StanCollender'sCapitalGainsandGames Washington, Wall Street and Everything in Between



Obama's Biggest Mistake?

29 Jan 2010
Posted by Bruce Bartlett

In my Forbes column this morning I explain why I don't think Barack Obama is an ideologue, but rather a goo-goo (good government type), which is okay but places a special burden on him to explain everything he does, something I don't think he's done nearly well enough. I also suggest that his biggest mistake was continuing too many of George W. Bush's policies.

 
A number of pollsters have noted that Barack Obama's approval rating is about the same as Ronald Reagan's at a similar stage of his presidency. Yet it feels that Obama is in far worse shape politically. I think a key reason for the difference is that Reagan had a consistency to his policies that Obama has lacked. This was embodied in a sort of narrative about how the country got into the condition it was in when Reagan was elected that provided a coherency to his actions that helped sustain him when the going got rough.
 
Reagan's narrative started with the idea that government was responsible for most of the problems people cared about circa 1980. While those who claim to be Reaganites today still blame government for every problem on Earth, the difference is that there was a lot of solid research and analysis backing up Reagan's argument and a direct link between his policies and the problems they were designed to address. By contrast, most conservatives today are just mouthing slogans they do not understand, and there is nothing like the seriousness in what passes for conservative research and analysis these days to what underlay Reagan's policies.
 
In foreign policy, Reagan was an anti-Communist whose views were well within the mainstream of foreign policy thinking post-World War II. They were grounded in a vast amount of writing and research dating back at least to George F. Kennan's work on containment right after the war.
 
Thus Reagan was on very firm ground in terms of his foreign policy, which made it easy for him to paint Jimmy Carter as a liberal dreamer who lacked the realism and toughness to defend American interests the way Democrats like Harry Truman did. When Iranian students took 444 Americans hostage in 1979, Carter did basically nothing to retaliate or force their release. The one thing he did to try and rescue them was so badly carried out that it had to be aborted. And when the Soviets invaded Afghanistan the only response he could muster was to pull out of the Moscow Olympics.
 
On domestic policy as well Reagan had a clear story to tell about how Carter--and by extension, liberal Keynesian economists--had brought on stagflation by monetary and fiscal profligacy, excessive taxation resulting from high statutory tax rates and bracket-creep, as well as regulatory overreach. Reagan argued, persuasively, that almost all of our energy problems, which occupied so much of Carter's administration, simply resulted from price controls on oil, gasoline and natural gas. I know there were times in 1979 when I would have happily paid $100 for a tank of gas but was not legally allowed to do so and was forced to sit in long gas lines instead.
 
These arguments were effective in getting voters to toss Carter and elect Reagan in 1980. As president Reagan continued to press the theme that our problems had taken a long time to accumulate under previous administrations and would take a long time to unwind. And he did not try to pretend that double-digit inflation and interest rates were going to come down without pain. He and his advisers were fully prepared for a sharp recession as the necessary price that had to be paid for the monetary and fiscal errors of the past.
 
When Reagan gave his first State of the Union address on Jan. 26, 1982, the nation was in a deep recession with unemployment a percentage point higher than when he took office; it would rise 2 more points and peak at 10.8% that December. Despite claims by Democrats that his policies were making matters worse, Reagan made it clear that he was simply cleaning up the mess he had inherited. As he said in his address that night, "To understand the state of the Union, we must look not only at where we are and where we're going but where we've been."
 
I bring up this history because Obama inherited a great many problems from the George W. Bush administration similar to those Reagan inherited from Carter. But rather than draw a clear distinction between his policies and those of the past, as Reagan did, Obama has tended to continue those policies. And in those cases where his policies are sharply different, Obama has tended to downplay those differences.
 
Foreign policy is clearly the area where Obama had the most to gain by a break with the past. He could have easily argued that the whole Iran-Afghanistan conflict was ill-conceived, based on bad intelligence and a ridiculously Utopian idea that we could impose democracy by military force in countries that had no experience with it or any of the requisite institutions. This idea is just as naïve as any held by Carter.
 
Yet rather than break with the past when he had the opportunity, Obama has instead essentially continued the Bush policy unchanged, even increasing our commitment in Afghanistan despite the long and dismal history of foreign military interventions there. Nor has Obama broken completely with the Bush policy on torture and holding suspected terrorists indefinitely without access to courts or counsel. Obama hasn't even fulfilled his promise to close the infamous prison at Guantanamo Bay by this date.
 
