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Last week’s brutal week has Democrats all angsty, and the concern isn’t misplaced. But given what a terrible candidate Mitt Romney is, there is still a path to victory, so we need to settle down, take a deep breath, and figure it out. One thing is for sure, though: the path does not lie through a garden of economic happy talk.

The news about the devastating 39% decline in median household wealth from 2007-10 is another reminder of the depth of economic misery created by the collapse of the housing bubble. It comes on top of another recent study that said that the previous estimate of underwater homeowners comprising a quarter of the housing market, already a stunningly high number, was actually underestimated- that the number underwater is actually closer to a third of homeowners. Given how closely tied middle class assets are to the value of their homes, these two studies are bookends of the same phenomena, a self-reinforcing vicious cycle that appears to be going nowhere fast. Between the housing black hole in this country, the Hobbesian choice in Europe between a deep recession and an economic collapse, and the slowing of both China’s and India’s economies, surprising doses of good economic numbers in the coming months are not going to save the President’s re-election chances, and references to things getting better will not fly.

This undeniable economic reality shows starkly why a conventional wisdom approach to politics right now will backfire. I wrote on Monday about the new Democracy Corps memo on the focus groups they had done with swing voters. Check out the comments from these people, who have been in the middle class their whole lives but are now just hanging on by their fingernails, and it will break your heart. The combination of economic pressures facing these kinds of Americans is close to overwhelming: family job losses, young people unable to find their first full time job, wage cuts, rising out-of-pocket health care costs, declining housing costs, college tuition inflation, groceries and gas prices going up, credit card and housing and student loan debt. The list goes on and on, and formerly comfortable families are getting more and more desperate. On most of these items, there doesn’t seem to be much upward progress either- and if there is, most people sure aren’t feeling it. What they are feeling is that the USA is in the 5th year of our Japan-style lost decade.

Voters are in a foul mood about all this, but I get no sense in the polling and focus group research I am seeing that they have a simplistic view of what is going on- most voters outside of hard core Republicans are not inclined to automatically blame Obama just because he is the incumbent. Instead, a lot of voters blame both parties for not doing enough, know we have a deep long-term problem on our hands, and blame Wall Street and wealthy special interests as much or more than the two parties. Swing voters aren’t inclined to trust government to solve the problem because they think government is bought off by special interests, but when they hear about Republican economic, tax, and budget policies, they reject them.

This is complicated stuff, and anyone who is confidently telling you they know how this will all shake out in the November election is either fooling themselves or has a bridge somewhere in Brooklyn to sell you. This election, for all its steep challenges for the party in the White House, is still a crapshoot. The conventional wisdom is that Democrats can’t win in a tough economy getting tougher, but given voters’ impressive sophistication about the nature of our economic challenges (a considerably higher sophistication than among DC elites), they understand that this not Obama’s fault and that climbing out of our economic hole is a long term deal. So there is a path to Democratic victory, but it isn’t the path of conventional wisdom and DC punditry. What it will take for a Democratic victory this fall is an economic message that shows Obama is not out of touch with what is happening to the middle class in this country, and that makes clear he is going to fight for them on the things that matter most.

If I were Obama’s speechwriter for his economics speech Thursday morning, I’d be including some language like this:

“Starting about 30 years ago, this country changed direction in terms of its economic policies. Strengthening and expanding the great American middle class stopped being our nation’s number one policy priority. We began shifting our manufacturing jobs overseas, and went from having the world’s largest trade surplus to having the world’s largest trade deficit. We lowered our investment in our roads and bridges and highways and water systems, and in our R&D that had produced the products that changed the world. We didn’t bother balancing our budgets because we chose instead to give the wealthy huge tax cuts. We allowed more and more concentration of wealth at the top, more stagnation of wages for everyday workers, and we deregulated the big Wall Street banks so they grew in size and power.

For the last 5 years, the chickens have come home to roost. The result has been the biggest economic crisis since the Great Depression, massive federal deficits, a terrible housing collapse, bad unemployment and no wage growth. Too many middle class Americans are being mercilessly squeezed by wages not going up, the price of their house going down, and the price of necessities going up, and are hanging on by the skin of their teeth to their homes and their way of life.

With no help from this do-nothing Republican Congress, we have worked hard to battle these trends, and will not rest until every American has a decent job and there is a new flowering of the American entrepreneurial spirit. But what Mitt Romney and the Republicans want to do is to return to the policies that made this economic hole so deep- and keep digging. When Romney was a business executive, he had no problems loading companies up with debt, laying off workers and cutting their benefits, and out-sourcing jobs so that he and his fellow executives could walk away with the profits. But we cannot afford those kinds of policies for America. We can’t afford more debt along with more layoffs for teachers, cops, and firefighters, and cuts in care for seniors and student loans- so that millionaires can get huge new tax cuts.

