Jeffrey Sachs: Why Obama's Failing On The Economy

The past week brought news of US double-digit unemployment and the Federal Reserve's decision to maintain near-zero interest rates. Both pieces of news expose the inadequacy of US economic policymaking. The Obama administration's stimulus policies are not well-targeted. The Republican alternatives are even worse. Both sides are missing the key fact: the US economy needs structural change that requires a new set of economic tools.

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Comments

[Altruth]

07:21 PM on 11/14/2009

GET OVER YOURSELFand get off your not-so-high-horse!

President Obama is AWESOME and I support him 100%!

[Altruth]

07:24 PM on 11/14/2009

Correction:

Posted in wrong location!

[NoMoreBail2]

09:58 AM on 11/13/2009

No more bailouts for too big to fail. NO more stupid tax cuts and other gimmicks. Need more jobs, affordable education & heath care.

good articles; http://financeopinionss.blogspot.com

[Chernynkaya]

03:05 PM on 11/12/2009

From a blog on this site, Kenneth N. Davis:

“[We must] rebuild our global competitive position wisely. We should start where we have the most strength -- possession of the world's biggest market by far. Remember this -- America is the only industrial nation that runs trade deficits. In the past 4 years, 2004 through 2008, we had a total trade deficit of 3.5 trillion dollars! We had to borrow 2 billion dollars a day to pay for it!

Imagine what we could do with that money to rebuild our industries and for other programs [such as] health care and education.

We must have at least balanced trade, and there's draft legislation already written to achieve it -- SB.3899 -- "The Balanced Trade Restoration Bill of 2006". The bill is based on a plan devised by Warren Buffett… It's market-based and doesn't target any country or industry. Imports are still welcome, but the purchase of the necessary import certificates will level the competitive playing field, especially with countries like China, Japan, and Germany that heavily subsidize their exports.
A very important feature is that little government funding will be required, and businesses should have a much better chance at easier credit with better market conditions.”

Sounds good—what am I missing?

[Chernynkaya]

02:51 PM on 11/12/2009

I agree wholeheartedly with Dr. Sachs, and for the medium and long term it is exactly what we need to be competitive.

Here's the problem: In the short term it won't create jobs. In the short term (and I mean withing the next 24 months), nothing will. I fear that there will still be massive joblessness during the 2012 elections, and an impatient and frustrated electorate might flail towards the Reptilians-- who will assuredly make matters worse!

Maybe we all need to be patient, but that's hard when we see Wall St. rolling in cash while the rest of us suffer. Obama, if he wants the patience of unemployed Americans, must do something to show that his #1 concern is Main St. At least we won't feel as though the fatCats are mocking us, and it may buy this Administration time to set us on the course Sachs is advocating.

[ebanks84]

02:10 PM on 11/13/2009

If the people of America do NOT get better educated, they will be looking for jobs that are NOT there any longer because our technology is rearranging our job needs. A lot of jobs that were let go will NEVER return. That means specifically trained people to a specific job is a problem and those people will need to be retrained for a more varied list of available employment.

Since Obama has made higher education easier to obtain, it behooves most unemployed people to jump at the chance to get reeducated to a new society while they are collecting their benefits so by the time they have used up their money, they will have something to fall back on in apply in the new job market. Our society is changing people and we must change with it. We are in the throes of evolution whether you know it or not!

[vippy]

11:55 AM on 11/12/2009

What is wrong with our country is that we keep voting for the same crooked politicians time and time again. That is the root of all problems. Now they have a good thing going with the industry or banks.
Nice going there. Seems to me that Obama would have plugged all holes first and foremost when taking office to stop this bleeding. So where should the jobs come from and this nonsense about the
jobless recovery, when cities are hurting for lack of revenue and pretty soon it will affect our government. Their ill decisions caused all of this.

[ebanks84]

01:52 PM on 11/13/2009

I'm trying to imagine your being in office and putting forth your agenda instead of Obama and I can't see our future there. What you're saying would have been your first course of action would have sent us into oblivion. But I don't think you can imagine that because the trees in the financial forest are in your way.

