President Obama’s first hundred days

April 29, 2009

 Diana Furchtgott-Roth– Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute.  The views expressed are her own. —

In his first one hundred days, President Obama has shown himself to be one of the most radical U.S. presidents in history.  He is harming America’s defenses by publishing memos on interrogation of detainees and threatening to prosecute lawyers who drafted supportive memos.  He shakes hands with America’s enemies, such as Venezuelan leader Hugo Chavez, and sends mixed signals to its friends, such as Colombia’s President Uribe.

And, in the name of combating a recession, he is destroying the fundamental institutions of America’s free-market economy.

Not only would President Obama’s proposed programs move government spending to levels, in relation to the economy, unseen since the end of World War II, but his administration is increasingly involved in the minutiae of a new, unwise, industrial policy, such as how much firms can pay workers, and which banks are allowed to repay government loans, and which industries and companies deserve a government rescue package.

Under Obama’s proposed budget, the nonpartisan Congressional Budget Office projects the government deficit to hit $1.2 trillion in 2019, or six percent of GDP, after “bottoming out”—if it does—at  $658 billion in 2012, a level more than 40 percent above the highest deficit under the presidency of George W. Bush. By 2019, government spending would take up nearly a quarter of GDP, far higher than at the peak of Iraq war spending and the highest, excepting 2009 and 2010, since 1946.

Much has been written about President Obama’s plans for multi-year, growing expenditures on energy and health care. He has proposed to invest billions of dollars in wind, solar power, and other renewables, which now produce about 3 percent of U.S. energy, yet he neglects nuclear power, which produces 20 percent.  He has suggested a substantial cap-and-trade energy tax, which would raise more than a trillion dollars over time, according to some estimates. And he wants a down payment of $634 billion for a universal health care plan whose details he has not yet confided to the public.

In addition, Obama is pushing for other programs which are both costly and naive.  One of his priorities is high-speed passenger rail service, which was given a downpayment of $8 billion in economic stimulus funds and possibly $5 billion more in the budget.  This proposal is, to put it charitably, poorly-designed. Real high-speed rail, with trains that travel 150 miles an hour and faster, can be found in Europe and Japan, but they have not stemmed the increasing use of road transportation.  And these trains need their own, specially engineered rights-of-way, which would cost much more than $13 billion.

Some of Obama’s economic proposals appear to be aimed at placating labor unions, an important element in his political base, rather than encouraging economic recovery.  In March, even before the swine flu scare, he signed legislation ending a program, opposed by the Teamsters union, allowing a small number of Mexican trucks to enter into the United States.  Mexico is retaliating by imposing tariffs on almost 100 agricultural products, including wheat, beans, beef and rice, hurting American exporters.

In another concession to unions, the president has let the U.S. Labor Department end some disclosure requirements for union finances, originally put in place so that union members can learn how their dues are being spent.

Although Obama lauds transparency, the Labor Department has announced that it would not enforce the filing of the form that requires union officials to report conflicts of interest, such as whether they had personal relationships with firms doing union business.  In addition, unions will no longer be required to disclose supplemental information about officers’ pensions and compensation.

Even as unions are allowed to reveal less about their finances, financial institutions that have taken government funds, some reluctantly and under Treasury Department duress, are subject to an unprecedented level of scrutiny as to their compensation of senior executives.  Goldman Sachs, Morgan Stanley, and J.P. Morgan are being discouraged from repaying their Troubled Assets Relief Program funds, even though pay caps are interfering with retention of talented staff.  A government pressuring banks to do something not required by law is engaged in extra-legal behavior.

The government’s treatment of executive compensation bonuses, standard in many industries, has also been capricious. Some executives working in banks that received TARP funds were paid their bonuses without complaints from Washington.  Others, notably those working at AIG, were demonized both by the press and government.

For those who favor nationalization of the economy, or at least of big business, Obama’s first 100 days have been a roaring success.  Others, however, pray that the economy can survive not only the recession but also the president’s prescriptions.

53 comments

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NON of you saw the video of Obama bowing to Saudi king did you? But I bet the bleeding heart libs will say that it was not a bow it was Obama looking for more coins for the economy. Keep looking – do your research, none of his programs will come without a cost. Do some research on Pelosi too what a hypocrite.

Posted by sonny | Report as abusive

Seriously – maybe there’s room for you down on the ranch in Crawford?

Posted by Chris | Report as abusive

During the “Spring and Autumn Period” of China, the king of Qin, ancestor of the first emperor once help the second son of the neighbour Jin into power because the second son was not so good so King of Qin hope it would weaken the neighbour Jin. Unfortunately the new King of Jin created a lot of trouble and made unnecessary wars with his neighbour. King of Qin regretted what he did.George Bush created a weak USA. He made wars that go nowhere. He brought US deficit to 11 trillion. He refused to rectify the Kyoto Treaty putting USA 8 years behind its commitment to carbon emission. During this period, we see the North Pole nearly melt completely.Obama would likely create a stronger USA. Learning from King Qin, we Chinese believe a stronger leader for the USA is in the best interest of China. So far Obama keeps his words. We prefer to deal with wise men. I supppose it will be the best interest of the Americans to have a wise president that keeps his words too.

