Wednesday, November 11, 2009

Exploring Obama’s Ownership of Massive Economic Problems

By persistent obstructionism and using endless false information, the GOP pulled off some big wins in the 2009 elections. Worse still, they have been able to convince people that Obama has handled the economy badly. The YouGov poll shows that 47% disapprove of Obama’s handling of the economy, while 43% approve. The biggest problem is that the independents who supported Obama are deserting in big numbers. One reason for this is that unemployment is getting worse, and is now at 10.2%, somewhere around 17% when we take into account all the gimmicks that are employed to keep the figure artificially low. We think that it will be 9.5% next November, around 15% in real terms. That does not bode well for the Democrats in next year’s elections.

Republican politicians and pundits as well as mainstream media types repeatedly say that President Barack Obama now “owns” the bad economy. Likewise, they say that he “owns” the grim situation in Afghanistan. The fact is that both are the result of eight years of Republican bungling. Despite our long-time national faith that progress is inevitable and to be expected to occur quickly, the fact is that we are now looking at some intractable problems.

The more astute Republican spokesmen concede that the downturn began under Bush but insist that Obama should not have sought the presidency if we was unable to administer a quick fix. That they are justified in blaming Obama for lost jobs and the slow recovery. Their false assumption is that all recessions are the same and can be fixed easily.
John Boehner, the typical Republican spokesman, continually asks “Where are the jobs?” thought there has not been enough time for Obama’s policies to work. Then he says that all the stimulus money has been spent and has accomplished nothing. The fact is that $500 billion still has not been committed and much of the remainder is just getting into the pipeline. Republicans have vastly inflated the amount of debt incurred under Obama. The amount of the Stimulus was $787 billion, but the Republicans have been saying it was $ 1 or 2 trillion and no one corrects them.


Obama’s policies saved us from another depression. Yet he is being blamed for not working miracles. He inherited the worst sort of recession---one with very high unemployment , which is followed by very slow recovery of jobs. The financial system he inherited is a basket case,, and it will take years to fix it.

Republican politicians and pundits as well as mainstream media types repeatedly say that President Barack Obama now “owns” the bad economy. Likewise, they say that he “owns” the grim situation in Afghanistan. The fact is that both are the result of eight years of Republican bungling. Despite our long-time national faith that progress is inevitable and to be expected to occur quickly, the fact is that we are now looking at some intractable problems.

The more astute Republican spokesmen concede that the downturn began under Bush but insist that Obama should not have sought the presidency if we was unable to administer a quick fix. That they are justified in blaming Obama for lost jobs and the slow recovery. Their false assumption is that all recessions are the same and can be fixed easily.
John Boehner, the typical Republican spokesman, continually asks “Where are the jobs?” thought there has not been enough time for Obama’s policies to work. Then he says that all the stimulus money has been spent and has accomplished nothing. The fact is that $500 billion still has not been committed and much of the remainder is just getting into the pipeline. Republicans have vastly inflated the amount of debt incurred under Obama. The amount of the Stimulus was $787 billion, but the Republicans have been saying it was $ 1 or 2 trillion and no one corrects them.
Only in the United States, among advanced countries, would a president and his party be punished for heading off a depression and not producing a impossible economic miracle. That is because the level of our political discourse is so low, our voters so uninformed, and our MSM so unprofessional.
No wonder the GOP chants “Where are the jobs?” and complains that Democrats are playing dirty pool by blaming Bush and the Republicans for the terrible problems they created.

Democrats must take a cue from the “Obama owns it” argument to start educating the public in basic economics. The main line should be that the Republicans offer no plan other than tax cuts for the wealthy. We have a plan, and it is beginning to work. It may not create jobs as quickly as we want because the problems are rooted in a system the GOP created and defended. Obama inherited an economic and financial system the GOP created to benefit powerful interests and shift wealth to people in the top 5%. They must hammer away at the fact that the ordinary guy has not had an improvement in real wages in twenty years because of Republican policy. Yes, some Democrats helped them along, but those folks are now becoming contrite. We need proposals for reforming our economy and economic system to make them serve ordinary people. Banks should be prohibited from gambling with our savings. Insurance companies gambled away reserves built on the premiums we paid. Then they got state insurance commissions to grant huge increases in premiums that should be fixed. We need a plan to gradually carve up the banks that are too big to fail.


Susan Jacoby noted that it was not the secrecy surrounding the Clinton health care plan that accounted for its demise. Rather, the Democrats had failed to prepare and educate voters on what the Clinton plan would involve. They should have anticipated simplistic Republican complaints and lies and used facts to help voters see through Republican appeals to emotions and fear. With little good information at their disposal, many average Americans believed the Harry and Louise claims against Clinton care. Now people are believing the wild claims about “socialism,” losing their liberties, and Democrats ruining the economy because they have almost no conceptual framework with which to view the economy. If Democrats do not start educating the public about economic matters, the GOP, with the help of the media, will spin these situations in such a way that many voters will conclude that President Barack Obama created the bad economy and Afghan War.

If Republicans can blame economic problems on Democratic spending, they will have a leg up in their efforts to launch another attack on entitlements. By next year, our debt will be larger and could be a major political issue. Democrats need to explain how it got so large and to tie some of it to recent military adventures. There are signs that the Obama administration is open to reform” as a means of reigning in debt. That term has the same meaning as the IMF’s favorite term, “structural adjustment,” which means making the little guy pay for the mistakes of others farther up the food chain. We may have to swallow some entitlement reduction, but it should not take place without an end to the Bush tax cuts and the institution of excess profits taxes on the energy industry and on any firm’s transactions in hedge funds and derivatives.

It’s a tall order, but if Democrats do not begin to educate voters now, they could lose control of the House of Representatives next year. It will be hard to get people to think seriously about the economy and stop thinking about it in child-like terms. But more people are hurting now, and they may be ready for a little meat rather than economic pablum. The object should be to staunch the erosion of public support and regain some among people willing to think a bit.
Democrats will need to learn a few things about message control and to draw upon the expertise of people in cognitive science like George Lakoff. If Democrats cannot seize the initiative in the national discourse, we could well see a president Sarah Palin and a cabinet stuffed with tea baggers like Dick Armey in 2013.

1 comment:

evelyn said...

Hi Sherm,
Am wondering if you ever check for comments. If so, I'd like you to know how very glad I am that you spoke up at WMR. Otherwise, I'd never have found your work, which I've now introduced to a good friend. We are so appreciative of your "world view" and the manner in which you give expression to it. Your history students were fortunate indeed. Wish I'd ever been taught history by someone requiring more than the regurgitation of received wisdom.
All the best,
Evelyn