White House Economic Advisor Resigns
Friday, August 6th, 2010Anyone remember all of those rosy promises of the stimulus package President Obama signed into law within weeks of taking office? Sure we were laying out over $878 billion in government spending (over $1 trillion after interest is taken into account) but desperate times called for desperate measures. Without the massive stimulus, we were destined for an economic depression and unemployment over 9%. However, if we allowed the Democrats to borrow and spend as they wished, unemployment wouldn’t rise above 8% and we would “create or save” millions of new jobs within the first year after it went into effect. Even though basic economics dictates this scheme would never work because government money has to be confiscated from the productive private sector in order to spend it elsewhere, the White House clung to their promises and led congressional Democrats to pass the stimulus package.
Now, over a year after the passage, unemployment is stuck at 9.5% and the only reason it isn’t higher is because chronic unemployment is so bad that each month more and more of the unemployed have become so discouraged with the bleak job environment that they have completely given up and withdrawn from the official workforce. Thus, the total number of unemployed actually decreases because the discouraged unemployed are no longer included as part of the job pool. If we were to add discouraged workers back into the workforce, unemployment would currently stand near 17%.
Last night, news hit that Obama’s chief economic advisor, Christina Romer, who was responsible for making the extravagant promises about the stimulus package announced that she will be resigning. There are reports that she has not been happy for quite some time from feeling as if she doesn’t have enough direct access to President Obama. Either way, she is out and now we have to wonder what genius will step into her place.
After watching President Obama spin the jobless numbers released today, it’s a safe bet that Romer isn’t being forced out for making outrageous promises. Nothing new is going to come out of this White House until the voters make a change in November 2012. All we can do in the meanwhile is work to take Obama’s congressional rubber stamp away this coming November by replacing his Democrat “yes men” currently leading both chambers.


