Democrats colossal miscalculation
The Democrats problem is they thought the fixed the economy and jobs with heir huge stimulus bill. It has been a huge bust and probably made matters worse. It has become a bright shining example of the failure of liberalism and Democrats are trying to find a way to do more of the same. That insanity will cost them even more votes in 2010.Honorable and intelligent people can disagree over the substance and details of what President Obama and congressional Democrats are trying to do on health care reform and climate change. But nearly a year after Obama's inauguration, judging by where the Democrats stand today, it's clear that they have made a colossal miscalculation.
The latest unemployment and housing numbers underscore the folly of their decision to pay so much attention to health care and climate change instead of focusing on the economy "like a laser beam," as President Clinton pledged to do during his 1992 campaign. Although no one can fairly accuse Obama and his party's leaders of ignoring the economy, they certainly haven't focused on it like a laser beam.
Last week's disappointing December unemployment report was the final blow in what was already a bad week for Democrats. One of the most sobering findings in the report was that if 661,000 Americans had not given up even looking for work that month, the unemployment rate would have moved up rather than holding steady at a horrific 10 percent.
Most economists had been expecting an increase of about 50,000 jobs in December; instead, the total declined by 85,000. Some 6.1 million Americans, the highest number in the post-World War II era, have been unemployed for 27 weeks or more. The "U-6" rate of unemployment, which adds in people who are working part-time while seeking full-time work and those who have stopped looking, stands at 17.3 percent, the highest level in the 15 years that the Labor Department has calculated it.
A number of economists expect that unemployment will get worse before it gets better. Even if that prediction is wrong, some analysts estimate that Labor's household employment survey would have to show a net increase of 150,000 jobs a month for 48 straight months for the unemployment rate to drop to just 9 percent.
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Another piece of bad news was the distressing late-December report that the housing sector's slow improvement had stalled, raising the specter of a second dip. As Wellesley College economist Karl Case, one of the developers of the definitive Standard & Poor's/Case-Shiller home price index, told The New York Times recently, "I'm worried. Everyone's worried." He added, "If prices sink 15 percent from here, which is a possibility, and the 2008 and 2009 loans go bad, then we're back where we were before -- in a nightmare." Faster action in Congress to renew (or even increase) the tax credit for first-time homebuyers might have boosted housing prices, which in turn would have improved mortgage lenders' balance sheets.
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It is one reason the Tea Party movement was started and it will only spur it on. Health care has also angered voters and they will be only angrier if the Democrats pass the current mess. Then there is the cumulative tax increases they are proposing of about $2 trillion. They are doing things now that will probably lead to a land slide defeat for the party this year.
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