Thanks to Dem Policies, High Unemployment and Slow Growth is the New Normal

August 24, 2011

Underwhelming CBO Numbers Highlight Democrats’ Broken Promises and Failed Policies

A new report out from the Congressional Budget Office (CBO) fed growing fears that the last few years of high unemployment and weak economic growth are not an aberration but a new normal. CBO’s report is all the more concerning for the fact that private sector estimates incorporating the economic turmoil of the last month are even more pessimistic.
This gloomy forecast highlights the complete failure of Democrats’ economic policies and their broken promises on the economy.
Yet despite the failure of their policies, Democrats are doubling-down with excuses rather than taking responsibility. Worse yet, they continue to push the same policies that have made a bad economy worse.

BACKGROUND

A new report out from the Congressional Budget Office (CBO) fed growing fears that the last few years of high unemployment and weak economic growth are not an aberration but a new normal. CBO’s report is all the more concerning for the fact that private sector estimates incorporating the economic turmoil of the last month are even more pessimistic:

CBO: “SLOW GROWTH AND HIGH UNEMPLOYMENT FOR YEARS TO COME”:“”The Congressional Budget Office projects slow growth and high unemployment for years to come as a result of the financial crisis and recession, a new report shows.” (Richard Wolf, “Budget Agency: Jobless Rate Above 8% For Years,” USA Today, 8/24/2011)

JOBLESS RATE AT 8.9% BY END OF 2011, ABOVE 8% THROUGH 2014. “In its semi-annual update of budget and economic data, the agency — which serves as the official scorekeeper for President Obama and Congress — projects the jobless rate will fall to 8.9% by the end of this but remain above 8% until 2014.” (Richard Wolf, “Budget Agency: Jobless Rate Above 8% For Years,” USA Today, 8/24/2011)

CBO SAYS ITS OWN FORECASTS OF 2.3% AND 2.7% ARE TOO HIGH, GIVEN RECENT SPATE OF BAD NEWS. “Economic growth will remain slow but steady, it says, increasing by 2.3% this year and 2.7% next year. However, in a blog post on the agency’s web site, director Douglas Elmendorf notes those projections were made in early July, before financial market gyrations and some lackluster economic indicators. ‘Incorporating that news would have led CBO to temper its near-term forecast for economic growth,’ he said.” (Richard Wolf, “Budget Agency: Jobless Rate Above 8% For Years,” USA Today, 8/24/2011)

“BANKS LOWER U.S. ECONOMIC GROWTH FORECASTS”: “Gross domestic product will grow 1 percent in the fourth quarter rather than the 2.5 percent previously forecast and 0.5 percent in the first quarter of 2012 instead of 1.5 percent, JPMorgan said in a note e-mailed to clients today. Citigroup cut its 2011 growth forecast to 1.6 percent from 1.7 percent and lowered its projection for next year to 2.1 percent from 2.7 percent, according to a note to clients dated yesterday.” (Scott Hamilton, “Banks Lower U.S. Economic Growth Forecasts,” Bloomberg, 8/19/2011)

This gloomy forecast highlights the complete failure of Democrats’ economic policies and their broken promises on the economy:

WHITE HOUSE IN 2009, POST-STIMULUS: 4% GROWTH IN 2011, 2012, 2013, AND 2014! “And recall that back in August of 2009, the White House — after having a half year to view the economy and its $800 billion stimulus response — made an astoundingly optimistic forecast. Starting in 2011, with Obamanomics fully in gear and the recession over, growth would take off. GDP would rise 4.3 percent in 2011, followed by … 4.3 percent growth in 2012 and 2013, too! And 2014? Another year of 4.0 percent growth. Off to the races, America.” (James Pethokoukis, “Panic at the White House? Goldman Sachs Sees High Unemployment, Possible Recession,”Reuters, 7/16/2011)

OBAMA IN 2011: “3.5% GROWTH IN 2012, MORE THAN 4% IN 2013 AND 2014:“Even in its forecast earlier this year, Team Obama said it was looking for 3.5 percent GDP growth in 2012, followed by 4.4 percent in 2013, 4.3 percent in 2014.” (James Pethokoukis, “Panic at the White House? Goldman Sachs Sees High Unemployment, Possible Recession,” Reuters, 7/16/2011)

AND WE CAN’T FORGET THE INFAMOUS 8% UNEMPLOYMENT PLEDGE: “Back in early January, when Barack Obama was still President-elect, two of his chief economic advisers—leading proponents of a stimulus bill — predicted that the passage of a large economic-aid package would boost the economy and keep the unemployment rate below 8%.” (Stephen Gandel, “Barack Obama’s Stimulus Plan: Failing By Its Own Measure,” Time, 7/14/2009)

Yet despite the failure of their policies, out of touch Democrats are doubling-down with excuses rather than taking responsibility:

OBAMA: NEW ECONOMIC FEARS ARE DUE TO “BAD LUCK”: “Over the last six months, we’ve had a string of bad luck — there have been some things that we could not control.” (“Remarks by the President in a Town Hall Meeting in Cannon Falls, Minnesota,” The White House, 8/15/2011)

DNC CHAIR REP. DEBBIE WASSERMAN SCHULTZ: “Well, I’m proud of the President’s record as are Democrats and middle-class Americans across the country.” (Remarks from Debbie Wasserman-Schultz, MSNBC’s “Andrea Mitchell Reports”, 8/13/2011)

