In his otherwise excellent speech in Cleveland on Wednesday, the president showed that, when it comes to the plight of the middle class, he still doesn't get it.
"Not everything we've done over the last two years has worked as quickly as we had hoped," he said, "and I am keenly aware that not all our policies have been popular."
But the problem isn't that his economic policies have been slow to succeed or unpopular -- it's that they have been inadequate given the magnitude of the crisis.
And, in his sit-down with George Stephanopoulos, he admitted to making unspecified "mistakes," but insisted, "if you are asking have we made the decisions that are the right decisions to move this country forward after a very devastating recession, then the answer is absolutely."
Can he really believe that, with unemployment at 9.6 percent, underemployment at 16.7 percent, millions of homes foreclosed, millions more heading to foreclosure, and the middle class under assault?
In any case, this appears to be the administration's story, and they are sticking to it -- come hell or a double-dip recession.
The president's comments were a continuation of the tack taken by Robert Gibbs who, when asked if the stimulus bill had been too small, offered this jaw-dropper: "I think it makes sense to step back just for a second. ... Nobody had, in January of 2009, a sufficient grasp of... what we were facing."
In other words: who could have known? So much for changing the way Washington works. The Who Could Have Known mindset is at the very heart of the failure of our political system to address our mounting problems. I devote a whole section to it in Third World America. It's been the official response of choice to virtually every fiasco of the last decade: Iraq, Katrina, the housing crash, the foreclosure crisis, the BP spill, etc, etc.
As I write in the book:
When you look at the elements that were crucial to the creation of each of these debacles of the past decade, it's amazing how much they all have in common. And not just in how they began but in how they ended: with those responsible being amazed at what happened, because... who could have known? Well, I'm amazed at the amazement, because each of these disasters was entirely predictable. And, indeed, every one of them was predicted. But those who rang the alarm bells were aggressively ignored, and we let those responsible get away with the 'Who Could Have Known?' excuse.
I list many other examples: Condoleezza Rice's claim that nobody "could have predicted" that someone "would try to use an airplane as a missile"; Paul Wolfowitz's claim that he found it "hard to imagine" that the occupation of Iraq would, as General Eric Shinseki predicted, require "several hundred thousand" troops on the ground; Robert Rubin's claim, when asked if he made mistakes at Citigroup, that "in hindsight, there are a lot of things we'd do differently. But in the context of the facts as I knew them and my role, I'm inclined to think probably not"; or Alan Greenspan's claim, regarding the financial crisis he helped create, that "if all those extraordinarily capable people were unable to foresee the development of this critical problem... we have to ask ourselves: Why is that? And the answer is that we're not smart enough as people. We just cannot see events that far in advance."
And now add to this dubious list Robert Gibbs: "Nobody had, in January of 2009, a sufficient grasp of... what we were facing."
This, of course, is utter nonsense. There were plenty of people with a sufficient grasp of what we were facing. Among them: Paul Krugman, who successfully hid his sufficient grasp in the pages of the New York Times (how crafty!). As he wrote on his blog in response to Gibbs, "the truth is that some of us were practically screaming back in January 2009 that the administration was proposing too small a program."
Then there's Martin Wolf, who hid his sufficient grasp in the pages of the Financial Times. His response to Gibbs:
I (among others) then argued that policy needed to be hugely aggressive. Alas, it was not. I noted on February 4, 2009, at the beginning of the new presidency: "Instead of an overwhelming fiscal stimulus, what is emerging is too small, too wasteful and too ill-focused.... Doing too little is now far riskier than doing too much."
As for myself, in February 2009, I wrote a blog entitled "If You Jump Halfway Across a Chasm You Fall Into the Abyss".
And there were many others. In fact, one of them, Council of Economic Advisers chair Christina Romer, was actually inside the White House. Here's a snapshot of how her entreaties were received, courtesy of Ryan Lizza in the New Yorker:
At the December meeting, it was Romer's job to explain just how bad the economy was likely to get. "David Axelrod said we have to have a 'holy-shit moment,'" she began. "Well, Mr. President, this is your 'holy-shit moment.' It's worse than we thought."
The most important question facing Obama that day was how large the stimulus should be...Romer had run simulations of the effects of stimulus packages of varying sizes: six hundred billion dollars, eight hundred billion dollars, and $1.2 trillion....Romer's analysis, deeply informed by her work on the Depression, suggested that the package should probably be more than $1.2 trillion. The memo to Obama, however, detailed only two packages: a five-hundred-and-fifty-billion-dollar stimulus and an eight-hundred-and-ninety-billion-dollar stimulus. Summers did not include Romer's $1.2-trillion projection...At the meeting, according to one participant, "there was no serious discussion to going above a trillion dollars."
So plenty of people had a sufficient grasp. We can only conclude, then, that Obama and his economic team chose not to know. It's not that they couldn't imagine what would happen if they didn't do enough, it's that they simply chose not to imagine. Parents know that if you have a really sick child, you don't calculate your response based on the best case scenario -- you assume the worst could happen and work back from there.
