Obama’S Empty Promises Vanished Hopes: An Analytical Review of a President’S Policy Failures

By Vahab Aghai Ph .D

Now that the first term of the Obama presidency is nearly over and another presidential election campaign is approaching, this book is especially timely. It summarizes the promises that then candidate Barak Obama made and analyzes President Obamas accomplishments in terms of delivering on those promises.

Obamas Broken Promises ventures across the total scope of the U.S. economy, factually and statistically documenting the administrations impact on unemployment, the national debt, poverty, health care, education, housing, energy, trade, foreign relations, and more.

Everyone who is planning to vote in November and feels impelled in an era of negative campaigning to base his or her choice on facts rather than attack ads should read this book. It is a bold excursion into the reality of Americas most pressing needs.

• Language: English
• Publisher: Xlibris US
• Release date: Jul 25, 2012
• ISBN: 9781477147405

Book preview

Copyright © 2012 by Vahab Aghai, Ph.D.

Library of Congress Control Number:       2012912986

ISBN:         Hardcover                               978-1-4771-4739-9

                   Softcover                                 978-1-4771-4738-2

                   Ebook                                      978-1-4771-4740-5

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TABLE OF CONTENTS

Part I  The Bad News Economy

Chapter 1  America’s Credit Rating Downgrade

Chapter 2  Americans—Squeezed by a Recovering Economy

Chapter 3  The Economy: An Ugly Picture

Chapter 4  A Weak Economic Recovery

Chapter 5  Obama—Hurt by Economic Constraints?

Chapter 6  The Economy: Voters’ Top Issue

Part II  Unemployment—No End in Sight

Chapter 7  Unemployment Rates (2000–2008)

Chapter 8  Jobs Lost During the Obama Administration

Chapter 9  Jobs Created During the Obama Administration

Chapter 10  Unemployment: Major Election Issue

Part III  Obama and the National Debt: End of Fiscal Sustainability?

Chapter 11  National Debt Statistics (2000–2009)

Chapter 12  National Debt Soars Under Obama

Chapter 13  National Debt as an Election Issue

Part IV  Obamacare—Like It or Not

Chapter 14  Health Care That’s Available and Affordable for Every American (Not)

Chapter 15  Lower Health Care Insurance Premiums (Not)

Chapter 16  Health Care Just Like Members of Congress Have (Not)

Chapter 17  How Will Small Businesses Cope with Obamacare?

Chapter 18  Obamacare: Cause of Inflation?

Part V  Failing at Education

Chapter 19  Who Has a Twenty-first-Century Education? Who Doesn’t?

Chapter 20  High School Graduation Rates: U.S. Slide Continues

Chapter 21  Worldwide U.S. Students Are at the Bottom of the Class

Chapter 22  Who’s Taking More College-level Courses?

Chapter 23  Barriers Still Up to Innovation and Choice in U.S. Education

Chapter 24  Why U.S. Workers Can’t Compete

Part VI  Housing and Foreclosures: A Crisis Still in Search of a Solution

Chapter 25  Obama’s Homeowner Relief Programs Overpromised and Underperformed

Chapter 26  The Rescue Plan that Never Was

Part VII  Poverty in Obama’s Time

Chapter 27  America’s Shrinking Middle Class

Chapter 28  Good Intentions Do Not a Rescue Plan Make

Part VIII  Two Long-standing Controversies: Energy and Outsourcing

Chapter 29  United States: Still Caught in OPEC’s Grip

Chapter 30  Outsourcing Jobs in Obama’s Time

Part IX  Obama’s Deficit Spending

Chapter 31  Obama—Deficit Hawk Who Pushes for More Spending

Chapter 32  Deficit Growth Under Obama

Part X  Foreign Policy and World Relationships

Chapter 33  Obama’s One Foreign Policy Success: Capturing Bin Laden

Chapter 34  Caring for Future Generations: Getting Our Fiscal House in Order Now

Chapter 35  Engagement: A Failed Policy in the Middle East

Chapter 36  Obama—Ineffective Advocate for Nuclear Control?

Chapter 37  Is Obama the Leader the World Hoped For?

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PART I

The Bad News Economy

Obama’s Election Promises in 2008

Chapter 1 America’s Credit Rating Downgrade

Chapter 2 Americans—Squeezed by a Recovering Economy

Chapter 3 The Economy: An Ugly Picture

Chapter 4 A Weak Economic Recovery

Chapter 5 Obama—Hurt by Economic Constraints?

Chapter 6 The Economy: Voters’ Top Issue

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CHAPTER 1

America’s Credit

Rating Downgrade

ACCORDING TO EDWARD Klein, a former New York Times journalist, former President Bill Clinton believes that the current president, Barack Obama, is incompetent, based on the current state of the U.S. economy and in particular on the recent downgrading of the country’s AAA credit rating. President Clinton denies these allegations (English 2012).