[PhilipTaylor]

02:32 AM on 11/12/2009

JEFFREY IS A VOICE OF LOGIC AND REASON! # 6 BELOW
_______________________

THE SIX THINGS STEALING OUR DEMOCRACY AND TRUE CAP1TALISM (VAMP1RE BANKSTERS)

1. Our Corrupting V0TE Selling Campaign Funding System

2. The BANKSTER OWNED FED Reserve System manipulated by Foreign and Wall Street Banksters

3. Distorted TAX system - Go Back to 50 year Tradition= TOP TAX Rate of 63% to 94% on incomes over $550,000! Apply to Hedge Fundsters = NO MORE Capital Gains TAX!
Graph = http://pol.moveon.org/budget10/chart/?id=15734-8599887-MahjTHx&t=1

4. This CROP of Wall Street CR00KS CAN NOT BE REHAB1L1TATED, FAR T00 C0RRUPTED BY THE EASY SC_AM, and MUST GO! Same goes with Summers/Ge!thner!

5. Do away with any Product/Derivative/Swap that can NOT be put on an OPEN EXCHANGE because it is too complex. Do away with “TOO-COMPLEX-TO-EXIST”

6. Use the added Revenue from #3 to build a NEW Manufacturing Economy that creates EXPORT WEALTH and SOLVES our ENERGY IMPORTATION from Our Enemies.

Overcome these SIX Problems and A Functional Democracy by the People and for the People will blossom.

[ebanks84]

02:00 PM on 11/13/2009

I agree with your list. But we would have to get rid of everybody in Washington at present before any one of these items could be accomplished. We've already let all the roosters into the hen house and they have total control of all finances, organizations, judges, and everything else that helps support the people.

I'm a true advocate of abolishing the Fed also. That should be our first choice and completely wipe out all debt supposedly owed to them because they were illegitimate thrust into place behind our backs in the first place.

[dadw5boys]

01:04 AM on 11/12/2009

i say BULL !!!!!

The SBA can now assume 85 % of the Small Business Loans risk !!!!!

What more can President Obama do ?

If people do not have the credit oe equity left do even come up witjh 15 % of the money needed to start a business then they need to save and wait.

Your trying to rewirte history here by ignoring the constant bombardment the consumers have dealt with over 25 years from the credit industry.

[RJII]

07:14 PM on 11/11/2009

I would do almost anything to land a halfa$$ job. I feel for everyone searching to no avail.

[ebanks84]

02:03 PM on 11/13/2009

Are you willing and able to enroll in a city college in a program that will give you new skills and job training for the positions that ARE available? Obama has made it quite easy for anybody to get more education and most people need to jump at this opportunity because the job market is steadily changing right before our eyes. The old jobs are almost obsolete and will NOT be coming back in a lot of instances.

[RJII]

03:47 PM on 11/13/2009

sure. as long as it costs zero dollars-- sadly, I'm not being funny. It took me a year to finish a masters, so I'd luv to finish any advantageous program or degree in quick time.. I looked some online about Obama's push for folks to go back to school for new skills, but didn't see anything in the form of a free or gov't sponsored programs. Reply if you got any leads-- how has he made it easier? Thanks. I should have started a program last year when I still had flow. Maybe I'll check out whitehouse.gov.

[desertman]

06:49 PM on 11/11/2009

The Obama government has made itself hostage to a toxic form of pretense and lying. In order to sustain the wish for “hope” — if not hope itself — the President and his White House advisors along with his cabinet appointments, are pretending that the historical forces of compressive contraction are not underway. They’re flat-out lying about the employment figures issued in the government’s name.

They’re willfully ignoring the comprehensive bankruptcy gripping government at all levels. They refuse to bring the law to bear against “the malefactors of great wealth.” They appear to not understand the epochal energy scarcity problem the whole world faces, or its implications for industrial economies.

Most of all, they persist in promoting the lie that this economy can return to the prior state of reckless debt accumulation (a.k.a “consumerism”) that has made us so ridiculous and unhealthy. -- James Howard Kunstler

[mikefina]

02:27 AM on 11/12/2009

Amongst the best posts I've read on this site. Well done. Thanks.

[ebanks84]

04:07 PM on 11/13/2009

None of what you've said is true. You're just "fear mongering" like the rest of the "no can do" group.

[CanHandleTheTruth]

06:44 PM on 11/11/2009

After his nefarious role in the Asian Financial Crisis of 1997, Jeffrey Sachs carries ZERO credibility...

...on this or any other supposed progressive social, economic or certainly environmental issue.

[JTHC75]

05:26 PM on 11/11/2009

Ultimately, the President doesn't have some kind of More Jobs/Less Jobs toggle switch. Give the guy a break. Everyone gives the office of the President more credit and blame than it deserves for the economy. Really, Bush did not personally send our jobs overseas. Obama is not personally failing to create jobs.

[RJII]

07:13 PM on 11/11/2009

agree.

