That was an ugly close for the second session in a row reflecting a number of things including a fair amount of confusion, matched or surpassed by frustration. I continue to say Fed news should be interpreted as a red flag for the US economy. It reminds me of a fancy electronic air pump I bought last year.
The engine was impressive, and the sales guy said it could fill up a truck tire in minutes. I finally broke it out early this summer as we prepared to go bike riding. I plugged it in, and the motor was humming. I Inserted the bike tube … nothing. I tried over and over again, but nothing.
I finally came to the realization that the tire couldn’t be pumped up as there was a serious and irreversible flaw. This is the dilemma facing the Fed, which can only print but can’t get those funds to Main Street. The problems are policies the deter success and rhetoric that just makes people want to go somewhere and hide. While the blame game may have gotten President Obama reelected it’s weakened the foundation of the nation into something akin to an indifferent mush. People are bombarded each day with excuses or news people fear by the very leaders we elect to give us confidence.
There is no confidence, and it’s wearing down on Main Street. The Fed is worried about deflation, so the notion of hiking rates or even tapering seems farfetched. On the other hand, Bernanke is coming to the realization that all his efforts have come up short. Economies are cyclical, and Fed-led rebounds are written into each script, but this time there are still so many areas of the economy lacking, including declining real wages (remember true inflation is too much money chasing too few goods). There probably is some kind of Fed etiquette also that would prohibit a change in policy as the torch is being passed along.
The flat tire is perhaps the best symbol of America these days. It reflects our lack of confidence and the inability to get out of first gear. The flat tire is also a great symbol for the Bernanke Fed that gave it the old college try but couldn’t overcome attempts to transform America into a collectivist nation without winners or losers and where earnings are shared by the masses. This is happening more and more each day, resulting in less effort by those that care … and don’t care.
If you didn’t catch it in your local news, President Obama’s approval rating slipped to its lowest point of his presidency. The irony of it all is his approval has never really been that high versus other recent occupants of the White House. Even more interesting is there was once a time when the economy had a direct correlation.
See the table on the left, and it’s clear an average GDP above 3% during the first term went a long way toward justifying a second term. The lone exceptions were Jimmy Carter and Harry Truman. For the former, the economy began to deteriorate rapidly as that infamous “malaise” settled into the nation.
For Truman, the economy followed post war recession, sky high inflation, and the start of the Cold War. Still he managed to turn it around in his final year in office and gain reelection.
President Obama on the other hand has enjoyed his best GDP in the four years in part to a nicely timed stimulus package that sort of moved the needle, but the outcome was substantially below all his predecessors. So, how come the reelection was so easy? I think it had more to do with Republican incompetence at campaigning and serious mistakes that couldn’t be overcome. A changing nation recoiled at some of the same social issues that scored points in the past, and there was no effective counter-attack. Be that as it may, what Americans got in the process was acceptance of mediocrity.
Or at least that’s what the administration thought.
People get tired of living paycheck to paycheck and even the notion that somehow taxing so-called rich people more can alleviate their circumstances is wearing off. Each day the air slips out of the nation more and more. Being the best finger-pointer isn’t working as wages move lower and job growth remains anemic. The future looks dimmer each day. So after the holidays, we’ll head into the same old battles in DC where perhaps embolden with the notion of another pyrrhic victory, the President allows the wheels to come to a grinding halt.
From a government shutdown point of view, it doesn’t matter, but markets are sensitive to the debt ceiling and understand that going cold turkey is something Big Government is ill-prepared to endure. It would be a wonderful time for leadership. It would be the perfect moment to pump some air in our sagging national confidence. Maybe it happens because despite all the cheering about Tea Party blowing it, the White House is watching its own ratings evaporate. At some point even folks with small egos consider legacy. Two presidents since end of WWII saw second term approval increase over the first term:
- Ronald Reagan
- Bill Clinton
It’s one thing to smear the Tea Party with a complicit media and complain about how hard the economy was upon inauguration, but there are two standard bearers for the two political parties in America and years from now few will mention President Obama outside of trivia and novelty. (Unless we stay down this road and then he’ll be known as the man that wrecked America.) He has a chance to borrow the Clinton playbook and bring some life back into the nation. Stop pitting Americans against one another and forget about fundamentally changing the greatest nation on earth.
It takes more than lip service and takes the kind of guts that begins with an honest mea culpa.
Obama approval rating sinks: a self-inflicted wound?
But self-inflicted wounds can be the most painful of all. And in the spirit of President Harry “Buck Stops Here” Truman, Mr. Obama may have no one but himself to blame for the botched rollout of HealthCare.gov, the website whose proper functioning is key to the success of the Affordable Care Act (ACA), the signature initiative of Obama’s presidency.
Presidential scholars are baffled that someone whose legacy rests on the success of the ACA – reinforced by a nickname, “Obamacare,” that includes his name – was by all accounts caught off-guard by the website’s problems. The simultaneous diplomatic brouhaha over US eavesdropping on close allies, which also apparently blind-sided the president, adds to the impression that Obama operates in a bubble.
