No, he can’t

Not a great slogan when there’s a pile of crap up ahead

November 6, 2012 gave generations of American history students yet unborn a new standard exam question: how did one of the most ineffectual presidents in US history get re-elected?

Across the OECD countries since the financial crisis hit in 2008 incumbents have had a tough time. Britain, Spain, France, Italy Greece and Ireland have ditched leaders. How did Barack Obama buck this trend?

The pattern has been that economic realities have forced big-spending, heavily-indebted Western governments of whatever stripe to adopt some measure of spending restraint. Even when, as in Spain and France, parties have been elected in opposition to so-called austerity they have been forced into it once in office by the remorseless reality of economics.

Electorates haven’t liked this. They still appear to believe, as the current travails of Britain’s coalition and plummeting popularity of President Hollande show, that there is a magic money tree somewhere, that plenty can return and cruel financial reality be banished simply by ticking a different box on a ballot paper.

Whereas other elections since 2008 have pitched an “austerity incumbent” against a “fantasyland challenger”, in America the roles were reversed. Obama, the incumbent, peddled fantasy; his challenger, Mitt Romney, offered some semblance of reality. Looked at this way the post-2008 pattern was maintained: the fantasy candidate won.

But it won’t make any difference. The people who celebrated Obama’s victory, thinking they had saved entitlement programmes like Medicare, Medicaid and Social Security from Republican cuts, are deluding themselves. America’s unfunded liabilities, including these programmes, rose by $11 trillion last year to $222 trillion. To put that in context, the entire US economy is just $15 trillion, of which $3 trillion a year is paid in tax. If you expropriated all the wealth of the richest 400 Americans, as some Obama supporters appear to suggest, the $1.7 trillion you would get wouldn’t make a dent.

Those programmes will not be saved by Obama’s waffle. They will die because there is no money to pay for them and there won’t be, no matter which box you tick. That is the lesson of the last few years and it is one the US is going to learn. The laws of economics have a habit of being enforced with the doggedness of Inspector Javert and the merciless brutality of Dirty Harry.

This article originally appeared in Standpoint

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6 thoughts on “No, he can’t

  1. Just out of curiosity, what is the level of growth in austerity Britain, say over the last two years? And how is austerity working out for Greece, Spain, Ireland? This isn’t a defence of Obama by any measure, but if the last five years have shown us anything its that “ecomonic laws” are not as rigourous as the theory of gravity…

      • Can you tax cut your way out of it? Low taxes = the huge growth? Seems to me the over-simplified sound-bite arguments on both sides are both stupid; but the volume has reached a point where nuanced discussion cannot flourish.

        But I live in hope.

          • I doubt we can cut our way out of this without some tax increases. It’s that debt, you see. In the 1990s, Congress forced Clinton to be fiscally conservative and pursue a moderate tax, reduced spending model that was great, but Clinton didn’t inherit $16 trillion in debt. The next president, whoever that is, will have an even greater burden. The US will need to pursue something like they did after the Civil War — a dedicated short-term tax increase specifically for paying down the debt AND significant spending reductions — at least back to 2008 levels, better back to 2006 levels. Slashing the budget by 1/3 would close the fiscal gap and a modest tax increase could be dedicated to reducing the debt. I’ve heard that it’ll take about 10 years under current economic growth to right things, but if the private economy gets energized by the changes, it could take less time.

  2. The question was “How did the most ineffectual president in American history get reelected?” As an American who has voted in every election since 1980, my answer is “I have no idea!” I have theories. Some of them border on conspiracies. Allen Keyes lost his election in a Florida county that currently shows 120% of the registered voters voted on November 6. Ohio and Indiana both had voter machines that automatically defaulted to Obama. Obama won by less than 1% of the popular vote and Romney was ahead most of the night until some of the states where there are voter issues started reporting. It’s not an incredible stretch to wonder if the Chicago machine that put JFK into office is alive and well and functioning in the battleground states. I’m not usually a conspiracy theorist, however, so I have other theories.

    Romney is NOT a conservative. Being a member of the Republican Party does not make one a conservative. Conservatives have been voting with the GOP since Reagan, but really … maybe they ought to stop. I suspect quite a few did this election cycle. I know Ron Paul supporters stayed home or voted Libertarian (though the third-party vote was lower than usual, so I think they stayed home). I voted AGAINST Barack Obama by casting a vote holding my nose for Romney,but I didn’t expect him to change anything for the positive and I think a lot of my fellow conservatives just decided not to bother.

    Romney’s campaign was mostly platitudes. He missed a lot of opportunities to challenge Obama on his record. His own record was so progressive that he often couldn’t challenge Obama without risking being called out as a hypocrite.

    Americans in the battleground states are so beat down by the recession that they will vote for whomever is offering to spread the “free” money. They can’t imagine, after four years of unremitting economic nastiness that they could pull themselves up by their bootstraps through their own hard work if government would just get out of the way.

    People really believe that you can tax the rich enough to close the fiscal gap and start paying down the debt. You can’t, but maybe people really are that ill-informed and naive.

    The GOP leadership wanted anybody but a conservative in the White House and they are as pleased with Obama as they would have been pleased with Romney. Afterall, Romney promised to spend as much money as Obama and to cut almost nothing at all. So, really, what’s the difference between them?

    Mostly, I think conservatives stayed home. I’m hoping that in 2014 we all vote third-party in preparation for voting massive third-party in 2016. It’s time we moved away from the two major parties to candidates that actually represent conservative values and, except for Ronald Reagan, the GOP hasn’t elected a conservative to the White House since Calvin Coolidge.

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