Election

The Natural Majority

In thinking about what to write after a long election season hiatus, I honestly just thought of completely reposting this piece from back in May, which built upon an earlier case I laid out for a ginormous Republican seat gain by making the case that if you simply assigned House seats to their Cook PVI winner, the result would be a sizeable GOP majority. 

How big? The seat breakdown I had for a perfectly politically balanced House of Representatives was 239 Republicans to 196 Democrats. 

Right now, we sit at 239 and we'll end up in the 242-243 range. 

In an odd way, I think the Tea Party surge has ended up bringing Washington back to the true political center of the country, but not yet fully to the right. The obstacles Republicans faced in moving the needle in their House numbers -- entrenched Blue Dog incumbents like Ike Skelton, John Spratt, Chet Edwards, and Gene Taylor -- were moved away last night. These are not "surge" seats that will be surrendered at the next election, but now likely Republican for life -- and ones we didn't have during Republican control of the House from 1994 to 2006. I tweeted out a few possible remaining targets for 2012 -- Heath Shuler for one, Ben Chandler for another -- but in truth I was having trouble coming up with that many because the Blue Dog hit list was exhausted so completely. 

Meanwhile, we generated a 63 seat wave without much in the way of gains in deep blue areas. The second act to the Scott Brown miracle didn't happen as New England stayed staunchly blue with the exception of New Hampshire. That's unfortunate from a storytelling perspective, but it also means we defend our newfound majority from much more solid ground than either the Democrats from 2006 onwards or Republicans in the dozen years after the 1994 revolution. 

The atmosphere in Washington today is also much more muted than it was after '94. Check out this remarkable clip of Gingrich right after the '94 vote poking his finger in the eye of the White House, claiming a mandate and saying "We are revolutionaries." I remember all that, but it sounded so out of place in today's context given all the modest rhetoric about a "second chance." 

This election was also a direct repudiation of a leader elected under Messianic pretexts. It was only a matter of time before the arrogance of it all -- the Hope stuff, the "We are the change we've been waiting for," the pretentiousness of the sunrise "O" -- generated an equal and opposite reaction (kind of like all of you who love to hate the Yankees). With Republican enthusiasm in the toilet the last two cycles, their very legitimacy as a political opposition spit on by the media, Republican voters I talked to yesterday took enormous satisfaction in seizing upon Obama's political weakness as they cheerfully showed up to vote. 

The act of yelling "realignment" after an election is getting tired and farcical after an unprecedented third wave in a row, so I'll resist doing it here. In the House, there was a tactical realignment, as seats Democrats held for personal reasons now give way to natural conservative Republican-held strongholds we'll hold for a long time. Attitudinally, the pendulum simply swung from the far left to the center. The President will be a Democrat, the Senate will be narrowly Democratic, and the House Republican, and the overall result will be all sides canceling each other out, e.g. centrism.

While not conservative per se, it is in one important sense: very little will get done. And that's a good thing. D.C. types assume gridlock is a dirty word, but voters acted very deliberately to hit the breaks on the Democratic train that ramrodded Obamacare. A pause in the frenetic activity of the last two years in Washington, and the fact of the House as a de-facto veto on spending levels, means a profoundly conservative outcome, if not in policy, than in the nature and speed and pace of activity coming out of the nation's capital. 

Grasping At Fictional Straws.

Why should anything be different during election time than during the normal day-to-day machinations of government? Well, my reply to that question would be that the re-election hopefuls would try to show themselves in the best possible light.

Polish the halo a little, carefully apply some make-up to cover the unsightly blemishes and, although perhaps difficult and not true to character, at least appear genuine and sound honest.

Promises and track-record are the two criteria that enable the average member of the electorate, the majority of whom, unfortunately, are pretty clueless when it comes to politics. Their main source of information is the traditional media, nearly all of which is biased to the left. While the internet has made huge inroads in educating and/or informing the public on political affairs, most are more content to spend their free time on Facebook or checking out the latest showbiz gossip than reading political analysis sites.

