Obama’s Talking Tour Proves Obamanomics is in Full Retreat
By: Matthew Roy
President Barack Obama recently launched a campaign-style speech tour to publicize “bold” ideas to help the middle class and renew his executive focus on the economy.
Of course, the president has political reasons to divert the public’s attention away from touchy security issues. A slew of scandals — Benghazi, IRS conservative targeting, and NSA data collection — have harmed the administration’s reputation and dominated media coverage for much of 2013. This new speech tour, however, isn’t President Obama’s first attempt to forcibly change the national conversation. In fact, the president has already unintentionally made economics the center of the dialogue for the past month. Obama’s problem is that the conversation has focused on the unintended costs and consequences of his policies, not his naïve, unattainable aspirations.
Late in June, Obama unveiled his Climate Action Plan — a spending and regulation initiative meant to reduce greenhouse gas emissions and mitigate global warming effects. While the administration tried to push their environmentally-centered messaging, the conversation quickly spun out of the president’s control and flipped to economics. Rather than praising Obama for dashing to the “rescue” of the climate, commentators, analysts, and industry experts began to question how new ambiguous EPA powers to regulate carbon dioxide would distort the energy market.
These new regulations are mentioned briefly in the 21-page document, but they are possibly the most impactful aspect of the plan. President Obama directed the “Environmental Protection Agency… to complete carbon pollution standard for both new and existing power plants.” Specifics about the regulations are still absent, but the target is obvious: coal. Barack Obama has never made his feelings on coal a secret. While campaigning for the 2008 election, then Senator Obama detailed a policy that would “bankrupt” coal-powered plants.
The current climate plan explicitly calls for government action to promote switching away from coal power. The way the regulators can do this is by setting carbon emission standards for power plants at an unachievably low level for coal users. Carbon regulation on the horizon has already halted construction of new coal power plants and could shut down existing ones in the future. Carbon-based fuel produces over 80% of the nation’s power; coal power alone contributes 40% of the total. Stifling development from fossil fuels would shock the country’s production and employment. Literally every business and household across the country would face higher energy costs. Managers would have no other option but to cut production, lay off workers, and raise prices. Middle and working-class people would suffer lower standards of living as prices rise all around them and jobs disappear. Coal towns around the country that are already struggling in this tough economy would become ghost towns.
That is the economic reality behind the president’s energy agenda.
As negative feedback from his climate plan piled up, President Obama again changed the conversation, this time to his legacy-defining and ever unpopular namesake, ObamaCare. The Obama Administration declared it would delay the implementation of the employer mandate provision just earlier this month, citing insufficient time to implement the bloated, complex law. This move did nothing but spark new doubt of the law’s purpose and highlight its follies.
The employer mandate requires businesses to provide health insurance for all employees if they employ 50 or more full-time workers. In anticipation of this costly and burdensome regulation, businesses have stopped hiring full-time workers or cut hours of existing employees. The number of part time workers has doubled since 2007, thanks in part to ObamaCare’s perverse incentives. Along with reduced hours come reduced wages, and many family breadwinners have no choice but to work multiple jobs and more hours per week just to stay afloat.
ObamaCare’s damaging effects to the labor market became a reoccurring discussion in media, so the administration looks to change message again. Now President Obama touts a renewed focus on economics and the middle-class — a safe retreating message as his administration faces harsh criticism on all fronts. Shouldn’t the economic health of this country and the middle-class have been his focus all along?
Don’t be fooled, the speech tour is merely the president’s latest attempt to rebrand himself on the economy. But putting a pretty new bow on a damaged package doesn’t change what’s inside. It is the same failed ideas and ideology that has kept the American economy stuck in stagnation.