Payne: The little engine that can’t

Posted by hpayne on June 4, 2012

To read America’s mainstream media, the U.S. economy is a victim of forces beyond its control.

“Businesses are facing a growing threat from Europe’s financial crisis, which has worsened in recent weeks,” wrote the Associate Press Friday in a report echoed by The New York Times, The Wall Street Journal, CNN, and other outlets. ” Greece could be forced to exit the euro, which could push the region into a sharp recession. That could limit U.S. growth.”

Echoing the Obama administration’s press releases, the Obamedia has been predicting an economic boom ever since the U.S. emerged from recession just months after Barack Obama took office. But, alas, we’re told, fate keeps getting in the way. The Japanese tsunami, tornados, Egypt’s political revolution, and now the European debt crisis – all are responsible for America’s lackluster job growth and stubborn 8.2 percent unemployment rate.

Excuses, excuses. But what is almost entirely missing from the news reports is any recognition that American economic policy matters.

The U.S. economy is one-third of global output. Thirty percent. America is the world’s economic locomotive, and when it is laboring the world is hurting. For the last three years, President Obama’s historic expansion of the regulatory state has put extraordinary burdens on American business, depressing job creation. Yet, in insisting that America is a victim of external forces, the Obamedia has ignored asking the job creators here at home why they aren’t creating jobs.

If they did, they would hear businessmen under the strain of bad policy. Here’s what Michigan businesspeople told The Detroit News Editorial Page last fall.

“For the home-building industry to regain strength, we need to have the administration stop crippling our industry at every turn,” said Colin Herren, president Michigan Association of Home Builders. “”From the EPA lead laws to the new OSHA fall protection laws, we need to stop the barrage of Washington-based mandates that impact our ability to remain competitive and keep home ownership affordable.”

“It seems that this administration assumes that all businesspeople are evil-doers and that we’re out to cheat somebody. But that’s not true. We want to hire people and provide services and run good businesses,” said Jerry Grubb, owner, Wee Discover Child Daycare and Learning Center, Waterford. “There are so many regulations.”

“We are most worried about regulations,” said PVS Chemicals Vice Chairman James M. Nicholson in Detroit. “The riskier projects, the ones that intend to involve more jobs, are going to stay on the shelf as long as there’s the threat of constant (regulatory) change.”

Talk to Michigan entrepreneurs and you will get an earful about the difficulty of raising capital due to Democratic banking regulations. These sentiments are echoed nationally from Conoco CEO James Mulva (who visited our offices to protest the EPA’s anti-carbon policies) to Home Depot founder Bernie Marcus.

“Rather than encouraging economic growth, policies from Washington are making it difficult for small businesses to grow into bigger businesses,” wrote Marcus last month lamenting that he probably couldn’t have started Home Depot today given Obama’s anti-business assault. “Massive government expansion into health care, banking and a wide variety of other areas has become a major hurdle to job creation.”

It’s the regulations, stupid.

Yet you would never know it reading today’s MSM. Obamacare? Dodd-Frank? EPA’s War on Coal? They are rarely mentioned.

Policy matters. Which is why America’s last deep recession – in the early 1980s – had a very different outcome. Then, the Reagan administration followed pro-growth polices of deregulation and tax reform. The result? Growth rates that were three times greater that today’s Obama recovery. America wasn’t a victim.

It was the engine that could.


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