Fatal Distraction

Hope and change was in the air. It felt like a thunderous paradigm shift was taking place in American politics and John F. Kennedy's proclamation 48 years earlier was ringing true once again, "Let the word go forth from this time and place, to friend and foe alike, that the torch has been passed to a new generation of Americans!"

The 2008 election of Barack Obama really did have a feeling of awe and mysticism about it, particularly for my generation, whose "political coming-out party" it was supposed to be. Now here we are, just 2 short years later, the Tea Party's screams of socialism having drowned out the chants of "Yes We Can!", young people nowhere to be found, and a new, far more radical Republican Party poised to perhaps take back the House just 4 years after having lost it, and to gain several seats back in the Senate. It's almost beyond belief. How did we as Americans go from such happiness and optimism in 2008 to such anger and pessimism in 2010? How did the Party of Bush orchestrate such a remarkable recovery within 2 years of W's leaving office? There is plenty of blame to go around but, as much as it pains me to say it, the responsibility for the negativity in 2010 rests primarily on the shoulders of the same man who was responsible for the positivity in 2008- President Barack Obama, and his well-intentioned but poorly-scheduled Healthcare Bill that destroyed his popularity, distracted his administration from recovering the economy (always the key to political credibility), and mobilized his opponents.

Let me be clear- I supported the President's proposals for Healthcare Reform and was quite happy when they passed. If I had my druthers, our country would adopt a single-payer system like that of every other industrialized country in the world, but I understand the necessity of compromise and pragmatism and think the bills passed in March were a good start. Having said that, I now regard the Healthcare Reform passed this Spring as a good thing at a very bad time. As aforementioned, economic prosperity is absolutely key to political credibility. After the passage of the Stimulus Plan, overwhelmingly endorsed by the economic community, Obama held this credibility, only to spend it immediately on the razor-thin passage of a Healthcare Bill that was utterly watered down by people who didn't end up voting for it anyway. While the President and the country had all eyes on Healthcare however, the Stimulus coffers ran out- and the economy was still not recovered.

Quite recently, two very different definitions of what constitutes a 'Recession' were put on display by the Bureau of Economic Research and billionaire investor Warren Buffett, respectively. Last Monday, the Bureau of Economic Research (which is typically regarded as the authoritative voice on these matters) announced that the U.S. did get out of recession, by their definition which sees a recession as "a significant decline in [the] economic activity spread across the country", in June of last year. In an interview with CNBC Thursday, Mr. Buffett disagreed, saying that he regards a recession as not being over until "real per capita gross domestic product returns to its pre-downturn level."
http://www.reuters.com/article/idUSN2314652920100923


Thus, by the Bureau of Economic Research's definition, Obama succeeded at getting the country out of recession as he intended. Unfortunately for the President, most people's definition of recession falls far more in line with Mr. Buffett's- and to break out of a recession by that definition would have required far more spending than the Stimulus passed last Spring authorized. Wouldn't it be nice if, in a perfect world, the President could propose doing what is right for the country and have it passed lickity split? Instead, the rules of modern politics required the Republican Party to denounce fiscal stimulus (which, by the way, was the same way that Ronald Reagan and Congressional Democrats steered the country out of the early-80's recession. Taxes went down and spending went up in Reagan's tenure, the very definition of fiscal stimulus). Now, the Republicans having succeeded at turning public opinion against him (in large part due to the Healthcare Debate), the President is afraid even to propose a 'second stimulus', sure that the Republicans will stick to their guns (I speak metaphorically, though a literal interpretation would probably be accurate as well) at opposing the concept of fiscal stimulation of the economy.


Had President Obama, upon passing the first Stimulus, stayed away from any other major initiatives until the economy was recovered, he would have retained his political popularity, the Republicans would have maintained the image of obstructionist Bushites who got us into this mess in the first place, and he would have been able to easily pass a Second Stimulus as needed. With the additional stimulus, the economy almost certainly would have recovered by now, making the President and, by extension, Congressional Democrats, more popular- and leading to what could have been another Democratic year this election cycle, giving Pelosi and Reid the votes necessary to pass real Healthcare Reform, including the Public Option and maybe even Single-Payer. Instead, we have a big Republican election victory on the horizon, the possible onset of a Depression as a result of the GOP's increasingly lunatic economic policies, and a half-hearted Healthcare Bill (which Insurance Companies are already finding ways to get around- http://articles.latimes.com/2010/sep/21/business/la-fi-kids-health-insurance-20100921) that served to do little more than create a fatal distraction for an administration elected with a mandate to fix the economy first, and do all else second.