"Boldness" is the rage among pundits advising the president on his speech this evening. Even the first two letters of that word connect Barack Obama with this demand. Yet White House leaks suggest that his prescription for this central malady of the nation will not deserve to be so named. The front page headline of the New York Times' story today makes the point: "Old Tax Relief Seen as Anchor in Obama Plan". Thus, the central idea will be to propose to extend for another year the reduction of two percentage points in the 6.2 percent Social Security payroll tax that employees pay. He is said to be even considering a proposal to expand the tax relief to the employer's share.
The Times explains that the appeal of this tax cut is that it is believed by the White House to be the only large stimulus measure that can pass Congress this year. If the term "boldness" were defined as something that, ex ante, one could feel certain of accomplishing, just imagine the huge number of Medals of Honor that would be earned. No, there is nothing bold in this proposal, although it has obvious merit in providing some stimulus, despite the likelihood that much of the money thereby put in employee pockets will be used not to buy things but to reduce household indebtedness.
The nation's problem number one is lack of work. Reducing the payroll tax paid by employees directly serves only those who are working. It does nothing to alleviate the misery and suffering of those who are not working or their families. Counting all who are out of work or working part-time but needing full-time work, the number comes to around 25 million. Add, on average, two dependents per unemployed worker and one gets the achingly painful number of 75 million citizens who suffer from the disease of forced idleness, a disease contracted through no cause of their own from a society increasingly callous to their plight.
For too long, and in far too many instances, the president has practiced the self-defeating art of negotiating with himself as to what he can readily sell to the Republicans. Mitch McConnell announced many months ago that the single most important goal of the Republican Party, towering above all others, was to limit Obama to one term in office. Since then the Republicans have been guided by this goal in their across-the-board opposition to anything the president sets forth. This being the case, it is a fool's errand to try to determine what will pass muster with the Republicans. Nothing will satisfy them if Obama wants it. Although extending payroll tax relief is a tax cut that one might suppose the Republicans would rejoice over, there are suggestions that even that idea would only be acceptable to them if cuts in the budget of equal size were made.
On the theory of better late than never, Obama should stop negotiating with himself and bring forth what the public could immediately understand to be a bold, powerful plan to put the unemployed back to work. Any plan of this sort must involve spending money on projects that can be started quickly and carried forward to completion without delay. Economists throughout the land have advanced many ideas, including grants to cities and states to arrest planned layoffs and open hiring offices for the huge volume of infrastructure projects needing manpower and money. The president should cite what Franklin Roosevelt did by creating the Works Progress Administration in 1935 to address an unemployment problem that, dire though it was, is beginning to look more and more analogous to our situation as it continues to deteriorate. He should then propose a multi-pronged plan to put millions -- yes millions -- of the unemployed back to work forthwith. And, finally, he should indicate a determination to fight for his program not just on Capitol Hill, where he would already know it is a dead duck, but before the people of this nation, well over 75 million of whom will be applauding him even before he leaves the speaker's platform.
Polls show Obama to have only a 43 percent approval rating for the job he is doing overall. More significant, more than 60 percent disapprove of his handling of the economy. These findings add urgency to the call for boldness in addressing the nation's most pressing issue. Just as it is absurd to condition aid to those whose lives and property were destroyed by Hurricane Irene on finding savings in the budget, the brainchild of Representative Eric Cantor, it is absurd to worry about adding to the deficit now to meet a need desperate from both the economic and humane points of view. There will be plenty of time down the road to solve the long-range deficit problem provided we come to it with resolution and common sense in serving public rather than party interest. And, of course, putting people to work is a sound exercise in pump priming for the economy which, as a result can be expected to start growing faster than otherwise would be the case.
The likelihood of the president coming close to the boldness here prescribed is made remote by an astounding story in today's New York Times, regarding the testimony rendered yesterday by Richard Cordray, the president's nominee to lead the new Consumer Financial Protection Bureau, before the Senate Banking Committee. This agency was created in the Dodd-Frank financial regulation law to write rules to protect consumers of financial products and services. It was widely believed by consumer advocates that financial institutions were not adequately regulated with a view to protection of the consumer and only a new agency with rule-writing powers over those institutions could fill the void.
Given the legislative purpose behind the creation of the CFPB, it is more than a little ironic to read in the Times that Mr. Cordray's priority was "to streamline and cut back" a mountain of regulations that has grown up over the last 30 years, regulations that he claimed excessively burdened some banks and discouraged them from lending money to consumers. From the Times piece a reader unaware of this agency's legislative purpose could be excused in thinking it was intended to strip away consumer protection regulations accumulated over the years in order to free up banks to do as they wish. Indeed, the reader could be excused as well in thinking that this agency had been the creature of Republican desire.
The trimming of sails works until the sail starts to propel the boat backwards. Surely, Mr. Cordray's approach to the Senate hearing had the approval of the White House. As such, it is a dazzling example of craven timidity tinged with rank hypocrisy. For this very recent example among many others of similar nature in recent months, the prospects for tonight's speech are not bright.