama
American and world markets are alarmed by the government debt and the terrible American economy. The price of gold is rocketing with the investors of the world are seeking fiscal safety. The President blames the Tea Party extremists and Republicans for the market plunge. According to the President, the debate over the debt-ceiling is the source of America’s problems:
We knew from the outset that a prolonged debate over the debt ceiling – a debate where the threat of default was used as a bargaining chip – could do enormous damage to our economy and the world’s.
This is ludicrous! Increased spending and no fiscal plan is the source of America’s troubles. The America government hasn’t had a budget – the essence of fiscal responsibility – for two years.
Keith Hennessey reveals the cause of America’s financial turmoil:
The U.S. economy was weak before the debt limit battle, throughout that battle, and still is weak today. The past few months’ legislative tactics did not cause March’s big drop in consumer confidence. These tactics did not cause U.S. GDP to grow by only 0.4% in the first quarter of this year.
The increased liquidity risk that resulted from those tactics was resolved last Tuesday when the President signed the new law. Problems in Europe, S&P’s downgrade and future solvency risk, and fears of a double-dip recession are better explanations for current market turmoil, not fear of liquidity risk that was eliminated six days ago.
The President’s deliberate distortion is another dodge from addressing the root-cause of debt and America’s economic turmoil. This February, the President’s proposed budget increased spending without any viable means of reducing the debt. Subsequently, Representative Paul Ryan (R, Wisconsin) presented a feasible plan to reduce the debt, which was ridiculed by the President. Recently, in the Wall Street Journal, Ryan exposes Obama dereliction of fiscal responsibility – an essential duty of every CEO.
His speeches and press conferences are no substitutes for actual budgets with specific numbers and independently verified projections of future deficits and debt. Meanwhile, it has been over two years since the Democrat-controlled Senate passed any budget at all. This is a historic failure to fulfill one of the most basic responsibilities of governing.
This leadership deficit has thrown the federal budget process into chaos at the worst possible time. Even though Congress has cut spending by a significant amount, it still hasn't dealt with the drivers of our debt—primarily federal spending on health care.
President Obama has intentionally increased the debt, and stubbornly refused to present a budget or strategies to reduce the debt. This is the major cause of America’s economic regression.
For more on debt and President Obama see August 2011: Debt and President Obama.