| Click for the Finfacts Ireland Portal Homepage |

Finfacts Business News Centre

 Irish Economy
 EU Economy
 US Economy
 UK Economy
 Global Economy
 Asia Economy


How to use our RSS feed

Follow Finfacts on Twitter

Web Finfacts

See Search Box lower down this column for searches of Finfacts news pages. Where there may be the odd special character missing from an older page, it's a problem that developed when Interactive Tools upgraded to a new content management system.


Finfacts is Ireland's leading business information site and you are in its business news section.


Finfacts Homepage

Irish Share Prices

Euribor Daily Rates

Irish Economy

Global Income Per Capita

Global Cost of Living

Irish Tax - Income/Corporate

Global News

Bloomberg News

CNN Money

Cnet Tech News


Irish Independent

Irish Times

Irish Examiner

New York Times

Financial Times

Technology News




Content Management by interactivetools.com.

News : US Economy Last Updated: Mar 7, 2014 - 8:18 AM

Dr Peter Morici: Obama Budget offers little relief from jobs drought
By Professor Peter Morici
Mar 7, 2014 - 7:49 AM

Email this article
 Printer friendly page
President Barack Obama meets with members of his national security staff in the Oval Office, March 06, 2014.

Dr Peter Morici: Friday, the Labor Department is expected to report the economy added 150,000 jobs in February. This is less than half the pace needed to lower unemployment to an acceptable level, and President Obama’s budget promises little relief.

Unemployment could slip to 6.5% because more adults quit looking for work.

ObamaCare and the Earned Income Tax Credit (EITC) encourage low wage workers and employers to limit hours to less than 30 per week. More part-timers boost the jobs count, but worsen the plight of the working poor.

The economy grew a nonplus 2.6% in the fourth quarter, and is slowing this winter. Auto and housing sales suffered, and service businesses such as restaurants and airlines took losses not easily recouped.

Slower commerce cannot be attributed only to cold and snow. Regulatory shifts burden the recovery. For example, the unnecessary jump in required pilot training hours imposes shortages on airlines, canceled flights and lost commerce.

Dodd-Frank has forced smaller banks into mergers with big Wall Street houses, where the drumbeat of criminal investigations continues like a Souza march on the Fourth of July. Homebuyers and businesses can’t get adequate credit and banks lay off workers by the thousands, while top brass gets multi-million dollar bonuses. If federal regulators and their congressional overseers have a learning curve, it’s mighty long.

Chronic slow growth is best illustrated by statistics spanning both the Bush and Obama years. Through two recessions and recoveries, GDP growth has averaged only 1.8%, whereas from Reagan through Clinton, the pace averaged 3.4%.

America has not changed. Technological progress continues, and global competition was just as tough when Japanese manufacturers invaded US markets as today with the Chinese onslaught.

Today’s leaders don’t value the combination of a vibrant private sector, genuinely competitive markets and personal responsibility as the last generation did. They are best skilled at gaming the system for friends, pacifying the poor and stressed working class with handouts, and collecting big commissions—a.k.a campaign contributions—that permit Wall Street banks, cable companies, large medical insurers, pharmaceuticals companies and the like to gain monopoly power and gouge customers. And they extract similar tribute from smaller players for shelter from an ever more abusive regulatory state and IRS scrutiny.

In emerging markets, Americans would label that corruption, but anyplace it simply breeds inefficiency and stagnant growth and kills good jobs.

Now, Obama’s budget champions even tougher regulation—for example, shoring up the Labor Department bureaucracy—and more entitlements boost the flagging spirits of the working poor—but no relief from IRS political targeting.

In this century, we have seen a substantial benefits expansion through the EITC, abuse of the Social Security disabilities program, Medicare drug benefits, Medicaid, ObamaCare, and student loans that bribe young adults out of the job market.

Thanks to the combination Bush-Obama regulatory reign of terror and welfare state, the economy has created a paltry 30,000 jobs per month since 2001. Four times as many would be needed to keep up with population growth.

Reagan and Clinton accomplished more robust growth and jobs creation with lighter regulations, lower taxes, less emphasis on entitlements and fewer efforts to suppress criticism of their administrations’ policies.

To bolster economic growth, those kinds of policies should be supplemented by greater attention to developing off-shore oil and gas, which could provide absolute independence from foreign oil, and confronting protectionism and currency manipulation to fix the trade deficit with Asia.

Together those could easily boost growth to 4 to 5% to catch up for lost progress and create more than 400,000 jobs a month.

Peter Morici,

Professor, Robert H. Smith School of Business, University of Maryland,

College Park, MD 20742-1815,

703 549 4338 Phone

703 618 4338 Cell Phone




Check out our subscription service, Finfacts Premium , at a low annual charge of €25 

© Copyright 2011 by Finfacts.com

Top of Page

US Economy
Latest Headlines
US jobs rose by 215,000 in July; Unemployment rate stable at 5.3%
US economy grew at weak pace in Q2 2015 - Worst expansion since 1945
Decoupling of per capita GDP, productivity, private employment, and median family income in America
US economy stumbles again in 2015
Income gap highest in 30 years; No inequality rise in best-paying US firms
Fed minutes raise doubts about fragility of US recovery
Senate Democrats block trade deal authority for Obama
Five firms held 25% of top US non-financial companies cash pile in 2014
US added 223,000 jobs in April; Broad jobless rate at 10.8%
Investment struggles as dividends/ share buybacks at top US firms to exceed $1tn in 2015
US economic growth plunged in Q1 2015
Why the Fed may (almost) never raise interest rates
US jobless rate falls to 5.5%; Broad rate at 11%; Participation rate at 1978 level
US added 257,000 jobs in January; Broad jobless rate at 11.3%
US economy will soon see best years in a decade
US annualised GDP slowed sharply in final quarter 2014
US budget deficit to fall to 2.6% of GDP in 2015
US added 252,000 jobs in December; Jobless rate falls to 5.6%
US adds 321,000 jobs in November; Private sector adds 10.9m jobs in 57 months of growth
US manufacturing slowed in November
US retail spending over Thanksgiving weekend fell 11%
US consumer spending weak in October; Business investment fell again
US third-quarter GDP revised up to 3.9% annualised rate
After destroying banking secrecy US helps Swiss exporters
US oil imports from OPEC cartel at 30-year low
Tax-inverted "Irish" firm Actavis agrees to buy US Botox maker Allergan
US nonfarm payroll employment rose 214,000 in October' Jobless @ 6-year low
Swiss bankers await fallout of US tax evasion acquittal
Two PMI reports give contrasting trends on US manufacturing
US GDP increased at annualised 3.5% in third quarter of 2014
US city home price growth slowed again in August; Consumer confidence rebounded in September
US new orders for manufactured durable goods fell again in September
Loans to buy US shares at record highs
Global markets slide; US industrial production best in 3 years & jobless claims in 14-year low
US federal budget deficit dips to 2.9% of GDP in fiscal year 2014
US added 248,000 jobs in September; Jobless rate falls to 5.9%
US set to become world’s leading liquid petroleum producer again
Obama issues new rules to combat tax inversions
US Securities and Exchange Commission to pay $30m award to foreign whistleblower
Typical American household income in 2013 was below the 1989 level