The president has delivered a speech on jobs in front of a joint session of Congress. National Review Online convened a panel to respond.
JOHN BERLAU
There was very little surprising in the speech, most of which sounded like it could have been given at one of Barack Obama’s 2008 campaign rallies. But there was one sentence that did surprise me, and, depending on the follow-up, it could even be a pleasant surprise.
In discussing regulation, the president gave his standard line of the past few months: We should get rid of regulations that put an unnecessary burden on businesses while still not exposing kids to mercury. This has been followed with little action other than a government-wide review. But one deregulation initiative in this speech, while still vague, did at least have a degree of specificity that has been lacking from his past rhetoric. Toward the middle of the speech, President Obama said, “We’re also planning to cut away the red tape that prevents too many rapidly growing start-up companies from raising capital and going public.”
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Obama didn’t identify the source of this “red tape,” but those following the issue know that the primary impediment to going public for smaller firms is the Sarbanes-Oxley Act of 2002. This is a law containing a series of accounting mandates, which was rushed through Congress in the wake of the Enron and WorldCom scandals. Mostly through a vague mandate for “internal controls,” Sarbox has made companies responsible for documenting the tiniest minutiae of little importance to shareholders
Politically, if Obama wanted to scale back or repeal a big regulation, this would be an excellent candidate. The law was signed by George W. Bush (though largely drafted by the Democrat-controlled Senate that came after the Jim Jeffords switch, as I explained in NR in 2005), and Republicans foolishly never took the opportunity to relax or repeal it when they were in power. Thus, Obama does not have to go back on legislation he supported and can even triangulate to the “right” of the Bush administration. And it is hard to see what priorities Obama would be sacrificing through a relaxation or repeal of this law. Sarbox hits start-up companies in politically favored industries such as alternative energy every bit as much as it hits other firms.
Sarbox remains a significant burden keeping the U.S. economy from reaching its potential — U.S. initial public offerings dropped off dramatically after Sarbox’s passage and have never come back. According to statistics from University of Florida finance professor Jay Ritter, in no year after Sarbox’s passage has the number of IPOs reached that of the slow-growth recession years of 1991 and 1992, let alone the late ’90s boom years.
And the law still disproportionately burdens smaller public companies. According to a Securities and Exchange Commission study released this April, for small-cap and micro-cap companies with market valuations between $75 million and $250 million, the cost of first-year compliance with the “internal control” mandates equals an amazing 77 percent of their total assets. Even after four years, this cost only goes down to 41 percent the firms’ total assets.
The difficulty of going public for smaller firms has been missing from the conversation about job creation, even from Republicans (though Newt Gingrich has mentioned repealing Sarbanes-Oxley in some recent instances). At the very least, Obama’s speech gets this specific burden to economic recovery back on the policy table. And who knows? Maybe this president will even pull a Jimmy Carter, who deregulated airlines and trucking after decades of rigid price-setting rules.
I wisely chose not to listen. Thank you NRO for this timely and prompt analysis.
Obama has pulled off the "bait and switch" commonly used by discount retailers. He repeatedly exhorted Congress to "pass the bill" which must have lead the Congress members who didn't walk out to scratch their heads and wonder "what bill?".
Now according to press reports he will submit his proposals to the "supercommittee" for consideration "soon". This saves him the semi-herculean task of putting his proposals into legislative language but also will allow him to disown them later as the politics shift.
A truly disgraceful use of the majestic tradition of such addresses. Boo! Hiss!
Gee, I felt like I was watching an infomercial - one of those that urges you to "Call NOW! - RIGHT NOW" (Oh, sorry, that last part WAS in the speech - multiple times).
I like this proposal, quoted by Fox: "...increasing and extending a payroll tax cut for workers that goes to Social Security, while providing the tax cut to employers, too. For workers, the tax that has been cut from 6.2 percent to 4.2 percent for this year would fall to 3.1 percent under Obama's plan... " This needs to be made permanent so that I can predict my personnel costs.
Anything that keeps money in the accounts of employers and employees and out of Washington is good. Let people have the wealth they earn, to save and spend as they wish, thus to keep their neighbors employed.
I care less about tax cuts, tax increases, rebates, credits, etc. than I care about our borrowing and the coming insolvency of entitlements our elderly have become dependent upon.
We just got downgraded to AA because our politics is so unserious.
Obama talks tax cuts while talking also about borrowing more. That has got to stop, regardless of party.
We also need balanced budget legislation. Responsible leaders who curtail borrowing should not have their work undone by others engaging in spending sprees.
My personal take away from the speech: if he could do all that he says, he must be magic!
