President Obama (Wikimedia Commons)
It's about jobs. It's about actions rather than words. It's about results. People who are unemployed or under-employed, people who have lost their homes or who are losing their homes or who fear losing their homes, people who can't or don't know how they will pay for their or their loved ones' needed medical expenses or educations or basic living needs don't care about speeches and political games, and they certainly don't care for excuses. It's about jobs. It's about actions rather than words. It's about results.
The New York Times editorial board on Wednesday succinctly summarized what is needed from President Obama:
Mr. Obama needs to put forward a comprehensive plan and fight for it. If he loses to obstructionist Republicans, Americans will know who is to blame.
That's it. That's the only hope for the economy. That's the best hope for the president's reelection. The president and all who want him reelected ignore this message at their own peril.
Mr. Obama needs to put forward a comprehensive plan and fight for it. If he loses to obstructionist Republicans, Americans will know who is to blame.
It's always good to be skeptical of polls this far out from an election, so neither the Marist Poll showing President Obama faring fairly well against his various opponents on a national level, nor the more troubling state-by-state polls, nor even the recent Gallup Poll showing him now below a 40 percent approval rating should be taken as definitive. But they are all troubling. The president is vulnerable, and the best news for his reelection chances would seem to be the continued antipathy toward his Republican opponents, none of whom seems likely to grow more popular with more familiarity. But the president is vulnerable.
The most important indicator for the president's reelection is the most obvious, and Adam Serwer summarized the danger:
When I spoke to political scientists and economists about Obama’s chances for reelection in 2012, they said that at the very least, GDP growth would have to average about 2 percent per quarter for Obama to be reelected based on date from prior elections. Growth in the first quarter of 2011, meanwhile, was a paltry .4 percent.
So there’s little point in wringing one’s hands over daily approval ratings. It’s still the economy, stupid, and what will likely determine the outcome in 2012 is not how the president’s approval ratings look today but what the economy looks like over the course of the next year or so.
But as the New York Times reported last Saturday:
Mr. Obama’s senior adviser, David Plouffe, and his chief of staff, William M. Daley, want him to maintain a pragmatic strategy of appealing to independent voters by advocating ideas that can pass Congress, even if they may not have much economic impact. These include free trade agreements and improved patent protections for inventors.
But others, including Gene Sperling, Mr. Obama’s chief economic adviser, say public anger over the debt ceiling debate has weakened Republicans and created an opening for bigger ideas like tax incentives for businesses that hire more workers, according to Congressional Democrats who share that view. Democrats are also pushing the White House to help homeowners facing foreclosure.
Even if the ideas cannot pass Congress, they say, the president would gain a campaign issue by pushing for them.
Free trade and patent protections are not going to create jobs, and that tax incentives for job creation should be framed as a big idea from a Democratic administration would be laughable were it not so infuriating. The neoliberal market-based approach has been proved at best a myth, and the president isn't going to gain any political advantage by pushing for more tax cuts for businesses. He would gain a political advantage by pushing for straight up jobs programs. He won't gain political advantage by worrying about deficits. He needs to go large, but he hasn't gone large. He has played into deficit worries. And the flagging economy and his tanking approval ratings are the result.
Mr. Obama needs to put forward a comprehensive plan and fight for it. If he loses to obstructionist Republicans, Americans will know who is to blame.
The president has discussed the idea of a federally funded infrastructure program, which would help, but as that same Times editorial continued:
But when the president floated the idea this week, he did not so much embrace it as his own as mention it in passing. “Congress should pass it and get it done,” he said.
Congress, left to its own devices, won’t get it done. Presidential leadership, daily and unrelenting, is needed. But as Binyamin Appelbaum and Helene Cooper reported in The Times, Mr. Obama and his advisers are still debating whether it is worth pushing any bold proposals, fearing that voters will see it as a failure if they don’t make it through Congress. That is an excuse for not trying. It also underestimates the intelligence of the American people.
Some of them, anyway.
Businesses aren't hiring, and it isn't because of taxes. It's because people have no money to spend. It's a demand crisis. As reported by Reuters:
Weakening demand in the United States and Europe has spooked some in corporate America, prompting big companies to throttle back their spending just as U.S. government looks for ways to cut its own outlays.
And how is deficit fever helping? It isn't.
The $2.1 trillion deficit-reduction plan reached in Washington this week spared the United States from defaulting on its $14.3 trillion debt, but raised questions on what spending would be cut, which in turn weighed on shares of companies that do everything from running nursing homes to building fighter planes.
"Where is the growth going to come from?" said Michael Goodman, director of economic and public policy research at the University of Massachusetts at Dartmouth. "It's not going to come from the private side and it doesn't appear like it's going to come from the public side. That does appear like a recipe for sluggish growth at best."
This is not some great new revelation. Exactly one year ago, the Washington Post reported this:
Corporate profits are soaring. Companies are sitting on billions of dollars of cash. And still, they've yet to amp up hiring or make major investments -- the missing ingredients for a strong economic recovery.
Because of a demand crisis.
They blame their profound caution on their view that U.S. consumers are destined to disappoint for many years. As a result, they say, the economy is unlikely to see the kind of almost unbroken prosperity of the quarter-century that preceded the financial crisis.
Across the industrial parks and office towers of the Chicago region, in a more than a dozen interviews, senior executives said they see Americans for years ahead paying down debts incurred during the now-ended credit boom and adjusting spending to match their often-reduced incomes.
People needed jobs. They needed income. Still. When people have jobs and income, they spend. When they spend, it feeds back into the economy. They don't just sit on their money the way corporations can do and are doing.
Over one year ago, Brad DeLong wrote:
However, even a minor and hasty acquaintance with the Great Depression teaches that the belief that the government should stand back and wash its hands because the self-regulating market quickly returns to full-employment equilibrium is the most arrogant belief possible.
And even a minor and hasty acquaintance with the Great Depression teaches that having the government stand back and wash its hands is the most risky strategy conceivable.
This is not some great new revelation. Market-based solutions don't work. Direct government spending does. But even if there's no way to get direct government spending through this Congress, the president and the Democrats should be trying. They should be framing the political argument. They have been failing to frame this political argument, and the worst move possible was to buy into the deficit/austerity game, but even that still can be turned around. The president can admit he made a mistake in playing along with the Republicans on deficits. He can remind everyone that President Franklin D. Roosevelt made a mistake in worrying about deficits in 1937, when he undermined his own recovery program, and that Roosevelt then realized his mistake and resumed spending and gave the recovery from the Great Depression a second jump start.
As I wrote almost exactly one year ago:
Businesses aren't creating jobs, and they have no intention of doing so unless they see signs that consumers will again resume spending. Consumers won't be spending as long as they have nothing or too little to spend. It's a feedback loop. There is only one way to break it. It has to be the government. The government has to create jobs. Infrastructure. Clean energy. Mass transit. There are plenty of social goods for government to fund, and there are plenty of people who are willing and able to be trained and employed. It has to happen. And only the government can do it.
The Republicans want us to believe that government is the problem. The Democrats can make the case that particularly in times of crisis, government is the solution. This is about framing. It's about theories of economics and it's about theories of government. And Democrats are failing even to attempt to defend what has been traditional Democratic framing. They are failing even to attempt to defend what the evidence clearly proves.
Mr. Obama needs to put forward a comprehensive plan and fight for it. If he loses to obstructionist Republicans, Americans will know who is to blame.
And if he fails to put forward a comprehensive plan and fight for it, Americans won't know who is to blame. Republicans are counting on it. They cannot win the political and economic arguments. They can only hope that there is no argument to win. For too long now, there has been no argument made by the Democrats.