Barack Obama's Economic Plan: Will It Work?

Photo: RyanMcD

Disclaimer: I'm not a journalist and please read my FAQ if you decide I'm pure evil. Thanks!

Since Obama released a 2 minute ad on the current economic climate and his proposals for change, I thought I would drill down to see what he's got. Once I realized it was a rehash of what was already on his site, I was a bit disappointed. I was expecting some new ideas. Either way, here's the first few points of the plan I've dissected:

$1,000 Tax Cut for Middle Class American Families

Obama and Biden will cut income taxes by $1,000 for working families, because the economy needs to be revitalized from the bottom up, not top down.

Energy Rebates

Obama and Biden will enact a windfall profits tax on excessive oil company pr ofits to give American families an immediate $1,000 emergency energy rebate to help families pay rising bills.

Income tax credit: good. Tax increases for corporations: bad. Emergency energy rebate: huh? (I don't understand who is entitled to the rebate and when - sounds like a subsidy to me.) Obama's fundamental misunderstanding of how taxes work is blatant here. When a corporation's taxes increase, they cannot materialize extra money from thin air, it is taken from their bottom line. You might think, "So what?" But you need to start using your brain. Corporations will simply raise their prices on you, the consumer, or fire employees (that would be you again) to make ends meet. You need to understand this isn't gouging, but economic survival. Also, you need to understand what windfall profits Obama is planning on taxing. For example, Exxon Mobil $1,400 a second in profits, sounds excessive, right? Well they also pay out $4,000 a second in taxes and $15,000 a second in operating costs. If Obama considers keeping 6.8% of profits is a windfall, we should fear what he'll do to our pocketbooks.

Create Jobs through Fair Trade

Obama and Biden believe that trade with foreign nations should create American jobs, not send them overseas. They will stand firm against agreements that undermine our economic security.

Free trade: good. Free trade with restrictions: uh, not free trade at all. More specifically, Obama opposes the Central American Free Trade Agreement and wants to "amend" NAFTA to protect American jobs.

Photo: saguayo
While I support his opposition to subsidies used abroad and tariffs, he is a hypocrite because he supports subsidized employment at home!

Furthermore, I call B.S. on Obama's collectivist mantras, he ignores the extremely beneficial impact CAFTA and NAFTA have/will have on the people of Latin America, whose lives and economies will be dramatically improved along with our own. NAFTA is the reason why Mexico elected an opposition party leader after 71 years under the same oppressive regime. How is that not good for the world? Obama opts for nationalist and elitist global politics. If you ask me, sacrificing the artificially inflated pay grades of American workers to help far more lives abroad is the real definition of fair and free trade; far more of an American ideal than stale, old protectionist policies, which is what Obama proposes. Globalization is not going away. If we refuse to adopt full free trade, there are plenty of other countries who will, and rightfully reap the benefits.

Create 5 Million Green Jobs

Obama and Biden believe that we should invest in innovation and manufacturing jobs in the growing clean energy market, freeing us from our dependence on foreign oil within a decade and creating 5 million green jobs.

Green jobs: good. Regulations forcing companies to adopt them: awful. I agree 100% with encouraging companies to go the "green" route, but companies have to make the choice willingly, not forced by government regulations or sleazy tax advantages to companies who produce what the central planners deem best. This is a pre-cursor to socialist policy, I can't sugarcoat it. We need to leave environmental matters to the market for the most efficient and cost effective results.

The shocker of the plan? Obama will mirror his Advanced Manufacturing Fund on Michigan's 21st Century Jobs Fund. I'm not sure if anyone has been to Michigan lately, but I'm a lifelong resident and recent years have seen a slow and desperate decline in jobs, productivity, and inability to attract new businesses due to an inhospitable business environment.

My biggest question: if Obama can Biden assert jobs can simply be "created," why stop at 5 million? How many unemployed people are there? Why not create enough for everyone who needs one?