[REBORN FROM THE ASHES][comment][02.20&21]

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Obama
This house believes that Barack Obama is failing.

The moderator's opening remarks

Feb 2nd 2010 | Robert Guest

Few politicians, in my lifetime, have raised such hopes. When I covered his presidential campaign, I met legions of supporters who told me that Barack Obama would remake America and solve a surprising number of their personal problems.

Measured against the expectations of his most ardent fans—the kind of people who bought pictures of him riding a unicorn—Mr Obama's presidency has been a failure. But in this debate we will use a more reasonable yardstick.

Have his actions revived the economy or hobbled it? Has he made America safer? Will he ever succeed in pushing through his big domestic reforms, such as health-care and energy? And if so, will they do more good than harm?

David Boaz, a libertarian from the Cato Institute, argues that President Obama is failing because he tried to do too much. Mr Boaz berates him for not grasping how inefficiently government works, or how little tolerance Americans have for its expansion. He frets that Mr Obama is adding debt, taxes and regulations to the burdens already endured by business. And he observes that the more voters see of his agenda, they less they like it.

Elaine Kamarck of the Kennedy School of Government at Harvard disagrees. She notes that unlike some of his predecessors, Mr Obama exhibits no scandalous personal failings. As a man, he is held in high respect. She concedes that the Democrats' "obsession" with health reform is not shared by the public, and reckons it has distracted Mr Obama from his "robust economic agenda". But she sees him learning and adapting. After listening to Mr Obama's state-of-the-union address, she predicts that he will focus on jobs, regain the public's trust and win re-election in 2012.

Our two debaters have made a spirited opening. I hope that in later statements they will dig deeper into domestic policy (perhaps addressing some of my questions above), and touch on foreign policy, too. How much does it matter that foreigners like Mr Obama more than George Bush? How dangerous are the concessions he has made to trade protectionists in Congress? How deftly is he dealing with Pakistan, Iran and China?

Let the argument begin.

The proposer's opening remarks

Feb 2nd 2010 | David Boaz

The editors make it too easy when they remind us that in claiming the Democratic nomination in June 2008 Barack Obama declared that "generations from now, we will be able to look back and tell our children that this was the moment when we began to provide care for the sick and good jobs to the jobless … when the rise of the oceans began to slow and our planet began to heal … when we ended a war, and secured our nation, and restored our image as the last, best hope on Earth." It truly would take a Messiah to fulfil such soaring promises.

But part of President Obama's problem may be that he tried to fulfil too many of them, with no sense of the limits of the state's efficacy or the public's tolerance for expanded government. The claims of some of his advocates in 2008 that no one could spend 12 years at the University of Chicago without absorbing some sense of the benefits of markets, the limits of government and the hard lessons of the 20th century now seem as off-base as Ben Stein's buy recommendation on Merrill Lynch in late 2007.

On 20 January 2009, the day of Obama's inauguration, the Washington Post wrote, "The federal government itself is a far more potent instrument, in its breadth and depth of command over national life, than it has ever been before." President Obama has never quite thanked President Bush for the new powers he inherited, but he has certainly used them.

Bush raised the federal budget by more than $1.5 trillion. He bequeathed to Obama a FY2009 deficit of about $1.3 trillion, which Obama proceeded to increase with his "stimulus" bill, an earmark-heavy omnibus appropriations bill, Cash for Clunkers and more. But more than spending, he seemed bent on using a crisis atmosphere ("You never want a serious crisis to go to waste," said Rahm Emanuel) to amass more money and power in Washington. He proposed to bring the key health-care and energy industries under the direction of the federal government. He sought to tell financial companies how they could invest and what they could pay. I don't think he really wanted to nationalise the automobile companies; it's just that, as Uncle Duke said of the pension fund, the automobile industry was just sitting there. So he snatched it up, and he and Congress started imposing political rules: build "clean cars" rather than cars that consumers want to buy, don't build them in China, don't buy palladium from the cheapest overseas sources, use unionised trucking companies, keep inefficient dealerships open—and make enough profits to pay the taxpayers back.

His Environmental Protection Agency announced that it would use previously unknown powers to regulate greenhouse gases. His Labor Department plans to push through 90 rules and regulations in 2010 that would strengthen unions and add costs to employers. He sought to give more regulatory powers to the Federal Reserve, as a reward for causing the bubble and financial collapse. He has proposed various schemes to encourage more lending to homebuyers with insufficient credit, which were just those that combined with easy money to create the housing collapse in the first place. His top advisers "flipped through the tax code, looking for ideas" on taxes to raise, reported the Wall Street Journal.

In many ways, of course, Obama has just doubled down on George W. Bush's policies of bailouts, takeovers, expanded Fed powers and nationalisations. Some of the opposition to him reflects the public's sense that we've been piling up spending and debt for over a year now, so he is being punished for his predecessor's mistakes. But Bush or Obama, these policies take us in the wrong direction. After a crisis brought on by cheap money and distortionary subsidies, he is doing more of the same. In a recession he is adding debt, taxes and regulation to the burdens already felt by business.

