A drilling moratorium aimed at big oil is a drilling moratorium aimed at local oil as well. That’s the message being sent by the Greater Lafayette Chamber of Commerce in Lafayette, Louisiana as they revive the “Energy Division” from several years of dormancy.

Why now?

According to The Daily Advertiser, “challenges from the moratorium and other anti-industry legislation signaled a need for its return, said Chamber President and CEO Rob Guidry.” In short, they are fighting the federal government. The Chamber was amongst those who organized last week’s11,000 strong anti-moratorium “Rally for Economic Survival” held at the Cajundome.

The near-complete shut down of Gulf Coast drilling by the Obama administration continues to compound the blows to jobs that towns like Lafayette are already feeling. Some drilling companies aren’t holding their breath for an expedited end to the moratorium and have already recommitted drilling resources to other countries. And with the “small people” sitting on the sidelines, they’re left with a spectacle of disaster.

That is why groups like the Lafayette Chamber’s Energy Division are continuing to crop up.

“With so many local companies involved in the exploration of oil and gas, it just made sense to provide them with a common ground,” said Guidry.

“Volunteers will lobby all levels of government to promote pro-industry legislation and work to defeat measures that negatively impact the industry. Immediate attention will be given to the moratorium on deepwater drilling.” – Jeff Moore, The Daily Advertiser

And they have every reason to be committed to seeing this moratorium come to an end. Heritage Foundation research has shown that the effects of an offshore drilling ban would result in a $5.5 trillion reduction in GDP and a reduction in job growth by more than 1.5 million jobs by 2030. Pair this with the realization that our expenses on imports would raise by more than $730 billion in the same timeframe, creating foreign employment while stifling the domestic market, and a very grim image begins to be formed.

The drilling ban was allegedly put in place to prevent repeat disasters like the Deepwater Horizon Spill, a worthy concern to be sure, but banning all drilling in the Gulf of Mexico is not a worthy answer. Other options remainthat will not only preserve jobs in Gulf States, but ensure that safety standards on drilling rigs are maintained.

From the smallest oil businesses on the Gulf Coast, to the Governor of Louisiana, to the majority of our nation, the resounding cry is for an end to the Gulf of Mexico drilling moratorium. Will it be heard? Or will the oil-spill simply remain another crisis to be taken advantage of?

Obamacare has been rightly blasted as fiscally irresponsible, yet few have noticed what may be Obamacare’s largest ticking entitlement time-bomb: the CLASS Act. My new op-ed on the subject is here, and my new report, co-written with Jim Capretta, is here.

CLASS is a new long-term-care insurance program that was inserted into Obamacare so that Congress could raid its $70 billion surplus through 2020 to cover Obamacare’s initial deficits. Like the raided Social Security trust fund, future taxpayers will have to repay that $70 billion with interest when the program falls into deficit later.

Thus, even Sen. Kent Conrad (D., N.D.) admits that Congress has enacted “a Ponzi scheme of the first order, the kind of thing that Bernie Madoff would have been proud of.”

It gets worse. CLASS is simultaneously 1) voluntary, 2) supposedly self-financing (premiums must be raised to match benefits), and 3) required to charge the same premium to healthy and unhealthy individuals of a given age. This is a recipe for insolvency.

To see why, consider an admittedly simplified example: Let’s say three 45-year-olds, based on varying health and expected long-term needs, state their individual willingness to pay for this insurance at $100, $500, and $900 per month.

In order to maintain solvency without risk-based pricing, CLASS would be required to charge all three people the same $500 premium. The healthiest person (willing to pay just $100) would consider this a bad deal and decline participation. At that point, premiums for the remaining two individuals would have to rise to $700 to keep the program solvent. This would cause the moderately healthy person (willing to pay $500) to also drop out, leaving only the unhealthiest person and a $900 premium.

Health economists call this an “adverse-selection death spiral,” and it would likely end in program bankruptcy. The CBO, the Department of Health and Human Services, and even the American Academy of Actuaries all agree that CLASS is unsustainable. Once it goes bankrupt (likely in 15 to 25 years), the subsequent taxpayer bailouts could cost trillions of dollars.

The best way to avoid a bailout would be to repeal CLASS before it begins enrolling participants and collecting premiums, which could be as soon as January 1, 2011. Is anyone in Congress paying attention?

The White House today released its updated federal budget projections. By releasing the report late on a Friday afternoon—a longtime Washington tradition for stories that politicians want to bury—the Obama Administration is effectively admitting that its budget numbers will not be well-received.

