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Posted

This is the response from President Obama to an email I sent a few weeks back detailing my concerns on big government and our country beginning to lean more towards Socialism. I am aware of the general sentiment of Obama at this point in time in the U.S., and I may lose some friends for this, but you have to hand it to the man, he handles criticism of his administration tactfully and diplomatically. This is a valuable character trait and debate/discussion habit that I hope to emulate whenever anyone offers critiques of my work in the future. As we look forward to a Trump presidency, just remember that Obama is human as well and has his good qualities like anybody else. At this point, dehumanizing his administration will not do anything to change what happened. All we can do is look back, reflect, and attempt to do better in the future. If this makes me a crazy leftist Statist in some peoples eyes, so bet it. The ability to recognize valauble traits in others despite disagreements over philosophy is the foundation for building a more peaceful society in my humble opinion.  


 


The White House, Washington


 


Thank you for writing. After recovering from the worst economic crisis in generations, our Nation has had the longest streak of private-sector job growth in our history. We are less reliant on foreign oil, and over 20 million people have gained health insurance since the coverage provisions of the Affordable Care Act took effect. With an unemployment rate cut in half, deficits cut by almost three-quarters, and an auto industry that has roared back to life, America now has the strongest, most durable economy in the world.


 


However, many feel anxious about the profound economic changes that started long before the Great Recession—from technology that can replace jobs on the assembly line and companies that can relocate anywhere on the planet to workers having less leverage for a raise and more wealth concentrated at the top. These changes are squeezing the middle class and making it harder for working Americans to start a career, a family, or a business and save for retirement. They also threaten the fundamental American promise that if you work hard, you can get ahead. My Administration has made progress in building an economy that provides security and opportunity for all, but there’s still more work to do.


 


Real opportunity in the 21st-century global economy requires access to the education and training needed to land a good-paying job, which is why we must continue investing in early childhood education, working to ensure our students graduate from high school ready to succeed in college and careers, and making college and technical schools more affordable. We also need to expand benefits and protections for hardworking Americans and strengthen our healthcare system, Social Security, and Medicare so more of our people can have a basic measure of security throughout their career and when they retire. And when someone falls on hard times, we should support them as they retrain and retool for a new job.


 


A thriving private sector is the lifeblood of our economy, and in this fast‑changing world, small businesses, startups, and workers need more of a voice—not less. And we need to use American innovations to solve our biggest problems. That’s why my Administration has called for all students to have access to high-quality computer science education, and why we have invested in clean energy technology and next-generation manufacturing hubs so the products of tomorrow can be designed and built right here in America.


 


Thank you, again, for writing. For information on what my Administration has done to build an innovation economy that works for everyone, visit www.WhiteHouse.gov/The-Record/Economy.


Sincerely,


 


Barack Obama


Posted

Can you let us know the email you sent him? It looks like rehashed info he normally talks about. Most of which are red herring, like the so called recovery, the unemployment, the "healthcare" which didnt let people keep their doctors, cost went up, fees etc yea, as if that is really a great way to care for peoples health...

During the Obama presidency the debt doubled, terrorism grew and race relations became worse. The good I see is it got someone like Trump to step in. #MAGA Thanks Obama

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Posted

Can you let us know the email you sent him? It looks like rehashed info he normally talks about. Most of which are red herring, like the so called recovery, the unemployment, the "healthcare" which didnt let people keep their doctors, cost went up, fees etc yea, as if that is really a great way to care for peoples health...

 

During the Obama presidency the debt doubled, terrorism grew and race relations became worse. The good I see is it got someone like Trump to step in. #MAGA Thanks Obama

This was the original email, be warned its quite long: 

 

