Bulls on U.S. GDP growth have been wrong for five years, and they are still wrong.\u00a0 Q1 GDP grew just 0.1%.\u00a0 Sure, weather was a problem, but, as Mr. El Arian points out, in a robust economy bad weather in part of the US would not derail growth.\u00a0 Because of how GDP arithmetic works (growth rates are versus the prior quarter, not versus the year-ago-quarter), a weak Q1 brings down growth for the whole year, because even if growth picks up in the next three quarters it is starting from a lower base.<\/p>\n
What bullish Wall Street economists, as well as supposedly deep thinkers like Summers and Krugman, miss is that economic policy matters, and Obama\u2019s policies are terrible\u2014assuming you care about economic growth rather than just winning elections by pandering to special interests such as big- money California enviro-maniacs.\u00a0 Obamacare\u2019s tax hikes and disincentives to hire, ending the \u201cBush tax cuts for the rich,\u201d Dodd Frank\u2019s unnecessary red tape for community banks, the EPA\u2019s attack on fossil fuel, the NLRB\u2019s attack on Boeing, and Obama\u2019s sophomoric attacks on \u201cmillionaires and billionaires\u201d have all hurt growth.<\/p>\n
And so have the things Obama has not<\/strong> done.\u00a0 Like fellow socialist Thomas Piketty, Obama cannot fathom the notion that creating conditions that facilitate profit-making activities by private companies would generate jobs, raise living standards, and reduce poverty.\u00a0 So he has not bothered to push a variety of reforms and initiatives that would do just that, including:<\/p>\n I could go on, but the reality is that U.S. economic growth will continue to be stymied by Obama\u2019s anti-growth sins of commission and omission.\u00a0 Confidence is being further undermined by his weak foreign policy.\u00a0 Yes, in retrospect perhaps the Iraq War was a costly mistake that increased Iran\u2019s regional influence.\u00a0 But Iraq was then and Ukraine is now.\u00a0 Putin is not Saddam.\u00a0 Obama is right to reject the cowboy diplomacy of John McCain.\u00a0 But irresolute and incremental baby steps are not the way to dissuade Putin from invading Ukraine.\u00a0 Tougher sanctions on the Russian economy (not just select Putin cronies) and a robust energy policy that lowers prices, slams the Russian economy and reduces Europe\u2019s dependence on Gazprom are the way to go\u2014for diplomatic, economic, and environmental reasons.\u00a0 Specifically, \u00a0Obama should approve the Keystone XL Pipeline, permit renewed U.S. exports of crude oil, open up more Federal land to oil and gas production, accelerate permits for LNG export facilities, and release oil from the Strategic Petroleum Reserve. A collapse in energy prices, Russian GDP and the ruble would get Putin\u2019s attention\u2014all without firing a shot. (But, then again, what would Tom Steyer say?)<\/p>\n Copyright Thomas Doerflinger 2014.\u00a0 All Rights Reserved.<\/p>\n","protected":false},"excerpt":{"rendered":" Bulls on U.S. GDP growth have been wrong for five years, and they are still wrong.\u00a0 Q1 GDP grew just 0.1%.\u00a0 Sure, weather was a problem, but, as Mr. El Arian points out, in a robust economy bad weather in … Continue reading \n