Posted by Lee Siu Hoi | Report as abusive

This is a President who dislikes everything about America, so much so that he wants us to be like Europeans and others who have spent decades envying us, and our way of life. Everything that was great about America will die in his Administration. His only appeal is to those who don’t want to take responsibility for their own lives, and want Government to act as a parent.This President is not like President Clinton in anyway, he will be another Jimmy Carter. My only hope for the survival of America is that he only gets one term.

Posted by Dee McDonald | Report as abusive

President Obama is a real breath of fresh air. He has his facts at his finger-tips and inspires leaders and people across America and world-wide. He is determined to bridge the gap between rich and poor. here is a caring, intelligent President trying his very best to reshape America and take it to the heights again. President Obama is vey much like President Kennedy especially with regard to charisma and intelligence. In 100 days his report card makes fascinating reading and one is convinced that his first term will be full of memorable successes

Do some reading Billy, you haven’t posted a fact yet.The Republican Congress of the 90′s was the biggest joke of the 20th Century. Rather than do something for the American people, they spent their entire time going after Clinton. They even shut down the government to their everlasting shame.Pay as you go Congress? They increased spending as much as any Congress, the difference being Clinton’s increased revenue.The dot.com boom was a small blip in the trillions of dollars of the US economy, it was the Clinton economic policy that caused the boom.

Posted by Mike O | Report as abusive

Diana, do you have to be so alarmist? Every article I’ve read from you thus far has been intensely critical Obama, and the goals that he is trying to achieve. I appreciate that your offering your opinion on the matter, but could you be a little less biased? You speak of Obama as if he’s going to precipitate the collapse of civilization.

Posted by Jonathan | Report as abusive

High speed rail is not practical for the US. In Nashville, they put in a passenger train line of about 30 miles. Used existing rail lines, bought used cars and refurbished them. The cost- ONE MILLION DOLLARS PER MILE!Now I am no expert, but I expect high speed rail to be much more costly. 13 Billion probably does not get us very far. And who will pay? Those of us who work. We pay the bill and if you think “Big Companies” or “rich people” will pay higher taxes to fund this you really are stupid. The companies pass the extra taxes to us as consumers. The rich had tax experts to keep them from paying, so “we” the “little people” pay.Oh, BTW, look how good a job universal health care is doing with the swine flu in Mexico. Sick people being turned away and not being treated aggressively. This is waht we have to look forward to under the big “O”.

Posted by Mel | Report as abusive

Hey Arlen – Welcome to The Party! Diana there’s still time to see the light!

Posted by Chris | Report as abusive

Mel – Are you seriously thinking that comparing Mexico and the United States on any level is an apples-to-apples comparison. Mind you Universal Care has hurdles, but a US Mexico comparison doesn’t come close to being real. While you are busy with your research remember to throw down a couple of Ho-Ho’s and some Ring Dings. Ultimatley there is of course no relationship between what you eat and how healthy you are. I am looking forward to paying more for all of you lard asses to have state sponsored heart by-pass operations under the future US Universal Health Care. Right after Im done paying for the mortgage on the house you couldn’t afford and the 60″ flat panel you bough on credit you really didn’t have.

Posted by chris | Report as abusive

Mike O, do some reading yourself. Not everyone agrees with you:”Clinton’s economic success was due to the dot-com revolution and all the capital gains taxes generated by huge stock gains and sales, not to mention the peripheral gains in income taxes from the resultant economic boom. These gains happened in spite of Clinton’s tax increases. That is, he was lucky. When the boom burst so did the surpluses.”That is not my opinion bur only one of many economic experts. Nothing but the facts, Mike. I’ll be watching from Costa Rica while you and your ilk go down the drain to socialism under your new prez.Costa Rica, the oldest democracy in Central America, NO MILITARY, low taxes, excellent health care at 1/3 the cost of the USA. Bye, bye.

