No bounce for Obama voters
STEVE HUNTLEY email@example.com March 11, 2013 9:08PM
A board on the floor of the New York Stock Exchange shows the closing number on March 5 for the Dow Jones industrial average, which beat the previous high it set in October 2007 (AP Photo/Richard Drew)
Updated: April 13, 2013 6:17AM
The stock market hits record highs. Household wealth recovers to pre-Great Recession levels. That closely watched barometer of the economy, the unemployment rate, is declining. The Obama economy is lifting up Americans — except maybe not so much for Obama voters.
The stock market boom enriches Wall Street “fat cats” and mostly the wealthy Americans against whom President Barack Obama has railed time and again as not paying their fair share in taxes.
The surge in household wealth stems mainly from the skyrocketing Dow Jones industrial average, meaning most of the increase in household prosperity is flowing to the undeserving rich. The gain is smaller for middle class Americans whose biggest investment is their homes, the values of which are climbing again now that the housing market is finally recovering.
The unemployment rate dropped last month to 7.7 percent, but that was mostly because more Americans are dropped out of the job market. The jobless rate for key parts of the Obama base is still bad. For African Americans, it was 13.8 percent, and for Hispanics, 9.6 percent, says the Bureau of Labor Statistics.
Generation Opportunity, a nonpartisan organization focusing on Americans 18 to 29 years old, the so-called millennials, crunched the numbers and found discouraging news for the young voters who so favored Obama in the last two elections. Their jobless rate, non-seasonally adjusted, was 12.5 percent in February. The data for subsets of the millennials were unemployment rates of 22.8 percent for African Americans, 13.4 percent for Hispanics and 11.5 percent for women. Young Americans may think Obama is cool and vibes to their cultural sensibilities, but he’s not doing much to help them launch their working lives.
Remember the $830 billion stimulus spending bonanza? It was projected to reduce unemployment to under 5.5 percent by now.
Yes, the stock market enthusiasm reflects a growing confidence that the economy is slowly improving. But the Wall Street trading also is a result of the easy money policy of Federal Reserve Chairman Ben Bernanke. His “qualitative easing” keeps interest rates near zero, stimulating investments in stocks but not much enthusiasm for bosses to hire.
An easy money policy means a cheaper dollar. That pushes up the prices of commodities — economist-speak for food and gasoline. Poor and middle class Americans are paying more for them, or paying the same for less with food processors shrinking the size of their products to avoid price hikes.
The slow growth we’re seeing comes more in spite of Obama policies than because of them. The energy boom from the fracking revolution in gas and oil extraction erupted mostly on private and state-owned lands away from the restraints and drilling prohibitions on federal lands.
New taxes and regulations from ObamaCare and the massive Dodd-Frank financial control act pose, to use a favorite White House phrase, headwinds for the economy. The administration no doubt will try to blame their ill effects on the automatic sequester spending cuts.
The good news is that Obama is finally reaching out to Republicans on the fiscal challenges holding back the economy. If it’s not just for show to try to reverse recent declines in his approval rating in the polls, Obama could open the way for compromises on taxes, spending and entitlements that could signal better days ahead for all Americans.