Press Briefing

Sep 17, 2010

U.S. Can't Risk Slow START
http://www.state.gov/t/us/147267.htm

Wealth and Poverty - How's that inequality thing working out?
WSJ, Sep 17, 2010
http://online.wsj.com/article/SB10001424052748703440604575495933472536928.html

If there is a single unifying principle behind the Democratic agenda of the last two years, it is this: Reduce income inequality. So yesterday's annual Census Bureau review of American incomes is a kind of progress report on how this agenda is working out. In a word, our wealth isn't spread any more equitably, though more of us are poor.

The Current Population Survey shows that in 2009 the poverty rate climbed to 14.3% from 13.2% in 2008—the highest since 1994. That figure translates into 43.6 million Americans living below the poverty line, the largest absolute number in the half-century for which comparable data are available. At $49,777, the real median household income fell slightly, though not in a statistically significant way. It declined 1.8% among families and rose 1.6% for individuals.

In a statement yesterday, President Obama attributed these results to the financial panic and recession, and that's true in part. The Census data also overstate the true level of poverty because they don't include noncash government payments like housing subsidies, food stamps, the earned income tax credit or entitlements like Medicaid.

But then Mr. Obama couldn't resist adding that "Even before the recession hit, middle class incomes had been stagnant and the number of people living in poverty in America was unacceptably high, and today's numbers make it clear that our work is just beginning." So to address the rising poverty on his watch, the President wants to plow ahead with the same policies that aren't reducing poverty.

We draw a different lesson, which is the continuing imperative of rapid economic growth. Census Bureau figures over the last 50 years show that poverty falls most rapidly during times of the most sustained growth—the 1960s, 1980s and second half of the 1990s. The poverty rate also fell in the mid-2000s before heading up again when the recession hit. The most important goal of economic policy should be to increase society's overall wealth. This helps the poor and everybody else.

Yet starting with his first budget proposal, Mr. Obama has made clear that his main policy purpose is reducing inequality. As the White House budget scribes put it, "There's nothing wrong with making money, but there is something wrong when we allow the playing field to be tilted so far in the favor of so few. . . . It's a legacy of irresponsibility, and it is our duty to change it."

Thus the 2009 stimulus was assembled around social programs and redistribution, defying even Keynesian precepts about immediate job creation. Among its many other goals, ObamaCare is intended to produce "a leveling" of the "maldistribution of income in America," as Senate Finance Chairman and chief author Max Baucus put it. Even now, amid a mediocre recovery and 9.6% unemployment, the inequality imperative is driving Democrats to insist on a huge tax increase—no matter the impact on growth.

The irony is that, while there has been a modest widening of the income gap in recent decades, the Census (as measured by the "Gini index") shows that inequality has remained mostly unchanged since the early 1990s—regardless of which party is in power. The reasons are many and rooted in larger economic and social forces that can't be fixed with higher taxes and White House social engineering.

More important, this preoccupation with inequality is actively harmful because it leads to economic policies that inhibit growth. That's the real warning in the new Census data. Democrats are succeeding in their goal of punishing business and the wealthy, but to the extent that this has produced anemic growth it is also punishing the poor and middle class.

The moral claim of Obamanomics is that it ensures that everyone pays his "fair share," but its early returns show this agenda is producing more poverty. In their obsession with income shares and how many people have how much wealth, the Obama Democrats are imposing policies that ensure only that there will be less wealth for everyone to spread around.


China's Currency Policies and the U.S.-China Economic Relationship. Sec Timothy F. Geithner
http://www.treas.gov/press/releases/tg858.htm

Constitution Day and the Perilous Future: "The federal government, yes, can do most anything in this country."
http://blog.heritage.org/2010/09/17/morning-bell-constitution-day-and-the-perilous-future

Is Google a Monopolist? A Debate
http://online.wsj.com/article/SB10001424052748703466704575489582364177978.html

China's Real Monetary Problem - Focus on yuan sterilization, not the yuan-dollar rate
http://online.wsj.com/article/SB10001424052748703743504575493120916038074.html

The U.S. at the U.N. and Beyond: A World of Transnational Challenges
http://www.state.gov/p/io/rm/2010/147232.htm

On Wind Power: : Where’s the Empirical Proof?
http://www.instituteforenergyresearch.org/2010/09/16/overblown-wheres-the-empirical-proof-part-iv/

NASA Ready to Send Humanoid Robot to Space
http://spectrum.ieee.org/automaton/robotics/humanoids/nasa-ready-to-send-humanoid-robot-to-space

The Uninsured Numbers Are Bad, but Obamacare Can Make Them Worse
http://fixhealthcarepolicy.com/in-the-news/the-uninsured-numbers-are-bad-but-obamacare-can-make-them-worse

Press Briefing

Sep 16, 2010

President Obama on Small Business Jobs & Tax Cuts: "We Don't Have Time for Any More Games"
http://www.whitehouse.gov/blog/2010/09/15/president-obama-small-business-jobs-tax-cuts-we-dont-have-time-any-more-games

Rooting for Redistribution - Are Americans easily fooled about their real interests? Review of Jacob S. Hacker and Paul Pierson's "Winner-Take-All Politics"
http://online.wsj.com/article/SB10001424052748703897204575488730182039948.html

White House - New Plans Underway to Increase Contracts to Small Business
http://www.whitehouse.gov/blog/2010/09/15/new-plans-underway-increase-contracts-small-business

The Case for a 'Repeal Amendment' - Virginia will consider proposing a constitutional amendment that would allow two thirds of the states to repeal a federal law
http://online.wsj.com/article/SB10001424052748703466704575489572655964574.html

President Obama's Message to Veterans on Retroactive Pay Due to 'Stop Loss'
http://www.whitehouse.gov/blog/2010/09/15/president-obamas-message-veterans-retroactive-pay-due-stop-loss

Principles for Economic Revival - Our prosperity has faded because policies have moved away from those that have proven to work. Here are the priorities that should guide policy makers as they seek to restore more rapid growth.
http://online.wsj.com/article/SB10001424052748703466704575489830041633508.html

Republican Tax Plan Doubles Nation's Deficit in Just Ten Years
http://www.whitehouse.gov/blog/2010/09/15/republican-tax-plan-doubles-nations-deficit-just-ten-years

Conservatives: The New START Rubberstamp Threat to National Security
http://blog.heritage.org/2010/09/16/morning-bell-the-new-start-rubberstamp-threat-to-national-security

Conversations With America: Meeting the Millennium Development Goals
http://blogs.state.gov/index.php/site/entry/conversations_with_america_mdgs

Too Much Progress - D.C. voters give a reform mayor, Fenty, the boot
http://online.wsj.com/article/SB10001424052748703743504575493841164082512.html

Update: U.S. Response to Pakistan's Flooding Disaster
http://www.state.gov/r/pa/prs/ps/2010/09/147200.htm

It's the Spending, Stupid - A chronic voter 'concern' has now exploded into a broad public movement
http://online.wsj.com/article/SB10001424052748703743504575493953591176476.html