Bad Economy Not Affecting Obama’s Popularity


The Republicans aren’t getting much credit for voting against increasing the debt ceiling but they should be. They have heard the message from Americans – stop the spending.

Trump is talking about running for President as an Independent – a sure way to get Obama re-elected. Trump said he is considering it because he is disgusted with Republicans and their penchant for self-destruction. For example, he said the timing of Ryan’s budget was horrible and if Ryan had waited for Obama to come out with his plan, the Republicans could have gone after Obama’s plan. Instead, the Republicans are on the defensive unnecessarily. Does he have a point? Or did Ryan show great leadership? The majority of Americans love Medicare and Social Security – it’s a hot button issue and people don’t always look into the facts before they react. Ryan said we are heading for a crisis; he wants to save these programs not gut them; and he wants to be on the right side of the issues. Whatever your opinion on this, you likely will agree that this is the most important election in our United States history.

By 2015, China will be the number one economy in the world. Americans should feel disgraced by this. A lot of China’s success is based on their near-slave labor which we foster. More and more American companies are leaving the oppressive regulations and taxes of the United States for more business-friendly countries. We are borrowing from China and innumerable other countries, many of whom are our enemies. And the worst part of that is we have no plan to stop the spending or cut the budget. Remember the Democratic Congressman who said we (Congress) can’t stop spending – someone needs to stop us. And then we have committed socialists like Paul Krugman extolling the virtue of endless spending via The NY Times. We can never spend enough to satisfy Dr. Paul.

Our dollar has lost significant value and has lowered the value of our debts, infuriating our creditors. We are paying them back with a dollar worth far less than the one we borrowed. Read here: Diminshed Dollar Is A 10-40% Tax Now we have a jobs report that shows companies created far fewer jobs in May than in April. The GDP grew at 1.8% which is insignificant and not enough to grow jobs. Read here: Anemic job growth Cantor is calling for a 5% job growth agenda. Larry Kudlow talked about Eric Cantor’s positive growth message on his radio show last Saturday, emphasizing the need for Republicans to start spreading a positive message.

From Larry Kudlow’s radio show: When I interviewed Cantor this week, he made it clear that faster economic growth was crucial to holding down spending, deficits and debt. As scored by the Congressional Budget Office, every 1 percent of faster growth lowers the budget gap by nearly $3 trillion from lower spending and higher revenues. “Grow the economy,” Cantor said. “It will help us manage-down the deficit, and it will help get people back to work.”

This is not to say that spending cuts and structural entitlement reforms aren’t necessary. They are. But it is to argue that lately the GOP has forgotten the growth component that is so essential to spending restraint and deficit reduction.

The GOP should say: In return for substantial federal-spending cuts, we’re gonna more than make it up to you with large tax cuts. You will win. Big government will lose.

I suggested to Cantor that the GOP adopt a 5 percent national growth target, which President John F. Kennedy had when he launched his across-the-board tax cuts in the early 1960s. “That is a fantastic goal,” he told me.
Read here: Larry Kudlow on Cantor’s Positive Message

The housing market is sinking again. The index shows that home prices slid by 4.2% in the first quarter of 2011, after declining by 3.6% in the last quarter of 2010. This year’s first quarter side is down 5.1% from the same period in 2010.

The sharp decline isn’t relegated to traditional real estate pariahs like Miami, Las Vegas and Los Angeles, either. S&P/Case-Shiller reports that 19 out of 20 major U.S. cities it covers suffered a net loss in housing values during the first three months of 2011. Twelve of them – including Minneapolis, which lost a whopping 10% in average home values – are at their lowest point in the Index’s history. Charts and Details here: Second Housing Bubble

Gallup continues to report high unemployment. “Unemployment, as measured by Gallup without seasonal adjustment, is at 9.2% in mid-May — down slightly from 9.4% at the end of April. It is also slightly lower than the 9.4% of mid-May last year.”

May Unemployment

Gas and Fuel prices are rising, putting a strain on paychecks. The national average of gas, now $3.79 per gallon, is just 32 cents away from the all-time high set in July 2008. Prices have been driven up by the a shrinking U.S. dollar, record speculation, government regulations/taxes, and unrest in the Middle East. Rising food prices worry most Americans according to USA Today. Rising food prices are a significant worry for Americans, with 73% of consumers in a new USA TODAY/Gallup Poll citing higher grocery bills as a concern, and nearly half saying food inflation has caused a hardship for their households. “According to the April 18-20 poll of 1,016 adults, food prices rank just below record-high gasoline prices in consumer angst. Eighty percent of those polled also noted energy prices as a concern.”

Obama’s approval ratings have been rising since December (up 5 points) according to many polls due to the killing of Osama bin Laden. However, Rasmussen reports that overall, 49% of voters say they at least somewhat approve of the president’s performance. Fifty percent (50%) disapprove. Gallup reports 49% approval and 42% disapproval. The bad economy and poor job outlook does not seem to be a deal killer for Obama’s approval ratings. Perhaps people still blame Bush, despite the failed Stimulus and quadrupling of the debt. The Keynesian economics of spending our way to prosperity is a dismal failure, but if we listen to Paul Krugman, we will spend at least another 4 trillion on the same failed initiative.