President Gives Campaign Speech Instead of Economic Plan

Yesterday, the President, before a Joint Session of Congress, gave an impassionate speech and laid out a $447 billion legislative plan for jump starting the stagnate U.S. economy, but more importantly set the stage for the 2012 Presidential election.

President Obama, in his speech to Congress outlined his "American Jobs Act", which if passed will now begin to create the jobs needed to resurrect the U.S. economy. Many of the proposals outlined by the President in his virtual second stimulus, are policy initiatives which have been tried before and have proven ineffective.

Inside the President's proposal are programs such as temporary payroll tax cuts, extended unemployment insurance, including incentives for businesses to hire new employees, and investing in infrastructure spending across the country. One has to remember all these proposals by the President were part of his first stimulus, which was over $800 billion, but failed to keep unemployment below 8%.

The unfortunate aspect for the President, which he mentioned in his speech, is the burden of regulations on the business community, which he stated hamper economic growth. The President wants to end crippling regulation on business, but failed to mention the passage of the Dodd-Frank Financial Reform Act of 2010, which has hampered business growth. The uncertainty of this piece of legislation has caused confusion throughout the business community, as more than seventy percent of the regulations have yet to be written. This was supposed to rein in the major financial institutions, which had a role in the financial crisis in 2008, but left Fannie Mae and Freddie Mac exempt. Both entities are still being bailed out to the tune of hundreds of billions of dollars.

The uncertainty facing the business sector hasn't been addressed by the President. It is one thing to give a tax break to businesses to hire additional personnel, but they still need to know what their tax burden will be in the future. Everything the President proposed are all temporary solutions. Hiring someone is a long term solution, if you are uncertain to what the future will be, you will not hire anyone.

Currently businesses don't know what future tax policy will emanate from Washington, as the Bush era tax rate expires at the end of 2012. Businesses are unsure what the financial regulations will be, or what environmental regulations will be set by the EPA and other government agencies. Health care is another area that is still looming, as like financial reform, an unelected bureaucracy will decide what regulations will be imposed.

The President gave a good campaign speech, but failed to solve the underlying problem with the economy; the uncertainty facing businesses across America.

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