The Obama Administration and the Federal Reserve have consistently over-estimated the strength of the US economy. The Fed has, on no occasion since 2009, had a remotely accurate prediction, constantly and consistently over-estimating economic growth by well over 40 percent on average. With that record, one wonders why anyone cares what the Fed thinks about the future. (The Wall Street Journal on Thursday reported, in a graphic, the predictions that the Fed had made over recent years).
Now, economists like Laura d'Andrea Tyson, a Clinton economic advisor, wonders why the poor are getting poorer in the Obama non-recovery since 2009. After five years of government expansiveness and a Federal Reserve out-of-control, the rich are getting richer and the poor and middle class are losing ground.
Strangely, these results were perfectly predictable. They follow from the Obama policies. We have implemented in detail what David Stockman, in his recent book "The Great Deformation," has excoriated as 'crony capitalism' that benefits mainly rich folks. It is no wonder that Warren Buffett supports all of this. He does well in an Obama economy. I doubt that his secretary's income is growing as fast as his personal wealth, regardless of who pays what in taxes.
Buffett, like other rich folks, is a hypocrite. He knows that Obama's policies mainly benefit folks like him and destroy opportunity for the middle class and reduces them to scrambling for part-time work or applying for food stamps and other subsidies. For Buffett, that works. For Obama, that works. For the poor and middle class, this is disaster.
Obama's only economic initiative this year is to encourage expansion of a law that makes it a criminal offense to hire an employee below a certain wage level. This means that low-skilled workers that wish to learn a skill on the job are told.....no! Forget about taking a job, without pay if necessary, to learn a useful skill that will enable you to get a real job. That kind of apprenticeship, long a staple of growing economies, has been criminalized. Obama would like to criminalize it further.
You wonder why Obama doesn't just propose a law saying that no one can hire a worker unless they are willing to pay them $ 150,000 and provide them with free health care. That would pretty much eliminate any opportunity for folks below the top 25 percent in income and wealth. I feel certain that Buffett could endorse such a proposal. Then he could fire his secretary and no longer have to worry about what taxes she pays.
The hypocrisy of folks like Obama, Bernanke and Buffett knows no bounds. They have spent the last five years in a successful effort to shut down the great American economic engine. They have succeeded. Expect the rich to get richer and the poor to get poorer. That's where these folks are taking us.