Free Markets, Free People

Daily Archives: June 7, 2011


Does the economy doom Obama’s re-election hopes?

I’m beginning to wonder if the Republicans can run just about anyone for President (note the qualifier – “just about” – not everyone, even among the declared candidates) and win given this economy and this president:

Americans’ disapproval of how President Barack Obama is handling the economy and its growing budget deficit has reached new highs amid broad frustration over the slow pace of economic recovery, according to a Washington Post-ABC New poll released on Tuesday.

The ratings boost Obama received after the killing of Osama bin Laden has dissipated with his job approval rating back to 47 percent. Forty-nine percent disapprove of his performance.

Obama’s approval rating bounced to 56 immediately after bin Laden was killed last month.

But it went back to a plurality very quickly.  On the key issue, however, it hasn’t returned to a particular percentage – it’s gotten worse.  Much worse:

Fifty-nine percent, a new high, gave Obama negative marks for his handling of the economy, up from 55 percent a month earlier.

Obama’s approval rating on the deficit issue hit a new low of 33 percent, down 6 points since April.

Anyone who doesn’t understand that is where the election will be decided hasn’t been paying attention to politics very long.  Bill Clinton knew it when he rode to victory on his “It’s the economy, stupid”.   Ronald Reagan knew it when he continually asked, “are you better off now than you were 4 years ago”?   And Barack Obama would probably kill to have the economic problems Jimmy Carter faced – not that he’d do any better than Carter.

The point is, in bad economic times, incumbents have a tough road ahead of them at election time.  That’s because economic issues, joblessness, insecurity and fear are felt and understood by everyone.   Pocketbook issues are personal issues.   And the public has always voted those issues in general elections – much to the disadvantage of incumbent politicians, especially presidents.  There’s a number going around out there which claims that no president  since FDR has been re-elected with unemployment over 7.2% .  Of course keep in mind only a some of them since then have run for re-election and not all of them had bad unemployment numbers at the time.   The point, however, is that this sort of issue is critical to re-election chances.

The survey reflects a broadly pessimistic public mood as high gasoline prices, sliding home values and high unemployment numbers raised concerns about the pace of the U.S. economic recovery, The Washington Post said.

Eighty-nine percent of Americans say the economy is in bad shape; 57 percent say the recovery has not started and 66 percent said the United States was seriously on the wrong track.

Forty-five percent said they trust congressional Republicans over Obama to handle the economy, up 11 points since March.

If much of what is listed in the first paragraph isn’t improving fairly dramatically when 2012 arrives, Obama is in for a long year and, just guessing here, an “upset” loss.  The shine has worn off.  The cache of electing a black president has run its course.  History has been made.  And now the results part of the show come to bear.   Having been a moment in history won’t save Obama if the economy still sucks as badly as it does now.

My dad used to always tell us boys, “you live between your ears”, meaning attitude was critical to how you approached life and overcame obstacles.  Attitude is also critical in economies.  Pessimism isn’t the predominant mood one wants within the citizenry when they’re hoping to see it turn around.   And it certainly isn’t the mood a president wants through out the lane when he’s running for re-election.

Yeah, this is going to be an interesting year and a half until election day 2012.  I’m betting it’s not better economically and, again depending on who the GOP eventually nominates, Republicans stand to win the election.  Or, and you heard it here first with all the caveats – it is most likely the Republican’s election to lose.

Of course, knowing them, I have little doubt they can manage to do that.

~McQ

Twitter: @McQandO


Survey: As ObamaCare kicks in up to 30% of employers plan to drop health care coverage

This, of course, is “unexpected” (and not believed) by some.  In fact, the White House has pushed back saying the findings of the survey of 1,300 employers is at odds with findings from the CBO, Urban Institute and Rand Corporation studies.

In an email response, the official wrote that when Massachusetts initiated its own reform, the number of individuals with employer-sponsored insurance increased.

Indeed, the Rand study released in April noted: “The percentage of employees offered insurance will not change substantially, but a small number of employees in small firms (defined as those with under 100 employees in 2016) will obtain employer-sponsored insurance through the state insurance exchanges.”

In a Jan. 25 study, the Urban Institute said that reports of the demise of employer-sponsored insurance were “premature” and that few would stop offering.

“Our results show the opposite — the [Affordable Care Act] has little effect on overall [employer-sponsored] coverage, and overall employer spending on health care would be slightly lower under the ACA,” according to its own study.

However, one can speculate that as the law becomes better known, employers are having second thoughts about trying to cope with something most of them would just as soon lay off elsewhere.  The cost and hassle just aren’t worth it and now that there are alternatives, a good percentage of them are actually interested in pursuing them:

The survey of 1,300 employers says those who are keenly aware of the health-reform measure probably are more likely to consider an alternative to employer-sponsored plans, with 50% to 60% in this group expected to make a change. It also found that for some, it makes more sense to switch.