Robert, I agree that what's needed are permanent tax cuts, but why cuts to social security? Isn't that already bankrupt? That's just kicking the can down the road again. Now, if they add an opt-out for younger workers, plus a permanent reduction, that's a different story. But I don't see that happening.
Social Security is not a lock box. It's part of the general bankruptcy. It doesn't matter if the SS taxes, or the Medicare taxes, or the income taxes, or the gas taxes are what is cut. Just cut it.
As a wise man once wrote, "Anything that keeps money in the accounts of employers and employees and out of Washington is good. Let people have the wealth they earn, to save and spend as they wish, thus to keep their neighbors employed."
Obama's speech appeals to the lowest common denominator, the most uninformed, and of course to his supporters. He is counting on the same morons that voted for hope and change to support this bill. He used emotion and passion in this campaign speech without explaining in DETAIL how this bill would be paid for. Just pass it without reading the bill because the funding details will be sent to you sometime in the future. Of course the "infrastructure shovel ready projects" were supposed to have been completed in the last stimulus. Once again, Obama presents a plan that would have the country tax and spend like DRUNKEN DEMOCRATS.
I love Mr. Ferrara's ideas about the Republicans passing things that will work in the House and then passing them along to the Democrat Senate, then going around the country explaining what they have done and putting the onus back on Obama and the Dems where it belongs.
"We should get rid of regulations that put an unnecessary burden on businesses while still not exposing kids to mercury."
I guess this means a ban on compact fluorescent light bulbs since they contain mercury and pose an immediate health hazard to children when they break.
I'll bet he's also got a bridge in Brooklyn he can sell you, cheap.
By the way, did anyone check the expiration date on this speech?
You are right that the President's plan was mostly worthless (jobs for his union and public-worker minions -- how revolutionary!) but remember that Reaganomics did NOTHING but fuel the economies of India and China, because Americans spent all their hard-earned tax cuts on tchotchke, cheap clothing and electronics from Asian countries -- and they continue to do so.
U.S. companies that want to operate overseas -- and still enjoy our freedoms and the protection of our laws -- should pay -- dearly.
Those companies that produce goods and services wholly in the U.S. should receive tax breaks.
While Obama focused on jobs for all Americans, he was hiding the gift handed to him by the Fourt Circuit Court of Appeals in Virginia v. Sebelius. Yet another head of the federal Hydra.
It's amazing people still seem to listen to Bambi as though there is the possibility he might shift here, adjust there, or offer some subtle indication he might actually have an interest in acting in a way that promotes the creation of individual wealth and sustainable economic growth.
In the words of the One, "let me be clear":
- He has absolutely no interest in "serving" the American public; rather his interest is in leading you wherever he chooses to go
- He knows more than you on any topic; there is nothing you can teach him
- All of his statements have an expiration date; usually when they leave his mouth
- When people live in worlds or their own creation, like him, outside influences matter not a whit; they will occasionally acknowledge the merits of appearances but only as it serves their own purposes
- Finally, and this is important to remember, his pathology makes him unsuited to be President, Senator, or anywhere near positions of power or influence; he is qualified to lead the Obama household and that's about it
Should you find yourself entertaining thoughts to the contrary, go back and revisit headlines over the past three years or so to remind yourselves just how vile this administration is.
Gentlemen:
I suggest we deal with the president with aikido rather than karate. When Mr. Obama reaches out for the middle ground, clasp his sleeve and tug him to our side. There little to be gained by obduracy while there is peace of mind in generosity.
Once he’s on the ground, beat him with a ball bat.
Our president is like a sophomore in college. When called upon to make a presentation in front of the class, he delays the presentation for weeks, and then shows up unprepared telling the professor, or perhaps guest lecturer, but I digress, that he and the class will just have to wait another 11 days for the second half of his presentation.
I didn't listen to the speech. Not because I simply dislike everything this clown does, but because there was no way in a single appearance he was going to be able to change his stripes.
He's a marxist, pure and simple. If you have ever dealt directly with a true believer (like a Marxist or a Bircher) you know, NO ARGUMENT will change them. So, why waste the time.
Dear Generic Republican Candidate;
Please, in the plainest language possible promise the following (and it would be most helpful if you followed through upon being elected): "To the extent of my Constitutional authority;
1) I will role back regulations to the end of the Reagan era,
2) I will return to a gold standard,
3) I will repeal the entire current tax code and replace it with a consumption tax,
4) I will serve only one term,
5) I will use the veto authority vigorously,
6) I will appoint originalists to the Supreme Court,
7) I will establish free trade in every corner of the world,
8) I will "re-invest" in our armed forces,
9) I will close useless departments/programs such education, energy, welfare;
10) I will reform entitlements protecting both current and future recipients.
On the second day; well I need to think about that....