Even internet news sites are biased in favor of the left, in some respects. This has come about from the fact that the most popular sites are extensions of existing traditional media, whether newspaper or television. Here is a list of the ‘Top Twenty’ that I found, although it did not contain a publication date:

1 CNN.com 2 CBS 3 ABC 4 Google News 5 Reuters 6 Yahoo News 7 BBC News Online 8 World News 9 MSNBC 10 FOXnews 11 USATODAY.com 12 CBC News Online 13 Time.com 14 The Associated Press 15 Guardian Unlimited 16 NewsLink 17 The New York Times 18 EmergencyNet News 19 Consortium News 20 News.com.au

I think you can see the general trend.

It is this overwhelming deluge of mostly biased information that is responsible for most of the major mistakes in recent years. Goebbels would have been impressed by the way the constant hammering home of promises and fabrications on the human senses has created a society where those that see through the falsehoods are ostracized and deemed ‘crazy’.

Tell the people a lie often enough and they will believe it. Man-made global warming, a better health care system, hope and change…. I don’t need to go in to the details, just cast your mind back to the frenzy of the 2008 presidential election, or the daily dose of doom from the climate-change soothsayers.

The American people have seen through their lies. A part of American exceptionalism is the ability to question and analyze the known facts, to filter out the rhetoric and lies. What remains is either something of no substance, or an agenda so repulsive that not even its designers would dare reveal to the public. If the electorate vote for the faux sheep’s clothes, the inner wolf gets a free pass.

This brings us to the current mid-term elections. The present Congress now has a track-record for the electorate to view. It is no longer about promises but cold, hard facts. The facts are that they, and the president, have failed in all respects. Not only have they failed the American people, the majority of whom are generally center-right, but failed the hard-line leftists in their own party. If a government with a Democrat president and large Democrat majorities in both the House and Senate can not get their radical legislation through, the game is up and they might as well take an early shower.

With a history they’d rather forget and a president that is now causing embarrassment to his own party, the Democrats are left with only one option. They can not campaign on success stories or policies, so the demonization of the opposition is the final line of defense.

The labeling of Mr and Mrs Average American as extremist is the biggest mistake they have made to date. If it was not so pathetic and downright offensive, it would be funny. The thought of Grandma, law-abiding and hard-working all her life, initiating a terrorist attack on the Capitol.

The announcement that they are launching a dirt-digging exercise on Republicans, including John Boehner, proves conclusively that they have no respect for anything or anyone, except of course for themselves, their failed ideological policies and their status. Make the most of that status, you won’t have it for much longer!

(Editor Dee is in for Skip today)

“The End Of The Beginning”

“Now is not the end. It is not even the beginning of the end. It is, perhaps, the end of the beginning”. Sir Winston Churchill at the close of the Battle of Britain. The Obama administration is scrambling to get the word out to its lapdog press and political smarm operators that it’s just a midterm and it doesn’t really mean that much…after His Arrogance crossed back and forth across both states enough times to give himself a teleprompter crick in his lying neck. The Marxispin band-aid crew is out in force, trying out spin after spin to try to keep this from looking like the ass-kicking it was. Virginia and New Jersey are firmly in Republican hands…and by large margins. The Democrats have been more tone deaf than the leadership of the Republican party, if that’s possible. AND that’s hard to do…must have been all those locked doors and overnight how-to-screw-the-electorate  and what-can-we-do-to-fool-them-today meetings. They’ve been buried in letters, phone calls and emails, with concerned voters visiting representatives’ district offices to voice their concerns over what they saw as a monumentally destructive policy in the form of this health care bill….and they didn’t listen. The leftist liberal OBSESSION to control every single aspect of every American’s life has completely blinded them to the groundswell building out in the electorate. In the 23rd District NewYork race Hoffman, completely unknown until thirty days ago, ran a heck of a race and gave the Democrats a near coronary but lost in a narrow decision…but it changes nothing. This is a harbinger of very tough times for Obama and the Democrats. “We have awakened a sleeping giant and filled him with terrible purpose”. Admiral Yamamoto after Pearl Harbor. Americans, as much as the Obama-world view would try to have you think otherwise, are more fair-minded than any other people in the world. We are also very quick to react to those who are not and who offend that innate sense of fair play. A lot of this has come into play here. Obama was elected on a raft of promises and make-believe centrism, then immediately turned hard left and he didn’t walk, he didn’t even trot (although he prances a lot), he ran as fast as he could to create the most extreme radical agenda AGAINST this country in its history. This hasn’t been lost on the American people…they are afraid and they are mad. The Conservative march to regain the country, its legislature, its laws and Constitution has begun. God Bless this Great Country and its indomitable people.

