How the economy is letting Obama down

Politico is featuring an amusing piece called “Obama’s 4 economic letdowns.” It wasn’t instantly clear to me who Politico believes is letting down whom. But it’s apparent from the article that Politico’s Ben White sees Obama as the victim.

Specifically, four forces are victimizing him: Congress, the Fed, the Europeans, and corporate America. At least Politico had the decency not to blame automated teller machines.

Congress is to blame for our economic woes because it’s doing nothing about “fiscal cliff fears.” But what about Obama? He has failed to propose a budget plausible enough even to garner any votes from Democrats. And not only did Obama reject the fiscal solutions proposed by his own bipartisan commission (Bowles-Simpson), he is now attacking an approach advocated by Mitt Romney that this very panel called for.

Politico also laments the fact that the Fed won’t embark on fresh campaign of “quantitative easing.” But the Fed has been pumping money into the system throughout Obama’s tenure. Moreover, Obama claims that the economic situation has been turned around and that it’s just a matter of time until existing policies usher in happy days. If that’s the case, it would be reckless for the Fed to engage in even further “easing.”

As for the Europeans, Politico has a point. The U.S. economy is always influenced by what happens overseas. Long before “globalization,” Martin Van Buren saw three years of trying to cope with fallout from the Panic of 1837 go to waste when the European economy turned south in the run-up to the election of 1840.

The banking policies of Van Buren’s party are generally believed to have helped cause the Panic of 1837, just as the housing policies of Obama’s party helped cause the recession of 2008. But at least Van Buren didn’t push the U.S. to adopt policies that led to Europe’s economic woes. The same cannot be said for Obama.

And finally, there is corporate America. If only it would stop sitting on that giant pile of cash and hire more people.

Politico correctly argues that economic uncertainty is causing American firms to keep their money on the sidelines. But Politico refuses to consider that Obama’s policies — e.g, Obamacare, Dodd-Frank, excessive regulation and the threat of more to come, failure seriously to tackle our fiscal problems — are contributing significantly to the uncertainty.

It is too busy fretting that the economic situation “could cost [Obama] his job.” It could indeed, and there would be nothing unjust about that outcome.


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