“He looks like a detached manager who has delegated inefficiently and doesn’t know when information needs to reach him,” says Kathleen Hall Jamieson, director of the Annenberg Public Policy Center at the University of Pennsylvania in Philadelphia.
This week, public outrage over Americans receiving health-insurance cancellation notices has added to Obama’s woes, as his longstanding promise that people who “like their plan can keep their plan” has proved to be false. His biggest sin may have been oversimplification.
At times, he has explained that plans in effect in March 2010 would be grandfathered in. But because people in the individual market tend to change coverage frequently, many plans don’t qualify. Americans have felt misled. Now they are being reassured that they can get new coverage, often better and cheaper than what they had, but the damage to public perception is done.
All the stumbles are likely behind Obama’s sinking job approval ratings. The RealClearPolitics.com average of major polls shows him at 43.9 percent. The latest Christian Science Monitor/TIPP poll shows Obama’s Presidential Leadership Index – which combines job approval, leadership, and favorability ratings – is at an all-time low of 43 (where a score of 50 is neutral).
The calamitous launch of HealthCare.gov may have damaged Obama’s image the most. After all, he ran two presidential campaigns featuring cutting-edge technology. Obviously, hiring people to build state-of-the-art technology for a presidential campaign is wholly different from presiding over a vast executive branch that includes an agency tasked with building a complex computer system, heavily staffed by contractors and subject to all the rules of government procurement. Still, analysts say, Obama should have had an early-warning system in place to let him – or more precisely, a top White House aide – know that the rollout of HealthCare.gov should possibly be delayed.
“He has all the virtues of an intellectual and all the difficulties that might flow from those virtues,” says Cal Jillson, a political scientist at Southern Methodist University in Dallas.
Of course, the president can’t oversee everything himself, or even ask all the important questions. But he has people in his midst who can.
“That’s precisely the chief of staff’s job,” Mr. Jillson says. “There are deputy chiefs of staff who have responsibility for the domestic and foreign policy sides. But the person who needs to be asking the questions so the president doesn’t have to is the chief of staff.”
Former top Obama White House aide David Axelrod says the president needs to get mad – publicly.
“Internally, I’m sure that there is a lot, a lot of strong words being exchanged between the president and people who are accountable for some of these things that have cropped up here,” Mr. Axelrod told NBC News in a story posted Oct. 30. “He needs to show some of that in public, he needs to show some of that edge, some of that anger. Because after all, the Affordable Care Act is something he ventured much of his political capital on, and he believes deeply in it.”
Others suggest that Obama needs to fire people over the debacle. So far, that hasn’t happened.
Obama says he didn’t know HealthCare.gov was in trouble until the site crashed upon takeoff. Ditto Health and Human Services Secretary Kathleen Sebelius. Both have since taken responsibility for the botched rollout. At a House hearing Oct. 30, Secretary Sebelius said she was told some things could go wrong but “no one indicated that this could possibly go this wrong.”
No one advised a delay, Sebelius said, while acknowledging that the site had had only minimal, late testing by the Oct. 1 launch. It’s not clear if she learned about the lack of “end-to-end testing” only after the rollout.
“If they didn’t know [it could fail], that’s a sign of how lax they were about how government really works or how uninformed they were about the delivery of programs like Obamacare,” says New York University’s Paul Light, an expert on government contracting. “It’s a naiveté that’s stunning.”
Just days before the rollout, top White House officials were touting HealthCare.gov to members of Congress and other thought leaders around Washington. In a meeting with reporters six days before the launch, White House senior communications adviser David Simas was upbeat.
“The marketplaces will be stood up,” he said, referring to the federal and state-run websites. “The 8,000 community health centers are staffed up and ready to provide the guidance. The commercials on television are going to be ready to go, up and running.”
Mr. Simas also warned that early enrollment numbers would be low, and not to read too much into them. When people are preparing to make a major purchase, they take their time to shop. Still, some numbers have leaked into the press – just 248 enrollees in the first two days, according to CBS News. HHS says those numbers are unreliable. In her testimony, Sebelius said HHS still doesn’t have reliable data on enrollment, but promises enrollment numbers by mid-November.
The Obama administration is fighting back with stories from happy customers — such as musicians Kim Treiber and Robert Chipper Thompson of Taos, N.M. After enrolling, their joint monthly premium will total $117.46, according to a story in the Santa Fe New Mexican circulated by the White House. Ms. Treiber was so delighted she posted a thank-you note to Obama on Facebook. Until now, the couple has been making do without insurance; their income is $1,000 too high to qualify them for Medicaid.
The bad news for Obama is that more often it’s the unhappy customers who get the attention. And Republicans, eager to recover from the politically disastrous government shutdown, are ready to pounce.