Semper Vigilans, Semper Fidelis

© Skip MacLure 2009

 

Race and the 2008 Election: What the Exit Polls Showed

This exit poll statistic is a candidate for most underreported fact of the 2008 election.

Those who said race was an important factor voted 55 percent to 44 percent in favor of Obama.

So, as Mike Turk had predicted last year, racism was a more common factor among Democrats than Republicans in the 2008 election.

This may explain why the 'racism factor' stories disappeared so quickly after the campaign, replaced (if it was discussed at all) by "race not a factor in election" stories.

College Students to the RNC: We Care, Use Us!

Promoted. My basic philosophy on a good leader: A's hire A's, B's hire C's. Let's hope that the next RNC Chairman is an A that can find A's within CR's and YR's to work for (and provide innovation for) campaigns and parties around the country. -Matt Moon

College Students to the RNC: We Care, Use Us!


by James Barnes and Brandon Hines, The George Washington University College Republicans

Fellow Republicans:  As we enter a fresh new year, it's easy to be discouraged by the battle ahead.  The Obama Administration promises to pursue an agenda of socialist redistribution.  On top of this, the 111th Congress has just convened, and it's the most liberal in our nation's history. Together, this double-headed monster threatens to grow another in the form of a new judiciary.

Sitting in a position we have long been removed from, our first step has been to question what got us here.  We've started to regroup, on Twitter, on the web, and soon by reconsidering who should lead the RNC into 2010 and beyond.  And, through these exercises, we've come up with some basic answers to the question of what got us in trouble.  We've blamed it on our grassroots, our fundraising, our web presence, our message, and a slew of other equally valid reasons, which we promise to overcome in the next election cycle.  We hope to argue, however, that many of these issues boil down to one oft-overlooked component: a focus on engaging and activating the 18-24 demographic —College Republicans. 

As the future of our party and, in many cases, the most passionate advocates for our platform, it is important that the RNC not only reach out and speak the language that we speak and communicate the way that we communicate, but that it engage and empower the youth of the party in helping to win elections. In this vein, the party already has a virtual army of well informed and connected potential activists, who, in many cases, simply haven't been asked to volunteer the resource they have the most of: their time. Though we lack the ability to donate large sums of cash, or the experience needed to run campaigns, we make up for this with cheap labor and an uncanny, even absurd, ability to remain in instantaneous contact with our peers and advocate for what we believe in. It is time for these and other potential resources to stop being overlooked, and for the RNC to directly engage the future of the party.

Consider this: during our organization's deployment by the RNC this year in Ohio, a state never lost by a Republican president, we never met a single student from an Ohio college.  Elsewhere, in 2007, many argue that we lost the Massachusetts special election due entirely to a complete absence of area college students.  Contrastingly, in Georgia's recent runoff, the unusually strong showing of college students from Maine to Texas served to bolster a winning campaign—a notable exception to a troubling rule.  College Republicans exist everywhere.  In this regard, it's very simple; it's not about changing the minds of college students-- it's about activating and empowering the ones who already care.  To our detriment, this is something that Barack Obama knew all too well.   

In the coming years, the promise of victory does not tolerate the prospect of an inactive college demographic.  This is why we, with the support of many of our friends in the young conservative movement, are calling on the next RNC chairman to pledge to directly engage the next chairman of the College Republican National Committee in kick-starting a strong partnership for a radically better next four years.  In this, they should plan for a future that utilizes CR’s in dominating new media, more directly involves college students in party operations, and most importantly, ensures that, in 2010 and beyond, every willing College Republican will be afforded the chance to work for a Republican candidate through a better organized and more broadly utilized College Republican grassroots operation in every state.  On the path to victory, this is an important stop that has the promise to change the future (and the face) of our party for the better.

