Peter Morici is a professor at the Smith School of Business, University of Maryland, and former Chief Economist at the U.S. International Trade Commission.
Despair grips the nation, as nearly 15 million are counted as jobless and many more languish in part-time employment. Free trade with China, flawed energy policies and pandering to Wall Street are destroying American prosperity.
Core private wage earners must be added to pay taxes for new positions mandated by new federally subsidized health benefits, financial sector regulations, and alternative energy technologies, or the federal deficit will fly into orbit; nevertheless, new tax-paying jobs are simply not materializing in sufficient numbers.
Democrats are pulling up in the polls—though not doing well, they are doing less badly. Prospects for a Republican sweep seem less likely than two weeks ago, and the Republicans have only themselves to blame.
Gold is approaching $1300 an ounce for good reason. The Obama Administration has flooded the world with greenbacks and Treasuries, global investors have little confidence in the management of the U.S. economy, and investors have taken refuge in gold.
Summers' replacement must be an economist that will go along or an industry leader who can polemic an alibi or be excused for not knowing better. This person, if it is an economist, must soft peddle the limitations of policy tools the President likes.
Resurrecting America requires addressing structural impediments to growth-the gaping trade deficit with China and self-destructive corporate outsourcing hysteria, the sorry state of the balance sheets at the 8000 regional banks, and the reckless casino culture on Wall Street that is luring local governments into fiscal disaster just as it did homebuyers several years ago.
The Commerce Department reported the deficit on international trade in goods and services fell to $42.8 billion. That is less than the $49.8 billion registered in June, as a slowing U.S. economy dampened import demand and civilian aircraft shipments jumped. The latter is not likely to be repeated.