Obama’s dangerous, lonely road
Today House Democrats finally broke ranks with President Barack Obama, disgusted by the compromise he struck with Republican leaders.
That deal extends tax breaks for the nation’s wealthiest earners, and expands exemptions for people inheriting money from relatives.
On the Republican side, meanwhile, GOP leaders are wrestling with a similar rebellion, with the Club for Growth and some tea party leaders blasting the deal as too liberal.
In theory, this whole mess puts Mr. Obama in the very middle of the political debate. This seems to be a position he’s coveted since inauguration day — the role of bipartisan deal-maker and referee.
Even during the healthcare debate, he signaled early to liberals that one of their prize goals, a public option or better yet a single-payer insurance system, was off the table.
The White House approach to climate change has also been so centrist that activists (and many scientists) view the approach as a sell-out.
The cap-and-trade strategy he adopted is a market-based approach which was first developed by Republican and conservative politicians.
Polls suggest that many rank-and-file Democrats are pretty comfortable with his tone. Mr. Obama’s poll numbers remain very, very high among Democratic voters, despite the lousy economy.
And it’s possible that this middle-of-the-road, focused-like-a-laser-on-jobs strategy will win back some of the independents who have abandoned the President since election day.
But the last twenty years, Republicans have managed to dominate the political scene by focusing very narrowly on their base — and liberals were expecting this administration to do the same.
Even though Mr. Obama telegraphed his moderate approach during the campaign, the backlash from the left looks to be very severe indeed.
Already the left-of-center media are savaging the President more aggressively than the right. It’s a lonely road when you’re being tarred by the Huffington Post and feathered by Fox News.
It’s also very, very unlikely that this approach will win many Republicans or conservatives. Mr. Obama is viewed by the tea party crowd as beyond redemption, a socialist, a closet Muslim, you name it.
I wonder, given the vitriolic climate, whether this President has the deal-making and negotiating skills to play the middle-man and the power broker successfully?
And finally, one has to ask whether this is really the role that the world’s most powerful man is supposed to play.
Not to pile on the metaphors, but did we elect Mr. Obama to play referee or quarterback?
Tags: politics
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With all due respect, Brian, he wasn’t focused like a laser on jobs. If he were, he’d have pushed through a bigger stimulus bill that created more jobs, and not been so passive in the face of chronic 9-plus percent unemployment.
Liberals knew that Obama was a centrist. We voted for him knowing that.
We didn’t expect he would start negotiations from a center-right position and negotiate further right from there. We expected that we would have some voice in the Whitehouse and not be locked out of important negotiations.
We have ideas for creating jobs and helping the jobless too.
It is the whole country not just Obama that is on a dangerous road. Our predicament grows worse by the day, and our leaders in Washington (and Albany) show no signs of rising to the occasion. If there was ever a case of a house divided against itself falling, we are living it. Two years is a long time in politics, and perhaps deepening crisis may bring politicians to their senses. I would not rule out Obama not running again in 2012.
There are interesting dynamics at work here. I believe that the country as a whole is centrist, with strong voices but limited representation (in the general populace) at the extremes. On the other hand, the legislature, especially the House, is populated by an inordinate number of ultra liberals and ultra conservatives. I don’t believe that Mr. or Mrs. Average American identifies with Nancy Pelosi or Barnet Frank on the one hand or Michele Bachmann or Rand Paul on the other. The challenge for Obama is to try to govern from the center when the political forces in Congress are anything but moderate.
This is a perfect example of how the balance between the politicking of the permanent campaign and the diplomacy of deal making has given the minority undue power. Obama’s campaign was inspiring and his early speeches—the inaugural and State of the Union—took the high road. But when he buckled down to the work, he seldom used the bully pulpit and tried, unsuccessfully in my view, to implement his agenda in a gentle manner.