James Barnes and Brandon Hines are the Political and Public Relations Directors, respectively, of the George Washington University College Republicans and are working to re-engage Republican youth.

Obama for President Wasn’t a Campaign, It Was a Business

The political blogosphere is buzzing about Obama campaign manager David Plouffe’s interview. Soren Dayton argues the lessons of the Obama campaign were “budgeting, technology, field, and media,” while Patrick Ruffini finds that the important lesson is that “Obama ran a better kind of offline campaign.” Although it is quite true that these are some critical lessons, as a business nerd and student at Carnegie Mellon’s Tepper School of Business, I think there’s a massive lesson that pundits are missing: Obama for President wasn’t run like a traditional campaign, but instead like a huge corporation. I don’t believe that any campaign on this level was ever able to accomplish this with nearly the same success as Plouffe and company.

Plouffe makes this unmistakenably clear throughout his interview:

There are business analogies. One is, we’re a startup, we had to go from zero to 60 in a matter of weeks. Our company, if we were successful, would only last two years at the most. … We had over 5,000 employees… And we were an organization about accountability. Down to the entry-level staffer, we measured their job performance based on metrics.

What specific trends that the most successful modern corporations employ were echoed by the Obama campaign?

  1. “Know your customer.” I’ve probably heard this from my entrepreneurship advisor a thousand times now, but only because it is perhaps the single most important phrase in business. Obama’s campaign really knew its customers – just look at the way it outreached to young voters.
  2. A consistent message and high-impact branding. These two go hand in hand. Take Apple, a highly successful company even despite the recession, for example: they have a simple but highly memorable logo, effective messaging (i.e. “Get a Mac” ads), and a well-designed and innovative website. Barack Obama’s branding and messaging was as good as any corporation.
  3. Job performance measurement and personal accountability. Think quarterly or annual reviews at your place of work. As quoted earlier, Plouffe confirms the importance of this in the Obama campaign: “Down to the entry-level staffer, we measured their job performance based on metrics.”
  4. Fiscal accountability. Successful corporations have very specific budgets, and virtually all spending is highly scrutinized. Plouffe notes that, “People on the campaign could not make more than a certain amount—$12,000 a month… If you were a deputy you got paid X, if you were an assistant, you got paid Y… From a fiscal management standpoint, Obama was very clear that he did not want to end up with a debt in the primary or the general, so we just planned accordingly. We didn’t spend beyond our means.” (emphasis added)
  5. A willingness to take significant financial risks and depart with the norm to be on the cutting-edge. This sentiment was echoed by the Obama campaign at many levels. Team Obama got the idea of peer production, which is quickly becoming the premiere business model of leading corporations like IBM, Boeing, BMW, and Goldcorp. In addition, as Patrick and Soren point out, Obama invested the campaign’s resources in a very unique way – remember the advertisements the campaign ran on an Xbox 360 racing game?
  6. A corporate infrastructure. Since when does a political campaign have both a Chief Technology Officer (CTO) and a new media director – let alone a Chief [Anything] Officer?

In business, constant innovation is crucial. Fall behind and your competitors will likely crush you. Find a decisive edge and you stand to profit immensely. Plouffe’s comments and the results of the election demonstrate that business and politics are actually two very similar animals.

Crossposted at NextGenGOP.

Third term curse: Obama's victory in perspective

Lost in all the punditry about the "impressive" Obama victory is how 2008 compares to other elections where one party had served two consecutive terms.

In 2004 Bush won re-election with about 2.5% of the vote. In 2008 Obama won by somewhere around 7.0%, producing a "swing" of 9.5%.

For comparison:

In 1904 Republican Theodore Roosevelt won by 18.83%. In 1908 Republican Taft won again, but only by 8.53%--a swing of 10 points even though Roosevelt was popular.

