This page was last updated on July 27, 2012.
Recovery on the way; Philip S. Dedig; Beaver County Times; July 25, 2011.
Mr. Dedig has written at least 19 letters since February 2008. Among those letters, Mr. Dedig supported the proposed federal gasoline tax holiday, Hillary Clinton for President, complained about “business as usual” (“Business as usual in D.C.,” 6/17/08) in Washington, DC, regarding energy, opposed offshore drilling, said Democrat voters deserve better candidates (“Local Democratic voters merit better,” 8/22/08), supported “bailing out Freddie Mac and Fannie Mae” (“Fed, Treasury had to move”, 9/30/08), told us we had “No choice but to help auto makers,” told us “College costs must be made affordable,” supported the $787 billion “stimulus” package (here and here), told us “U.S. can afford health care for all,” and claimed “U.S. Rep. Jason Altmire is a Republican in sheep’s clothing.” Mr. Dedig’s most recent previous letters were “Pipeline not good idea,” “Energy policy long overdue,” and “Obama caves in far too easily.” If it’s a leftist position, Mr. Dedig supports it.
Below is a detailed critique of the subject letter.
“President Obama was somewhat correct when he remarked that the private sector economy was doing just fine.”
[RWC] Wow! Despite what he wrote, something about this letter tells me Mr. Dedig doesn’t really believe it.
There is only a “private sector economy.” GDP growth (annual rate) for the second quarter of 2012 was 1.5%, down from 2.0% (previous estimates were 2.2% then 1.9%) for the first quarter.
The public sector is overhead. Though overhead is not inherently good or bad, you’ll find all businesses – both profit and nonprofit - attempt to minimize overhead consistent with business goals. For example, while all businesses must expend resources on accounting, they want to spend the minimum required to meet business and legal requirements. The same should be true for government.
“Economic output of goods and services has increased continually since 2009 and has surpassed pre-recession levels.
“Except for June, industrial production has been growing the last three years and is near levels prior to the recession.”
[RWC] Before the recession, GDP peaked at $13.3 trillion (annual rate) for the fourth quarter of 2007. The GDP for the first quarter of 2012 was $13.5 trillion, an increase of only 1.2% over the pre-recession level. GDP needs to grow at a significantly higher rate just to maintain a constant unemployment rate to account for population and productivity increases.
“Unemployment has been declining but at a slow rate.”
[RWC] According to U.S. Bureau of Labor Statistics (BLS), the unemployment rate has varied between 8.1% and 8.3% so far in 2012. The rate was 8.2% for May and June. The BLS unemployment rate doesn’t include people who are unemployed but gave up looking for a job.
“Economic growth in America has been driven entirely by the domestic private sector. This growth was due primarily to consumer spending and investment.”
[RWC] As I noted above, there is only a “domestic private sector.”
“Recessions caused by a financial meltdown, like this one, have a lot longer recovery period, usually eight to 10 years.
“Job growth is the key to a full recovery. Federal Reserve sharing with the states needs to be reinstated in order to put the 500 thousand laid off public employees back to work. The American Jobs Bill, which has been sitting in Congress since September, needs to be voted on and passed.”
[RWC] What is “Federal Reserve sharing?” As for the American Jobs Bill, its predecessors didn’t work so why would another “jobs bill?” Consider the following quote: “We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong … somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises … I say after eight years of this Administration we have just as much unemployment as when we started … And an enormous debt to boot.” - Henry Morgenthau, FDR’s Treasury Secretary during the Great Depression, testifying before the House Ways and Means Committee in May 1939.
“The partisan politics in Washington have no compassion for middle class working families and working poor. They sit on their hands and talk foolishly while the American workers suffer. There is only one solution: Jobs, jobs, jobs.”
© 2004-2012 Robert W. Cox, all rights reserved.