The “Mid-Session Budget Review” projects that this year’s budget deficit will reach $1.471 trillion, or 10 percent of the economy. In nominal dollars, it’s the largest deficit in American history. As a percentage of the economy, it’s the largest deficit since World War II.

This will be the second consecutive year of trillion-dollar deficits that approach 10 percent of the economy. By comparison, the previous post–World War II record was 6 percent of the economy in 1983. Under President George W. Bush, deficits typically ranged between $160 billion and $400 billion (around 3 percent of the economy).

And the Obama Administration concedes that these large deficits are here to stay. It projects another $1.4 trillion deficit in 2011, followed by sustained deficits that never fall below $698 billion. The national debt held by the public—$5.8 trillion at the end of 2008—would soar to $18.5 trillion by the end of this decade.

These future deficits are driven almost exclusively by rising spending. President Obama’s budget would push inflation-adjusted federal spending past $36,000 per household by 2020—$12,000 above the level that prevailed under President Bush. Even President Obama’s enormous and anti-growth $3 trillion tax increase proposal won’t stop this spending spree from pushing the national debt to economically dangerous levels.

The Mid-Session Budget Review also confirms the failure of Obama’s economic agenda. The President concedes that the unemployment rate will remain at nearly 10 percent this year and not revert to pre-recession levels until 2016—and even that is based on the same optimistic Keynesian economic models that claim the stimulus created or saved 3 million jobs. If this is economic policy success, one wonders how failure would look.

With the Mid-Session Budget Review, the Obama White House has once again confirmed its agenda of runaway spending, surging taxes, and soaring budget deficits. And its economic figures concede that high unemployment rates will be a mainstay of the Obama presidency.

Federal Reserve Chairman Ben Bernanke warned that the unemployment rate would remain well above 7 percent through the end of 2012, and the duration of President Obama’s current term.

Bernanke, in saying that the Fed had no immediate plans to provide additional support to the economy, dashed the hopes of some economists and executives who have been pushing for action to add momentum to the sluggish recovery, The New York Times reports.

Bernanke also sounded a discouraging note for Washington incumbents facing tough re-election fights.

Bernanke told the Senate Banking Committee that it would take “a significant amount of time” to restore the 8.5 million jobs lost in the United States in 2008 and 2009.

He also warned that financial conditions, particularly the European debt crisis, had “become less supportive of economic growth in recent months.”

He called the slow recovery of the job market “an important drag on household spending.” And he noted that the growth in private payrolls — about 100,000 jobs a month in the first half of the year — was “insufficient to reduce the unemployment rate materially.”

The Fed expects the economy to grow this year by 3 to 3.5 percent, picking up only slightly, to 3.5 to 4.5 percent, in 2011 and 2012. The unemployment rate is projected to drop to 7 to 7.5 percent by the end of 2012 — still far higher than the 5 to 5.3 percent that the Fed now considers to be full employment.

Meanwhile, new U.S. claims for jobless benefits climbed more steeply than anticipated last week, the latest sign that the moribund labor market is struggling to recover.

Initial claims for state unemployment benefits rose 37,000 to a seasonally adjusted 464,000 in the week ended July 17, the Labor Department said on Thursday, more than erasing a decline in the prior week.

Analysts polled by Reuters had forecast claims rising to 445,000 from the previously reported 429,000 in the July 10 week, which was revised slightly down to 427,000 in Thursday’s report.

The report covered the survey week for government’s closely monitored employment report for July, which is scheduled for release on Aug. 6, and added to a growing list of indicators indicating a moderation in the economic recovery pace, Reuters reported.

‘Unsustainable” is a scary word that recently entered political discourse, coming authoritatively from Congressional Budget Office Director Douglas Elmendorf. Unsustainability is the operative moniker for Barack Obama’s massive deficit spending, which Elmendorf said “cannot be solved through minor tinkering.”

The CBO predicts an increase in our public debt from $7.5 trillion at the end of 2009 to $20.3 trillion at the end of 2020 if Obama’s fiscal 2011 budget is implemented. As a percentage of gross domestic product, the debt will rise to 90% from 53%.

Sen. Kent Conrad, D-N.D., sharpened the focus by asking the CBO director: “What’s going to be necessary (is) either a 25% increase in taxes or a 20% reduction in spending, or some combination thereof. Is that correct?” Elmendorf replied “yes.”

