My Turn: Obama administration chose no-growth policies over working people

For the Monitor
Published: 7/13/2017 3:12:15 AM

Jonathan Baird is correct that the Democratic Party abandoned its largest base, the American working people (Sunday Monitor Forum, June 25).

The article points to a Princeton University study that reveals a “cumulative disadvantage for those with less than a college education.”

However, today we need skilled workers with community college experience and trades people. That research report points out that workers without a college degree have experienced a decline in life prospects and that a stagnation in wages has bred a sense of hopelessness. These conditions for working people were magnified during the eight years of the Obama administration.

Even though he campaigned to help the working people, President Barack Obama abandoned them, the largest base of the Democratic Party. Instead he embraced the environmental extremists (not responsible environmentally prudent people) and the Bernie Sanders/Elizabeth Warren wing of the Democratic Party, which believes our free enterprise system is the problem and American businesses should be punished and not incentivized to innovate.

By embracing the environmental extremist and the socialist wing of the Democratic Party, we will get a continuation of a stagnant economy with stagnant wages and little or no growth in our Gross Domestic Product for working people.

The environmental extremists love a no-growth domestic policy because “no growth” means we will burn less fossil fuel. The socialists also love no GDP growth because they can build a case that our free enterprise economy will not provide the economic environment for wage growth and big government will be their answer.

Baird is right about one point. He points that the plight of working people is due to a sense of their loss of the American Dream. The American Dream is the belief that if we work hard and play by the rules, we can achieve what we have a passion for in life. The two wings of the Democratic Party that President Obama embraced at the expense of working people is the reason that working people are losing hope in achieving the American Dream.

Where Baird is dead wrong is that the American Dream is a “myth.” It is alive and well, and working people will have an opportunity to achieve that dream because of the leadership on the economy that President Donald Trump is providing to our country.

In New Hampshire there should be no reason for wages to be stagnant for our working people. There are about 1,800 advanced manufacturing jobs open here. We also have a shortage of semi-skilled trades people. One does not need to have a four-year college degree to close the skills gap in our state.

And, if some of our residents do not have sufficient income to get these badly needed skills, our community college system has a program called WorkReadyNH, where working people can obtain these skills for free. With these opportunities for our working people, the prospects for landing a secure, good-paying job with benefits have never been better.

All the Obama administration was able to produce was low-paying service jobs with no benefits. Because Obama refused to negotiate a fiscal economic policy that Trump is promoting, there was only monetary policy from the Federal Reserve that kept our economy from falling back into recession.

Under the Obama administration, the monetary policy was the only game in town because there was no economic fiscal policy for balance to grow our economy. This condition that the monetary policy has created is an artificial economy with artificially low interest rates and artificially higher prices for hard assets. This is a condition that I know firsthand.

I am an investment real estate broker. My job is to sell income-producing properties to investors who have significant dollars to risk in the purchase of real estate.

So, the lower the interest rates to borrow for real estate, the higher the price of those assets will go. The income received from these assets is about eight times the rate that working people can get for their savings.

Here is where the Obama “no growth” policies of the last eight years have widened the income gap between the top 10 percent of the population in America and the working people. Working people do not have hundreds of thousands of dollars they can risk to buy hard assets. They have to rely on certificate of deposit savings. Asset prices increase because of artificially low interest rates. Investors can earn a large return on their invested cash. Working people are stuck with savings accounts that pay out even lower interest rates than the investors borrow with. That is how the income gap widens between the investor class and hard-working people. This is a tax on working people.

Baird goes on to suggest that the Democratic Party needs to tackle economic inequality. This is a true statement. It substantiates my claim that we have economic inequality today because of the last eight years of the policies of President Obama. To suggest that Sanders’s big government policies are where the party should start will only widen the income gap in our country. To suggest that we can rebuild America with a “green economy,” a code word for environmental extremism, will only make matters worse.

While we should continue to pursue sustainable energy sources like solar and wind, these unprofitable industries will not help to narrow the income inequality gap.

It was also suggested that America engage in a massive public investment program. President Trump has asked the Congress to approve such a program to the tune of $100 billion per year for the next 10 years. This type of initiative can provide good-paying jobs for working people.

If Democrats would take as their leader people like Rep. Tim Ryan of Ohio and not the minority leaders Nancy Pelosi and Chuck Schumer, the party can find middle ground with our pro-jobs president and re-establish the American Dream the working people in America deserve.

(Joseph Mendola is a real estate broker and lives in Warner.)




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