(1912 was complicated by a three-way race that hurt the Republicans, so direct comparisons with 1908 are impossible.)

In 1916 Democrat Woodrow Wilson won by 3.12%. In 1920, after an unpopular war and an economic recession (sound familiar?) Republican Harding won by 26.17%. The swing amounted to 29.29%.

(Another third party ticket sabotaged a party in 1924, making comparisons with 1928 impossible.)

In 1936 Roosevelt won re-election by 24.26%. He ran for a thrid term in 1940 and won by 9.95%--a swing of 14.31%.

(1944 was a war year and Harry Truman essentially served that term.)

In 1948 Truman was elected by 4.48%. In 1952 Eisenhower beat Stevenson by 10.85%. The swing was 15.33%.

In 1956 Eisenhower was re-elected by 15.40%. In 1960 Kennedy beat Nixon by 0.16%. The swing was 15.56% even though Eisenhower was popular.

In 1964 Johnson crushed Goldwater by 22.58%. In 1968 Richard Nixon barely won by 0.70% but it amounted to a 23.28% swing.

In 1972 Nixon won by 23.15%. In 1976 Carter beat Frod by 2.06% and the swing was 25.21%.

In 1984 Reagan won re-election by 18.22%. In 1988 Bush won a Republican third term by 7.73% but that still amounted to a 10.49% swing in spite of Reagan's popularity.

In 1992 Bush lost to Clinton by 5.56%, marking another 13.29% swing.

In 1996 Clinton was re-elected by 8.51% and in 2000 Gore won the popular vote by 0.51%. The Swing was 8.0% even though most thought the country was going in the right direction.

Barack Obama's 9.5% swing is thus smaller than the 16.5% average swing. In fact, only in 2000 was the swing less than 9.5%--and then not by much.

If we only average the unpopular administrations (1920, 1952, 1968, 1976, 1992), we get a swing of 21.28% on average.

Once again, the question that should be asked is why we didn't lose by more, not why we lost.

Record number flunks press coverage

According to a new Pew survey, that is. Of course, they don't put that in their actual report, instead you have to go to the complete report and scroll down to page 35 to find out that fully 24% gave press coverage an "F" grade. The previous high was 20% in 2000 after the Florida fiasco. Another 15% gave a "D" grade and 26% said "C".

But there's more. Fully 44% believe that the press did not fairly cover the McCain campaign. This compares with 40% who said the same thing about Bush in 2004 and 35% who said it about Bush in 1992. Even these numbers don't tell the full story though. Just 22% of Republicans thought the press was fair to McCain compared to 40% who thought it was fair to Bush in 2004 (and 67% of Democrats who thought the press was fair to Kerry).

In 1992 73% of Republicans thought Clinton was covered fairly, in 2008 only 48% of them thought Obama was covered fairly.  41% of Republicans thought the press was fair to Bush in 1992.

Notes on the Virginia/North Carolina losses

A lot of commentary has been focusing on the fact that the GOP lost Virginia for the first time since 1964 and North Carolina since 1976. This is treated as absolutely unprecedented, and to a certain extent it is.

But consider the demographics. The last Republican loser, Dole, won Virginia by a tiny 2 point margin while McCain lost it by 5.5. However, in 1996 the Virginia electorate was 81% white and 16% black while in 2008 it was 70% white and 20% black. Dole won white voters 53-39 while McCain won them 60-39--a substantial improvement. The problem was, of course, that the black vote in 2008 was larger and more monolithic than in 1996. The same lesson applies to 1992, where the elder Bush won the state by 4 points while obtaining an identical margin among whites than McCain did.

Similarly, in North Carolina whites were 80% in 1996 and Dole won them by 24 points, carrying the state by 5. McCain did better at 29 points but barely lost the state because whites only constituted 72% in 2008.

The point is that we lost these former Republican strongholds not necessarily because parts of the state have more white liberals, but rather because the white share was lower (and the black share correspondingly higher) than in the past elections we lost. We can look forward to these states being purple for as long as these turnout trends hold up.

