I told you that Mr. Obama would present his tax overhaul plan any day. And lo and behold, two days after last week’s column, he announced it. Sometimes, I scare myself. But scarier still is that President Barack Obama thinks he knows what he’s doing.

Meet his new tax strategy: same as the old one. Sparse on details, I call it the “Wimpy strategy.” Those of you who remember the Popeye cartoons will remember Wimpy’s signature line: I’ll gladly pay you Tuesday for a hamburger today. In Mr. Obama’s case it’s: I’ll gladly agree to a tax revision today, if you agree to spend all the extra revenue tomorrow.

Are politicians completely incapable of just doing what’s right?

If an overhaul of the corporate tax system is needed, just do it. But no. The White House can’t be satisfied with improving the tax code and generating a one-time windfall. Like a kid in a candy shop, it’s compelled to spend the new-found wealth. That wouldn’t be so bad if the federal government weren’t awash in red ink.

The president said he supports simplifying business taxes “as long as we use the money from the transitioning to a simpler tax system for a significant investment in creating middle-class jobs.”

Under the president’s plan, most of those middle-class jobs would be unions jobs lasting only as long as the money holds out.

Mr. President: How about helping middle-class business owners instead of repeatedly cow-towing to large corporations. Proposed changes include the oft discussed “tax holiday” for income large corporations earned offshore. In this incarnation, the plan would encourage companies to bring the funds back to the U.S. by levying a lower one-time tax.

A proposal targeted at smaller businesses would allow them to expense up to $1 million in investments. That sounds great, but it only defers taxes. It doesn’t lower them.

Both ideas are the type of temporary “let’s artificially juice the economy” strategy Washington loves. It creates an unsustainable positive blip just in time for the next election.

As Washington fiddles, Wall Street continues its torrid pace. The Dow could blow through 16,000 before month’s end, and the S&P could see 1,800 before year’s end. That is, if the Federal Reserve continues to taper its talk of tapering.

Meanwhile, the economic data remains a mixed bag. These two headlines in the same edition of the Wall Street Journal illustrate: “Tepid Growth Restrains Fed” and “U.S. Factories Rebound Strongly.”

She loves me; she loves me not. The economy has loved the investor class for some time. But the question is whether it will start loving the people who do the work and actually produce things. In that regard the economy may be warming up to the middle class.

The aforementioned rebound in factory output is one positive signal. July marked the best month for U.S. factories in two years. The one-month jump in the Institute of Supply Management index from 50.9 to 55.4 was the biggest monthly increase since 1996.

The resurgent housing market is serving as one catalyst for manufacturing. Demand for furniture, appliances and electrical equipment all increased. And with demand remaining strong for autos, there were fewer summer plant shutdowns.

Even Europe is showing signs of emerging from its economic coma. Last month, the euro zone’s manufacturing sector registered growth for the first time in two years.

Asia remains problematic.

China’s “official” Manufacturing Purchasing Managers’ Index ticked up from 50.1 to 50.3. Both readings are barely above the growth threshold of 50. However, at 47.7, a similar private manufacturing gauge published by HSBC indicated continued softness. Me thinks someone may be cooking the books.

The initial reading for second-quarter GDP shattered estimates. Too bad those estimates were for a 0.9 percent increase. The bad news is that at 1.7 percent, overall growth remains below a tepid 2.0 percent.

For those who enjoy looking further into the rear view mirror, there was another good news/bad news scenario. First-quarter GDP, which the government initially estimated at 2.4 percent, then revised down to 1.8 percent, was revised down yet again to 1.1 percent. The good news is that the 1.1 percent reading means Q2 was an improvement.

Second-quarter growth got a little help from a new method of calculating GDP. The Bureau of Economic Analysis is now factoring in the “knowledge economy.” This includes investments in R&D, and entertainment and the arts. It also changes the way pension contributions are calculated.

In general, the impact of the new method is small. Despite that, the Commerce Department took the time to recalculate 83 years of GDP data.

Regardless of the method used, the government will continue to get it wrong until the third or fourth time around. And economists will follow suit by continuing to incorrectly estimate the government’s miscalculations.

Finally was Friday’s jobs number which disappointed. Only 162,000 jobs were created in July, and the previous two months were revised downward by a combined 26,000.

Average earnings and the average workweek also declined. The good news is that the unemployment rate dropped from 7.6 percent to 7.4 percent.

Don’t you love government statistics?

Author, professor, entrepreneur, radio and TV commentator Tony Paradiso can be reached at
tparadiso@tds.net.