The Conference Board reported in recent days that consumer confidence in the economy plummeted to and index reading of 59.7. February’s reading came in at 68.
A healthy economy needs a confident consumer yielding an index of 90. Without this level of faith in the future of the economy, Americans are more wary of letting go of their cash for fear they may need it. And that kind of trepidation drags down an economy where consumer spending controls a 70% stake of its economic activity.
Of course this number reflects the concern Americans have over the much vaunted “sequestration cuts”, or so Board member opined.
Don’t you believe it.
First, there are no “cuts” in the sequestration affected spending bill recently signed by Obama. Remember that the sequestration was Obama’s brain child. Also remember that the spending bill he just signed was for $3.55 TRILLION, he wanted $3.59 TRILLION so even with the sequester government spending, that is, deficit spending, that is borrowing still increased by nearly $25 BILLION. The measly $85 billion sequestered came out of proposed spending increases which were scaled back. The federal government is still spending billions of dollars it does not have.
Second, nobody outside of Washington, DC and federal government employee circles paid much attention to the entire sequestration debate. A Pew Poll found in an early March sampling that less than 25% of Americans had even heard about it and less than 18% understood what it might do. Perhaps they took the commonsensical position that an $85 billion slowdown of spending in a budget blueprint calling for outlays of $3.55 trillion wasn’t worth the bother. And they’re right.
The sequestration issue pales in comparison to the real issues facing the American consumer. When Obama took office in January 2009 they were paying $1.84 for a gallon of gas. They’re lucky to get it for under $3.75 today. They buttered their toast on Inauguration Day 2009 with bread they bought for $1.77 a loaf; last week they kept the ends (“heels” to some) to extend the life of the $2.28 loaf they just bought.
And the economy does nothing but sputter, slipping into negative growth territory with the Federal Reserve offering up nothing more positive than a 2013 GDP growth of 1.9%. Look for a downward revision as more of Obama’s policies/regulations take hold. Unless there’s a GDP of 3.0 or better, getting unemployment under 7.7% simply won’t happen. It doesn’t matter how many people are added to local, state and federal government payrolls.
The consumer knows that Obama, Reid and Pelosi and other members of the Democratic Central Planning Committee have only two solutions to the mess they’ve created: increase spending and confiscate money from the job creators to give the illusion of “fairness” to everyone’s suffering.
In 2008 Obama campaigned on “Yes We Can!” In 2012 it was “Forward!” And so he did. He moved us forward into a European style economy complete with a threatened European style health care, entitlements, unemployment, taxation and inflation for necessities.
Barack Obama is a eurosocialist. He must be stopped.
©2013 Gary M. Wisenbaker
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