"We can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by. Or we can restore an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules."
—President Barack Obama, State of the Union address, January 24, 2012
President Obama speaks often of “fairness” these days, implying that certain dynamics of the free market are not “marked by impartiality and honesty : free from self-interest, prejudice, or favoritism,” to quote the Merriam-Webster Dictionary. In reality, the Obama Administration’s public policies are the antithesis of fair, picking winners and losers in the economy and subjugating taxpayers’ interests to those of certain political constituencies.
Three years after the President said that he would not deserve a second term if he could not turn the economy around, 13 million Americans are unemployed and more than 46 million people are on food stamps due to the Obama economy. It’s clear that the President’s policies have failed and actually made things worse. As he cannot run on a record of accomplishment, President Obama has turned to the politics of envy and division.
Campaign priorities trump economic fairness for the Obama Administration
Unfair Auto Bailout: If the failing auto makers GM and Chrysler had restructured through a typical bankruptcy in 2009, the secured creditors (i.e. bondholders) would have held priority on certain financial decisions over unsecured creditors (i.e. unions), according to well established bankruptcy law. Any ultimate losses would have been borne by creditors and other stakeholders. However, the Obama Administration’s decision to spend more TARP money in the reorganizations allowed them to put union interests above those of private creditors. Was that fair? Or is it fair that taxpayers are now on the hook for the government’s latest estimates of $24 billion in losses on the auto bailouts?
Unfair Stimulus Spending: Enacting the wasteful $1.2 trillion stimulus in early 2009 was supposed to keep unemployment below 8 percent, according to the Obama Administration. What it did instead was allow the President to play Venture-Capitalist-in-Chief, making “investments” in various green technology companies that the Administration decided were ideologically acceptable. While Americans suffered with unemployment above 8 percent for a record 35 straight months, the President preferred to invest in unproven firms that gave him political benefit, as in the $535 million loan guarantee for the now bankrupt solar panel manufacturer Solyndra or the $118 million in stimulus funds for the recently-failed electric car battery maker Ener1. How is wasting taxpayer dollars on speculative industries to please environmental groups fair?
Unfair Housing Meddling: Nearly two years after failing to reform Fannie Mae and Freddie Mac, the bankrupted entities at the epicenter of the housing crisis, in Democrats’ permanent bailout of Wall Street Law (Dodd-Frank), the Obama Administration continues to look for ways to spend more taxpayer money in the housing sector. During this election year, President Obama’s latest plan seeks to trade taxpayer money for moral hazard by providing financial incentives for homeowners who are not even in distress to refinance their mortgages. Yet after $183 billion of a taxpayer funded bailout to Fannie and Freddie, housing weakness continues with 2.7 million homes receiving foreclosure filings in 2011, up from 2.3 million in 2008. What sense of fairness argues for throwing good money after bad into a housing market that is so dysfunctional because of the federal government’s involvement?
President Obama’s ideas of fairness are focused on pitting groups of Americans against each other and redistributing wealth to equalize outcomes. Those policies only end up creating special deals for Democrat cronies and actually weaken the ladder of economic mobility that allows Americans to climb out of poverty. In contrast, House Republican policies such as the Plan for America’s Job Creators are rooted in the American ideal of empowering those who work hard and play by the rules to earn success, not punishing them when they do.