Saturday, April 19, 2014

Obama Is Anti-Business? Hardly. Republicans Have A More Productive Economic Argument To Make: We Need Higher Wages

     We've heard it enough, already, Republicans, and it's getting old.  The hackneyed claim that President Obama is not merely anti-business but  the most anti-business Prez in a good long while just doesn't wash: Obama's is "the most anti-business administration since at least Jimmy Carter", per Mitch McConnell. And then there's this ridiculous overstatement: "Barack Obama is the most antibusiness president in a generation, perhaps American History," according to Dinesh D'Souza, the outspoken conservative who has been one of Obama's harshest critics. D'Souza spoke at last week's big Republican dinner in Rapid City to what I'm told was a warm reception.  I wasn't there, but have no doubt that he hammered on this theme during his presentation.  As a Republican I know it's basic GOP dogma coming into this election cycle and will more than likely be repeated ad infinitum at political rallies all over the country as the mid-terms draw near.
     Personally, I think we Republicans are barking up a fruitless tree on this issue.  Why?  Because the economic facts of the matter simply don't jibe with the notion that business has been hampered in any way, shape or form since Barack Obama has been in office.  Exhibit Number One?  U.S. corporate profits as a percent of GDP are the highest they've been since at least 1950 ("the highest ever" per Robert Reich's facebook assertion this morning).  Exhibit Number Two?  Stock indexes have made sizable gains to new or near-new highs since Obama was first sworn in, with the Dow Jones Industrial Average more than doubling over that span.  Exhibit Number Three?  U.S. tax revenues since 2009, both in dollars and percent of GDP have been steadily increasing.  Exhibit Number Four?  The federal deficit as a percent of GDP is now a third of what it was in 2009.  Frankly, as a good Republican businessman, I'm extremely pleased about how well things have gone since this "most anti-business" president has been in office.
     So what are we GOPers to do now that reality has undercut one of our favorite memes?  Here's what.  Let's reconsider that Reuters link on corporate profits which is accompanied by a chart on wage growth.  The conclusion?  Profits might be great but wage growth stinks.  It's the lowest it's been in half a century.  Though I refuse to conclude that correlation is causation, I know full well that Democrats jump all over these two data and believe they're connected.  What's more, as political grist it's an easy conclusion to pitch in an era when class divisions and the natural envy they produce can be converted into political capital.
     My view is that Republicans can steal the march on this by talking up higher wages, either through minimum wage increases or incentives given to employers who are willing to raise them on their own.  For one thing, profit margins have been so high in recent years that employers probably have plenty of financial room to start kicking up pay scales.  For another, it's time for a certain moral imperative to be applied.  Executives and managers have been making great money.  Shareholders have been having a field day.  But workers?  Please.  The current situation is pathetic and needs to be addressed.  On a practical level, putting more money into the hands of mass consumers can only be a good thing in an economy that is about 70% driven by them and their household purchases.  On a political level it would probably do a lot of good for Republicans who constantly have to fend off charges, bogus in my view even though they're effective, that we Pubs care only about the rich among us.
     Pressing hard for better wages in this country and making it an integral part of the Republican message this year would be a winner.  Time to get moving on this, Pubs
   

9 comments:

  1. Well. You've left me nothing to argue about here. Hmfph.
    This must be a good post then.

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  2. Anti Business President? Some examination please.

    1.Bailed out the banks along with the Bush administration. These are the thugs that brought down the economy in the first place ever since the repeal of Glass Steagall. They then turned around and gave corporate bonuses to their executives with the bailout money. And what did the Obama administration do for the drowning homeowners at the same time?

    2.Bailed out the auto industry with infusion of money and a cash for clunkers program designed to get the cheaper vehicles off the road, which allowed auto dealers to raise the price on both the remaining used cars and on the newer vehicles. But that in turn hurt the smaller auto parts industry and auto repair businesses, because there were fewer older cars to fix. Additionally it was to get the lower MPG cars off the road, but have the MPGs of the new vehicles increased significantly?

    3. The Affordable Healthcare Act against which so many in business and on the right, rail against, anti-business? Anybody remember the Public Option? Many on the left have lobbied for Universal Single Payer Healthcare for years. Recognizing that he could not get that done at this time, President Obama offered the Public Option. That would allow the government to offer health insurance to keep the insurance companies in line as far as how much they charged and whom they covered. President Obama allowed Congress to negotiate that away to pacify the insurance industry and the big healthcare insurance companies lobbied to be able to keep their profits high, by increasing their rates immensely during the time the bill was being negotiated. I watch the lady CEO of Blue Cross Blue Shield of California testify before Congress and she was making an 8 figure income, and had over twenty executives in her company making over 7 figure incomes. At the same time they had the audacity to be asking for a 39% increase in their rates with California insurance regulators.

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    1. And the list goes on. I just don't see Republicans getting much traction from the economy's performance. Hasn't been stellar, but it's been steady. I sense from GOP conservative media that Pubs will gain significant seats and that Dems are running scared, but these are the same honks who insisted Romney (who I voted for) would win in '12. I think the battle for Pubs will be the same as it was a few years back: getting a broader demographic base--and I don't see their "Obama is anti-business" pitch doing much good on that front.

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  3. Well dang! I have to agree with you again John. I don't think enough gerrymandering exists for the Republicans to do more than keep the House, for now.

    They have got to expand their base. That is just not going to happen without changes in policy. I think they must look at core deep changes or the perception that the Republican Party is the Corporate Party will remain.

    The Democratic Party is too corporate for my tastes too, but less extreme than the Republicans. The Democrats push health care, minimum wage, higher mpg, etc. In my mind, the Republican Corporate Party of America is an accurate moniker. Can that be changed? Can the Republican base grow beyond Old White Guys and their spouses?

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    1. If the GOP's principal message coming into the midterms is the vow to destroy Obamacare, I doubt that they'll do anywhere near as well as the conservative punditry expects. I see no message from Republicans that appeals specifically to young adults or ethnic/racial minorities. The party has grown reactive and needs to switch to a proactive approach to the election, which I don't see happening. The essential problem with Republicanism these days is that it's boring. Not a real good way to get people fired up to vote.

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  4. Nathan at "An Inland Voyage" has a very thoughtful and thought provoking post on economics focused on a guaranteed income. I read the post and the links. A guaranteed income has much support and makes economic sense to me. Also to many libertarians and right wingers. Interesting. Here is the link:

    http://aninlandvoyage.com/2014/04/21/attention-entrepreneurs-you-need-to-think-bigger-and-give-some-thought-to-a-guaranteed-basic-income/#respond

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    1. Most provocative, Deb. I think raising the minimum wage substantially is a start toward guaranteeing working Americans that they have a shot at making a decent living just by finding employment. Far short of the vision put forth in your link, but politically much more realistic and doable. Republicans need to come up with energetic proposals like this.

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  5. I sure wish the Republicans would John. As a liberal-to-my-core citizen, I feel that Republicans are dangerous and punitive. I'd love to see some positive proposals like support for a minimum wage. I'd support Republicans who I felt were not wedded to anti-Obama, pro-wealthy ideology. I'm much more liberal than Democratic, but Democrats are the best bet right now for people with little.

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