After a weekend of unprecedented moves by governments all over the world, Barack Obama lays an egg while pretending to promote better governance. In a speech in Ohio today he unveiled some new policies that aren't just bad, they're disastrous.
He scolds Americans for not living within their means and then proposes to give them an incentive to save even less:
1. "allow savers with tax-favored Individual Retirement Accounts and 401(k)’s to withdraw 15 percent of those retirement savings, up to a maximum of $10,000, without paying a tax penalty as the law currently requires for withdrawals before age 59 and a half."
Yes, let's have a massive securities sell-off right now! Let's encourage Americans to save less and spend more. Ridiculousness! Which of his economic advisers approved this message? This will lead to less future wealth and higher interest rates. We need Americans to save MORE and not less!
This would be like the opposite of McCain's proposal last week to eliminate the mandatory withdrawal clause.
2. "bar financial institutions that take advantage of the Treasury’s rescue plan from foreclosing on the mortgages of any homeowners who are making “good-faith efforts” to make payments."
That will do nothing to stabilize housing prices. How do you define a "good-faith effort"? Banks are already doing this so that they don't foreclose and essentially get a depreciating asset.
3. Mr. Obama called on Congress to double by another $25 billion the government loan guarantees for automakers.
Yes, let's increase government spending and subsidize our inefficient automobile manufacturers again! 2 weeks ago automakers received $25 billion in loans from the government at 5% interest (at a time when few businesses can afford to borrow due to high interest rates). Our government essentially loses on the deal, which means taxpayers lose, just like with any subsidy.
This is bad, bad, bad. You're winning the election by a wide margin, why throw this junk out there?