[Nellybelle]

09:35 PM on 11/11/2009

I think America has a broken Congress . It seems that a handful of senators , in this case "blue-dog democrats" under the financial influence of some large corporations , have the power to block the will of the House , the President and the people of America.

Right now a 51 vote majority in the Senate looks like a good idea.

[valboski]

05:22 PM on 11/11/2009

The stimulus was never intended to create jobs. It was a political tax heist that is only being given to the political servants who will vote for bigger government. We were hijacked as a country with TARP too. Congress should be laid off and the spending then stops!

[hippie4ever]

05:04 PM on 11/11/2009

I agree we face systemic problems: after the coup d'etat of November 22, 1963, this country has been in lockdown. This isn't a democratic republic -- it's a police state bent on perpetual war! The oligarchy moved all the decent jobs overseas, to condition us for a Neocon takeover (2012 or 2016). Expect the only jobs to be in the military or the police departments. Is this the society you want? If not, wake up, get organized and speak out! Think what happened in Nazi Germany can't happen here? Think again.

[chocolatecity]

04:56 PM on 11/11/2009

Good grief. We haven't even had any transportation, infrastructure, or energy bills which would be where all of the funding that Sachs is talking about would come from. And the president did put a pretty good down payment on all of these issues in the stimulus. Let the man finish his work on health care and financial reform.

[cavegal]

06:00 PM on 11/11/2009

The one energy bill I have read parts of provides $60 billion to the coal industry to further develop (i.e fancy techno blather for unproven technology) carbon capture and sequestration vs. $20 billion to furthering existing alternative technologies that have proven track records of 30 years or more.

[jsarets]

07:07 PM on 11/11/2009

I agree.

Let's refrain from observing the political process and anticipating its future consequences.

Let's wait until we suffer the consequences and pass judgment ex post facto...

[factotem]

04:40 PM on 11/11/2009

Why would Obama's approach succeed? He hasn't done anything but avoid the topic, and hope it changes. Do your problems fix themselves when you look away?

[Melanie in AZ]

05:29 PM on 11/11/2009

I think you should do some homework before writing.

Our National Debt when Clinton left office was $5 Trillion and he had a record surplus on the federal budget for two years running - in FY 2000 it was $230B. That Nat. Debt included debt run up from all the President's before CLINTON got into office - Reagan and Bush Sr., etc.

Bush Jr took that Clinton federal budget surplus and a National Debt of $5T and by the time he left office it was over $10 Trillion (October 2008 and counting). So in 8 years Bush Jr. managed to double our National Debt - one President managed to do more harm to our country financially than 42 President's before him. Now, the National Debt is over $11 Trillion because President Obama had to spent another $780B PLUS to keep our economy from going from a very deep, deep recession into a DEPRESSION where all major US banks would have collapsed - Citibank, Wells Fargo, Bank of American to name a few and to stimulus jobs or at the very least keep teachers and other state employees from losing theirs as most state's would had to layoff ten's of 1000s starting in January 2009.

You think 10% unemployment is too high - try 25% or higher - which is what would have happened if Obama did not continue the extreme government financial measures taken towards the end of 2008 and carrying them forward.

[factotem]

05:40 PM on 11/11/2009

Yes, and that was a good way to start things ...TEN months ago! Sure has been quiet since. You are not dealing with a Bush partisan so you don't need to school me on his disastrous presidency.

[cavegal]

06:04 PM on 11/11/2009

I do not believe we can hold Obama responsible for everything. He is the President, not the entire Congress. We did elect a dictator or messiah.

I agree that problems do not fix themselves when you look away. They merely fester and get bigger. Americans, regardless of their ideologies, have to figure out how much time they would like to invest in engaging their politicians. We need boots on the ground marching, not fingers sailing across keyboards if we are to become an effective electorate.

[ebanks84]

06:23 PM on 11/11/2009

I don't believe in your statement of "....a dictator or messiah" and just for my own edification, I would like to hear your explanation of using those terms so freely if you don't mind.

[ebanks84]

06:33 PM on 11/11/2009

Writing and calling can be just as effective. Not all of us are able to put our feet on the ground. But I stay focused and make sure I contact the the leaders in my community to let them know how I feel about their congressional stand. The people should make sure their voices are heard also to keep our leaders on their toes. I love the fact that a group has started a campaign to back Lieberman's opponent if he stops our bill from passing in the senate. To me, that's involvement. I'm also so very glad to see Americans getting more involved every day in politics than they've ever been in the past. It's wonderful to be sure!