Obama: ‘Yes, But We Cannot’
Published in Le Point
(France) on 30 January 2014
by Michel Colomes (link to original)
(France) on 30 January 2014
by Michel Colomes (link to original)
Translated from
by Teresa Sorbera.
Edited by Bora Mici.
What is noteworthy about Obama's State of the Union address is the new self-confidence of the United States and the limits on the president's power.
Obama's State of the Union address, which was held on Tuesday, Jan. 28, in the Eccles Building in Washington, headquarters of the Federal Reserve, was significant for several reasons: first because Ben Bernanke, chairman of the Fed during the worst financial crisis since 1929, passed the torch to his successor, Janet Yellen. It is also significant because it showed that the United States, now on the road to economic recovery, has absolutely no desire to "come to the rescue" each time a new monetary crisis is announced.
Emerging countries, like Turkey, India, Brazil, and even Russia and China, are going through periods of turmoil with regards to the strength of their currencies and economic growth. The U.S. government is partly at fault. After having poured billions of dollars into financial markets to restart its own economy, which incidentally supported the growth of the economies of other countries, last fall, the government reversed this trend by gradually reducing mass purchases of Treasury bonds, all the while increasing interest rates. The result was that investors once again turned toward the dollar and abandoned the currencies of emerging countries.
It is therefore of little importance to the Fed that Turkey is trying to save its currency by almost doubling its interest rates, that Argentina is collapsing, and that the ruble has been falling in value. The U.S. is doing well. The U.S. unemployment rate is currently no higher than 6.7 percent, and there are signs of growth everywhere. In addition, the central bank will continue to reduce its bond purchases by $10 billion a month, at the risk of strangling the economic progress of other countries. Obama had promised that the U.S. would not abandon countries experiencing economic difficulties. It seems that this is no longer the case, at least not under this administration.
Raise the Low Wages ... of 250,000 People
Thanks to the U.S. economic recovery, Tuesday evening, Obama took the liberty of proclaiming himself a victorious economic war leader during the yearly State of the Union address, a position focused on the well-being of American society, far from the role of rescuer and savior that had been bestowed upon the U.S. since the time of the Marshall Plan. However, during the global crisis that we are experiencing, what head of state could blame the U.S. president for deciding that charity begins at home....
Obama is still faced with one problem: Spurred by the recent U.S. recovery — 3.2 percent growth in the last quarter — he would like to emphasize the social aspects of the politics of his administration to combat obvious inequalities, but he cannot. At the very most, he could do very little. What we really took away from Obama's State of the Union address was the president's decision to increase the lowest wages by almost 30 percent. The only thing is, as Obama does not hold the majority in Congress, he is not allowed to pass a measure to protect the poorest citizens of the United States, thus he is forced to resort to obtaining a court order: what Americans call an executive order. This is a system that limits Obama's power, essentially only allowing him to help civil servants and employees of companies working for the government. As a matter of fact, the federal [contract] minimum wage will go up from $7.25 to $10.10 per hour, but very few people — barely 250,000 — will benefit from this.
This is a far cry from the promise Obama made a year ago to significantly increase the minimum wage of 17 million Americans. Congress would have had to vote in this measure, otherwise it could not be implemented, something that would be totally unimaginable today. Certainly, the Republican majority in Congress lost credibility at the end of last year by preventing the American administrative machine from operating for several days, but the Constitution and famous checks and balances system gives the Republican majority the right to control the president's zealous reforms. John Boehner, leader of the Republican majority, made reference to this fact in his reply to Obama's speech. If he foregoes the approval of Congress, he can only resort to obtaining court orders for minor matters, and for matters that are limited in time: "Yes ... but we cannot."
Obama's State of the Union address, which was held on Tuesday, Jan. 28, in the Eccles Building in Washington, headquarters of the Federal Reserve, was significant for several reasons: first because Ben Bernanke, chairman of the Fed during the worst financial crisis since 1929, passed the torch to his successor, Janet Yellen. It is also significant because it showed that the United States, now on the road to economic recovery, has absolutely no desire to "come to the rescue" each time a new monetary crisis is announced.
Emerging countries, like Turkey, India, Brazil, and even Russia and China, are going through periods of turmoil with regards to the strength of their currencies and economic growth. The U.S. government is partly at fault. After having poured billions of dollars into financial markets to restart its own economy, which incidentally supported the growth of the economies of other countries, last fall, the government reversed this trend by gradually reducing mass purchases of Treasury bonds, all the while increasing interest rates. The result was that investors once again turned toward the dollar and abandoned the currencies of emerging countries.
It is therefore of little importance to the Fed that Turkey is trying to save its currency by almost doubling its interest rates, that Argentina is collapsing, and that the ruble has been falling in value. The U.S. is doing well. The U.S. unemployment rate is currently no higher than 6.7 percent, and there are signs of growth everywhere. In addition, the central bank will continue to reduce its bond purchases by $10 billion a month, at the risk of strangling the economic progress of other countries. Obama had promised that the U.S. would not abandon countries experiencing economic difficulties. It seems that this is no longer the case, at least not under this administration.
Raise the Low Wages ... of 250,000 People
Thanks to the U.S. economic recovery, Tuesday evening, Obama took the liberty of proclaiming himself a victorious economic war leader during the yearly State of the Union address, a position focused on the well-being of American society, far from the role of rescuer and savior that had been bestowed upon the U.S. since the time of the Marshall Plan. However, during the global crisis that we are experiencing, what head of state could blame the U.S. president for deciding that charity begins at home....
Obama is still faced with one problem: Spurred by the recent U.S. recovery — 3.2 percent growth in the last quarter — he would like to emphasize the social aspects of the politics of his administration to combat obvious inequalities, but he cannot. At the very most, he could do very little. What we really took away from Obama's State of the Union address was the president's decision to increase the lowest wages by almost 30 percent. The only thing is, as Obama does not hold the majority in Congress, he is not allowed to pass a measure to protect the poorest citizens of the United States, thus he is forced to resort to obtaining a court order: what Americans call an executive order. This is a system that limits Obama's power, essentially only allowing him to help civil servants and employees of companies working for the government. As a matter of fact, the federal [contract] minimum wage will go up from $7.25 to $10.10 per hour, but very few people — barely 250,000 — will benefit from this.
This is a far cry from the promise Obama made a year ago to significantly increase the minimum wage of 17 million Americans. Congress would have had to vote in this measure, otherwise it could not be implemented, something that would be totally unimaginable today. Certainly, the Republican majority in Congress lost credibility at the end of last year by preventing the American administrative machine from operating for several days, but the Constitution and famous checks and balances system gives the Republican majority the right to control the president's zealous reforms. John Boehner, leader of the Republican majority, made reference to this fact in his reply to Obama's speech. If he foregoes the approval of Congress, he can only resort to obtaining court orders for minor matters, and for matters that are limited in time: "Yes ... but we cannot."
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