How do we get out of this hole we are in? By understanding that America’s middle class is at a make or break moment, and fighting for them in everything we do. We need to hold Wall Street accountable and say no to the wealthy special interests that are wrecking our economy and our democracy. We need to raise taxes on the wealthiest Americans so that we can afford to invest in what matters for America’s future- our education, our infrastructure and our future. Most of all, we need to say yes to more and better jobs with good wages and benefits.”

Obama needs to show that he knows what people are feeling in this economy, and that he will fight for the middle class in his 2nd term. If he does that, he still has a path to victory.

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Comment Preferences

  •  Fine. In the mean time, I've got a new pitchfork (2+ / 0-)
    Recommended by:
    blueoregon, DMLjohn

    and a Tiki Torch in the corner, wait'n for the rider to come along yelling, "The Republicans are coming!"

    Of course, in the other corner is my broom and bucket, waiting for them to come alive via Anastasia and begin a good cleaning of the house, dusting in the court and bringing this Republic back its shine.

    G-r-r-r-r-r :-)

    Vote for Obama. Other choice finds your pockets.

    Hope has a hole in it when Republicans come, bringing shackles and sorrow; branding their greed on the backs of the poor. - Wendy Connors

    by Wendys Wink on Wed Jun 13, 2012 at 01:34:30 PM PDT

  •  Thanks for the diary. (1+ / 0-)
    Recommended by:

    "Such is the irresistible nature of truth that all it asks, and all it wants, is the liberty of appearing." - Thomas Paine

    by blueoregon on Wed Jun 13, 2012 at 01:38:04 PM PDT

  •  chickens to roost??? (0+ / 0-)

    Ahhhhhhh, don't start that again!!!!! Lol.
    So agree with this assessment

  •  Good work here, Mike (0+ / 0-)

    Your "speech" was right on point.

  •  Yes, you're right, good speech (0+ / 0-)

    but he can't give it.

    If he says those things, it will hurt his donors' fee-fees.  Honestly.  That's the problem.  I don't know how to solve it.

    The "War on Women" meme would have worked.  It would have allowed him to be the fierce, principled defender of people's rights (in this case, women) without pissing off his friends on Wall St.

    but Anne Romney got her feelings hurt, and they dropped the talking point and ran like children caught smoking behind the barn.

    I mean really.  If this is how Democrats run a campaign, it's no wonder they often lose!

    Being ignored is the difference between being a one percenter and an American.--sweeper

    by SouthernLiberalinMD on Wed Jun 13, 2012 at 03:36:22 PM PDT

  •  I agree he cannot alienate donors (0+ / 0-)

    I think Americans are ready for truth!  They know jobs are lost to technologies that have eliminated clerk positions, manu jobs robots do, online sales eliminating needs for rental space etc...    I think he can also reassure businesses we want to be globally competitive and have a tax rate that is super competitive but that we cannot subsidize oil etc...  He also should point out that if Republicans want to get the fiscal house in order we cannot further reduce taxes period!  Not stressing wealthy but have real numbers on the whole it will blow in the deficit and press down on how the Ryan budget increases the deficit and what specifically they have to lose in the cuts.  We can have fair taxes to have services government provides allowing dignity to ALL Americans  to a certain living standard tax free amount and above that everyone will be taxed fairly.  People know medicare and SS are on the block and he should point out the DIFFERENCE in approaches between he and Romney on addressing it.  He should also use the word," dignity" over and over in the need for these important programs especially in a country as great as ours.  We need to tax SS on 100 percent of income as now it is a regressive tax and everyone needs to pay on all their income not just up to a point to save it.  Many people have no idea they even will get medicare and SS even though it comes out of their checks!  We have to educate the voters so they do not vote against their own  interest because they treat politics like sports teams losing sight of the stakes.

  •  The Way To Win Is To Keep It Simple And Keep It (0+ / 0-)

    truthful. Obama just needs to keep reminding people that his stimulus is responsibe for saving X number of jobs, and that the job creation numbers have been positive for the last 27 months, thanks to his policies. He can express empathy by saying "is the recovery happening as fast as we'd like? No, but under my administration at least the economy is heading in the right direction. Under Mitt Romney, we would see more income inequality (cause Romney wants to cut taxes on millionaires even more), and more unemployment (cause Romney outsourced jobs at Bain Capital)."  Obama also needs to keep reminding voters of how the do nothing Republicans in Congress have obstructed EVERYTHING he has tried to do to help the economy. How about saying, "you know, unemployment is now 8.2%, but it could be much lower if only the REPUBLICANS in Congress would pass my jobs bill." This reminds people that he is trying, and puts the blame for the lackluster recovery where it belongs - on obstuctionist Congressional Republicans. If President Obama keeps it simple and truthful, he WILL win in November!!

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