Americans are beginning to wonder if Greece is the picture of the U.S.’ future. But we need look no further than the place where Obama and his team were trained in community organizing and bully tactics to redistribute the wealth: Illinois.

Illinois was the stomping ground for years for Obama, his top advisers Rahm Emanuel, Valerie Jarrett and David Axelrod, and his appointees such as Secretary of Education Arne Duncan. After they promoted themselves to Washington to run the country, other Obama associates who didn’t make the cut continued to run Illinois into the ground, as the Illinois unemployment rate jumped from less than 5% to nearly 11%.

For years, we thought California was the most fiscally irresponsible of all 50 states, but Illinois has now taken the lead. A lengthy news article in the New York Times was headlined: “Illinois Stops Paying Its Bills, but Can’t Stop Digging Hole.”

Under years of Democratic leadership, Illinois has refused to honor its obligations, cut spending or trim its shockingly large deficit, which at $12 billion per year approaches nearly half its budget. As a result, Illinois’ credit rating has been downgraded and it pays a massive amount in interest on its loans.

That’s like a family making $50,000 but spending $75,000 each year. Obviously, it won’t take long before such a family would lose everything it has.

The big-majority Democratic state legislature, defying Illinois’ balanced-budget law, has been passing deficit budgets for years. The new definition of a liberal is no longer tax-and-spend; it’s borrow-and-spend.

It’s no surprise that unemployment keeps increasing, and the reason why the rate isn’t higher than we are told is that the government has stopped counting people who have given up looking for a job. Employers are not hiring because taxes and regulations are expected to rise.

Starting Jan. 1, 28 million middle Americans will be socked with a massive Alternative Minimum Tax (AMT), which Republicans had suspended. That’s a “gotcha” that penalizes taxpayers in ways they never expect, adding big tax penalties based on an “alternative” way of calculating taxes due.

Upper-income Americans will see a big jump in their marginal tax rates. Their accountants are already telling them that the more they work, the less additional money they will take home, so they may be already slowing down, canceling investments or retiring to draw Social Security.

Hardworking parents who are saving for their children’s future will be hit by the reinstatement of the massive “death tax” on Jan. 1. They may wonder why they work hard and save if their money will go to Uncle Sam and to people who choose not to work.

Marriage penalties will hit couples hard, both in the income tax law and in ObamaCare. Obama’s financial favoritism toward unmarried women, his second biggest voting bloc, has become common knowledge.

Those who choose to control their own health care through Health Savings Accounts will be slapped with new taxes. That’s just one more way to promote Obama’s goal of moving all health care to government control.

Employers are not hiring because they know they will soon be paying not only higher taxes but also more health care costs or penalties. Depreciation allowances for investment in equipment will be lowered from $250,000 to $25,000, which means businesses will do less investing.

Our ability to compete in the marketplace, of course, depends on our advanced research and development. New taxes will hit R&D hard, which means more slowdowns and more outsourcing overseas.

The expiration of the GOP tax cuts will impose the largest tax hikes in history, affecting all taxpayers. The nearly 50% who pay no taxes will also be hurt by more loss of jobs.

There is only one antidote for these depressing prognostications. On Nov. 2, American voters will have the chance to choose real change from Obama’s failed Illinois borrow-and-spend policies by electing Republicans who commit to extend the expiring tax cuts.

President Barack Obama has signed into law an overhaul of banking and Wall Street regulations that he says will create the strongest financial protections for consumers in history.

The law is a legislative victory for the president, who has made tightening restrictions on banks a signature issue since taking office amid the nation’s financial meltdown. Obama says the reforms will end many of the Wall Street practices that sent the economy into the worst recession since the Great Depression.

In an ironic touch, Obama signed the bill in the Ronald Reagan Building, named after a president who championed deregulation. Obama was joined by scores of consumer advocates, business executives and lawmakers who supported the bill.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

WASHINGTON (AP) — President Barack Obama says a sweeping new overhaul of financial regulations represents a triumph for consumers.

Obama spoke Wednesday before signing the legislation that creates a new consumer protection bureau and a host of regulations on banks and financial markets.

The bill is a signature achievement for Obama and congressional Democrats nearly two years after Wall Street’s failures knocked the economy into a spiraling recession.

Obama was signing the bill into law in a ceremony at the Ronald Reagan Building, with scores of consumer advocates, government officials and business owners looking on.

