Editore"s Note
Tilting at Windmills

Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

May 4, 2011

WHEN HOPE IS THE ONLY PLAN LEFT.... Atrios summarized the painful state of the economic debate nicely: "It's all about the deficit, nobody talks about jobs anymore, and the administration isn't making the case that there's something they want that Congress won't give them. The plan is... hope for the best."

Quite right. President Obama could announce today that he's launching an ambitious jobs plan, but he won't, because he knows Congress would reject it. Indeed, Americans, for whatever reason, elected a House majority that wants to make unemployment worse on purpose, and actively dislikes those who are unemployed.

And so, while the public is clamoring for Washington to focus on economic growth and job creation, policymakers are focused on the opposite: taking money out of the economy. The best -- the very best -- we can hope for is a president who'll stop Republicans from making matters much worse, and maybe a reluctant Federal Reserve that might choose to play a more constructive role.

But really, that's it. The White House can't act without Congress, and Congress doesn't want to act at all. We're left to simply hope the economy continues to improve on its own.

The NYT's David Leonhardt isn't sure hope is enough.

White House advisers and Ben Bernanke, the Federal Reserve chairman, argue that the bad news is a merely a blip caused by bad weather, a temporary cut in military purchases and other one-time factors. They may be right, too. Stock market investors certainly share their optimism: the Standard & Poor's 500 index is near a postrecession high.

But both Wall Street and Washington were also optimistic around this time last year -- too optimistic. The unfortunate truth is that the recoveries from financial crises have a habit of disappointing.

Crises do so much damage that they leave businesses and households predisposed to believe the worst and to pull back at the first hint of economic weakness. Households are slow to resume spending. Banks are slow to lend, especially to small businesses. Companies are slow to hire.

All this is why the typical financial crisis has caused unemployment to rise for almost five years, according to historical work by the economists Carmen Reinhart and Kenneth Rogoff. We are well ahead of that timetable, thanks to aggressive action by the Fed, the Obama administration and, in its final months, the Bush administration. But our working assumption should be that this recovery will remain at risk for a long time.

Leonhardt added that the "sensible" response from Congress would be some sort of short-term stimulus, perhaps tied to a long-term deficit reduction plan.

But Americans ensured last November that no "sensible" economic policies will come out of this Congress any time soon.

Steve Benen 1:50 PM Permalink | Trackbacks | Comments (15)

Bookmark and Share
 
Comments

BLS report on Friday May 6, 2011 will be crucial.

Posted by: ElegantFowl on May 4, 2011 at 2:05 PM | PERMALINK

I don't remember Democrats making their own point about any of this.

At least not since the first (and last) stimulus.

The Republicans framed them with that issue, and so the Democrats let them frame the issue on deficits as well.

Democrats don't know how to play this politics game.

Republicans will do anything from changing the rules to cheating to lying to win thie politics game.

Sometimes, it's like watching a Little League team play against a Major League team managed by Leo Durocher.- a well known cheater.
Republicans would elect Durocher President if he was alive today. He was their kind of guy. Maybe too smart, though...

Posted by: c u n d gulag on May 4, 2011 at 2:05 PM | PERMALINK

Way to smart .. they only worship stupidity itself .. celebrate it ...

Posted by: stormskies on May 4, 2011 at 2:07 PM | PERMALINK

when i was an adolescent, lo these many decades ago, i used to wonder how we were so sure we'd never have another depression.

and the answer was that economics had learned from the depression and we now understood policy tools that would prevent another depression from occurring.

and in the broad sense that the economy could have gone much further south without the modest deployment of those tools we had, it's true, but we're really learning that the answer to my adolescent concern was "we shouldn't be sure that there won't be another depression; we can't count on the politics to support what the economics tells us we need to do."

because the democrats in congress really constitute two parties - the democrats and the moderate republicans - i tend to cut obama more slack than many do on being realistic about what can get through congress.

but where i cut him no slack at all is his failure to use his rhetorical gifts to make the stakes clear; my belief is that he spent too much time hanging around with university of chicago economists and it harmed his thinking.

Posted by: howard on May 4, 2011 at 2:10 PM | PERMALINK

You know, Steve, I am more sympathetic to Obama than some of your posters, but there's nothing stopping him from presenting a jobs bill but himself. He could present, campaign for it, and say Republicans are why it won't pass. Harry Truman did that in 1948, and it worked for him.
I think Obama's biggest problem is thinking losing votes in Congress is an avoidable failure. With the opposition in control of one house, it isn't avoidable, so he might as well make the best losses he can.