WHITE HOUSE PRESS SECRETARY JAY CARNEY: “UNCONTESTABLY TRUE” THAT “ECONOMY IS VASTLY IMPROVED” SINCE OBAMA TOOK OFFICE. (“Carney: Economy Has ‘Vastly Improved’ Since Obama Was Sworn In,” Real Clear Politics, 7/21/2011)

NY TIMES: WHITE HOUSE HOPING “MAYBE IT’S NOT THE ECONOMY, STUPID”: “Maybe it’s not the economy, stupid. White House officials have begun to entertain the idea that they can run for re-election without being able to point to a strengthening economy. For one thing, they may not have a choice.” (David Leonhardt, “Negotiating Election Headwinds,” The New York Times, 7/19/2011)

OBAMA CLAIMS HE WAS “LARGELY SUCCESSFUL” IN STABILIZING ECONOMY, DESPITE THE FACT THAT “STUBBORN” UNEMPLOYMENT IS FAR ABOVE HIS 8 PERCENT MARKER. (“Press Conference by the President,” The White House, 7/11/2011)

TREASURY SEC. TIM GEITHNER SAYS “RIDICULOUS” TO COMPARE OBAMA’S RECORD ON DEBT AND UNEMPLOYMENT. (NBC’s “Meet the Press”, 7/10/2011)

WHITE HOUSE CHIEF OF STAFF BILL DALEY SAYS THE “POLITICAL SYSTEM” IS TO BLAME FOR WEAK ECONOMY, NOT OBAMA. (Imtiyaz Delawala, “Bill Daley: President Obama Still Wants a ‘Big Deal’ on Deficit Reduction,” ABC’s “This Week”, 7/10/2011)

OBAMA ADVISOR DAVID PLOUFFE PRE-EMPTS JOBS REPORT, CLAIMS “VISION” MORE IMPORTANT THAN JOBS. (Julie Mason, “Plouffe: It’s About Vision, Not Jobs,”Politico, 7/8/2011)

EVEN OBAMA JOKED ABOUT HIS FAILED STIMULUS … HA HA?: “Obama smiled and interjected, ‘Shovel-ready was not as … uh .. shovel-ready as we expected.’The Council, led by GE’s Jeffrey Immelt, erupted in laughter.” (“Obama Jokes at Jobs Council: “Shovel-Ready Was Not as Shovel-Ready as We Expected,” Fox News, 6/13/2011)

Worse yet, Democrats continue to push the same policies that have made a bad economy worse. What will it take for them to learn?

WSJ: OBAMA POLICIES A LESSON IN “HOW NOT TO GROW AN ECONOMY”:“Financial markets are in turmoil, investors are fleeing to safe havens, and the chances of another recession are rising. This would seem to be a moment when government should be especially careful to do no harm, to talk and walk softly, and to reassure business that Washington wants more private investment and hiring.

“But this is not how our current government behaves. Day after day brings headlines of another legislative, regulatory or enforcement action that gives CEOs and investors reason to hunker down, retain as much cash as possible and ride out whatever storms are ahead. This is not the way to nurture an already fragile recovery, much less help the economy to endure shocks from Europe, natural disasters or a big bank failure. …

“But the cascade of such stories day after day—about new regulations, new prosecutions or fines against business, new obstacles to investment, more spending and higher taxes—contributes to the larger lack of business and consumer confidence.

“It’s impossible to quantify the impact of such policies on lost GDP or lost job creation, but everyone in the real economy understands how such signals work. The great tragedy of the Obama nonrecovery is that this Administration still doesn’t realize the damage it is doing.” (Editorial, “How Not to Grow an Economy,” The Wall Street Journal, 8/22/2011)

PRESIDENT OBAMA, LAST WEEK: “I’LL BE PUTTING FORWARD… A VERY SPECIFIC PLAN TO BOOST THE ECONOMY, TO CREATE JOBS AND TO CONTROL OUR DEFICIT.” (Jake Tapper, “President Announces ‘Very Specific’ Jobs Plan to Come,” ABC News, 8/15/2011)

WHITE HOUSE ADVISOR DAVID AXELROD: NOT SO FAST, IT’S JUST AN OUTLINE:” ‘The president is going to outline a short-term plan to accelerate the economy,’ Axelrod said on ABC’s ‘This Week’…” (Phillip A. Klein, “Is Obama’s ‘Specific’ Plan Now Just an Outline?,” The Washington Examiner, 8/22/2011)

WH ADVISOR ROBERT GIBBS: OBAMA TO “OUTLINE SOME IDEAS,” JUST LIKE HE HAS “OUTLINED IDEAS EVERY DAY HE’S BEEN IN THE WHITE HOUSE”: “On Meet the Press, Gibbs used similar language, ‘The president is going to outline some ideas, the president has outlined ideas every day he’s been in the White House.'” (Phillip A. Klein, “Is Obama’s ‘Specific’ Plan Now Just an Outline?,” The Washington Examiner, 8/22/2011)

BUT MAYBE THE “NEW PLAN” IS THE SAME AS THE OLD PLAN: MORE FAILED STIMULUS: “President Obama has decided to press Congress for a new round of stimulus spending…” (Zachary A. Goldfarb and Peter Wallsten, “Obama to Issue New Proposals on Job Creation, Deficit Reduction,” The Washington Post, 8/17/2011)