Obama Swallows Poison Pill, Spares GOP from Pyrrhic Victory

The outcome of the election, as reported by the media, was one of a historic victory by Barack Obama and the Democrat Party. However, I want to put a look on this going forward as opposed to going backwards. My take on it is that Obama and the Democrats have swallowed the poison pill of a bad economy and John McCain and the Republicans were spared from a Pyrrhic victory.

Defined, a poison pill is that of a strategic move in politics or business designed to increase the likelihood of negative results as opposed to positive ones during a takeover. By winning the 2008 Presidential and Congressional elections, President-elect Barack Obama and the Democrats have willfully swallowed a big poison pill left behind by George W. Bush.

Meanwhile, a Pyrrhic victory comes from King Pyrrhus, the ruler of Eprius, who won a series of battles that his army won in 280 and 279 BC against the Romans but the casualties they took on were devastating. Had John McCain been elected President, it would have been one such victory that would have been enough to strengthen Democrat majorities in the House and Senate while setting up the Democrats for a landslide win in 2012. For that, McCain and the Republicans spared themselves what would have been a costly victory.

The good news for the Republicans is that there are a number of ways that Obama can consume poison pills and do so happily while fooling himself by proclaiming it as an “engine of change”. Believe me, that the Republicans will be more than happy to keep supplying the poison pills. All of this with the GOP’s rise back to the top by 2012.

Had the roles been reversed with McCain winning and a Democrat-led Congress to work with, the Democrats would have blocked many of McCain’s economic policies and would force him to cross the aisle for the policies they wanted, which would have made McCain the second-comings of Herbert Hoover and Jimmy Carter.

In the end, it would have made John McCain’s Presidential win that very Pyrrhic victory that would have lengthened the minority of the Republicans in government and turned John McCain’s legacy from that of “Maverick” John McCain the war hero to John S. McCain the failed President. Instead, Obama and the Democrats took a tighter grip on power that could ultimately give the public one reason to vote Republican.

What Obama and the Democrats are proposing could be a prescription for an unmitigated economic disaster that could lead to GOP victories in 2010 and 2012. Those victories also assume that the Republican leadership in Congress and party back in working order.

If nothing else, it would be highly unlikely that Obama governs from the political center. Back in 1992, then-President-elect Bill Clinton was told by House Democrats that they would pull support for centrist positions of his if he tried to get Republicans to vote for his proposals. They told Clinton that if he stayed within the confines of the Democrat Congressional and Senatorial Caucuses, they would deliver other policy proposals. That ended in 1994 with a Republican landslide in the House and Senate elections.

Before that, Jimmy Carter decided that he was not going to govern from the left in the early stages of his presidency. The end result was a clear alienation of his own party that led to Carter vetoing in four years more than double the bills that George W. Bush did in eight years. By the time Carter tried to woo the liberal base of his party, it was too late. Thanks to not governing from the left and his ineptitude, Ronald Reagan defeated him in a 44-state landslide in 1980 in an election that was over one hour before the polls closed on the west coast.

President-elect Obama is now in a bad spot electorally. If the economy goes from bad to worse post-2009, Obama and the Democrats will not have Bush to blame. Instead, they will have to answer the question “What have you done for me lately?” If they’re not careful, the Republicans will start by making significant electoral gains in 2010 and could regain power back from the Democrats in 2012. That would be the final, fatal poison pill.

There was no secret by the Obama campaign about their desires to raise the capital gains tax from 15 percent to anywhere between 20 to 28 percent. The last time an increase in the capital gains tax was implemented was back in 1986 when the tax code was reformed under Ronald Reagan to make the capital gains rate the same as the top rate of 28 percent. When implemented, capital gains tax revenues dropped 44 percent because selling stock became less desirable.

What could make matters worse is the desire of Obama and the Democrats to raise the top marginal income tax rate from the current 35 percent rate to that of the 39.6 percent it was back in 2000. There are a number of serious consequences that would arise from a tax increase in an economic slowdown or an economic recovery. According to Obama’s proposals to repeal the Bush tax cuts for the top five percent of wage earners ($153,542 in adjusted gross income or more) and Obama’s proposed removal the income cap on FICA taxes could impose a federal tax rate of 54.9 percent.

