Obama Walks on Water

Many thought Obama walked on water as in November of 2008 he swept to an election victory by the greatest margin in the popular vote in twenty years, gaining his victory by a margin of 53.41% compared to George H.W. Bush's victory of the hapless Michael Dukakis by 53.9%, though Obama brought out a far larger total vote, gaining almost 57 million votes compared to Bush’s just short of 49 million. 

His resounding triumph was not entirely due to his charisma or his political appeal, for he ran at a time when the incumbent President and his Republican majority in the Congress had brought the country to the brink of a repeat of the great depression of ’29, where the unemployment rate had gone from 2.5% in 1926 to 35.5% in 1933, when Roosevelt took office. When Roosevelt finally took measures to stem the downturn it took four years to bring the unemployment rate down to just over 20%. See my post from March 12, 2009 and the graph displayed.

Now let us imagine what would have happened if like in the period preceding and following the market crash of ’29 the same policies had been followed as they had in the ‘20s. It is not inconceivable that similar disastrous unemployment would have resulted. Fortunately, it was recognized even by the incumbent President Bush that we were having a banking crisis, which in many ways resembled that of the 20’s, and Bush, who had always preached laissez faire capitalism, took vigorous steps to stem the looming disaster despite his own party in the Congress deserting him. At the same time the long time Chairman of the Fed, Allan Greenspan, long an apostle against regulation, said with disarming frankness “ I was partially wrong" and "I have found a flaw,” but the members of The Republican Congress who correctly have a reputation for “ having never forgotten anything” and “having never learned anything” show that they have learned nothing.

Last week the unemployment rate hit 10.2% and the public has discovered that Obama does not walk on water and has no magic wand. He is being hit with a populism from both left and right that denounces him for helping the banks instead of main street, ignoring the fact that the first thing Roosevelt dealt with was also the banking crisis, with his bank holiday and then guaranteeing deposits. Unfortunately, unlike in Roosevelt’s time when banks were many and small, we now have the behemoths that are “too big to fail.” But of course he is helping main street when he helps the banks, and his stimulus program directly aids main street, its principle weakness having been that it did not allocate enough money to the states to help them out of the crisis, forcing them to either raise taxes or cut back on programs desperately needed in this recession. 50 billion dollars was cut from the stimulus program to aid the states to get the three Republican votes needed to stop the Republican filibuster.

Both Left and Right denounce Obama for not having stopped unemployment from rising as though there were a magic wand that would turn things around by the mere waving of it. As Obama has pointed out the Ship of State does not turn like a motor boat and measures taken nine month ago, which is when the stimulus bill was passed, can not be expected to already affect the unemployment rate, since as all economists tell us that the employment always lags in an improving economy. While for the moment it is little comfort to those unemployed (of course those unemployed take little comfort even when unemployment is low) the economy has now turned around and Reuters, among others, reports, “Productivity surge signals Job Growth to follow. But the agitation about the high unemployment rate is difficult to understand in any case, for the unemployment rate under the Republican hero, Ronald Reagan, was even higher, and I don’t remember the hand wringing then, nor is there much emphasis in our media (Liberal media?) that Reagan presided over a slightly higher unemployment rate, with the unemployment rate then having reached 9.7% more than a year after he was inaugurated, as compared to Obama in office a mere nine month. See the graph and comments on Mark J. Perry's web site.

But as I said he is being attacked from both Left and Right with, e.g. David Brooks in the New York Times of November 6, writing he is doing too much and Paul Krugman writing he is doing too little. It may be that what he is doing is just right, though I would like to see the $50 billion cut from aid to the states restored.

But Obama is also being hit with complaints from the Left that his promises during the campaign are not being fulfilled fast enough, which ignores that our system of government is not designed for fast action with its checks and balances (See Anna Quindlen in Newsweek of November 2) and the non-constitutional requirement of 60 votes in the Senate, a Clinton era Republican invention. But the extent of the obstacles facing Obama are misunderstood and understated even by the above referenced article of which, e.g. incorrectly states with respect to the military policy dubbed, “Don’t Ask, Don’t Tell, Transformation is within his grasp, in a pen, a signature, an executive order” which is patently untrue, for it is enshrined in a statute of the Congress which was passed on November 30 1993 in response to President Clinton’s attempting to abolish discrimination against Gays in the Armed Forces by executive order.

As for Obama’s paucity of accomplishments in his first nine months, that too is an invention, or at least a misconception, that I will address hereafter.

   As for understanding why the voters turned to Republicans in New Jersey and Virginia in the the last election, thus turning to the very people responsible for the present crisis, I leave that to the pundits.

   I can analyze issues. I do not pretend to understand voters.