The American economy suffered a setback as, Bush was about to leave office and it appeared that Obama was going to win the election. It started as a bank bust and many other banks had their necks on the chopping block. One TARP plan and the banks were saved. The US did not enter into a state of depression. Yet the collapse of the housing bubble continued and the country entered into a recession as, Bush left office and Obama took the reigns of power.
The plan worked out in this transition period, by both democrats and republicans, went into action. After so many job losses the bleeding eventually stopped, relatively speaking. More jobs were being created than jobs lost. However hope of a quick turn around was soon dead. Job growth was only about half of what was expected. It meant that the economy would take twice as long to recover, but it would recover.
Then came Obama Care. A health plan to insure all Americans. It was pushed through a Congress and a Senate that the democrats controlled. Even though most Americans rejected the plan, Obama covered his ears so he could not hear the outcry to stop. The following mid-term elections was a wake-up call to stop government growth, in size and spending, and a rejection of the health care plan. The wake-up call fell on deaf ears. The plan, the growth, the spending is going forward unabated. The result, a job growth so slow that it would take a decade or more to turn around. Even that assessment is too optimistic.
One would think that the problem of very slow job growth would be difficult, if not almost impossible, to turn around. Yet the collapse of the meagre job growth was not due to the increase in spending from the stimulus plans. The slow growth of jobs, reduced to a creep, came about from that single action taken by the government. That action, that act, was the passing of the health care plan. It is the great unknown facing every company, both small and large. How much red tape? How much will it cost the employer? How much will everyone’s cost for insurance increase, both business and personal?
It can’t be all the blame of the health care plan? Probably not. But with conditions the way they are, adding this huge unknown burden to business at this time, was a foolish step. The banks withhold money because of uncertainty. Businesses also are withholding jobs because of uncertainty. Nobody wants to buy… because of uncertainty. Look at the job creation stats. They were rising slowly prior to passage of the health care plan. After the health care plan passed and was signed into law the job growth stats levelled off. Sadly, the only reason the unemployment rate has levelled off is because people are falling off the grid. Kind of insane if you ask me. You measure the unemployment rate by those receiving benefits, and fail to include those who are still unemployed but no longer qualify to collect benefits. The unseen, not measured, blot on the economic picture.
Obama’s health care plan, and it is his plan with some modifications, is the major reason for the continuing problem of minimal job growth. Even a trillion dollars a year in increased spending can’t turn this young mule around. The roll of bureaucrats is increasing and miles of red tape are being prepared. Businesses fear two things: the cost of the program and the red tape that will accompany it. It isn’t the only thing that worries business, perhaps they could weather the storms of financial woes coming from overseas. They won’t be able to do that if they are tied down by greater expense and regulation at home.
It is the government minions trussing up the business Colossus. Remind you of anything?
Wrapping with Care the Colossus
Ahem, Gulliver and the Lilliputians if you missed the reference.