Challenges ahead

In a surprise move that has basically been telegraphed since the day after he said it last year, President Obama said they he will not re-open talks on NAFTA. In the Democratic primary debate on February 16, 2008, Obama was crystal clear on his view of NAFTA:

"I will make sure that we renegotiate [NAFTA], in the same way that Senator Clinton talked about. ... I think we should use the hammer of a potential opt-out as leverage to ensure that we actually get labor and environmental standards that are enforced. And that is not what has been happening so far."

It didn't take long for the campaign to offer whispers to Canada that Obama didn't really mean what he said about NAFTA. In fact, members of the campaign allegedly met with Canadian officials 8 days before the debate to re-assure Canada that whatever candidate Obama said publicly about NAFTA was simply for show to get nominated.

Backing down from this promise is good news for markets and for all three countries involved. The article also notes that there are positive steps in getting the free trade agreements with Panama and Colombia moving forward, after the Democratic congress shamefully refused to hold an up or down vote on these agreements solely for political posturing on behalf of labor unions during the final days of the previous administration.

There is an interesting article from Yahoo news today talking about whether couples who make $250K a year are rich. The conclusion: probably not. The problem, the article finds, is that as these couples' wealth have increased, education and health care costs have skyrocketed beyond their income growth. The article notes "data show that over the last 10 years, education costs have risen 5.91% annually, and health- care expenses have gone up 4.16% annually, while wages and income have risen only 3.7% over the same time span. That means many families are seeing a greater percentage of their income going toward those two areas." Additionally, that wealth may also be tied up in their house, and with falling housing prices, their wealth may also have suffered as a result. Then there are those who live in states with high costs of living and high tax rates, such as California. That is to say, the tax code does not take into account standards of living. As San Jose Mayor Chuck Reed said, "a family earning $250,000 a year can't buy a home in Silicon Valley." Yet, the Obama budget plan seeks to increase taxes on just those people, based on an arbitrary definition of "rich."

One can only wonder what other tricks this charlatan has up his sleeves in his attempt to pull another fast one over on the American people? Carolyn Lochhead at the Chronicle has an idea: "Obama hopes we can't count."