UK: The choice

The Economist

Barack Obama and the economy

The choice

Jun 15th 2012, 0:37 by W.W. | IOWA CITY

 

 

IN A long-winded speech in Cleveland today, Barack Obama attempted to reboot his campaign by offering voters a clear choice between his approach to the economy and Mitt Romney's. Mr Obama's basic strategy in the speech was to cast Mr Romney's economic vision as a stale rehash of Bush-era Republican policies—tax cuts for the rich, corporate deregulation, war—on which the president laid most of the blame for America's belated and faltering recovery (without ever mentioning Mr Bush). He placed the remainder of the blame on a "stalemate" in Washington, which he urged voters to break by electing him a second time, though he notably omitted to name the lever with which he might budge the boulder of Republican obstructionism in a second term. Naturally, Mr Obama was quick to accept full responsibility for all signs of economic improvement. But he was careful to emphasise the immense scale of the economic problems he inherited, suggesting that any expectation that the economy might have done better during his tenure was unrealistic.

Though he addressed a partisan crowd, Mr Obama's speech was pitched to the centre. Indeed, he seemed keen to steal some of Mr Romney's thunder among independents by characterising himself as a tax-cutting, business-friendly, lightly-regulating, paragon of fiscal responsibility. "I don’t believe the government is the answer to all our problems", Mr Obama said. "I don’t believe every regulation is smart or that every tax dollar is spent wisely. I don’t believe that we should be in the business of helping people who refuse to help themselves." Mr Obama even touted his own record of fiscal conservatism: "Over the last three years I’ve cut taxes for the typical working family by $3,600. I’ve cut taxes for small businesses 18 times. I have approved fewer regulations in the first three years of my presidency than my Republican predecessor did in his." Jack Kemp lives!

When it comes to Mr Romney, however, tax cuts and a soft regulatory touch add up to a monstrous hybrid of Grover Norquist and Montgomery Burns:

Governor Romney and his allies in Congress ... maintain that if we eliminate most regulations, we cut taxes by trillions of dollars, if we strip down government to national security and a few other basic functions, then the power of businesses to create jobs and prosperity will be unleashed and that will automatically benefit us all. That’s what they believe. This -- this is their economic plan.

Most regulations? Government stripped down to a few basic functions? All those Ron Paul delegates are going to be delighted when they get the news.

Mr Obama was at his most effective when highlighting the tension between his opponent's tax-cut and deficit-reduction plans. If Mr Romney is going to have his tax cut and cut the deficit too, he's going to have to cut a lot of spending. It's true. Mr Obama's proposition is that these cuts will come at the expense of the vulnerable and the middle class. In a somewhat sleazy but probably effective move, Mr Obama exploited the lack of specificity in Mr Romney's deficit-reduction plans by indulging in a bit of terrifying speculation, all while insisting on his own scrupulous fairness:

Now, I—I want to be very fair here. I want to be clear. [Romney and congressional Republicans] haven’t specified exactly where the knife would fall, but here’s some of what would happen if that cut that they proposed was spread evenly across the budget.
Ten million college students would lose an average of a thousand dollars each on financial aid. Two-hundred thousand children would lose the chance to get an early education in the Head Start programme. There would be 1,600 fewer medical research grants for things like Alzheimer’s and cancer and AIDS; 4,000 fewer scientific research grants, eliminating support for 48,000 researchers, students and teachers.
Now, again, they have not specified which of these cuts they choose from ...

In a Romney administration, the "knife will fall" on students, kids and people suffering from Alzheimer's, cancer and AIDS. Maybe. Or maybe not. Let's just say they haven't ruled it out. Because let's be fair!
Mr Obama went on to argue that Mr Romney's plans to reform the tax code would brutalise the middle class by ending tax expenditures that help middle-income "families afford health care and college and retirement and homeownership". And then there's Medicare and Mr Romney's proposal to "end the programme as we know it."

Urging voters to reject the apocalyptic prospects of a Romney presidency, Mr Obama promised to protect the vulnerable and the middle-class while cutting the deficit with a combination of tax hikes on the wealthy, health-care cost-control, and a return to economic prosperity by way of pays-for-itself pro-growth government "investment":

I see a future where we pay down our deficit in a way that is balanced—not by placing the entire burden on the middle class and the poor, but by cutting out programmes we can’t afford and asking the wealthiest Americans to contribute their fair share.
That’s my vision for America: education, energy, innovation, infrastructure, and a tax code focused on American job creation and balanced deficit reduction.

There's your "framed choice". Whereas Mr Romney offers a return to the devil-take-the-hindmost, trickle-down policies that put us in this economic pickle, Mr Obama offers an economy revitalised by a growing middle-class and smart government spending. "This has to be our north star," Mr Obama averred, "an economy that’s built not from the top down but from a growing middle class; that provides ladders of opportunities for folks who aren’t yet in the middle class." Not down from the top, but out from the middle. That's the pith of Mr Obama's pitch.

Had Mr Obama stopped there, instead of droning on for another quarter-hour, it would have been a strong speech that communicated in clear terms the contrast he needs voters to keep in mind. However, Mr Obama's subsequent meandering reflections on togetherness, the glory of big infrastructure projects, green industrial policy, and a tedious list of sundry nickel-and-dime initiatives seemed to me only to underscore that if he "doesn’t believe the government is the answer to all our problems", as he claims, that's only because he believes government is the answer to most of our problems and is splitting hairs. By the time he got around to the forced big finish, Mr Obama sounded more like the guy Mr Romney wants him to be than the sensible centrist he aimed to appear. Successful triangulation sometimes means knowing when to shut up.

http://www.economist.com/blogs/democracyinamerica/2012/06/barack-obama-and-economy