Welcome to the Democrat Malaise

While China Surpasses U.S. Manufacturing, Job Creators Doubt Democrats’ New Stimulus Will Do Better than the Last

• A new report shows China surpassing the U.S. in manufacturing, a sign that the bad economy Obama inherited has become appreciably worse.
• This is just the latest jarring signal that under Democrat policies America is struggling to grow our economy and falling behind our global competitors. Yet President Obama wants to place a $450 billion bet that if his first $800 billion stimulus didn’t grow our economy, perhaps hundreds of billions in more government spending will.
• As Democrats double-down on more of the same failed stimulus spending, it’s not hard to see why many job creators are skeptical of Obama’s plan to “spend his way out of the recession.”

BACKGROUND 

A new report shows China surpassing the U.S. in manufacturing, a sign that the bad economy Obama inherited has become appreciably worse:

U.S. ECONOMY MAY FACE “A PROLONGED PERIOD OF MALAISE,” ECONOMISTS WORRY: “Professional forecasters are increasingly worried that the U.S. economy faces a prolonged period of malaise.” (Luca Di Leo, “Economic Forecasters Become More Pessimistic,” The Wall Street Journal, 9/13/2011) 

GROWTH FORECASTS SLASHED IN HALF: “The latest survey by the National Association for Business Economics Monday showed forecasters slashed in half their 2011 economic growth predictions to a level that’s too low to bring down the high unemployment rate.

“While most still believe the economy will skirt a recession, more than one-third expect the recovery from the deep downturn of 2008 and 2009, now in its third year, to remain subpar. … The panel of 52 economists — ranging from Rajeev Dhawan, professor at Georgia State University, to Jim Glassman, economist at J.P. Morgan Chase & Co. — on average expect gross domestic product to rise by only 1.5% at the end of this year. That’s down from a 3.1% GDP growth forecast made in the previous May survey. For 2012, forecasters expect GDP to rise 2.7%, down from the 3.3% growth rate projected in May.” (Luca Di Leo, “Economic Forecasters Become More Pessimistic,” The Wall Street Journal, 9/13/2011)

CHINA ON TRACK TO SURPASS U.S. IN MANUFACTURING STRENGTH SOON…IF IT HASN’T ALREADY: “Exactly when China took the lead, ousting the United States from a position held for more than a century, isn’t easy to pin down. The bureau says it may have come in 2009, when Chinese manufacturers generated $1.7 trillion of ‘value added,’ versus America’s $1.6 trillion. (When a $100 sheet of steel, for example, is shaped into a $125 auto fender, the value added is $25.)

“Relying on World Bank figures, some economists suggest that China moved into first place in manufacturing last year. Others say that based on measurements of actual purchasing power, the moment has not yet arrived but will come soon.” (Louis Uchitelle, “Is Manufacturing Falling Off the Radar?”, The New York Times, 9/13/2011)

AS OBAMA PROPOSES STIMULUS 2.0, MANUFACTURING “HAS LARGELY FALLEN OFF WASHINGTON’S RADAR SCREEN”: “As President Obama urges Congress to enact a package of tax cuts and new government spending intended to revive growth and create jobs, one crucial corner of the American economy — manufacturing — has largely fallen off Washington’s radar screen.” (Louis Uchitelle, “Is Manufacturing Falling Off the Radar?”, The New York Times, 9/13/2011) 

POVERTY LEVEL SWELLS TO 1 IN 6, HIGHEST LEVEL IN DECADES: “The ranks of America’s poor swelled to almost 1 in 6 people last year, reaching a new high as long-term unemployment left millions of Americans struggling and out of work. The number of uninsured edged up to 49.9 million, the biggest in more than two decades.” (Hope Yen, “Census: US Poverty Rate Swells to Nearly 1 in 6,” Associated Press, 9/13/2011) 

This is just the latest jarring signal that under Democrat policies America is struggling to grow our economy and falling behind our global competitors. Yet President Obama wants to place a $450 billion bet that if his first $800 billion stimulus didn’t grow our economy, perhaps hundreds of billions in more government spending will:

USA TODAY: IS THIS “JOBS PLAN DÉJÀ VU”? “SADLY YES”: “Americans who watched President Obama’s call for a new jobs bill Thursday night might have wondered whether they were stuck in a time warp. A proposal to spend hundreds of billions of dollars to put people to work: Is this 2009 all over again? In some ways, sadly, yes.” (Editorial, “Jobs Plan Déjà Vu,” USA Today, 9/9/2011)

