LEE’S SUMMIT, August 8, 2011 – In the middle of the Free Fall on Wall Street, the President of the United States gave a speech that spread blame, put off leadership to committees, and offered nothing new for investors to use as a foothold in order to start climbing again. At the end of the day the Dow Jones Industrial Average was down more than 634 points (down 5.55%) on the day alone.
Trouble in the World Wide Investment Community continue as right now the Nikkei 225 is down more than 403 points (down 4.4%), the Hang Seng index is down over 1,241 points (down 6%) since the opening a few hours ago. The Seoul Composite is down over 7.9% and Europe still has several hours before it opens.
The trend is very negative on the lack of Leadership in the United States after the S&P downgraded its debt on Friday (read the S&P statement here).
President Obama spoke at 1:30 PM Eastern time to the Nation (full transcript here), let me summarize what he said:
- On Friday, we learned that the United States received a downgrade by one of the credit rating agencies — not so much because they doubt our ability to pay our debt if we make good decisions, but because after witnessing a month of wrangling over raising the debt ceiling, they doubted our political system’s ability to act.
- The fact is, we didn’t need a rating agency to tell us that we need a balanced, long-term approach to deficit reduction. That was true last week. That was true last year. That was true the day I took office.
- And we didn’t need a rating agency to tell us that the gridlock in Washington over the last several months has not been constructive, to say the least.
- We knew from the outset that a prolonged debate over the debt ceiling — a debate where the threat of default was used as a bargaining chip — could do enormous damage to our economy and the world’s.
- Our challenge is the need to tackle our deficits over the long term.
- What we need to do now is combine those spending cuts with two additional steps: tax reform that will ask those who can afford it to pay their fair share and modest adjustments to health care programs like Medicare. [Emphasis added by me]
- There are plenty of good ideas about how to achieve long-term deficit reduction that doesn’t hamper economic growth right now. Republicans and Democrats on the bipartisan fiscal commission that I set up put forth good proposals. Republicans and Democrats in the Senate’s Gang of Six came up with some good proposals. John Boehner and I came up with some good proposals when we came close to agreeing on a grand bargain.
- …a refusal to put what’s best for the country ahead of self-interest or party or ideology. And that’s what we need to change.
- … ultimately, the reason I am so hopeful about our future — the reason I have faith in these United States of America — is because of the American people. It’s because of their perseverance, and their courage, and their willingness to shoulder the burdens we face -– together, as one nation.
Mr. President, the time for hope is gone Sir, the time for leadership has arrived. Drawing lines in the sand is exactly what changed the “spend” mentality of Washington Politicians, to “Deficit Reduction” which is exactly one of the two main reasons cited by S&P in its downgrade.
Leadership, Sir, is not about pointing fingers, and finding blame, but setting a specific course of action and gathering support for it and moving forward.
In a quick search on Google, I posed the search question “Obama Blames” (the two words in quotes) and I received over 455,000 results. A quick review of who’s to blame for our condition, according to the President of the United States shows the following:
- Politics is to blame for the downgrade,
- The Arab Spring, the Japanese Tsunami are to blame for lack of jobs in the US (referred to several times as “headwinds on the economy”.
- Congress is to blame for the S&P downgrade.
- GOP is to blame for Broken Immigration Promises.
- The Splintered News Media for Lack of Compromise in Washington.
That is only on the first page (several repeats were omitted). If my boss were to tell the Board of Directors of our company, that the reason things are not going as planned is because the Market is unfriendly, our suppliers are not very good, the managers in the company can’t get the job done, and the press is not giving him a break, they would laugh him out of the meeting, and fire us all for incompetence.
You can’t run a business in uncertainty, and you certainly cannot run it on blame. The fact is that everyone is competing for the same suppliers, the same customers, and the same funding. It is truly a dog-eat-dog world.
Russia is not shy about slamming the United States for being a parasite on the world economy. If the US falls from power, maybe Russia is not as bad as it once was thought of. It is good for Russia for the US to fail.
China had no problem condemning the US’s addiction to debt. If the US falls from a leadership position, China believes it is best suited to take its place. They believe in China First.
Our European Allies have their own fiscal problems so they are focused on fixing their own house with Greece constantly on the verge of default, Italy now moving forward with massive reforms, England suffering through major fiscal changes, Germany realizing it cannot fund everyone’s appetite for socialist budget policies.
The US needs more than pretty words. The US needs more than just rhetoric and placing blame on the Tea Party for telling the Emperor he’s wearing no clothes. The US needs real leadership and it needs it now. Commissions, Committees, Blue Ribbon Panels won’t solve this crisis: Leadership will!
The $14 Trillion plus debt albatross hanging around the neck of the United States needs to be removed, not in 10 years, but in the next 3 to 5 years. We need to move seriously forward on debt reduction. The lunacy of passing higher taxes needs to go away. Even if you confiscated the wealth of the top 400 riches people in the United States, you would not have enough wealth to cover next year’s budget shortfall.
We cannot TAX our way out of this situation. We must look at the expenditures and rein them in; and quickly.
Congress should give up their recess, and come back to Washington and focus on the 2012 budget: Now! No need for a special committee. We need leadership and the budget blueprint should come from the President of the United States of America. Use the 2008 spending budget as a baseline, and cut all the increases since then. Lay those cuts on the table and have Congress do the job they are paid to do.
The 2008 budget is not the answer, but it is a start. Then take a serious look at the Connie Mack Penny Plan, but apply it to 2008 levels, and force the balancing of the budget. Draconian, you bet: But it needs to be done, and it needs to be done right away.
America needs to have leadership, and right now all we have are pretty words, and hope from the President, when he’s not busy blaming others for the situation. No one can “blame” their way out of this situation.
Lead Mr. President. Lead us away from deficit spending, drive forward the Balanced Budget Amendment as your legacy of sovereign control, drive off the regulatory choke-hold on business and lift the encumbrances that keep businesses from moving the economy forward. Limit our spending to less than 18% of GDP and watch a FREE America turn on the turbo charger of the Free Enterprise system and you’ll see growth again; cut off the fuel and watch that engine stall and die.
Please Mr. President: Lead!
The Lee’s Summit Conservative