Wow, this is just embarrassing. A raspberry from businesses, the object of Obama’s tender ministrations. And the reason? Basically, too little demand, something that tax cuts won’t remedy.
From the New York Times:
The dismal state of the economy is the main reason many companies are reluctant to hire workers, and few executives are saying that President Obama’s jobs plan — while welcome — will change their minds any time soon.
That sentiment was echoed across numerous industries by executives in companies big and small on Friday….[M]any employers dismissed the notion that any particular tax break or incentive would be persuasive. Instead, they said they tended to hire more workers or expand when the economy improved.
Companies are focused on jittery consumer confidence, an unstable stock market, perceived obstacles to business expansion like government regulation and, above all, swings in demand for their products.
“You still need to have the business need to hire,” said Jeffery Braverman, owner of Nutsonline, an e-commerce company in Cranford, N.J., that sells nuts and dried fruit. While a $4,000 credit could offset the cost of the company’s lowest-cost health insurance plan, he said, it would not spur him to hire someone. “Business demand is what drives hiring,” he said.
This is why, as yours truly and others have said, we need more debt restructurings and writedowns to get the debt overhang resolved faster, and fiscal deficits to offset the deflationary effects. Monetary policy is not an adequate substitute, as we have seen, and barely stimulative stimulus programs, like inadequate doses of medicine, destroy faith in the remedy when the flaw is in how it is being administered.
Even if the Republicans do serve up one of their more extreme candidates as their presidential nominee, the economy’s certain-to-be-lousy-if-not-even-more-Godawful performance next may well seal his fate. It’s hard to get your base to turn out when you look so dedicated to doing the wrong thing.