Sorry State of the Union

As many people know, tonight is the annual State of the Union address, in which the president lays out his agenda for the coming year.  Although this is a long-held tradition, it often is an exercise in frustration and futility.  

According to the Wall Street Journal, the country is "increasingly worried" about the president's abilities and are fearful about America's future.  A Washington Post poll revealed that fully 63% of Americans have little or no faith that Mr. Obama will make the right decisions.  At the same time, the public seems to support many of the president's themes and policy ideas.  There seems to be some kind of disconnection here.

Mr. Obama and other Democrats have certain phrases that they use over and over, knowing that they resonate with people:  "income inequality", "war on women", "minimum wage", etc.  When it comes to income inequality, for example, who could possibly be against helping the poor improve their lot in life?  No one whom I know.  But pay close attention; what has Obama actually done to address these problems? His "solution" is to take money that the wealthy have earned and redistribute it to those less fortunate. Would it not be better to empower people to rise out of poverty through their own efforts, rather than simply taking from the wealthy? Our economy remains anemic, millions of people have simply given up on looking for work and the median household income has decreased during Mr. Obama's presidency, due to his failed policies.  We could all possibly end up poor and miserable, but, boy, we'd all be equal!  

The United States, although weakened, is still a strong country, but we will likely not recover fully under this president.  Mr. Obama seems to confuse rhetoric with action, and there is a dichotomy between what he says and what he actually does.   We would do well to follow the example of Andrew Carnegie, who said "As I grow older, I pay less attention to what men say.  I just watch what they do." 

A Trillion Here, a Trillion There....

With attention focused on the healthcare struggle, we need to be ever vigilant about the government's plans to increase spending of our hard-earned money in a variety of ways.  As usual, the government's cost forecast involves some very creative accounting.

The Wall Street Journal reports in its main editorial today the Obama administration is poised to take over the student loan market.  If Mr. Obama can convince Congress to approve his plan, the federal balance sheet will increase by one trillion dollars over the next decade.

For years, the main means of borrowing for college has been through private lenders who offered government-guaranteed loans.  Private lenders would raise money from private capital markets, make the loan, and pay a small fee to the government for each loan.  The government in turn covered most of the cost of defaults while allowing the private lenders to make a regulated return.

This system started breaking down in 2007 when Congress passed legislation that resulted in returns so low that private lenders could no longer afford to make these loans.  (Do I need to remind anyone that this was the year Democrats took over Congress?)  If Obama gets his way, starting in 2010, private lenders will be barred from making government-guaranteed loans and taxpayers will be supplying approximately $100 billion a year to lend to students

I would urge everyone to read the editorial in its entirety; it's quite revealing.  The WSJ says this legislation is certain to pass the House;  the only chance to stop it is in the Senate.  If it passes, parents will have no choices in borrowing for their children's college education and taxpayers will be footing one heck of a bill.