Sunday, December 20, 2009

What the President and Democrats SHOULD have learned from Mid-Term Elections

The Bigger Picture
Published on December 3rd in Metro Éireann By Charles Laffiteau
In last week’s column I faulted President Obama for his handling of two of his three most important domestic policy issues; healthcare reform and climate change legislation. I believe the President blundered by allowing Congressional Democrats to take the lead in developing these bills, thus providing his Republicans opponents with plenty of ammunition for them to use in an attempt to torpedo these initiatives.
While I am a strong supporter of the President and his domestic policy agenda, unlike many of Obama’s other supporters, I also won’t hesitate to take President Obama to task when I believe he has erred. But before I expand on my critique of how the President mishandled his healthcare and climate change proposals, lets put them into context by first examining how he succeeded in achieving his number one legislative priority shortly after he took office; arresting the free fall in the American economy.
President Obama correctly perceived that stopping the economic hemorrhaging caused by the financial wounds various segments of the economy had suffered was his most important job as our nation’s 44th President. To that end Obama and his chief of staff, Rahm Emmanuel, took the lead in crafting an economic stimulus package rather than leaving it to Democratic leaders in the US House of Representatives and Senate.
The Obama administration proposed a combination of increased federal spending, which was criticized by Democratic liberals as being too small and by Republican conservatives for being wasteful, and tax cuts that were criticized by liberals as unnecessary and by conservatives for being less than what was needed. But at this early stage in America’s economic recovery process it appears that President Obama and his economic advisors got the economic stimulus package that they proposed just right.
I should also note this isn’t just my opinion either. At the same time US Treasury Secretary Tim Geithner was being raked over the coals by a few Democrats as well as the Republican members of the Joint Economic Committee at a hearing on Capitol Hill, a very different consensus of opinion about Obama’s stimulus package was emerging from a group of respected non-partisan economic analysts.
Before the hearing a Democratic representative unhappy about America’s high unemployment rate was asked by a TV interviwer if Geithner should be allowed to remain as Treasury Secretary and responded with an emphatic “No!” Then during the Joint Economic Committee meeting the next day, one House Republican told Geithner he had “failed” while another Republican on the committee said President Obama should have never given Geithner the Treasury job to begin with.
Maybe I’m crazy to think this way, but I just have a lot more faith in what a group of knowledgeable economists have to say about the Obama administration’s economic recovery legislation than I do in the opinions of politicians from either political party about the success or failure of these policies.
In response to Congressional complaints that the huge economic stimulus package wasn’t working, Nigel Gault , the chief economist at IHS Global Insight was quoted as saying; “I don’t think it’s right to look at it by saying, ‘Well, the economy is still doing extremely badly, therefore the stimulus didn’t work.’ I’m afraid the answer is, yes, we did badly but we would have done even worse without the stimulus.”
Mr. Gault’s opinion is shared by Mark Zandi, chief economist of Moodys, who was quoted as stating that; “In my view, without the stimulus, G.D.P. would still be negative and unemployment would be firmly over 11 percent. And there are a little over 1.1 million more jobs out there as of October than would have been out there without the stimulus.”
But in contrast to the Obama administration’s development of the apparently successful economic stimulus legislation, when it came to healthcare reforms and climate change legislation, the President let Congressional Democrats develop these proposals on their own with very little input or guidance from the White House. As a consequence, 5 different House and Senate committees drafted their own separate versions of healthcare reform proposals that addressed the desires of their generally more liberal constituents.
The end result was an incoherent jumble of healthcare reform proposals that gave anti-Obama Republican conservatives all the ammunition they needed to put conservative Democrats and moderate Republicans on the defensive. What were they thinking? That they could still win enough support from these legislators to pass these bills without putting them at risk of losing their upcoming swing state or district re-election battles in 2010? Obviously these more liberal Democratic Congressional leaders weren’t thinking!
Crafting healthcare legislation that addresses the concerns of liberal Democratic constituencies is not a strategy that will work unless Democrats have an overwhelming majority in both Houses of Congress. Well guess what? They don’t and their chances of achieving such a majority in 2010 have never been dimmer. What the more liberal Democrats don’t seem to understand is that getting healthcare reforms passed in the Senate is dependent on selling the idea to the 85% of Americans who currently have healthcare insurance, not the 45 million Americans who don’t.
One of the few liberal Democrats who understood this kind of political calculus was the now deceased “Lion of the Senate”, Ted Kennedy. I could be wrong, but I don’t think Ted would have let any bills out of committee until he had developed a package of reforms that he could persuade a smattering of conservative Democratic and moderate Republican legislators to vote for. The bill would have been criticized by liberals for not going far enough to address the needs of the uninsured and by anti-Obama conservatives for going too far, but it would have passed and become law.
Ted Kennedy’s stance on reform legislation was to get the most significant reforms in place then come back in a couple of years and make it better. Thankfully, President Obama finally appears to be ready to adopt this approach to healthcare reform. Now what does Obama do about Afghanistan?

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