The real State of the Union, as opposed to what you will hear from the President tonight, is captured by Michael Ledeen: Banks are not lending, companies are not hiring, because they are afraid of what Obama will do next. Both are afraid of onerous taxes, including new health care burdens, and the banks fear new regulations and the consequences of the recently declared war on evil bankers by the president. Seniors are afraid they will be deprived of medical treatment. Juniors are afraid they are going to be forced to buy health insurance they don't think they need. Across the board, Americans are afraid they're not going to find work, and won't be able to afford a house. And, as the Massachusetts vote showed, Americans are worried about threats from abroad, worried about Iran, afraid of terrorist attacks, and afraid the Obama Administration doesn't take all this seriously enough. As Scott Brown put it, most Americans think our tax dollars should go to fighting terrorists, not to pay lawyers to defend terrorists.
Rhetoric cannot alter reality. There is nothing that Obama can say (or will do) to change the realities above. Virtually everything he has done or tried to do has made the situation worse. He dug a deeper hole. His problems are now intractable.
Obama rode into office as the new Roosevelt. He will be chased out as the new Hoover. His most vigorous pursuers will likely be irate Democrats carrying tar, feathers and rope.
Monty Pelerin www.economicnoise.com
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