"Obama’s Gotta Go"--truer words never spoken

Niall Ferguson: Obama’s Gotta Go

Why does Paul Ryan scare the president so much? Because Obama has broken his promises, and it’s clear that the GOP ticket’s path to prosperity is our only hope. 

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I was a good loser four years ago. “In the grand scheme of history,” I wrote the day after Barack Obama’s election as president, “four decades is not an especially long time. Yet in that brief period America has gone from the assassination of Martin Luther King Jr. to the apotheosis of Barack Obama. You would not be human if you failed to acknowledge this as a cause for great rejoicing.”

Despite having been—full disclosure—an adviser to John McCain, I acknowledged his opponent’s remarkable qualities: his soaring oratory, his cool, hard-to-ruffle temperament, and his near faultless campaign organization.

Yet the question confronting the country nearly four years later is not who was the better candidate four years ago. It is whether the winner has delivered on his promises. And the sad truth is that he has not.

In his inaugural address, Obama promised “not only to create new jobs, but to lay a new foundation for growth.” He promised to “build the roads and bridges, the electric grids, and digital lines that feed our commerce and bind us together.” He promised to “restore science to its rightful place and wield technology’s wonders to raise health care’s quality and lower its cost.” And he promised to “transform our schools and colleges and universities to meet the demands of a new age.”

Unfortunately the president’s scorecard on every single one of those bold pledges is pitiful.

In an unguarded moment earlier this year, the president commented that the private sector of the economy was “doing fine.” Certainly, the stock market is well up (by 74 percent) relative to the close on Inauguration Day 2009. But the total number of private-sector jobs is still 4.3 million below the January 2008 peak. Meanwhile, since 2008, a staggering 3.6 million Americans have been added to Social Security’s disability insurance program. This is one of many ways unemployment is being concealed.

Niall Ferguson discusses Obama's broken promises on ‘Face the Nation.’

In his fiscal year 2010 budget—the first he presented—the president envisaged growth of 3.2 percent in 2010, 4.0 percent in 2011, 4.6 percent in 2012. The actual numbers were 2.4 percent in 2010 and 1.8 percent in 2011; few forecasters now expect it to be much above 2.3 percent this year.

Unemployment was supposed to be 6 percent by now. It has averaged 8.2 percent this year so far. Meanwhile real median annual household income has dropped more than 5 percent since June 2009.

Nearly 110 million individuals received a welfare benefit in 2011, mostly Medicaid or food stamps.

Welcome to Obama’s America: nearly half the population is not represented on a taxable return—almost exactly the same proportion that lives in a household where at least one member receives some type of government benefit. We are becoming the 50–50 nation—half of us paying the taxes, the other half receiving the benefits.

And all this despite a far bigger hike in the federal debt than we were promised. According to the 2010 budget, the debt in public hands was supposed to fall in relation to GDP from 67 percent in 2010 to less than 66 percent this year. If only. By the end of this year, according to the Congressional Budget Office (CBO), it will reach 70 percent of GDP. These figures significantly understate the debt problem, however. The ratio that matters is debt to revenue. That number has leapt upward from 165 percent in 2008 to 262 percent this year, according to figures from the International Monetary Fund. Among developed economies, only Ireland and Spain have seen a bigger deterioration.

Not only did the initial fiscal stimulus fade after the sugar rush of 2009, but the president has done absolutely nothing to close the long-term gap between spending and revenue.

His much-vaunted health-care reform will not prevent spending on health programs growing from more than 5 percent of GDP today to almost 10 percent in 2037. Add the projected increase in the costs of Social Security and you are looking at a total bill of 16 percent of GDP 25 years from now.

That is only slightly less than the average cost of all federal programs and activities, apart from net interest payments, over the past 40 years. Under this president’s policies, the debt is on course to approach 200 percent of GDP in 2037—a mountain of debt that is bound to reduce growth even further.

And even that figure understates the real debt burden. The most recent estimate for the difference between the net present value of federal government liabilities and the net present value of future federal revenues—what economist Larry Kotlikoff calls the true “fiscal gap”—is $222 trillion.
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(for once I put only page 1 of 4 for concerns of length of a post on this page--go to the link for the rest of this knock-your-socks-off reality check)

http://www.thedailybeast.com/newsweek/2012/08/19/niall-ferguson-on-why-barack-obama-needs-to-go.html

(here's the last few grafs):

It remains to be seen if the American public is ready to embrace the radical overhaul of the nation’s finances that Ryan proposes. The public mood is deeply ambivalent. The president’s approval rating is down to 49 percent. The Gallup Economic Confidence Index is at minus 28 (down from minus 13 in May). But Obama is still narrowly ahead of Romney in the polls as far as the popular vote is concerned (50.8 to 48.2) and comfortably ahead in the Electoral College. The pollsters say that Paul Ryan’s nomination is not a game changer; indeed, he is a high-risk choice for Romney because so many people feel nervous about the reforms Ryan proposes.

But one thing is clear. Ryan psychs Obama out. This has been apparent ever since the White House went on the offensive against Ryan in the spring of last year. And the reason he psychs him out is that, unlike Obama, Ryan has a plan—as opposed to a narrative—for this country.

Mitt Romney is not the best candidate for the presidency I can imagine. But he was clearly the best of the Republican contenders for the nomination. He brings to the presidency precisely the kind of experience—both in the business world and in executive office—that Barack Obama manifestly lacked four years ago. (If only Obama had worked at Bain Capital for a few years, instead of as a community organizer in Chicago, he might understand exactly why the private sector is not “doing fine” right now.) And by picking Ryan as his running mate, Romney has given the first real sign that—unlike Obama—he is a courageous leader who will not duck the challenges America faces.

The voters now face a stark choice. They can let Barack Obama’s rambling, solipsistic narrative continue until they find themselves living in some American version of Europe, with low growth, high unemployment, even higher debt—and real geopolitical decline.

Or they can opt for real change: the kind of change that will end four years of economic underperformance, stop the terrifying accumulation of debt, and reestablish a secure fiscal foundation for American national security.

I’ve said it before: it’s a choice between les États Unis and the Republic of the Battle Hymn.

I was a good loser four years ago. But this year, fired up by the rise of Ryan, I want badly to win.