Whether Clinton was correctly quoted is uncertain, but what Standard & Poors said was not. In early August 2011, the United States lost its top-tier AAA credit rating from the firm, which was an unprecedented event for the world’s largest economy. The U.S. credit rating was downgraded to AA-plus because of concerns about the government’s budget deficit and rising debt burden. The action could eventually cause borrowing costs to rise for the U.S. government, companies, and consumers. According to S&P, the action was a safety measure needed to stabilize the government’s medium-term debt dynamics. The firm added that the outlook on the new U.S. credit rating is ‘negative,’ and another downgrade could occur within the next eighteen months. This could have consequences for the U.S. dollar’s reserve currency status. The deterioration in the global economic standing of the United States was the precursor to the downgrading. The United States had had a AAA credit rating since 1941. Specialists indicated that from now on the global system will have to adjust to the uncertainties caused by the downgrading.

The fact is that on August 2, 2011, President Obama signed legislation reducing the fiscal deficit by $2.1 trillion over ten years; however, S&P had requested a reduction of $4 trillion. Politicians voted against the backdrop of slowing U.S. economic growth, causing the worst week in the U.S. stock market in two years. S&P stated that the policymaking and political institutions had weakened in the past months more than expected, causing issues for the nation’s budget and debt problems. In fact, S&P had considered that the tax cuts imposed by President George W. Bush in 2001 and 2003 would not expire as expected by 2012 because of Republican opposition to raising revenues.

The country’s financial sector suffered the consequences of the downgrading, from insurance companies to Freddie Mac. U.S. Treasury bonds are now rated lower than bonds issued by Britain, Germany, France, and Canada. Foreign creditors such as China urged the United States to protect its U.S. dollar investment by working on its budget problems. Although according to Vassili Serebriakov, a strategist for Wells Fargo, foreign investors did not sell U.S. Treasuries because there were still few alternatives to the Treasury market in terms of depth and liquidity. The downgrading did not come at the best time, because it will definitely affect the presidential elections of 2012 (Brandimarte and Bases 2011).

The United States is at risk of another downgrade. According to Standard & Poors, the political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable. John Boehner, Speaker of the House, has stated that raising the debt ceiling without addressing the fiscal challenge would be extremely irresponsible (Avlon 2012). For his part, Mitch McConnell, the Senate minority leader, has indicated that regardless of who the next president is, he will make the same mistake and ask to raise the debt ceiling again 2013. Experts believe that the United States is approaching a fiscal cliff, that it is necessary for the nation to be realistic about its fiscal situation and the only way out—spending cuts, revenue increases, and entitlement reforms. Although there are opponents of these measures, politicians are aware of the fiscal cliff they are approaching; but they will not act to prevent it until after the election. Why? Because that would make them more politically vulnerable. The fact is that out of all the members of the Senate and House of Representatives, only a few are looking at the situation in a realistic way; the rest, according to John P. Avlon (2012), are extreme members of their caucuses, moved by their well-funded special interests, who are not interested in reaching a deal. Avlon describes this as absolutism.

Sen. Tom Coburn (R-OK), who is a fiscal conservative and pro–Tea Party, asserts that another credit downgrade is certain because the United States government has not effectively demonstrated the political will to solve the problems (Sands 2012). Coburn differs on the reasoning behind the downgrading. He asserts that it was done because the biggest cost drivers of U.S. debt were not addressed, namely Medicare and Social Security. He believes that the best path for stability is to modify earnings limitations and age requirements for those two programs. This would require the kind of bipartisan deal making in which both sides risk being disloyal to their personal and political interests (Avlon 2012). In Coburn’s opinion, these are changes that no one likes, but they will be forced upon the system by lenders if the government won’t make them. The senator predicts that if no action is taken to reduce the federal debt, in two to five years the United States will be facing a situation similar to that of Greece (Sands 2012).

CHAPTER 2

Americans—Squeezed by a Recovering Economy

IN MAY 2012, MSNBC’s home page featured a topic that everyone knows about, but no one discusses: If the economy is recovering, why are so many Americans still feeling squeezed? (Shifflett 2012)

Robert Reich is one commentator who has addressed this issue, back in November 2010. According to Reich, there are two American economies—one recovering, the other still struggling. The one recovering is the America’s Big Money Economy; the one struggling is the Average Worker’s Economy.

America’s Big Money Economy is composed of Wall Street traders, major investors, top professionals, and corporate executives. Its recovery can be attributed to a number of factors. First, the Fed has been keeping interest rates low by printing money, money that has been essentially free to America’s Big Money Economy and has been used to create even more money. Second, large corporations have been buying back their shares of stocks, boosting corporate earnings. Third, other corporations have grown themselves by merging with and/or acquiring other companies. Fourth, in markets like China, India, and Brazil, major American corporations have been increasing their sales. By November 2010, 40 percent of S&P’s 500 largest corporations were conducting business abroad. As a result of their success, other investors decided to do the same (Reich 2010).

What was the combined effect of all of these activities? According to the Wall Street Journal, Wall Street’s bonus pool increased