“OBAMA’S JOBS SPEECH: DÉJÀ VU ALL OVER AGAIN?”: “The speech mostly gave us a sense of déjà vu. From the president’s language, you would never know that Congress already has acted under his watch to save jobs — the $800 billion stimulus plan passed shortly after he took office.” (Glenn Kessler, “Obama’s jobs speech: deja vu all over again?” The Washington Post‘s The Fact Checker Blog, 9/9/2011)

ABC NEWS’ JAKE TAPPER: “NEW, SECOND STIMULUS” BASICALLY “FOLLOWS THE SAME CONTOURS” OF THE FIRST ONE: “The president’s plan, aimed at answering his critics’ recent calls for boldness, follows the same contours of the $825 billion economic stimulus package he signed into law three years ago.

“This new, second stimulus of sorts features a mix of tax cuts for businesses and workers, billions in new infrastructure spending and aid to states, and an infusion of aid for the long-term unemployed.” (Jake Tapper, “President Obama Pushes $447 Billion Jobs Plan in Address to Congress,” ABC News, 9/8/2011)

DETROIT NEWS: “OBAMA OFFERS STIMULUS LITE.” (Editorial, “Obama Offers Stimulus Lite,” The Detroit News, 9/9/2011)

PRICETAG FOR SON OF STIMULUS: $450 BILLION. “It’s fairly clear what the plan would cost. Though the price tag has not yet been officially tabulated by the Congressional Budget Office, private economists have come up with back-of-the-envelope estimates of about $450 billion.” (John Schoen, “Obama Plan to Pay for Jobs Program Murky,” MSNBC, 9/12/2011)

As Democrats double-down on more of the same failed stimulus spending, it’s not hard to see why many job creators are skeptical of Obama’s plan to “spend his way out of the recession”:

EMPLOYERS: OBAMA’S NEW STIMULUS “WON’T LEAD TO HIRING SPUR”: “The dismal state of the economy is the main reason many companies are reluctant to hire workers, and few executives are saying that President Obama’s jobs plan — while welcome — will change their minds any time soon.” (Motoko Rich, “Employers Say Jobs Plan Won’t Lead to Hiring Spur,” The New York Times, 9/8/2011) 

NATIONAL FEDERATION OF INDEPENDENT BUSINESS: OBAMA’S NEW STIMULUS IS “MORE OF THE SAME” FAILED POLICIES, “PRESIDENT THINKS HE CAN SPEND HIS WAY OUT OF THE RECESSION”: “Small-business owners needed to hear something bold from President Obama tonight, but instead just heard more of the same. His plan does not address the fundamental problems facing small business today. In addition, recent history tells us that a huge federal stimulus program is the wrong approach, and again sends the message that the president thinks he can spend his way out of this recession.

“The truth is that small businesses need the government out of their way. Tax breaks are always a welcome help to small businesses, especially in these tough economic times. But those outlined tonight by the president are temporary, and avoid the question of meaningful business tax reform. Lack of sales is still a major concern and there is a great deal of uncertainty among small businesses thanks to the threat of higher taxes and the thousands of pending federal regulations. The president’s speech did little to ease those concerns.” (“NFIB Statement on Obama’s Jobs Address,”National Federation of Independent Business, 9/8/2011) 

MARKETS REACT TO OBAMA JOBS PLAN: DOW SINKS 300 POINTS. “The Dow Jones Industrial Average and other stock market indices plummeted Friday, less than 24 hours after Obama unveiled his plan to a joint session of Congress. The Dow lost 303 points, or 2.7 percent, and the S&P 500 dropped by a similar percentage.” (Alexander Bolton, “Economists Say Obama Jobs Plan Could Help, but Wall Street Unsure,” The Hill, 9/10/2011) 

EVEN ECONOMISTS AT LIBERAL HARVARD UNIVERSITY DON’T AGREE ON WHETHER THE NEW STIMULUS WILL CREATE JOBS: “Yet even among Harvard professors, there seems to be no clear consensus on whether the jobs bill is what the nation needs to revitalize an economy that saw no net job growth in the month of August.” (Kevin J. Wu, “Harvard Economists Have Mixed Views of Obama’s Jobs Proposal,” The Harvard Crimson, 9/12/2011)