Most in my generation vaguely remember our World History and U.S. History classes from high school. The unit on the Cold War was exciting and interesting for some of us (I being one of them) while putting others to sleep. Most Americans, and indeed citizens from all over the world have living memory of this conflict. Really what is was defined by was a clash between two schools of economic thought throughout the 20th Century. One school represented by John Maynard Keynes, Keynesian-ism which he published in his "The General Theory of Employment, Interest, and Money. The other school was represented by Friedrich August von Hayek, The Austrian School of Economics. We have all have studied history at some point and have seen the results of attempting to organize along the Keynesian model for an economy. In the Soviet Union, the means of production were nationalized (owned by the state), there was collective farming, industrial manufacturing and controlling it all was a centralized administrative politburo. In attempting to run their economy in this way, leaders such as Khrushchev, Lenin, and Stalin were able to obtain a high output of industrial production, but there were sacrifices made in other industries. Mainly there were shortages of food, which led to social unrest and a general confusion by the leaders about why things were going so wrong. This happened in other Socialist states around the world such as North Korea, Venezuela, Cuba, China, North Vietnam, Mozambique, Somalia, East Germany and countless others. In all of these places at that point in time the same phenomena were present and the government officials could not understand why their plans were not going as planned. One may ask, how did the U.S. end up different from the rest of the world where socialism was being instituted? The simple answer is this: The Free Market. I will now attempt to refute some typical critiques of our current hybrid between Socialism and Capitalism and why what we have is not a true free market, but indeed a distortion. I will also offer potential alternative courses of action we might consider as a nation. An understanding of the fundamentals of economics is essential if we are to have a flourishing, and prosperous society.

 

Critique: "Capitalism does not look after the poor and down trodden. That's why we need a government safety net to ensure nobody lives in abject poverty."

 

Rebuttal: Let me ask you all a question. What do we do in this country when we have an idea for helping people and providing value? We go out and we try to start a business. If our idea is compelling enough and enough people are willing to invest in the company, then we have a small business that employs workers in order to serve its customers. If all who feel passionately about the plight of the poor, wanted to do something, then they could gather together with other who share their interests and bam, the market working its magic. This however does require the cooperation of many different individuals all working in their own self-interest so that society may be made better off. 

 

For a simple example, a farmer Joe in Kansas doesn't know how many people he is feeding dinner with the wheat that he grows. He is primarily concerned with his own well-being and that of his family. For this reason, he works hard to get his produce to market, where it can be sold as bread or cereal, or whatever else. In order to get the produce to market our friend Joe here has to work with supply chains. These supply chains involve trucks. Those trucks have many different moving parts that not many people know how to make, so individuals who are specialized in the manufacturing of automobile components have to be involved. The waitress who serves the trucker his lunch on his 30-minute lunch break, she has to be involved. The factory workers that process the wheat to purify and ground it, they also need to be involved. I could keep going on but I think most of you get the picture. Cooperation between many different know-hows is required for the creation of the products that all of us want and need. Widespread dispersion of knowledge works beautifully in delivering the products to the grocery store shelves. When we go to the grocery store the product we are looking for is often in stock and waiting for us to come pick it up. The phenomena that makes this possible is the Invisible Hand and spontaneous order. The miracle of this concept is the absence of a centralized planning committee attempting to direct resources around in ways that they deem efficient. This collective decision on the provisioning of resources can lead to governments to potentially allocating far too many productive resources towards say, the manufacturing of war machines, and as a consequence less is allocated towards other things we want or need. The lesson this example teaches us is that there is not a single person, or group of people in the world that could possibly know enough at any given time what a society desires and how to allocate the resources available efficiently enough to achieve those ends. When left to its own devices, The Invisible Hand will work miracles and give us products we could never even have dreamed of.  

 

Critique: "But we need regulations to control big business so that we don't get monopolies."

 

Rebuttal: A minimum set of regulations is certainly called for. I must stress the minimum aspect however. If the rules of the game keep changing too frequently or begin to pile up to the ceiling, nobody wants to play anymore. Imagine playing a game of tic-tac-toe with someone trying to do two moves at once, or a game of chess with one player making an illegal move and the referee allowing it as an exception. Now imagine that happening constantly year, after year. At some point everyone just gives up. Not very fun at all. The driving motivations of the various players turns from producing useful goods and services towards seeking to influence the referees in order to gain favor over everyone else. When the government has the authority to draw unlimited funds from the Federal Reserve in order to finance projects, the main priority of businesses and firms is to get in bed with our elected officials and hog their share of the loot. This is what gives us lobbyists in Congress for Oil, Financial, Agricultural, and yes even teachers unions among other special interests. Instead of each of these industries working to provide their goods and services to customers, they have to dedicate millions of dollars annually to essentially "get in bed" with our politicians to make sure the rules of the game are rigged in their favor. If all government did was set the minimum amount of rules and regulations reasonable to a given industry, and provide a consistent rule of law then the free market would take care of the rest. Think about our tax code and how incredibly complicated and excessive it is. Thousands upon thousands of pages of new regulations are added every year, making the lives of accountants and tax compliance specialists an enormous drag. If the tax code were simplified, just think how much more productive work could get done rather than costly, lengthy litigation to try and figure out who isn't paying up. I'm no tax expert, so I don't know the details of a simplification, but I do know this is likely to yield the best results. 