“At least 30% of employers would gain economically from dropping coverage, even if they completely compensated employees for the change through other benefit offerings or higher salaries,” the study says.

It goes on to add: “Contrary to what employers assume, more than 85% of employees would remain at their jobs even if their employers stopped offering [employer-sponsored insurance], although about 60% would expect increased compensation.

Health care benefits are a net loser for any company.  Cost added to the requirement for staff, contracts, problems, etc. makes it a program many employers would love to ditch.  But such benefits have become a part of any competitive package through the years – the better the benefits, the more attractive the offer.  Now, under ObamaCare, those “Cadillac” plan are going to be taxed (well, unless you have an exemption like most unions).  So there’s little incentive to continue with them.  Consequently, despite promises to the contrary, employers aren’t going to pay for something that is going to be taxed at a higher rate.   So you won’t get to keep your plan.

Employers, in the meantime, are looking for cost savings alternatives and dumping health care cost and the associated hassles has to be very attractive to them.  So it comes as no surprise, at least to me, that 30% of those surveyed are considering exactly that.   A huge “told you so” that critics pointed to prior to ObamaCare passage that was largely waived away by supporters.

So who you going believe – CBO, Urban Institute and Rand, or human nature?

Yup – me too.

~McQ

Twitter: @McQandO


A couple of enviro myths and reality

Myth one – wind power has no down side.  Well, except for the fact that wind power needs fossil fuel backup to give it any consistency and thus can be hardly called strictly renewable or “clean energy”.

But in this case, I was thinking more on the endangered species side of things.  The assumption is that wind power is an entirely eco-friendly way of generating power.  Yeah, not so much if you’re a bird – especially, in the case of California, a golden eagle:

The death count along the ridgelines of the Bay Area’s Altamount Pass Wind Resource Area has averaged 67 a year for three decades.

The 200ft high turbines, which have been operating since the 1980s, lie in the heart of the grassy canyons that are home to one of the highest densities of nesting golden eagles in the US.

‘It would take 167 pairs of local nesting golden eagles to produce enough young to compensate for their mortality rate related to wind energy production,’ field biologist Doug Bell, manager of East Bay Regional Park District’s wildlife programme, told the Los Angeles Times. ‘We only have 60 pairs,’ he added.

Interesting – the enviro-crowd will go to war for some tiny fish no one is heard of to stop a dam or some other project, but when something they mostly support grinds up endangered golden eagles at a rate at which they can’t replace themselves, crickets (endangered crickets, of course).  In CA only the Audubon Society is speaking out. 

And nationally:

Nationwide, about 440,000 birds are said to be accidentally killed at wind farms each year, as well as thousands more bats. With the government pushing for more wind energy farms, that statistic is likely to rise.

Can’t wait to see what comes of the Cape Wind project off of MA.  The toll of birds is sure to rise, and my guess is it will become a favorite hang out for sharks – with the automatic chumming and all.

Myth two – we’re “deforesting” the earth and that is a major reason that the climate is changing and getting warmer (more CO2 generated by man , minus less CO2 capture by forests).

A new study says not so fast:

For years exponents of climate change theories have used images of deforestation to support their cause.

However, the density of forests and woodland across much of the world is actually increasing, according to a respected scientific study.

The change, which is being dubbed the ‘Great Reversal’, could be crucial in reducing atmospheric carbon, which is linked to climate change.

Seems that the density has in fact increased significantly enough to actually reverse what was claimed as irreversible a decade ago:

In countries from Finland to Malaysia, the thickening has taken place so quickly that it has reversed the carbon losses caused by deforestation between 1990 and 2010.

Of course, even if they acknowledge the results of the study, enviro types aren’t happy with the mix of the new density.

Environmentalists expressed concerns, however, that much of the increasing density is driven by huge new monoculture plantations.

In China, an ambitious reforestation programme has added three million hectares to the country’s forests every year over the past decade, but green campaigners believe this is predominantly composed of one species – eucalyptus.

But the study says the density, regardless of species, is having the effect of taking in more carbon that forest were taking in during the previous decade, regardless of species.

The research, carried out by teams from the University of Helsinki and New York’s Rockefeller University, shows that forests are thickening in 45 of 68 countries, which together account for 72 per cent of global forests. Traditionally, environmentalists have focused their concern solely on the dwindling extent of forested areas, but the authors believe evidence of denser forests could be crucial in reducing the world’s carbon footprint.

So – if you’re one of the global warming alarmists who want to do something about your carbon footprint – go plant a tree or two.  As for the myth of deforestation – well, it’s just that, a myth.  10 million hectares of “new forest” are planted each year on newly felled woodland or reclaimed land.  And, per the study, the density in which it is planted has, within a decade, “reversed” any theorized damage and has the world in a net positive situation for CO2 capture.    That means, of course, that the alarmists no longer have this particular issue with which to hammer industries that use forest products – well except whine about what they’re planting.

~McQ

Twitter: @McQandO

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