To nobody’s surprise, in Tuesday’s State of the Union address President Barack Obama repeatedly called on Congress to make "investments" in America’s future by appropriating large new sums of money for education, alternative energy and infrastructure to create what he often calls the jobs of the 21st century. If you feel like you have already heard this song from the chief executive, it is because you have — quite often in fact.
In January 2009, Obama said this in his first address to a joint session of Congress: "Now is the time to ... invest in areas like energy, health care and education that will grow our economy. The only way to fully restore America’s economic strength is to make the long-term investments that will lead to new jobs, new industries and a renewed ability to compete with the rest of the world."
Well, the "investments" recommended by Obama were made, to the tune of more than $100 billion in his economic stimulus program alone. So if business buzzwords such as "competitiveness" and "investment" — backed by billions of tax dollars — could create a friendly climate for American businesses, then we should be experiencing record economic growth right now.
Obama used the word "investment" 14 times in the February 2009 signing ceremony of his stimulus package. But for a more accurate representation of Obama’s views on business and private investment, look at the people he has hired to work for him in the White House. Take for example this gem from the deputy car czar, Ron Bloom: "I don’t need lenders." That is what Bloom told Chrysler’s secured creditors just before Obama’s Treasury Department forced them to accept the company’s fire sale to Fiat via a kangaroo bankruptcy.
Or how about this statement: "You don’t want to kill the golden goose, but you don’t want it to crap all over you either." That comes from Jared Bernstein, Vice President Joe Biden’s chief economic adviser and a key proponent of the 2009 economic stimulus program.
Officials such as Bloom and Bernstein say such cavalier things because in their boss’s America, business aims are subordinated to Obama’s vision of government industrial policy. In that context, the word "investment" means pouring the taxpayers’ money into dubious "clean-energy" projects and high-speed rail boondoggles.
Because there is no genuine market demand, these new "investments" will create neither wealth nor a net gain in new jobs.
We know that from Obama’s previous investments. For example, the White House Council of Economic Advisers asserted in a July 2010 report that by dedicating $46 billion in stimulus money to clean-energy programs and high-speed rail, they attracted another $107 billion in private investment in those areas. In other words, they lured $107 billion away from potentially productive, wealthy and job-creating investments and into more-expensive products and services for which there is little or no consumer demand.
That’s Obama’s idea of good business — forcing people to buy things they do not want (more-expensive energy) and do things they do not want to do (ride trains instead of drive vehicles). This exercise in political correctness might be good for Obama’s self-esteem, but it is lousy economics no matter how you look at it.