My column today dives into the TARP special inspector general’s audit of the “Factors Affecting the Decisions of General Motors and Chrysler to Reduce Their Dealership Networks.” You can find it at the TARP OIG’s website here. I encourage you all to read through the entire 45-page report. The superficial MSM coverage of the audit, released late Sunday, didn’t do justice to the independent watchdog’s damning indictment of the arrogant bureaucrats in charge of nationalizing the U.S. auto industry — or the devastating consequences of politically-driven “shared sacrifice” with Obama, his SEIU cronies, and campaign lackeys behind the wheel.

Obama had the chutzpah to drag an unemployed car dealership employee laid off by Honda up on stage Monday to attack Republicans over government unemployment benefits. I suggest Republicans match him with a stage full of unemployed Chrysler and GM workers who lost their dealership jobs as a direct result of the capricious mandates of Obama’s non-expert auto experts.

A few trips back down memory lane before we get to the column: I’ve been hounding the Hayekian fatal conceit of Treasury’s TARP peddlers (under both Democrat and Republican administrations) from day one. And I’ve been hounding auto bailout supporters (both Democrat and Republican) since day one. Only the willfully blind and the woefully dumb couldn’t see what was coming.

Chicken Littles on Capitol Hill, I’m talking to you.

***

Dealergate: Destroying Jobs in the Name of “Shared Sacrifice”
by Michelle Malkin
Creators Syndicate
Copyright 2010

Everything you need to know about the nightmare of government-controlled businesses can be found in a damning new inspector general’s report on Dealergate. The independent review of how and why the Obama administration forced Chrysler and General Motors to oversee mass closures of car dealerships across the country reveals grisly incompetence, fatal bureaucratic hubris and Big Labor cronyism. No wonder you won’t hear much about the report’s in-depth details in the so-called mainstream media.

Under the guise of “saving” the American auto industry through a bipartisan, taxpayer-funded bailout now topping $80 billion, President Obama’s know-nothing bureaucrats pushed the car companies to eliminate thousands of jobs — with unjustified haste using dubious economic models.

Obama ordered the bailout recipients to “prove” their long-term viability by submitting restructuring plans. But White House and Treasury Department “experts” rejected the auto manufacturers’ proposals, citing the too-slow pace of their plans to reduce their dealership networks over a period of five years. Once the auto companies modified those plans to meet government-backed timelines, the money flowed.

But Neil Barofsky, the federal watchdog overseeing the bank-auto-insurance-all-purpose bailout fund, found that the White House auto industry task force and the Treasury Department “Auto Team” had no basis for ordering the expedited car dealership closure schedules. They relied on a single consulting firm’s internal report recommending that the U.S. companies adopt foreign auto industry models to increase profits — a recommendation hotly disputed by auto experts who questioned whether foreign practices could be applied to domestic American dealership networks.

Team Obama’s government auto mechanics also ignored the economic impact of rushing those closures. According to Barofsky, they discounted counter-testimony from industry officials that “closing dealerships in an environment already disrupted by the recession could result in an even greater crisis in sales.”

The inspector general also noted that “it is clear that tens of thousands of dealership jobs were immediately put in jeopardy as a result of the terminations by GM and Chrysler.” After extensive investigation, the watchdog concluded that “the acceleration of dealership closings was not done with any explicit cost savings to the manufacturers in mind.” Onlyafter Capitol Hill critics — both Republican and Democrat — started questioning the Dealergate decisions did Obama’s auto “experts” come up with market studies and estimated job loss data to assess the impact of their reckless, arbitrary orders.

In sum, the inspector general found: “(A)t a time when the country was experiencing the worst economic downturn in generations and the government was asking its taxpayers to support a $787 billion stimulus package designed primarily to preserve jobs, Treasury made a series of decisions that may have substantially contributed to the accelerated shuttering of thousands of small businesses and thereby potentially adding tens of thousands of workers to the already lengthy unemployment rolls — all based on a theory and without sufficient consideration of the decisions’ broader economic impact.”

This is no surprise, of course, considering the amount of actual auto business expertise among Obama’s auto czars and key staff. That is: zero. Obama’s first auto czar, Steve Rattner, ran a private equity firm in New York before resigning his position amid a financial ethics cloud.

Rattner’s chief auto expert adviser, Brian Deese, is a 30-something former Hillary Clinton/Barack Obama campaign aide and law school grad with no business experience, who openly boasted that he “never set foot in an automotive assembly plant.”