Contrast the administration's response to the middle class crisis with the handling of the banking crisis. In that case, our elected officials -- both Republicans and Democrats -- had a more than sufficient grasp of the worst that could happen. In the space of one weekend, we were told that if the government didn't act -- using taxpayer money -- the worst would happen. Our leaders were somehow able to imagine the doomsday scenario of the collapse of the entire financial system. And so they took action. Not with a series of half-measures, but with a bold and unprecedented rescue plan. They didn't go around asking for consensus. They demanded it. They demanded lawmakers stop playing partisan politics and do what was needed to save the banks. We were told the world would fall apart if they didn't. And they got their rescue plan. We won't ever know if the world would actually have collapsed, but it was a possibility, so we took action.
Does anybody recall ever seeing this same kind of urgency directed toward the daily calamities afflicting America's middle class? It's not that the middle class might collapse -- it is collapsing. And yet, as Harold Pollack puts it in The New Republic: "There is a palpable lack of urgency in the face of this crisis. The problem here is one of priorities -- or lack of priorities. The House and Senate act with surprising skill and speed when concentrated and powerful constituencies really need something done." And so does the administration.
Worse, the administration's half-measures have undermined its chances of making the case for truly bold proposals commensurate with the crisis. As Martin Wolf writes, Obama's halting response "has allowed opponents to claim that policy has been ineffective when it has merely been inadequate." As a result "the administration has lost credibility with the public and the chances of a renewed fiscal expansion have disappeared."
And we are left with bromides like: "...to heal our economy we need more than a healthy stock market. We need bustling main streets and a growing, thriving middle class...that means doing everything we can to accelerate job creation." That was from Obama's weekly radio address. But, in fact, the administration is nowhere close to doing "everything" it can for struggling Americans.
So, enough with the Who Could Have Known excuses. Enough with the half-measures. Enough with the lack of imagination. Enough with the lack of urgency. It's time to look facts in the face. It's time for all the known knows to be embraced.
Follow Arianna Huffington on Twitter: www.twitter.com/ariannahuff
We can expect a continued LOSS of hope and no economic prosperity whatsoever for the declining Middle Class.
It might be too late for this President. Sadly, we had high hopes.
Congress is bought & paid for..... perhaps the President is too (most of his cabinet definitely is)
We need true LEADERSHIP in the country.
Term Limits
Public Financing.
Real Reform
If you happen to be exceedingly wealthy, and find an extra $100K in your account this year? Do you snatch up some cheap real estate? some beat-up stocks? While I'm sure there are ways to spend these tax cuts and other stimuli that do help job growth, I can't help but think that many people are spending their money in a way that doesn't cause companies to hire.
I know there are companies that are doing well, but are uncertain how things are going, and haven't pulled the hiring trigger yet. Instead of spending the stimulus on the demand side, use limited-time-only supply-side hiring incentives: hire someone in the next 3 months and get a 2 year employer contribution payroll tax holiday and health coverage? Hire soon, or you'll might miss out on a great deal...
Get people to work through direct hiring incentives, have the newly hired people pay their bills, keep their homes and watch how that keeps the economic fire burning...
The opposition to recovery has been appalling, and it is getting worse.
It’s commonly understood the economy in any administration’s first year is consequence of policies in force the previous year. Change doesn't start on inauguration day-- takes time to pass legislation, put it into effect, then see any results.
Federal Bureau of Labor and Statistics reports in Bush presidency’s final year 4.5 million jobs were lost, and in the first 11 months of the Obama presidency another 4.5 million jobs were lost (Bush legacy). The data also show so far this year through August, employment has GROWN adding 1.5 million jobs
Unemployment has not improved much because young people add to the work force every year. Also, unemployment stats don’t include people no longer collecting benefits, so when these people return to employment it has no effect on unemployment statistics. But 1.5 million new jobs suggests the “Keynesian experiment” of stimulus is beginning to work. Unemployment has dropped from 10% at the beginning of the year to 9.6%. Not enough, but a definite trend reversal. Expect a slow bumpy ride back to full employment, but we're no longer losing jobs.
Disbeliever? Copy/Paste NEWdirectlink below; the Document was moved by BLS to permanent location. I tested this new link today.
http://www/bls.gov/web/empsit/cpseea3.pdf
http://www.bls.gov/web/empsit/cpseea3.pdf
Chris Hedges NYT in an interview with Robert Kall.
And you're a pundit. A pundit of your own opinions apparently.
And you're a pundit. A pundit of your own opinions apparently.
Chris Hedges, journalist NYT in an interview with Rob Kall, OpEd News.com
I agree with you on the idea that the stimulus what not enough. But as far as wasteful spending i suggest that we all understand that when a State takes or ask for stimulus money and does not spend it correctly or wasteful which happens a great deal that the blame does not go on the President.
When a governor has money and wants to build a bridge or use it for certain programs politics and favors always or often takes place. This has been going on forever and the President has no control of this.