For me, it started when Senate Democrats never forced the Republicans to actually filibuster. If they had, the president could have taken to the air waves and made a case for the issue at hand. But instead they used a vote count and then didn’t make the case for their issues. They allowed the Republicans to paint this president, closer to Nixon on the political spectrum the FDR, as a Socialist.
In the name of fiscal conservatism, the Republicans are “forcing” the country to accept the continuation of the Bush era tax cuts. These tax cuts are 10 years old and they did not lead to a low unemployment even before the crash of 2008. And we forget why they are expiring instead of remaining permanent: The projected cost of the cuts on the country’s debt were so staggering that the only way for them to have a modicum of responsibility was to make the expire in 10 years!
We seem to like fairy tales so much that we elect politicians who believe in them. Fairy tales like “reducing the tax rate will stimulate the economy so much that tax revenues will increase.” Can’t a single Democrat stand up and say that? Jeesh!
There fixed it.
That stimulus money had to come from somewhere didn’t it? If the government borrows it then that money isn’t available for private investment now is it? If the govenment collects taxes to “stimulate” the economy then the taxpayer no longer has that money to spend and “stimulate” the economy does he? If, rather then spending it yourself, you loan me $1000 which I then spend what has changed other then the party doing the spending? Nothing. There is no extra “stimulus”. Jobs that the private sector would have maintained or created with the money the govenment sucked out of the private markets for the “stimulus” is never considered.
No one is getting a tax cut. (deaf ears)
Obama seems to be in agreement that no one should get a tax increase right now.
We are talking about money we don’t have. We have to borrow it, mostly from China, to pay for those tax cuts. As far as I am concerned, the “temporary” Bush tax cuts helped to get us into this deficit mess and they should have been restored a long time ago.
The discussion of “job creation” is a bit perverted. Any politician that says he or she will be creating jobs by taking some action (stimulus or tax relief) is blowing smoke for the most part. The truth is that the de-leveraging that has resulted from the housing bubble (people can’t use their house as an ATM anymore) has sucked an enormous amount of demand out of the domestic economy. Until that demand is replaced, businesses will not hire (in the U.S.) unless they absolutely have to. Incentives to hire, stimulus plans, and lower taxes are measures that dabble around the margins.
In typical recessions, i.e., those we’ve experienced since WW II but before the present one, arguably efforts to replace reduced demand were effective because the length of the recession was relatively short and deficit spending (stimulus) could fill a relatively transitory demand gap. What we are experiencing now is an altogether different phenomenon. It will take years for the economy to recover and years for the unemployment level to be rate to “normal” levels.
The government can create conditions that are marginally more favorable to employment but they are generally short-lived because they can’t be sustained (e.g., stimulus that saves government jobs for a years or so) or are of secondary importance (tax policy whose impact is blunted by a lack of demand).
I don’t think I’m breaking any new ground here, but I do think that people who believe that government action in whatever form will “create” jobs are buying empty political rhetoric.
I was wrong again. I though Obama was Mr. Spock. Turns out he is Gumby.
So how could you have been sooo wrong about him? Is he an utter fraud?
I guess I keep forgetting he went to Harvard.
There are a lot of really smart people at Harvard (and many other great institutions) who are carefully trained to be clueless. Remember all the economists during Bush’s term who kept telling us that there was no inflation and that the economy looked great?
There are still economists telling us there’s no inflation and that the economy is on a rebound. A very bright man said just the other that we need to stop listening to “experts’ and look around with our own eyes, use our own minds to evaluate things and to decide on our own whats really happening. Good advice I think.
Remember that $800 Billion dollar stimulus? There was a grass roots movement, a small one, that thought that if the Gov’t truly HAD to have a stimulus, better to send it out to the taxpayers than to big business. That would have been, if I did the math right, a little under $6K per taxpayer. It seems to me that would have put the money into the economy and boosted the economy much faster and for a longer time than the non-stimulus that we did end up with. Things like that just make you wonder what kind of game the powers that be are really playing. It wasn’t a stimulus- it was a slush fund to bail out big dollar donators!
