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US Economy Troubling Obama Again

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TEHRAN, May 6 (ICANA) – US President Barack Obama's image will significantly improve with the announcement of bin Laden's death as Washington's politics continue to detach from macroeconomic reality.
Friday, May 06, 2011 12:04:21 PM
US Economy Troubling Obama Again

Press TV interviewed Ian Williams with the Foreign Policy in Focus about the US attempt to stimulate job creation, and the Republicans' conservative attitude in preventing the growth of the country's economy.

Q: The so-called great recession started with the sub-prime mortgage crisis and the breakdown of the country's financial sector. How far along do you think the US is in real estate recovery, and what guidelines have been put in place to prevent another meltdown in the financial sector?

Williams: I think that is what is being reflected in these numbers. There is no clear plan out of this. President Obama and his advisors are correctly suggesting that the way to grow the economy is for government spending to stimulate job creation and consumption. The Republicans are pushing for cutting back on government spending. In the meantime private companies are putting on huge amounts of cash profits, which they are not reinvesting because they can't keep the economy growing.

That's the point Obama's advisors are making. They want to see the economy growing. The economy won't grow until the government puts some money into it. The government isn't being allowed to put money into the economy because of the Republicans' neo-liberal tactics, and their opposition to almost all expenditure except on weaponry.

Q: What was interesting was the timing of bin Laden's death that was announced by Obama. Many say it's going to help him in the polls. The economy is certainly on the minds of Americans. Considering this recent announcement, and with the job market looking the way it is, how is Obama going to be affected by all this?

Williams: One possibility is that he will get a boost of his image by managing during the killing of bin Laden. He will have a much stronger hand negotiating with the Republicans over the economy. And whether that is true or not or whether he wants to avail himself as having stronger hand is another way of doing it.

As I wrote this morning, there could be one irony in that the death of an elderly Saudi in Pakistan might save medical care for millions of elderly Americans in the United States, because of the strange way the American politics work, which is actually detached from macroeconomic reality so much.

One only has to look at Congressman Paul Ryan's plan to beat the deficit, which does so by the method of cutting the government's revenue from taxation to see that we are dealing with people who are not on the same planet as the rest of us.

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