In a sign of the times, there is uproar over President Obama’s decision to speak to schoolchildren and convey a message of studying hard and staying in school. Parents have appeared on the cable news stations crying out in anger at the idea that President Obama would dare speak to the nation’s children. First and foremost, Barack Obama is the President of the United States, a fact that eludes many U.S. children. He is the leader of the free world and is held to a higher standard and in higher regard than other politicians. Second, that the President wishes to dedicate time towards reaching out to schoolchildren is mutually beneficial and exposes students to the idea of nation and community.
“What is the difference between a taxidermist and a tax collector? The taxidermist takes only your skin,” wrote Mark Twain. Those making over $250,000 may soon prefer the taxidermist. President Obama is desperately trying to adhere to his campaign promise of not raising taxes on those earning below $250,000. This is ill-conceived policy that is unsurprisingly supported by congressional Democrats, namely those on the far left of the party. The claim that Americans must pay their fair share is valid, yet our politicians have it backwards. Soaking high earners is both an economic and a political mistake.
President Obama’s decision to release internal CIA documents detailing interrogation techniques represents a fundamental contradiction in his policy towards torture and transparency. President Obama has vehemently expressed his opposition to anything that can be construed as torture (rightly so) and one of his first actions as President was to close down Guantanamo Bay. However, President Obama has decided to “move forward” by releasing these torture memos, yet maintains the same state secret arguments that President Bush utilized. President Obama cannot have it both ways.
President Obama said something very important and insightful during his address to Congress on February 24th. “We cannot afford to govern out of anger, or yield to the politics of the moment,” was the President’s advice on how Congress and his administration should proceed with stabilizing the financial system. The moral hazard involved in bailing out institutions deemed “too big to fail” is well documented, but the costs of allowing some financial institutions to fail is greater than the costs of using taxpayer dollars to stabilize these institutions. Both the administration and Congress must be wary of growing populist sentiment, because there will inevitably be more money needed to solve the financial crisis.
The election of President Obama and the new Democratic majority in Congress was a sign that the people of the United States wanted sweeping change and a new course for the nation. The federal government has certainly seized on this mandate and has quickly passed the American Recovery and Reinvestment Act, while the House has passed a bill to retroactively tax bonuses received by employees of TARP recipient firms. Some have argued that this shows the government’s ability to now enact reform efficiently and effectively. However, Congress has been acting indiscriminately in wielding power.
President Barack Obama made health reform a pillar of his campaign and he has issued some broad guidelines as to how he might proceed. In a surprising moment of specificity, however, President Obama made a statement regarding a specific policy he might like to implement. This policy entails third-party billing for veterans’ healthcare. This is common practice for conditions unrelated to military service, but now President Obama is considering allowing the VA to bill third-party, private insurers for services resulting from injuries received as a result of combat.
The Obama administration, by its own admission, is redefining the role of the federal government. This is evidenced by the President’s budget for the fiscal year 2010, which is not only a document of numbers and figures, but one of goals, priorities and yes, ideology. This is not to say that all aspects of the President’s budget are misguided, but Americans need to be made aware of the changing reality in which we are living.
The Obama Administration’s $275 billion Homeowner and Affordability Stability Plan is the first real, comprehensive effort by the federal government to address problems in the real estate market. The HOPE Now program supported by the Bush administration has been limited in its effectiveness to address the underlying problems of the mortgage market. The current plan claims that it will help seven to nine million families avoid foreclosure by restructuring and refinancing mortgages. However, this plan not only poses implementation problems, but also creates some perverse incentives for those in danger of delinquency and for those who are current on their mortgage payments.
Today the Senate passed its version of the stimulus bill. The House version of the American Recovery and Reinvestment Act has a price tag of about $820 billion while the Senate version stands at a total of $838 billion. Now the two versions will have to be reconciled and signed by President Obama. The ultimate goal of the stimulus legislation is to restore demand by replacing private spending with public spending and using tax cuts to hopefully restore consumers’ income enough to spur consumption. It is widely accepted that a stimulus bill is the proper means by which to improve the economy – it is perhaps the best of some bad options.