Obama, Jobs, Poverty, Taxes, and the Enthusiasm Gap

obama thinkingToward the end of last month, the New York Times said editorially:

“If President Obama has a big economic initiative up his sleeve, as he hinted recently, now would be a good time to let the rest of us in on it.” The editors went on to suggest what the elements of such a plan might be. First, they wrote, “he needs to keep driving home that he is committed to addressing the deficit, and that he will call for widespread sacrifice to do so – starting with letting the Bush tax cuts for the richest Americans expire at year end. Mr. Obama must tell Americans that claims from Republican leaders that the country can both cut taxes and tackle the deficit are absurd and cynical. Next, he needs to explain why too much sacrifice, too soon, especially from the middle class, would do more harm than good while the economy is weak. More government support is needed until conditions improve.”

“Mr. Obama also needs to inspire Americans who have been ground down by the economic crisis and Washington’s small-bore sniping. He needs to rally the nation around a big idea – a project that is worth sacrificing for, worth paying for, worth working for. One that lets them know that there is more ahead than just a return to a status quo of lopsided growth in which corporate profits surge while jobs and incomes lag,’ said the paper. “That mission could be the ‘21st century infrastructure,’ that Mr. Obama mentioned on a multi-city trip this month, ‘not just roads and bridges, but faster Internet access and high-speed rail.’ It could be energy independence, with high-tech green jobs and a real chance for addressing global warming. Either of the above would make sense, economically and politically.”

Well, he’s gone and done it.

Is it too late? Perhaps. But that depends on what it’s too late for. Changing the Democratic Party’s outlook for the November election? Probably not. (However, the latest polling figures paint a picture not quite as bleak and the monkey-see-monkey-do media pundits keep repeating.) In any case, a call for actually retooling the economy for today’s challenges and granting preferential tax treatment to struggling working people could stir some enthusiasm among people now seeming inclined to sit out the election.

Is it too little? Perhaps. But that depends on what it’s too little for. Rescuing the nation from the capitalism latest crisis? Of course not. But it does point in the direction many liberal and progressive activists and opinion influencers have suggested going for some time. These latest economic proposals coupled with a firm commitment to defend Social Security and Medicare – not just from privatization but from cutbacks (something the President has not yet done). Last week, American Prospect editor Robert Kuttner offered an apt bit of advice to the White House: “… Make it clear that your administration will not support cuts in Social Security. Declare that if the fiscal commission comes up with a formula that reduces benefits for seniors, its recommendations will be a dead letter. Dare the Republicans to follow suit.”

All this should be accompanied by a stronger resolve to bring the ghastly and costly foreign wars to a close, a move that could also light a fire under those not inclined to disengage from politics. In any case, it would help gear up for the critical battles on tap for after the mid-term election.

None of this will happen, however, without three things being present:

  • a commitment by the White House to really follow through, as opposed to a Chicago-style rollover, splitting the difference with the political opposition;
  • some backbone displayed by the Democratic Party Congressional leadership and
  • united actions by labor, liberal and progressive groups and movements to press forward, including street mobilization.

And the so-called blue dogs have to be confronted. It is true that some of them are influenced mostly by the powerful vested economic interests that help them acquire and hold onto their offices, but some of them are simple ideologically on the other side. Last week, the Financial Times’ Edward Luce, one of the most perceptive political analysts in the major media, commented on the “hazard-strewn political environment” confronting the President and the “increasingly Alice-in-wonderland quality of American politics ahead of the midterm elections.” Citing Sen. Michael Bennett (D-Colo) – whom the White House had supported in a tight primary race this summer – who slammed the President propose infrastructure spending plans when Obama had barely gotten the words out of his mouth, Luce wrote that with friends like these Obama “has no need for enemies.”

“Republican obstruction means that the best we can hope for in the near future are palliative measures – modest additional spending like the infrastructure program President Obama proposed this week, aid to state and local governments to help them avoid severe further cutbacks, aid to the unemployed to reduce hardship and maintain spending power,” wrote economist Paul Krugman recently. Where he finds the basis for hope is anybody’s guess, for later he says, “it’s by no means certain that we’ll do even that much. If the Republicans go beyond obstruction to actually setting policy – which they might if they win big in November – we’ll be on our way to economic performance that makes Japan look like the promised land.”

“It’s hard to overstate how destructive the economic ideas offered earlier this week by John Boehner, the House minority leader, would be if put into practice,” continued Krugman. “Basically, he proposes two things: large tax cuts for the wealthy that would increase the budget deficit while doing little to support the economy, and sharp spending cuts that would depress the economy while doing little to improve budget prospects. Fewer jobs and bigger deficits – the perfect combination.”