Posted by: JMG on May 4, 2011 at 2:21 PM | PERMALINK

The president may know that Congress won't act on any plan he may want, but why does that stop him from arguing for it?

The silence from the White House on this is deafening and discouraging.

Posted by: karen marie on May 4, 2011 at 2:22 PM | PERMALINK

It doesn't matter that Congress won't give the President what he wants. He should be out beating the drum incessantly on this issue and telling people to write, call and email every Congressperson until he gets action. At the very least the 2012 campaign should be based on this Congress's unwillingness to address this issue and it should begin yesterday.

Posted by: digitusmedius on May 4, 2011 at 2:23 PM | PERMALINK

Let's not forget there is an election coming up next year, and timing is everything.

There is little the president can do right now, with a dysfunctional Senate and a Republican House.

Expect more of that good ol' Obama rhetoric, starting with the 2012 SOTU address.

Posted by: DAY on May 4, 2011 at 2:25 PM | PERMALINK

But Americans ensured last November that no "sensible" economic policies will come out of this Congress any time soon.

Democrats had a choice going into the November elections. They could have pointed to GOP obstructionism and, as Atrios said, make "the case that there's something they want that Congress won't give them." They chose the alternative: to play up their "accomplishments". Thus, the election became a referendum on what the last two years had been under Democrats, rather than a referendum on what the next two years could be without the GOP.

Never once has the White House said they wanted a larger stimulus bill. Instead, Team Obama spent 2009 and 2010 talking about green shoots and hyping the economic comeback. When the public was underwhelmed they voted for the alternative party in a two-party system.

Since November, team Obama has doubled down on the stupidity by agreeing to a series of tax and spending cuts that will both slow the recovery and make it politically difficult for the Democrats to blame the GOP.

This is why I have a problem with the Obama cheerleaders who, rather than identifying with dissatisfied voters, prefer to blame voters for not recognizing Obama's awesomeness and telling them to go visit a website listing Obama's achievements.

Posted by: square1 on May 4, 2011 at 2:33 PM | PERMALINK

Debbie Wasserman Schultz, for the DNC, has an email out asking what we (Democrats) think the party should do. Everyone concerned with the administration's inertia on jobs and economic development should respond and tell her so. If Obama hopes to get back the House, he needs to convince the voters that it will actually make a difference if he does. As in telling them what he wants to do!

Posted by: JackD on May 4, 2011 at 2:36 PM | PERMALINK

ArmObamabullyLBJpulpitFDRprimaryJFKcommitteeHSTchairchallengetwisting, is what.

All you have to do is want it bad enough.

That's how I got my BMW.

Posted by: Davis X. Machina on May 4, 2011 at 2:40 PM | PERMALINK

For all the media talk about Obama's political courage in sending Navy SEALs after OBL, aggressively attacking the deficit shibboleth would require a lot more political courage.

As for the lack of response from Dems in Congress, I don't think they would be sitting on their hands if their were directives and a concerted campaign from the WH and Dem leadership.

Posted by: bdop4 on May 4, 2011 at 2:57 PM | PERMALINK

i agree with several of the posters above in the belief that obama should submit his jobs plan, and any other plan he may have, regardless of whether he thinks the house will support it. make them go on record opposing constructive progressive policies, and beat them over the head with it next election.

Posted by: just bill on May 4, 2011 at 3:13 PM | PERMALINK

It seems that:

- we're asking Republicans not to take futile actions (actions they likely intend to take to the public and say "we're trying to fix things, but the Dems won't let us!").
- we're asking Democrats and the President *to* take futile actions, in the hopes that they can take them to the public and say "we're trying to fix things, but the Republicans won't let us!".

There is a slightly different dynamic at work for each party, but how likely is the American public to differentiate between the two?

Posted by: O. on May 4, 2011 at 4:59 PM | PERMALINK

People who are unemployed, or fear becoming so, + those who will need the social safety net for medical care and old age have to VOTE. It may be unkind of Obama and elected Democrats to overlook the plight of the down and out, but if the down and out don't try to protect themselves it's hard to ask it of the politicians.

Posted by: keith on May 4, 2011 at 5:09 PM | PERMALINK
Post a comment









Remember personal info?










 

 

Read Jonathan Rowe remembrance and articles
Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

Advertise in WM



buy from Amazon and
support the Monthly