A Letter to the President from a Listener!

The following was a very interesting analysis in the form of a letter sent by a local listener to President Obama:

Dear Mr. President:



1. Your role as President is to inspire us, and give us hope for the future. Lift us up, instead of scaring us to death. There is no need to remind us that things are bad and likely to get worse – we already know. Please refrain from using words like “crisis” and “catastrophe” and instead reassure us by emphasizing the coming economic and financial recovery and the future prosperity that awaits us. Like a weatherman who forecasts a blizzard, even if it never comes, we’ll inevitably adjust our behavior accordingly by stockpiling food and milk until the shelves are clean. Similarly, if you continually remind us of how bad things are and how bad things are going to get, we’ll respond in similar fashion. Businesses will prepare for the coming economic “blizzard” by cutting costs and laying off employees. Consumers, concerned about their jobs, will likely reduce their spending. These actions will ultimately cause the very collapse in the economy we are trying to prevent. It’s all about confidence. If we believe things will get worse, they will. Conversely, if we believe things will get better our behavior and spending patterns will adjust accordingly and the economic sun will shine again. Stop playing politics – we already know things were bad before you took the oath of office and don’t hold you responsible. Become the leader we thought you could be, not the politician we feared you were.



2. If you really want to stimulate the economy, why on earth would you raise taxes during these depressed economic times – particularly on capital gains? Although typically the financial markets adjust in response to economic conditions, I would argue that this time it will be the reverse opposite – future economic fundamentals will depend upon financial market performance. Consumers will not spend, and thus the economy will not improve, while their wealth and after-tax income is eroding. Improvement in the financial markets will restore much of the wealth that has been lost and inevitably the necessary spending to jumpstart the economy. Given the steep losses in the financial markets, no one has capital gains anyway. Reducing or eliminating capital gains taxes – even if only for a few years – would cost the government little while providing a psychological boost to encourage prudent risk taking and the capital formation we so desperately need to get our economy back on track. A temporary elimination of the capital gains tax would likely cause the stock market to appreciate a minimum of 10 – 20% in short order. I assure you that consumer confidence and spending would quickly follow. And do you actually think raising income taxes in the midst of the current economic calamity will help reduce the deficit? Here’s a clue – tax me more, I’ll spend less. The less I spend, the worse the economy. The worse the economy, the more jobs are lost. The more jobs are lost, the less income you have to tax. Instead, tax me less, I’ll spend more and everything is reversed. Get it?



3. Why punish the financially responsible and reward the financially irresponsible? Why reward those who used excessive debt to purchase homes or other luxury items they couldn’t afford at the expense of those who lived responsibly within their means? I recognize we have a housing crisis and that mortgage delinquencies are contributing to our current economic malaise, but instead of forgiving the outstanding principal of delinquent mortgages at taxpayer expense wouldn’t it at least be more equitable to have a lien against future appreciation – perhaps at time of sale or even against one’s estate upon death? Please explain to us how simply forgiving the outstanding principal, with no possibility of recapture of subsequent appreciation by the taxpayer, is fair? All you are doing is incentivizing others to stop making their mortgage payments so that they too can be rewarded for their bad behavior by receiving a government handout on my and other taxpayer’s hard earned dime. It would seem to me that your policies in this arena will merely make the problem worse, not better. Nothing complex Mr. President – just common sense.



4. Please explain how reducing the charitable income tax deduction on high income taxpayers will help non-profit organizations throughout this country and increase the tax revenue to the federal government. Do you realize that this would potentially eliminate the very lifeblood of these organizations and the essential services they provide? Without the source of private donations most non-profit organizations would cease to exist, creating a void that only the government (and thus the taxpayer) could fill. More government involvement would likely equate to even greater taxpayer expense than any resultant increase in tax revenue. It’s not rocket science.



5. If you actually think we can become energy independent solely through alternative energy sources and little reliance on oil you are sadly mistaken. Your budget proposal to eliminate tax incentives on oil exploration will merely reduce our domestic oil supply, increase our reliance on foreign oil, compromise our national security, and further jeopardize our economy through higher oil and energy prices. Further, your proposal to limit certain emissions from the very businesses and manufacturers we depend upon for employment and job creation will only increase their manufacturing costs, reduce their global competiveness, and cause the loss of even more jobs than those we’ve lost already. Although the ideal of having clean energy and environmentally friendly manufacturing processes is indeed admirable, I don’t think our idea of a cleaner environment consists of the absence of manufacturing altogether. Want to turn a deep recession into a depression? Just go ahead and add even more cost and inefficiency to an already beleaguered U.S. manufacturing industry during these severe economic times.



It’s only been a few weeks since your inauguration Mr. President. You obviously have a lot to learn. It’s no coincidence that our financial markets are plummeting and our very way of life threatened since that time. It is readily apparent that neither the markets nor we have any confidence in your words, decisions, and proposed policies since assuming the highest office in our sacred land. Nor do we believe your policies and proposals represent the “change” we thought we were getting when we elected you. It’s now on YOUR watch, and there is no longer time for on the job training or assigning blame to others. Although the American people are patient, our patience is wearing thin. Please wake up – and soon. Be the great President that many felt you could become. Our hopes, our future, and indeed our very faith in the American Dream are dependent upon it.



Sincerely,

Kevin