Posted by Billy | Report as abusive

As an independent both of you party-line voting sides scare the hell out of me. One side bowing to Obama, another side talking about how great Bush is (by siding with the bush-loving author).Best way to help the market is with limited gov’t, no income taxes and a 10-15% corporate tax, which neither president and neither political party wants to have their powers over the peopled limited in such a way.Both parties want to tax us all til we’re lower class,spend crazy amounts of money through “stimulus” packages, nation build (Iraq or Afghanistan), keep the borders wide open, rack up the national debt, bow down to NAFTA, work hand in hand with Communist China, there’s literally not one bit of difference in the two parties.We’d prefer to just keep shooting ourselves in the foot while our standard of living slowly declines year by year. To the guy who was whining about Obama bowing down to the Saudi King, we’ve been allies with those monsters throughout both democratic and republican administrations and your boy Rumsfeld was happy to shake hands with Saddam Hussein.For the good of your country and the good of your souls in the next election vote for a 3rd party and if you don’t support any of them don’t vote.Ron Paul 2012

Posted by Michael Ham | Report as abusive

Michael, obviously you have mistaken me for someone who votes for the two leading parties. I learned better than that long ago. I vote Libertarian and always will. Keep the government OUT of my business. That’s why my state still has a 14 billion dollar surplus and will not take any bail-out money that has any government stipulations.

Posted by Billy | Report as abusive

Billy,I was talking about the commenters as a whole, not you individually. However you are implying that NOW we’re a socialist country and weren’t prior to Obama. Despite the fact that our taxation, parts of healthcare, parts of auto insurance, social security, education have all been socialist for decades.

Posted by Michael Ham | Report as abusive

Equity holders are wiped out. Secured lenders offered mere pennies on a dollar, and the offer strongly implies “you better take it or else…” Corporate actives handed down to the unions and the government. Who could’ve done it? Lenin in 1917? Fidel Castro in 1959? Chavez in 1998?Nope, it’s Obama 2009! That scenario was exactly what he planned for Chrysler, and something along those lines is in the works for GM. Ford will remain the only private holdout in the industry, and probably not for long. The control over US auto industry being handed down to UAW, that was the main culprit in the industry demise, with their exorbitant pay and benefit demands. The unions were among Obama’s most fervent supporters, and now he is paying back.Hopefully the bankruptcy judge will stick to the law and not give in to the pressure. According to the law UAW is nothing more than unsecured lender, and as such must line up behind bond holders, suppliers, and other secured lenders.As for other things, there are questions no one dared to ask:- Are you personally better off today than 100 days ago?- Is the economy better today than 100 days ago?- Are the relations with our allies around the world better today than 100 days ago?For the last 2, the jury is still out, but it looks rather negative than positive. And the first question – ask any one that got laid off, went into bankruptcy, or lost their house in foreclosure during the last 100 days.

Posted by Anonymous | Report as abusive

It is evident to me that our political parties nominate and and elect criminals to office including the Presidency. Our government is charged with the responsibility of impeaching and prosecuting elected officials where evidence suggests they have committed “High Crimes and Misdemeanors”. Or are wars of aggression, seizing resources and torture neither?Perhaps we should all read the works of John Locke and closely review the Declaration of Independence too.

Posted by Anubis | Report as abusive

I think he’s doing the same thing I would have done. I’m tired of all the secrets, the allowing of executive orders to be signed in, (more secrets) and how there was no regulation in the banking industry so that this mortgage crisis could manifest into the implosion of the the century. I thank God for the transparency, I believe it is written that there are no such things as secrets, just a lacking of knowledge as to how to read between the lines. A long time ago, people thought that a wierd looking vehicle was called a chariot of fire, but today, we’ve seen that what it really was a flying saucer. Every mystery has a time for recognition, it just takes the right kind of people. Is Obama the right kind of person for this job. Of course he is, i’ve seen no one with more guts to open up the chambers of lies and disclosure like President Barak Obama. Now if he could only look into the secret world of DCF, he will faint, his heart will be broken, touched and moved. This group is one of the biggest conspirators of all times. Foster kids for sale.

Posted by pumpkin pie | Report as abusive

Diana, your comments on energy consumption are misleading, and suggest that you are too focused on promoting your agenda to be bothered by the facts. Nuclear power provides for 20% of U.S. ELECTRICITY consumption, not 20% of our total energy. And since solar and wind power currently supply much less, why NOT encourage their growth? These are two of our cleanest and most plentiful renewable energy resources, and have been neglected unwisely for decades by previous administrations.

Telling the truth sure makes him a radical from recent presidents. This kind of message from Diana is why the Repubs lost the election..fair & balanced..indeed

Posted by Dan Cedusky | Report as abusive

You leftist and Obama lovers are out of control. this is an article based on fact. Not right wing extremism. The only things extreme going on right now is our radical president. You leftist want to bash Bush and make him out to be some sort of comunist but as fasr as I am concerned he protected my white american rear. Obama chooses to sale me out, take my money, give it to worthless trash to buy crack and then expect me to also pick up the medical bill when they overdose. This is horrible and If george washington was alive today, you would see a NEW AMERICAN REVOLUTION. Starting with the removal of the new socialist party and all the imigrants and lazy fools in america that follow it. AMerica became strong by defending itself and protecting its interest in the world since it was founded. That is long gone now.This is a sad sad age fro America, I am glad I do not have children right about now.

Posted by Mike F | Report as abusive