On September 9, the New York Times featured on its front page an analysis by one of its newer editorial writers, Matt Bai, which contained this assertion that the Administration has erred by arguing that, in effect, stimulating the economy today and reordering it for decades to come are basically the same thing. “In this way, Mr. Obama risked confusing the voters – and not for the first time,” wrote Bai. “By consistently conflating short-term and long-term economic goals, the president and his Democratic Party may have missed an opportunity to explain the crucial difference between the two, and they have all but ensured that voters this fall will give them credit for neither.”

I seriously doubt that if the Democrats lose big in November it will because the Administration confused short and long term goals. As one perceptive letter writer to the paper put it, “Contrary to Mr. Bai’s suggestion, there is no ‘crucial difference” between creating jobs today and investing in our schools, highways, bridges, railways, electricity grid, water supply systems, Internet access and other infrastructure projects that will make Americans more productive and America more competitive in the future.

“The people who are without jobs today should be given the opportunity to go to work now on projects that will build a better America for all the tomorrows to come.”

The problem with making things clear to the general public comes from the all-too-pervasive tendency of the Administration to fall back into its we-didn’t-create-this mess stance. Of course, they didn’t. In addition to capitalism as a system being prone to periodic crisis, the origins of the present pain can be traced back to policies adopted during the reign of the last two administrations. But what the prospective voters are looking for is a sign that the government intends to do something meaningful about the nation’s plight in both the short and long terms.

Last week came the painful news that the percentage of people in the country without health insurance has risen to 16.7 percent, and the percentage of Americans living in poverty increased to 14.3 percent. Upon hearing the news the White House issued a statement essentially saying the poverty rate was going up before the recession and would be even higher if the original stimulus package was put into place. All well and true, but where do we go from here?

Well, the President has put forward a plan. It involves tax relief for working people and increased spending on infrastructure and development projects to put some of the 22 million unemployed women and men to work and provide some jobs for the young men and women seeking entrance into the workforce.

“On Labor Day afternoon in Milwaukee, President Barack Obama finally began to vigorously push the kind of high-profile, rebuild-America infrastructure campaign that is absolutely essential if there is to be any real hope of putting Americans back to work and getting the economy back into reasonable shape,” Times columnist, Bob Herbert, wrote September 7. “In a speech that was rousing, inspirational and, at times, quite funny, the President outlined a $50 billion proposal for a wide range of improvements to the nation’s transportation infrastructure. The money would be used for the construction and rehabilitation of highways, bridges, railroads, airport runways and the air-traffic control system.

“Obama linked the nation’s desperate need for jobs to the sorry state of the national infrastructure in a tone that conveyed both passion and empathy, and left me wondering, ‘Where has this guy been for the past year and a half?’”

“Obama’s proposal is only a first step,” continued Herbert. “Despite the $50 billion price tag, it’s not in any way commensurate with our overwhelming infrastructure needs or the gruesome scale of the nation’s unemployment crisis. But it’s an important step. It’s a smarter approach to infrastructure investment than the wasteful, haphazard, earmark-laden practices we’ve become accustomed to, and it will put some people to work in decent-paying jobs.”

Nation magazine editor, Katrina vanden Heuvel, wrote in the Washington Post last week, “But even if passed, these proposals aren’t anywhere near what needs to be done to reshape the economy and put people to work. Obama has been eloquent on this in the past. In his Georgetown University ‘Sermon on the Mount’ speech last year, he argued that we can’t recover to the old economy that was built on debt and bubbles – and should not want to. We have to build a ‘new foundation’ for the economy with investment in world-class education, in research and development, in a 21st-century infrastructure. Transition to new sources of energy will help secure a lead in the green industrial revolution. Curbing financial speculation and balancing our trade, so we make things in America once more, are essential. To enact this project, Washington will have to free itself from the destructive grip of powerful corporate lobbies.

“This agenda is both good policy and a powerful political message. It provides a context for what Obama has done to date – from the recovery plan to financial reform – and the case for staying the course.”

However, wrote Herbert, “The question that remains, however, is whether he and his party will fight with the skill and tenacity needed to guide his proposal to fruition, and whether they will finally focus on the difficult but critical task of putting unemployed Americans back to work.”

Unlike most of the people quoted here, I actually think that if the White House did these things resolutely in the weeks ahead it could have an impact on the November voting. It could narrow somewhat the “enthusiasm gap.”

Carl Bloice

Repubished with permission from The Blackcommentator

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