And Rattner’s auto czar successor, Ron Bloom, is a far-left union lawyer who cut his teeth under Big Labor boss John Sweeney, has ideological ties to the corporate-hating Labor Zionist movement; and opined that “the blather about free trade, free-markets and the joys of competition is nothing but pabulum for the suckers.”

In search of the rationale for Team Obama’s bizarre, job-killing exercise of power over thousands of small car dealerships, the TARP inspector general may have stumbled onto the truth from Bloom. On page 33 of its report, Barofsky writes that “no one from Treasury, the manufacturers or from anywhere else indicated that implementing a smaller or more gradual dealership termination plan would have resulted in the cataclysmic scenario spelled out in Treasury’s response; indeed, when asked explicitly whether the Auto Team could have left the dealerships out of the restructurings, Mr. Bloom, the current head of the Auto Team, confirmed that the Auto Team ‘could have left any one component (of the restructuring plan) alone,’ but that doing so would have been inconsistent with the President’s mandate for ‘shared sacrifice.’”

“Social justice” chickens coming home to roost.

***
Yesterday: Why does Ken Salazar hate our economy?

***

Previous Dealergate coverage:

May 2009 – Dealergate and the MSM

May 2009 – Crunching the numbers: Dealergate & cronyism continued

June 2009 – Dealergate continued: More on Chrysler and Clinton cronyism

July 2009 – Democrats reverse Obama on auto dealerships

I agree with Tom Brown’s bottom line at Seeking Alpha:

“…the reason the auto companies were in trouble in the first place was that they’d been run into the ground by managements that had agreed to lavish their unionized workforces with uneconomic wage and benefit packages. The companies deserved to fail. (And remember that Ford, to its everlasting credit, has managed to survive without a federal lifeline.) Instead, GM and Chrysler are doomed to limp along as wards of the state, and will steadily hemorrhage jobs along the way. They’ll almost certainly end up as American versions of British-Leyland.If President Obama had really been interested in sustaining a prosperous auto industry that could create and sustain thousands of jobs, he would have allowed the companies to go through the normal bankruptcy process so that they could emerge with rational competitive labor-cost structures.”

The Obama administration’s policies in steering the auto bailout drove unemployment up, according to an audit by the Office of Special Inspector General for the Troubled Assets Relief Program (SIGTARP).

“At a time when the country was experiencing the worst economic downturn in generations and the government was asking its taxpayers to support a $787 billion stimulus package designed primarily to preserve jobs, Treasury made a series of decisions that may have substantially contributed to the accelerated shuttering of thousands of small businesses and thereby potentially adding tens of thousands of workers to the already lengthy unemployment rolls – all based on a theory and without sufficient consideration of the decisions’ broader economic impact,” the audit by SIGTARP Neil Barofsky stated.

“It is not at all clear that the greatly accelerated pace of the dealership closings during one of the most severe economic downturns in our Nation’s history was either necessary for the sake of the companies’ economic survival or prudent for the sake of the Nation’s economic recovery,” the audit added.

The federal government committed $80.7 billion out of TARP, the $700 billion rescue bill enacted in late 2008, to save General Motors and Chrysler. Chrysler closed 789 dealerships, while GM is set to have closed 1,454 dealerships by October 2010 as a cost cutting measure.

The Treasury Department pushed General Motors and Chrysler to close dealerships at a faster rate than the companies suggested, without taking job losses into consideration, the audit says.

“Although there was a broad consensus that GM and Chrysler generally needed to decrease the number of their dealerships, there was disagreement over how, where and how quickly the cuts should have been made,” the audit says.

“In the fact of the worst unemployment crisis in a generation and during the same period in which government was spending hundreds of billions of dollars on a stimulus package to spur job growth, the Auto Team rejected GM’s original plan (which included gradual dealership terminations), expressly indicated that GM’s pace of terminations was too slow, and then encouraged the companies’ use of bankruptcy to accelerate dealership terminations,” the audit continued.

White House Press Secretary Robert Gibbs said Monday that if the administration had not taken the actions it did, far more jobs would have been lost.

“I think it’s important to look at the decision to put into bankruptcy and restructure both Chrysler and GM. I think it is safe to say without that decision that the president made, it is likely that neither of those two auto companies would exist today,” Gibbs said. “Because of the president’s actions to date, there are tens of thousands of auto jobs, auto manufacturing jobs, auto dealership jobs that exist and auto parts manufacturing jobs. “

The Treasury Department strongly disagreed in a letter to the special inspector general’s office.