The perfect thing for Obama to do now wold be to pull an FDR and get some sort of law passed limiting business investment and requiring rehiring of employees, preferably unionized employees. That would be the coup de grace to whats left of our economy. Lets hope he doesn’t move down that road.
“The economy” is on the rebound. It’s the working class that isn’t. They announced yesterday that the average household income grew by 2.2% last quarter based on the growth in the stock market. That’s fine if you are one of those who make money by trading stock but most working class people aren’t making their money by investing in stock. If they have any stock at all it is in a retirement plan and represents potential future income. I say potential because it could just as easily go down or even disappear before they are in a position to retire and it becomes actual income. Until we start measuring the health of the economy in terms of real money in people’s pockets rather than promises of something someday if things continue to go well, there will be a discrepancy between the official definition of recession and people’s perception of recession.
James Bullard said: “The economy” is on the rebound. It’s the working class that isn’t. ”
Exactly. We are getting the banana republic we deserve. And I love that Notinthevillage thinks everybody who’s a millionaire, including the people at AIG who ruined the economy, are “earners.” So I guess John Dillinger was an earner, and the neighborhood oxycontin freak who fences your kid’s stolen bike is an earner, too. I love the post-accountability world.
Just one thought on Obama. I would not be surprised if he has competition for the next Democrat nominee for President. Who? That I cannot imagine.
On jobs – forgetaboutit!
I think there is a problem no one wants to confront. Simply put, we have more people than we need to fill the jobs we need. This is a problem that began to brew with the industrial revolution, followed by automation and kicked into high gear with computerization and globalization. Fewer people can do more and more. This all works great for companies but not so good for people looking for work.
You just don’t create jobs. Jobs are created when there is a need, not the other way around.
It is ironic that Republicans make the case for tax breaks for millionaires will increase hiring when NPR reported today that corporations have more cash as a percentage of their overall assets than they have had since 1959. Just how much cash to they have to have before they decide to spend it? Could it be that they are rationally waiting for consumer demand for their products? Not everyone lives in a field of dreams where if you build it they will come (and buy it).
Robin, interesting isn’t it?
Corporations are supposed to have a fiduciary responsibility to shareholders to either use excess cash for capital projects etc or return it to shareholders as dividends.
Republicans made that the case for tax cuts and yet corporations are sitting on all that cash.
If corporations were to return trillions of dollars to shareholders wouldn’t that be a tremendous stimulus? Shareholders would use that money to create jobs AND they would have to pay tax on it! Boost to the economy and a boost to the treasury.
Why didn’t Obama push for corporations to get that money working in the economy months ago?
The fact is this is a great move for him. He has ONE thing he has to do before 2012 and that is get the unemployment rate down, everything else is secondary, everything. Nothing he does will matter if we have over 9 % unemployment in 2012. This bill will help.
Yes it is unfair that we don’t tax the million+ crowd at higher rates, so what; its more important to reduce unemployment than making us feel good.
This is about getting things done not making some political points it is a very good sign that the far right and the far left hate this bill, its the first time I have really liked this President.
“Why didn’t Obama push for corporations to get that money working in the economy months ago?”
Like FDR did? Force corporations to rehire workers rather than invest in their infrastructure, tooling, etc thereby crippling the recovery and prolonging the depression? The problem with the idea is that gov’t makes lousy business decisions. They aren’t a business, they aren’t familiar with the workings of those businesses, and in the case of most recent administrations, they have no one on board who has ever even been involved in a for profit business. Having gov’t micromanage business is like having me run the space shuttle program- I’d have no clue what I was doing. Gov’ts concern would not be growing the business, ensuring a reasonable profit, looking towards the long term success of the business. Their concern, right now, would be lowering the UE role and getting good press and resultant votes.
