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Obama Acknowledges Bad Economy

7/3/2010, by Proloy Bhatta

HIGHLIGHTS

• Obama's approval in MA: 53%.
• Obama's approve in NY: 55%.
• Obama's approval rating has dropped double digits.

Obama has dropped to new lows in approval for Massachusetts and New York -- two states that are considered to be very liberal -- 53% and 55% respectively.

And we know why... ECONOMY!

According to Newsweek, Obama's approval rating has dropped double digits, 10%, in his handling of the economy over the past two months. And Obama is answering his critics by acknowledging the poor economy. According to a report by Reuters recently,

"U.S. President Barack Obama said on Wednesday he was not satisfied with the rate at which the U.S. economy was growing and said it needed to be expanding at 4 to 5 percent annually."

Obama supporters are right to say that Obama inherited a poor economy from Bush but they are not right to say that Obama is effectively improving the economy. Both parties are responsible for passing the bailout bill that, although helped us avert a crash, did nothing but lengthen the downturn by not allowing natural economic forces to take place and fix itself.

Much of the economic progress that the United States has had during the Obama administration has been due to consumer spending -- not because of economic production. A country cannot have economic growth purely based on consumer spending. Imagine that the government cut the entire citizenry a million dollar check... Not only would there be an increase in GDP due to massive spending increases but there would only be massive inflation due to an increase in the money supply. So when the increase in consumer spending rises, can it really be purported to be economic progress?

Of course, a million dollars per citizen is an extreme example of what the government had done during the bailouts but the premise still holds, an increase in money supply causes inflation and postpones economic disaster by propping up the markets at unstable prices.

If the market was allowed to stabilize, then the market could truly begin to rebound. There would be a lot of people hurting if the markets were allowed to crash but the fast rebound to the economy would help those people sooner than is happening now. In today's economy, we are just lulled in a poor economic state for a longer amount of time.

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