Had Obama wanted to spend more money which States badly needed we would of had less unemployment at this time. It was a mistake .
The bottom line is that business brings about jobs with innovation and demand from the public and support from government when needed.
We are going through a evolution now and did you ever think one could snap their fingers and say after 2 years everything is fine?
I am shocked that things are not far worse because i have been through tough times in America before .
We must continue speaking out strongly as Arianna does to get America back on track.
Although some disagree our trade laws with China are advancing unemployment in America and will have to be reviewed.
What's "freedumb"? A word describing DUMB interpretations of FREEDOM, which I suggest are
at the heart of America's current difficulties... Take its citizen's purported "freedom to bear arms"
as a typical example of the freedumb permeating America's social discourse -
"A well-regulated militia being necessary to the security of a free state, the right of the people to
keep and bear arms shall not be infringed"
Curious, a Martian familiar with the Second Amendment could innocently ask; "Kind sir, as we
are in Vermont and you own this awesome bullet shooter, you'd be a member of the 2nd Platoon
of the Well-Regulated Vermont Militia, wouldn't you...?"
Now since 1945 America has been the anchor of Western Civilization - its existential guarantor
in a world steeped in millennia-old contempt for human freedoms. That said, America's post war strength still allowed it to indulge in its freedom-borne fantasies without much detriment. Alas...
Welcome to free trade - the ultimate monument to American freedumb...
"Hey, with the DEMAND FOR LABOR representing our country's most precious economic asset,
why don't we freely surrender it to countries operating at only 10% of American wages so we can
all get rich?" Try topping this little number!
Sincerely,
Mark Gendala
Melbourne, Australia
www.ssotu.com
WHY didn't Obama hire NYU Professor Rubino as an economic advisor, who not only anticipated the financial crisis of 2006 but gave the reasons why it would happen and the solutions for recovery. WHY?.
Why didn't Obama hire economists to help solve the Republican Bush financial catastrophe? instead of hiring the Federal Reserve Bank (Fed) alumni who created the balloon economy and its catastrophic consequences that destroyed the working Middle Class? WHY?
And why did he follow Bush's bailout billions that went to the Fed Big Banks? Instead of following FDR solutions with bank holidays and creating productive employment for millions with the WPA, NRA, and other work programs to pull us out of the Republican Hoover Depression. WHY?
Why?
I read the blog that you referred to in your post, and if you read my posts on your blog, you will find that I agree with the premise of that post, but reminded you that although Obama is the President of the U.S., the powers granted to him by the Constitution are balanced by the legislative branch of our our government, and, therefore, he is not omnipotent. My only hint at disagreement with you was that the President was simply swamped with too many situations at once from the very beginning of his inauguration, and that he can't be blamed for protecting his flank with respect to his re-election. He obviously does not intend to be a one-term president. To accomplish that, he must not govern in a way that would have all the independents abandon him in 2012. Once his re-election is in the bag, I promise you that you will see the old Obama that you fell in love with on the campaign trail. I empathize with your disappointment, but I respect your gifted IQ. I married two Menzans. And if by any chance you think that Menzans are attracted to non-Menzans, I suggest that you go to one of their meetings. You started your post with a question. I'm ending mine with a question as well: what do you think attracted you to click on the fan icon next to my monicker?
Historically, only three of the last twelve administrations (Reagan, Bush 1 and Bush 2) have increased the national debt as a % of GDP. Each of these administrations told us repeatedly that "deficits don't matter". Similarly, only one of the last four administrations (Clinton) actually reduced the size of government both by numbers of employees and spending.
Unfortunately, Obama has shown his willingness to lie to us also. His claims of "transparency" gave way to secret meetings with health insurers, big pharma and Wall Street to gut the health care and financial reform bills. He brought in the same tired Wall Street financial experts to run the economy that they themselves were part of ruining. He has maintained the war policies of the bush regime and promotes the un-American, morally reprehensible and internationally illegal concept of "pre-emptive war". We will waste $100's of billions more on Iraq and Afghanistan for zero benefit to America while the infrastructure of this country crumbles around us.
We were promised a "change". What we got was "more of the same". What we needed was true leadership. What we got was a community organizer producing a disorganized administration.
Why isn't the border between Mexico and the US secured? Why are billions of our tax dollars being sent to Mexico? Would it have anything to do with the agreement between G.W. Bush, the president of Mexico and the premiere of Canada to merge all three countries into the North American Corporation?
Were the American peoole told about this and I missed it? Were we asked to give up our sovereignty, our nation/states? Is there a reason why the middle class is being wiped out in America?
And the reality is that the auto industry, like most others, is forever linked to the global economy. The world is still flat.
Do some research and see for yourself what he has done. Start here and if you want more, I'll gladly give you more links. But at least realize what's the underlying cause of our financial demise before you go blaming it all on Obama.
http://www.marketwatch.com/story/bill-clintons-legacy-is-our-financial-disaster