Obama’s clever use of default management
By Reginald Shareef
“Whether you live or die depends on the configuration of the battleground; whether you survive or perish depends on the way of battle.” — “The Art of War,” Sun Tzu
Many pundits were surprised by President Obama’s victory in the “fiscal cliff” battle with Republicans to raise the income tax rate on higher-earning Americans. They shouldn’t have been. Here’s why.
Shareef is a professor of public administration and policy at Radford University and Virginia Tech.
January 31, 2013 - 12:08 AM
Yeah that Prezbo is one clever dude as he keeps winning all these battles.
Default management takes you just so far though. It IS the battlefield and the conditions under which the battle is fought or the game played. And here Obama enjoys the homefield advantage. When the adoring media and those making their livelihood and existence off of growing government programs determine who the victor is, it’s not surprising that Obama just keeps on winning.
Last September if you’ll recall, oh wait you probably won’t, it was reported by the World Economic Forum that the USA placed 7th in global competitiveness. Nations ahead of us were Switzerland, Singapore, Finland, the Netherlands, Germany and Sweden. We ranked 76th in wastefulness of government spending and the burden of government regulations and 111th in macroeconomic environment due to the growth of national debt and lowering of credit rating. In that category the year before we placed 90th.
What’s interesting is in 2011 we ranked 5th, 2010 4th and in 2008, the USA was #1 in global competitiveness as ranked by the same World Economic Forum.
Yesterday, we learned our economy contracted .1% in the final qtr of 2012. We have 15,000,000 more people on food stamps since “the clever one” took office. MAYBE, if it were less about claiming and reporting victory and MORE about working toward building a successful future for the nation we would be winners.
But I fail to see the intelligence and benefit of Obama winning battles and we lose the war.
Dang! All those Socialists are ahead of us? Just Dang!
Professor Shareef has a very valid interpretation but I think the crux of the matter is that there are no easy, painless or cheered for choices left. ALL of the options are hard. ALL of them will bring pain. ALL of them will take time to bear fruit. The easy days (if they ever existed), are long gone.
What we cannot continue to do is have the top economic class and the bottom economic class pulling money, effort and time from the other two, it is unsustainable and IMO, immoral.
“America’s Four Socioeconomic Classes
1. Parasitic financial Aristocracy (creates no value, skims national surplus)
2. High value creation (employed, heavily taxed)
3. Low value creation (employed/informal economy, lightly taxed)
4. No value creation (unemployed, dependent)
In the conventional view, the wealthy subsidize the poor via taxes and donations to charity (i.e. noblesse oblige). But the conventional framework ignores the key question of where the wealthy obtained their fortunes, and the consequences of that wealth acquisition on the larger economy.
…What we need to consider is what happens as the parasitic and dependent classes take an ever-larger share of the national surplus while the classes creating most of the value decline in size and political influence.”
http://www.oftwominds.com/blogjan13/4-classes01-13.html
It is no good wasting money “going after” only one segment of users or abusers IMO.
Switzerland, Singapore, Finland, the Netherlands, Germany and Sweden are socialist? Who knew? (well, Sandi did I guess…)
Actually all have some form of representative government, whether through parliamentary elections, a republic, what have you. I think Sweden, like Britain, has a monarch, but mostly out of tradition, and mostly as a figurehead.
3 – Sandi, I was going to post that same article…you beat me to it. I agree with the four economic classifications. We need to minimize classes 1 (which includes the government, by the way) and 4.
Aww come on, if they have “universal health care” they are Socialists and you know it! Sweden FGS? “well-funded govt. social programs are offered. Universal healthcare and government-provided education at all levels is made available”! SOCIALISM!! You can’t fool me, those countries that take care of all those leeches cannot compete with us. Except when they do.
BUD, you are aware of a large part of the reason for the contraction don’t you? Come on, sure you do. Reduced government spending, especially defense. You should be cheering.
6 – I’m guessing they have much less debt than we do, and that’s the real kicker, no matter what economic system you trust.
7 – total government spending actually increased, meaning whatever miniscule cuts were made in defense were more than offset by budget increases elsewhere. What we are seeing is inflation.
So debt is “the kicker”?
So after an economic collapse, while this nation tries to recover, private spending stops and government spending should too?
Wow!
It’s inflation Sandi. Any idea why people are saving and not spending?
And in the spirit of tossing out meaningless exclamations at inexplicable times… ZOWIE!
To #6 (Sandi) and #8 (89Hoo): Concerning Sweden: http://www.economist.com/news/leaders/21571136-politicians-both-right-and-left-could-learn-nordic-countries-next-supermodel
“In the 1970s and 1980s the Nordics were indeed tax-and-spend countries. Sweden’s public spending reached 67% of GDP in 1993. Astrid Lindgren, the inventor of Pippi Longstocking, was forced to pay more than 100% of her income in taxes. But tax-and-spend did not work: Sweden fell from being the fourth-richest country in the world in 1970 to the 14th in 1993.
Since then the Nordics have changed course—mainly to the right. Government’s share of GDP in Sweden, which has dropped by around 18 percentage points, is lower than France’s and could soon be lower than Britain’s. Taxes have been cut: the corporate rate is 22%, far lower than America’s. The Nordics have focused on balancing the books. While Mr. Obama and Congress dither over entitlement reform, Sweden has reformed its pension system. Its budget deficit is 0.3% of GDP; America’s is 7%.“
Oh those funky Nordics!!
11- thanks Brian. Leave it to someone named Lindholm to have the scoop on Sweden.
Brian, thanks for adding that link. It confirms that whatever Sweden is doing or has done right, they still smack of that old ill-gotten helping their own people Socialism. No doubt, it spells their doom.
I thought disease and starvation was pretty much how the world keeps tabs on Category No. 4.
15 – and people call ME a conspiracy theorist.
I think we would all be amazed at just “how the world keeps tabs” on most of the things they constantly tabulate.