On the economy, Obama has done a terrible job of explaining how much of the mess he is dealing with was caused by the Bush administration's policies. For example, he could have shown very easily that the vast bulk of last year's budget deficit was inherited from Bush. He could have even cited the research of economist Dan Mitchell of the libertarian Cato Institute on this point.
 
Obama could also have explained how the Federal Reserve's easy money policy created the housing bubble, the crash of which is at the heart of our current economic problems. Yet he reappointed Republican Ben Bernanke as chairman of the Federal Reserve rather than using the expiration of his term as an opportunity to break from the past and chart a new course by at least appointing a Democrat like San Francisco Fed President Janet Yellen. Given that Bernanke served as Bush's chief economic adviser in the White House before becoming Fed chairman, this should have been a no-brainer.
 
Similarly, in appointing Tim Geithner as Treasury secretary, Obama lost an opportunity to blame the previous administration for its response to the financial crisis in the fall of 2008. As president of the Federal Reserve Bank of New York, Geithner was up to his neck in the bank bailout that is reviled equally by those on the right and the left. And as more and more details about the backroom deals involving billions of taxpayers' dollars and the vast profits made by the very bankers who caused the crisis come to light, the worse both Geithner and Obama look.
 
Even in terms of the stimulus bill, which the right wing tea party/Fox News crowd thinks is the root of all evil, Obama never really explained why it was the appropriate response to our economic problems. And then he essentially caved to Republican pressure by making tax cuts the single biggest part of the package even though his own economists knew that they were its least stimulative element. Despite this, he got zero Republican votes for his trouble.
 
Finally, on health care, Obama never once blamed Bush and his party for ramming through a massive unfunded expansion of Medicare in 2003, which in part necessitated the Medicare cuts that were part of his health reform effort. Nor did he even accuse Republicans of gross inconsistency when they insisted Medicare should never be cut for any reason. Indeed, Obama could have argued that his health reform was essentially based on Republican ideas, such as those enacted in Massachusetts by Republican Gov. Mitt Romney and supported by the state's newly elected senator, Scott Brown.
 
In short, at every point Obama has failed to break sharply with the Bush administration. Indeed the Cato Institute has taken to calling Obama's administration Bush's third term. Of course this makes a joke of the idea that Obama is some sort of radical socialist left-winger, though the idea is still widely held even by non-ideologues. Obama has allowed his enemies to define him more than he has defined himself.
 
To many Americans Obama is still a bit of an enigma without a clear governing philosophy. That has made it easy for right-wingers and Republican partisans to fill the vacuum with their own self-serving and largely dishonest portrait of him. By contrast, when Democrats and left-wingers tried to do the same thing to Reagan they failed because his philosophy was so well known and clearly articulated, and because his policies were tied together by a narrative that plausibly explained our problems by the mistakes of his predecessor. Consequently even those who had serious doubts about Reagan tended to give him the benefit of a doubt, which sustained him through the dark days of the 1981-1982 recession.
 
I think Obama's real problem is that he is fundamentally a moderate--what we in Washington call a "goo-goo," a good government person, a pragmatist who deals with problems as they arise without seeing them as part of pattern of failure and without any preconceived idea of what should be done about them based on ideology or political philosophy. There's nothing wrong with that, but it places a special burden on those who see the world this way to explain themselves and what they are doing clearly and unambiguously to both their supporters and their enemies, and to be willing to do so over and over again.
 
Obama obviously has the rhetorical skill to do what has to be done. But he seems oddly reluctant to use it. He seems to feel that once he has explained himself there is no need to keep doing so. In this respect, he should take a lesson from Reagan, a former actor who had the ability to deliver a line the hundredth time with the same empathy and enthusiasm as he did the first time. He also understood that ideas had to be repeated many times before they penetrated peoples' consciousness, which is the cornerstone of advertising and modern public relations.
 
And Reagan knew that sometimes the most important audience for his speeches wasn't the American people, but his own staff and supporters, so that they understood where he was coming from and why he was doing what he was doing, because ultimately his success was dependent on their willingness and ability to echo his words and carry out his policies.
 
