President Barack Obama’s Speech

President Obama opened his speech in primetime on Monday night to remind the American people that George W. deficits Bush 's irresponsible are crippling the economy. Sure, he racked up a “little credit card debt” saving the economy, but not to worry, he assured us, it’s a problem that can easily be solved. “Rich” “corporations” make too much money. Unfortunately, a radical cadre of House Republicans is standing in the way of a “grand bargain” to reduce Bush’s deficit by not “seeing eye-to-eye” with the president on the need to raise taxes. Call your elected representatives, Obama implored. Tell them to agree with me.

Raising the debt ceiling is just not that big of deal, he explained. Every president has done it (though he voted against it as a Senator). He just needs an extra $2.5 trillion in debt to pay the bills that have already been “racked up by Congress.”

But we also need to reduce Bush’s deficit. Unfortunately, the “cuts-only” approach being championed by House Republicans “doesn’t solve the problem,” and is simply unacceptable. The cuts-only proposal put forward by Senate Majority Leader Harry Reid (D., Nev.) on the other hand, is “a much better approach” because it absolves lawmakers from having to relitigate the issue at a later date (when there are important reelection campaigns to consider).

“We all agree,” he said, even House Speaker John Boehner (R., Ohio) and plenty of Senate

Republicans, on the need to reduce the deficit by $4 trillion, and the need to raise taxes by $1 trillion on “patriotic Americans” who are “willing to pitch in.”

“They’ve done it before,” he said. Indeed, argued the president, when congress has raised taxes in the past, the American people have tended to pay them. Did you know that Reagan raised taxes? I’m just like Reagan, he assured us. He’s perfectly willing to make “tough decisions” on entitlement reform, but only if “the burden is fairly shared.”

“We’re left at a stalemate,” Obama concluded. Therefore, he has decided to take the lead, by demanding that congressional leaders come up with a “fair compromise” that can pass both houses, so he can sign it (and take credit for it). The American people, he said, are “offended” by “a town where compromise has become a dirty word.” What is this great country of ours, if not a “grand experiment in compromise?”

As for the blatant, cynical demagoguery, politics, the speech was part of the course. On the merits, Obama endorsed the proposal of Harry Reid in the Senate, but not explicit threat to veto an increase in short-term debt (as indicated in the Boehner plan). Either way, it's a bit late in the game at this time to try to reframe the debate on debt, especially in the Apocalypse is coming in the White House insists that will happen if nothing is done by August 2. Should be an interesting week. 

Barack Obama investor warren buffett

Billionaire investor Warren Buffett said the credit quality of the U.S. remains "good" and the nation will honor its obligations even as lawmakers debate whether to lift the nation's borrowing limit.

"We will pay our debts in the end," Buffett, chairman and chief executive officer of Berkshire Hathaway Inc., said in a Bloomberg Television interview on "In the Loop" with Betty Liu from an Allen & Co. sponsored conference in Sun Valley, Idaho. "Our credit is good. It's not like if we don't pay we can't pay. We have the right to print our own money. The U.S. is a very special place."

The billionaire investor famously supported Barack Obama, who in turn used Buffett as his amulet of normalcy: What, me radical? Tell it to this rich white guy from Omaha. One of the lamest things I can remember having seen in politics transpired in 2008 when Obama was challenged on his radical associations and used Buffett to change the subject. His phrasing was memorably odd: “Let me tell you who I associate with. On economic policy, I associate with Warren Buffett and former Fed chairman Paul Volcker. If I’m interested in figuring out my foreign policy, [Editorial aside: “If”?] I associate myself with my running mate, Joe Biden, or with Dick Lugar, the Republican ranking member on the Senate Foreign Relations.”

 

U.S. employers added 18,000 workers in June, the fewest in nine months, and the unemployment rate unexpectedly climbed, Labor Department data showed today in Washington. The median estimate in a Bloomberg News survey called for a June gain of 105,000. The unemployment rate rose to 9.2 percent, the highest level this year.

This data "means that we are a ways off from getting to be where we should be," Buffett said. The kind of slump we had "doesn't turn around in a week, or a month or even a year. On the other hand, we are coming back,"