“In the absence of government assistance, both GM and Chrysler faced almost certain failure and liquidation, which would have resulted in the loss of hundreds of thousands of jobs across multiple industries,” said the letter from Herbert Allison, assistant Treasury secretary for financial stability.

Meanwhile, GM also weighed in with a statement Monday.

“The events depicted in the SIGTARP’s report have since been overtaken by a new GM and a stronger dealer network to match,” the GM statement said. “More than a year since its bankruptcy, GM is showing substantial progress.

“The company’s business performance is stronger, sales of its four brands are up 32 percent, and it is investing billions of dollars in its plants and bringing several thousands back to work. The new GM is also moving forward to improve dealer relations and has already reinstated several hundred dealers and completed the arbitration hearings for the remaining dealers who filed cases,” the statement added.

The inspector general’s audit also said the closing of plants lacked transparency.

“Just as troubling, there was little or no documentation of the decision-making process to terminate or retain dealerships with similar profiles, making it impossible in many cases for SIGTARP to determine the causes of deviations from the supposedly objective criteria,” the audit says.

The GM statement said the firm was completely cooperative with the inspector general’s office.

“Throughout its review, GM cooperated fully with the SIGTARP to best document the company’s efforts, as well as the criteria and numerous business factors used in GM’s dealer wind-down and appeals process,” the statement said. “The GM which existed at that time did its best to develop and implement an objective dealer consolidation process under extraordinary circumstances.”

Today, President Barack Obama will attend a groundbreaking ceremony in Holland, Mich., for a South Korean-owned factory that will make batteries for electric cars. The purpose of the trip is to highlight the “success” of the President’s $862 billion economic stimulus package which the White Houseclaimed yesterday has already “saved or created” 3 million jobs. Specifically, this factory is being subsidized by $151 million of stimulus funds from an even larger $2 billion honey pot of stimulus money set aside for electric car battery investments. This one plant is expected to employ 300 workers. That works out to more than $500,000 per job created. $500,000 per job. This plant, in a nutshell, explains why the President’s stimulus plan has been an objective failure.

The American people know the President’s stimulus has failed. A new CBS poll out today shows that 74 percent of Americans believe the Obama stimulus either damaged the economy or had no effect. And a Washington Post poll released Tuesday again showed that a majority of Americans disapprove of President Obama’s handling of the economy. So how on earth can the White House claim they “saved or created” 3 million jobs? By rerunning the same economic models that predicted the stimulus would prevent unemployment from ever rising above 8%. That’s right. The White House’s 3 million jobs number is not based on any real world data.

So what does the actual objective real world data show? When the President first began selling his stimulus plan to the American people in November 2008, he promised it would create 2.5 million jobs. But as employment fell at the end of 2008, President-elect Obama increased his employment promise by one million to 3.5 millions jobs created. At the time, employment stood at about 134.3 million. Using these two data points, one can objectively establish the Obama jobs target for December 2010 at 137.8 million. Fast forward to July 2010 and the latest jobs report shows total U.S. employment at almost 130.5 million. This means President Obama’s stimulus has failed to meet its own standard for success by 7.4 million jobs.

Why has the President’s $862 billion stimulus failed by 7.4 million jobs? Because government spending does not stimulate economic growth. All it does is move resources away from one sector of the economy to another. And government has a horrible track record at efficiently allocating resources. All that really happens is that, on net, jobs get destroyed in the transfer process.

That brings us back to Holland, Michigan. Maybe this new battery plant is worth investing millions of dollars in. Maybe it will eventually turn a profit. But maybe not. The issue is, “Why is this any of the government’s business?” We used to be a capitalist country. We’re supposed to have vibrant capital markets that make these decisions using market principles. Instead we have the Obama administration acting as a venture capital fund picking winners and losers not based on economics, but on political priorities (in this case global warming).

And this is where the President’s war on the rule of law and audacious domestic agenda come into play. The White House claimed yesterday that the Obama stimulus has encouraged $280 billion in private sector spending. The facts do not support this. In reality annual private fixed nonresidential investment has fallen by $327 billion since the recession started— a 19 percent drop. Businesses are not investing because of the vast economic uncertainties the Obama administration is creating.