 

Critique: "But we have to tax the rich so that they pay their "fair" share of taxes."

 

Rebuttal: The rich already pay their "fair" share in taxes. Determining what is fair is really more of an normative discussion than it is an objective one. According to data from the IRS Tax stats for the most recent year: The top one percent of income earners who made $250,000 or more were taxed at a rate of 51.6% of income paid. The bracket of earners between $100,000 and $199,999 paid an effective tax rate of 21.9% of their income. By contrast those making less than $15,000 payed an effective tax rate of 0.1%." http://www.pewresearch.org/fact-tank/2016/04/13/high-income-americans-pay-most-income-taxes-but-enough-to-be-fair/

 

From this data we can conclude that the rich are the ones bearing the highest tax burden. Generally what do we know about taxes? Well, most people don't like them. Everyone does anything they legally can to reduce their tax burden because we all want higher income remaining after taxes. So if the top 1% has to pay the lion share of the taxes, what does this do to effect their incentives, and why should we not be trying to levy something ridiculous like a 95% tax rate? The answer is simply a matter of perspective. If you woke up tomorrow and you knew that the government was going to levy a 95% tax on your earnings, would you be motivated to work hard and produce, or would you do everything in your power to avoid this burden, such as moving to off-shore tax havens or less tax intensive environments? This is the dilemma corporations, which comprise of individuals, face when popular opinion sways towards Socialism. What would you do if you were the management of this company? With increased costs of doing business, you would be forced to either garnish more of your employee's wages in order to satisfy the liability or lay-off workers and consider automation/outsourcing. Regardless of political affiliation, we can all agree that the middle class is getting a raw deal and has been for decades. In order to have jobs return to our shores, the solution I propose is to make taxes as low as possible and to make them easy to understand. By doing this, businesses will have much more time to dedicate towards actually producing what we want and less time towards compliance, and litigation, and lobbying to write regulations that allow the tax law to be in their favor, effectively raising what economists refer to as the barriers to entry. 

 

If there are any arguments that I haven't made compellingly enough, feel free to offer rebuttals to my rebuttals. The information that I posted in this email was taught to me by Sherri Lynn Wall, perhaps the most passionate economics professor I have ever had the pleasure of learning from. Above all else, my goal in writing this was not only to introduce my friends and family to Free Markets, but to maybe unite both sides of the aisle on the fundamentals of economics. Who knows maybe you could suggest this analysis for consideration in the halls of Congress, so that we may finally discuss the merits and the limitations of both systems for organizing our economy. I want to stress that this discourse should take place without any yelling, screaming, name calling, or any other inappropriate gestures. Reasoned, and calm deliberations are key to solving not just the ailments of our state but indeed perhaps the aliments of our country. Thank you for your consideration. 

 

Sincerely, 

Isaac Gage 

Posted

Great job Isaac, on the letter you wrote.  It is full of important logical construct, with an eye towards historical reality and honest recognition of implications.  Thus, it's chance of honest response had a sparrow's chance of penetrating bullet-proof glass beak first.

 

The O-response is pure boilerplate smokescreen.  It is glaring for what it doesn't say.  Almost every sentence is cheerleading avoidance.  For example, suggesting that career success is dependent on kindergarten.  I'd think a more secure childhood would be the better approach.  The unspoken: -- Where teachers with unions will be employed, and the children are further removed from family structure, and big surprise, earlier introduction to various propaganda.

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