No American president has ever won a second term in office when unemployment is greater than 7.1% across the States.  It currently sits at nearly 10%.

Obama’s announcement to the Congress and Senate of his Return to Work Bill is yet another example of a knee jerk, ill thought out set of announcements which will cost the American taxpayer a further $450bn.  It seems laudable, but the fact is further central intervention and spending from Washington will do little to change the landscape of the American economy. 

What needs to happen is smaller government and more empowerment to entrepreneurs to create growth and the main role the American government should take in this is reducing red tape, opening up trade barriers and facilitating American banks to start  lending again.

His speech has been favourably reported in the UK.  The worst of all possibilities is that the UK is taken in by this fake dream. It needs to keep its nerve on small government, reduction in spending but still needs to do more to get the banks lending again.