I realize business is the “enemy” to many people. But those businesses are no different than you and I, just at a different scale. If you were unsure of your employment and what the future may hold you wouldn’t go and commit a large portion of your income or savings to anything you didn’t deem absolutely critical. Same with business, right now they’re holding their cards and waiting to see what happens. I wish they felt confident enough to hire people, but they don’t and I can’t blame them for taking the conservative approach.
If business does not have the freedom to hire and fire than you will have an economy where those decisions are made politically. At least with a business you know what they want; profits.
However if business wants to take a handout from the government then indeed the government has the right to tell them exactly how to use that money.
The reason the stimulus funding and the TARP bank bailouts were so frustrating for me is that they did not come with exact contracts for how the handouts were to be spent. If a bank took TARP they should have had to track exactly how many new loans they made with that exact money and report that amount each quarter etc.
If you become a ward of the state then you should have to toe the line. When the government gives Lockheed Martin a huge contract they get a couple of F-22’s for the money or C-130’s or whatever product they are buying. Overpriced yes indeed but they get something for the money. The banks should have been told what they were to use our tax dollars for instead they just kept it all.
Of course this itself may point out the problem with the government getting that involved n the economy they don’t in general know what they are doing.
Bret read what I said. By law corporations are not supposed to carry unlimited cash on on their balance sheets. That cash should be used to upgrade equipment, or hire new workers, or buy out competing businesses, or buy back stock–it can be used for many different things–or it can be returned to the shareholders as dividends. Whatever the corporations decided would be the best thing for the shareholder’s interests they should and must do. The one thing they should not do is hold on to all that cash.
A trillion dollars in cash released into the economy would be a better stimulus than the deal Obama made.
We have a Securities and Exchange Commision. Why don’t we use it?
But if a company is not maximizing shareholder value the shareholder has the option of selling the stock. The taxpayer has no option of dumping the stock if the government is giving the corporation our money.
So much stock is held by insiders and in funds that it is unrealistic to believe shareholders really have any way to sell the stock. What stocks are held in your mutual funds? Can anyone tell me off the top of their head? What do you know about anything held in your retirement fund?
Not too many of us own individual stocks in any quantity. Certainly not enough that selling it will change the stock value and register at the boardroom level.
The SEC is supposed to be looking out for our interests.
Agreed. Corporations sell their ownership shares to the public at large they also are given special consideration by the State to be able to organize as a corporation, so the public through the SEC has an interest.
I don’t think the SEC can nor should tell a corporation how to manage their balance sheet. Part of a balance sheet is going to be liquid assets including cash equivalents. In an uncertain business environment it may very well be in the interest of the owners (stockholders) that there is more liquidity on the balance sheet.
However like I said earlier, all bets are off if the corporation took direct taxpayer aid, in that case the government not only has the right but the duty to tell the corporations exactly how they want that money spent and what they want to see as an outcome from that money.
If a bank took TARP money then the US government should have demanded that they use it in a way that directly benefits the objectives of the government. I don’t think simply holding the money as cash was one of those objectives. The government has been totally derelict in its duty in this regard.
“If a bank took TARP money then the US government should have demanded that they use it in a way that directly benefits the objectives of the government. ”
WRONG, it should have been used in a way that directly benefited the economy or the company, not gov’ts “objective” which might have nothing to do with realistic objectives that benefit the company or economy.
I also doubt that much TARP money is being held as cash, if there’s proof of that it’s news to me.
No that is not correct. When you get taxpayer dollars the government has the duty and right to tell you how to spend those dollars. IF you don’t want that oversight don’t take the money.
No real oversight was provided for the TARP grant program we may never know where that money actually went.
I agree in part- but you said “benefits the objectives of THE GOVERNMENT”. The objectives of the Gov’t in most cases is to secure power and prolong their stay in office. See the problem?
“No real oversight was provided for the TARP grant program we may never know where that money actually went.”
Bingo- it’s a slush fund for politicians. Nothing new there.