A third problem stems from the administration’s lack of an explicit plan to deal with future budget deficits and with the exploding national debt. This creates uncertainty about future tax increases and interest rates that impedes spending by households and investment by businesses. The national debt has jumped to 69% of GDP this year, from 40% in 2008. It is projected by the Congressional Budget Office to reach more than 85% by the end of the decade, and to keep rising after that. The reality is even worse since ObamaCare alone will cost more than $1 trillion in its first 10 years. The president’s boast that his health legislation would not “add a dime” to the national debt was possible only by combining that increased spending with proposed new taxes and with projected cuts in Medicare spending that will never occur.

Finally, there is the administration’s incoherent position on the international value of the dollar. The Treasury repeats the slogan that “a strong dollar is good for America” while watching the real value of the dollar fall by 7% over the past year, and while urging the Chinese to allow the dollar to fall more quickly relative to the yuan. The lack of a consistent dollar policy adds to the uncertainty that limits business investment and hiring.