Will secured creditor contracts be honored in court? Or will the Obama administration rip up those contracts? How much does it cost to hire a new employee? No one will know until thousands of pages of Obamacare regulations emanate from the IRS and HHS. How much will energy cost? That depends on how draconian the Obama EPA global warming regulations are. What are the rules for financial markets? You better have the cash for an army of good lawyers, because the 2,300-page Dodd-Frank bill touches every aspect of financial markets and requires 243 new rule-makings by 11 different federal agencies.

The Obama administration’s massive spending and regulatory expansion is not helping economic recovery. It is actively thwarting it.

Quick Hits:

• Today at 2 PM Eastern, The Heritage Foundation will host an event titled “Remember the Gulf: Is the Administration Doing More Harm Than Good,” featuring The Honorable John F. Young, Jr., council chairman for Jefferson Parish, La. RSVP here or watch online.
• U.S. home foreclosures reached a record high in the second quarter of this year, U.S. retail sales dropped for the second consecutive month in June, and according to Gallup, Americans’ confidence in the economy sank significantly between June and July.
• The Federal Reserve marked down their expectations for growth and inflation, concluding that the economic recovery is proceeding more slowly than previously thought.
• Erskine Bowles, former White House chief of staff to President Bill Clinton and co-chair of President Obama’s fiscal commission said Wednesday that Obamacare will do very little to bring down costs, contradicting claims from the White House.
• The Obama administration has approved taxpayer funding of abortion through new high-risk insurance pools in Pennsylvania and New Mexico.

UPDATE: The original version of this post reported the Obama jobs target as 138.6 million jobs based off of BLS data that showed 135.1 million jobs in December 2008. In January 2010 the BLS revised down the Decemeber 2008 count to 134.3 million. So the updated Obama jobs target is 137.8 million and the 7.4 million jobs gap total is correct.

The White House moved on Tuesday to ease simmering tensions with the business community, telling corporate executives it has an “open door” and pledging to listen to their ideas.

President Barack Obama has come under criticism by some business groups, which charge that the administration’s regulatory and fiscal agenda is leading to uncertainty and is dampening job growth.

The healthcare reform legislation, financial regulatory reform and proposals to cap carbon emissions are cited by some in corporate America as examples of regulatory overreach. Business groups have also criticized Obama’s fiscal policies, warning of the danger of high deficits.

The administration has responded with efforts to reach out, including a June 30 meeting with the Business Roundtable, one of the main U.S. business lobbying groups.

As a follow-up to that meeting, the White House promised the group it would listen to its input, according to a copy of a letter from senior White House adviser Valerie Jarrett to the Business Roundtable released on Tuesday.

“While we may disagree on some issues, we have an open door and are always willing to consider input and ideas from everyone, including the business community,” Jarrett wrote.

The Obama administration has also undertaken a review of federal regulations and sought input on how to make them less burdensome to businesses.

REVIEW OF REGULATIONS

“Our approach to regulation is a pragmatic, commonsense one that is evidence-based and data-driven,” said White House deputy communications director Jen Psaki. “We want regulations that protect the health and well-being of the American people while promoting, and not undermining, economic growth.”

The Business Roundtable brings together chief executives of companies including American Express Co, Honeywell International Inc and Boeing Co.

The group’s current chairman is Ivan Seidenberg, chief executive of Verizon Communications. Seidenberg, in a speech last month, complained of a “disconnect” between Washington and the business community he said was harming job growth.

But in correspondence with Jarrett following the June 30 meeting, his tone was cordial. Seidenberg listed some concerns he hoped the administration could address, including a corporate tax structure that businesses view as hampering their competitiveness, deficit reduction and trade issues.

He said his group supports a “common goal” of boosting jobs and spurring economic growth.

The release of the correspondence comes a day before another large business group, the U.S. Chamber of Commerce, is scheduled to hold a “Jobs for America Summit.”

Chamber CEO Tom Donohue is expected to issue an open letter to Obama and Congress that will urge “immediate action to address the new regulatory stranglehold placed on America’s job creators.”

Tensions with the business community could pose political problems for Obama at a time when his Democrats are trying to fend off a challenge to their dominance in Congress ahead of the November midterm elections. Republicans are eager to try to pin an “anti-business” label on Obama.

The administration also has other reasons for wanting to avoid a rift with the business community.

U.S. business are holding onto some $1.8 trillion in cash, according to the Federal Reserve. The Obama administration wants to encourage them to invest some of that money to help jump-start a U.S. economic recovery that has so far been lackluster.