As for the rest of the Bush tax cuts, they will be set to expire on January 1, 2011. If there is now tax cut extension put in to place, an economy that could be poised for a recovery would instead suffer a contraction. George W. Bush will not anywhere close to the scene of the crime (he’ll probably be getting ready to go fishing in Texas by this time) to be blamed and Obama would take the hit. In other words, Obama will be the first President to run for reelection on the heels of a recession since George H.W. Bush lost to Bill Clinton in 1992.

Spending can also get out of hand with the Democrats wanting more money for more spending programs. John Kerry has called for a new New Deal and Barney Frank has called for more spending, deficit be damned. This, combined with Speaker Nancy Pelosi’s push for funding for embryonic stem cell research (which is more throwing good money after bad since embryonic stem cell research has produced no cures while over 80 cures have been found via adult stem cell research) and Ted Kennedy’s push for socialized health care will be enough to generate our first-ever trillion-dollar deficit.

Once the recession is over, the next monster the economy will become hyperinflation that has gone unseen since the 1970’s. The contributors will be record deficit spending, energy prices run amok, and artificially increasing wages.

Obama has proposed raising it from the $5.15 it was back in 2006 when the economy was actually good to the $7.25 per hour wage that it will be next summer to $9.50 by 2011. The dirty little secret about labor pricing in economics is that if you inflate wages against the will of employers, you actually create more unemployment—like what is happening right now.

If you look at the inflation-adjusted number of the original minimum wage when it was implemented in late 1938, today’s minimum wage would only be $3.64 an hour. The $9.50 an hour that Obama would attempt to implement would be the 1938 equivalent of 68 cents. In other words, when adjusted for inflation, non-skilled workers—mostly high school teenagers, people working for the first time, and those looking to start a business by learning a trade—are making more than 2.61 times more than what they were making 70 years ago.

In some ways, inflation was made worse by the Carter administration in the 1970’s by increasing the minimum wage every year he was in office. When Carter took office, the federal minimum wage was $2.30 an hour. That figure went up to $2.65 an hour in 1978, $2.90 an hour in 1979, $3.10 an hour in 1980 and to $3.35 an hour when he left office in January 1981. By comparison, the Reagan administration never passed a minimum wage increase and one would not take effect for more than nine years.

Why does the minimum wage matter? It is the only real way to create a trickle-up economic effect. It will increase wages across the board by an even bigger percentage than that of a minimum wage increase. Employers will respond to higher taxes and higher wages with higher job cuts. We will be longing for the days of a 6.5 percent unemployment rate.

Then there is the credit crisis as we are facing as banks are more reluctant to give loans for any reason. Obama wants to give selected homeowners the ability to refinance during a 90-day foreclosure freeze. That will lead to a freeze on lending for either the same length of time to one that’s even longer. That is, unless of course, Congress decides to force banks to lend (which is what got many of the banks in this mess in the first place).

With the shrinking equity from Wall Street and the reduced lending of the banks (barring mandatory lending against the better interests of the banks), businesses will be harder-pressed for cash which will lead to more layoffs and less production of goods. When inflation by contraction (stagflation) on this scale happens, more Congressional bailouts won’t be enough to save corporate and small-business America.

Speaking of bailouts, there will be a push to bailout the automotive industry to the tune of $250 billion. For once, I agree with Congressmen like Dennis Kucinich. It is only on the issue of equating this to corporate welfare. However, he and his fellow far-leftists in the Democrat Party will likely acquiesce thanks to all of the additional goodies thrown in the form of pork-barrel spending projects to win votes just like what Nancy Pelosi did with her first Iraq spending bill that George W. Bush promptly vetoed.

The end result is a Democrat Party and an Obama administration overwhelmed with political poison pills gladly accepted on their part from the Republicans. By 2012, Obama will likely go down as one of America’s worst presidents and could make Americans long for the days of—dare I say—George W. Bush. At that point, the American public will vote probably for Republicans…any Republican.

 

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