It's not too late for Obama. His polls will turn up when the economy does, just as Reagan's did. But he has already lost a lot of time to define himself and his philosophy, which has emboldened his enemies. If he hopes to avoid being a one-termer he needs to sharpen his focus, be more willing to fight for what he believes and find a narrative that ties it all together.

Addendum

Derek Thompson comments here. Here's the e-mail I sent him in response:

"I think you misunderstood my point. I wasn’t saying that I don’t support Ben. I do. I’m just saying that as a purely political matter it was a mistake for Obama to reappoint him when there are well qualified Democrats available. Same with Tim. I’m not saying he should be fired, only that he shouldn’t have been appointed in the first place. As I have blogged, I don’t think it makes sense to fire Tim at this time because there’s no obvious replacement for him and given the problems of getting Treasury appointees confirmed, I think it would be unwise to leave the department rudderless."

Kenin Drum comments here. Megan McArdle comments here. Related discussion by Walter Russell Mead here. See also Krugman.

What Would Reagan Do?

Bruce,

Enjoyed the column (as always). Your decision to write about Reagan is timely. I have been thinking recently about what Reagan would do today (if he was alive) as it relates to his party. Reagan famously said "I did not leave the Democratic Party. The Democratic Party left me." He also had a famous 11th commandment: "Thou shalt not speak ill of any fellow Republican."

With that as a backdrop, I wonder what direction Reagan would take today if he was with us. Would he acknowledge what is so evident today - the GOP of 2010 is much more radically right than the GOP of 1980-1988 and speak out against their ruinous economic positions (no tax increases and no Medicare cuts under any circumstances whatsoever) and ill-advised foreign policy positions? Would he acknowledge and that the party left him? Or would he adhere to his 11th amendment? I am curious what your thoughts are before I provide mine.


Reagan

These are hard questions because the times were so different when Reagan was the unquestioned leader of the conservative movement. They really need to be answered by someone who knew Reagan personally far better than I did.


Bruce, I think I've

Bruce,

I think I've read/heard that GDP and employment tend to recover at a substantially faster pace after recessions due largely to monetary tightening, as per 1982 via Volcker's actions, vs. after recessions NOT due largely to monetary tightening (the recent and current situation). Is that true? If so, and if GDP and/or employment are still poor in 2012 rather than recovered to anywhere near the extent they had by November, 1984, it seems to me that that reality will be a larger factor in Obama's re-election chances than anything else.


Agree with you

"places a special burden on him to explain everything he does, something I don't think he's done nearly well enough"

The noise from the other side is so loud, and so shrill . . . difficult to get the reason wedged into the debate.

The opposition controls the airspace with outrageous claims (lies) and sound bites like "death panels", "government takeover", "communism", "socialist", "nazi", etc. They set up astroturf events and send the lowest common denominator of our society (those who can't think critically) to stand on the Capitol steps with the likes of Michele ("re-education camps") Bachmann.

They drown out civil discourse and rational debate with fear mongering and lies. They can do that easily because we no longer have a Fairness Doctrine. I can listen to Faux news all day and hear only one side of any debate -- complete with lies and distortions -- without rebuttal.

The social civil war goes on . . . divide and obstruct. It's great business -- Palin is cashing in, and Limbaugh and Beck have made tens of millions from inflaming irrational passions.


Bush III

first impression:

when you lead with a summary that compares Obama policies to Bush's, you lose a lot of people whove heard that story before, dozens of times...

stick to "this policy is wrong"

just sayin...


The Republican Party is now

The Republican Party is now made up of the rude "youth" screaming "Reagan" "Reagan" over and over gain, much to Reagan's annoyance, at the Republican Convention. Slogan screamers.

The Democrats in general, not just Obama, do not communicate what they are up to. They are too caught up in Beltway processes to communicate clearly and simply (beyond slogans) about what they want to accomplish.

Ironically, the Supreme Court ruling on campaign financing may be the salvation of the Democratic Party. The only way to combat big money is to offer solutions to important problems and communicate these solution clearly, simply, and persistently (after the legislative process begins). The Dems should use Twitter to pare down their messages while retaining some substance (unlike Republican slogans).


auto bailouts question

Mr. Bartlett, may I please have your opinion on the auto industry bailouts of last year? Back when they happened, someone I know was outraged. I said I felt ambivalent about it and she replied that she didn't because it was the taxpayers' money. I've seen some arguments on both sides of the issue, but am curious what you would have advocated, and your reasoning.
Thanks very much.




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