The policies themselves are bad enough. The lobbying frenzy created by all this money on the table is not healthy for our politics. And the uncertainty created by this ambitious and protean agenda retards recovery. From last January ("growing anxiety on Wall Street about what the government would do next", New York Times) to this month ("The people that have money are sitting in kind of a cocoon—they're not making decisions because they're concerned about what's coming down in terms of taxation and vindictiveness against the wealthy," Denver Post), we see employers and investors worrying about what Washington might do next.

And now the voters are turning against this sweeping agenda that seeks to make America a European welfare state. Obama came into office on a wave of good feeling, with 69% expressing approval and only 12% expressing disapproval. Now his ratings are below 50%. Obama's approval rating fell 21 points during his first year in office, the largest first-year decline for any president since Gallup began tracking presidential approval ratings in the 1930s. Approval by independent voters has fallen from 62% to 45%. And even young people are leaving: The Politico/Insider Advantage poll showed Scott Brown leading among voters under 30 by 61% against 30%. In contrast, the 2008 exit poll showed 18-29-year-olds in Massachusetts voting for Obama 78-20.

Worse, the voters aren't just grumbling. They have switched parties in New Jersey, Virginia and even deep-blue Massachusetts. Congressional Democrats are scurrying for the exits, and even Vice-President Biden's son has decided to take a pass on the 2010 Senate race.

Worse yet for Obama, voters are not just reacting to the continuing economic weakness or engaging in fickle channel-changing. They are increasingly opposed to his plans to "remake this great nation". The longer Congress debates the health-care bill, the less voters like it. In a Wall Street Journal/NBC News poll 53% said they disapprove of the federal government's expanded role in the efforts to fix the nation's economy, 60% disapprove of the government's financial help to banks and other lending institutions and 65% disapprove of the government's ownership stake in General Motors.

It is not just specific policies. The director of Pew Research says that "anti-government sentiment, which had been building for years, was heightened by the financial bailout and stimulus program". In a January Washington Post-ABC News poll, Americans said they prefer "smaller government and fewer services" to "larger government with more services" by 58% to 38%. Since Obama won the Democratic nomination in June 2008, the margin of support for smaller government has increased in Post-ABC polls from five points to 20 points. Gallup data show that 57% of Americans say the government is trying to do too many things that should be left to businesses and individuals, the highest number since October 1994.

When your policies aren't working, the voters have noticed and your transformative ideological agenda is moving broad public opinion in the other direction, it's safe to say you're failing.

The opposition's opening remarks

Feb 2nd 2010 | Elaine Kamarck

Barack Obama is not failing. Failure in American politics is not subtle or nuanced, it is marked by a swift and deadly movement of public opinion from the political to the personal. At this stage in his presidency Harry Truman's approval ratings were low and falling and he was the butt of jokes about his mid-west roots, his poker games and his cronies. One of many popular jokes went: "What would Roosevelt do if he were alive? What would Truman do if he were alive?" Truman suffered a humiliating defeat in the 1946 midterms but he still managed to pass the Marshall Plan and win re-election in 1948.

Many other presidents have found themselves in much more serious situations than Obama finds himself in now. He and his wife Michelle retain great personal respect. People like him and wish him well. They think that he shares their values. He has not been saddled with any of the demeaning scandals that plagued Bill Clinton's presidency. He does not suffer from a character problem. Quite the contrary. The young people who voted for him in such large numbers are perplexed by his troubles but they are by no means ready to abandon him. His political troubles have not turned into personal troubles. This is critical. Personal failings and foibles fix themselves like glue in the minds of the public. Once a politician is regularly pilloried in the monologues of the late-night television comics he or she finds it nearly impossible to change the negative image. Unlike personal failings, political and governmental failings can be fixed.

The fix began in the State of the Union address. I carefully watched the clock. It took 40 minutes for him to even mention the words "health care." And in the 40 minutes before that he talked of nothing but the economy and jobs. The State of the Union was a recalibration of his presidency that will limit his losses in the midterm elections to within the normal range and guarantee his re-election.

Obama's first-year troubles were entirely predictable. In fact, in November 2008, my colleague William Galston and I did exactly that. In a long article titled "Change You Can Believe in Needs a Government You Can Trust", we reviewed the decades of data from the American public showing a severe and persistent lack of trust in the federal government. This lack of trust is an especially difficult problem for a Democratic president with an activist and progressive agenda. Trust, we wrote, "shapes the limits of political possibilities. When trust is high policy makers may reasonably hope to enact and implement federal solutions to our most pressing problems. When trust is low as it is today and has been for much of the past few decades, policy makers face more constraints."

It is understandable that both Obama and the Democratic leadership would ignore this and choose to interpret their stunning victories in 2008 as a repudiation of decades of scepticism about the government's ability to get things done right. But that they did, with results that were entirely predictable on two fronts.

As unemployment grew, trust in the capacity of the stimulus bill to create jobs shrank. This was exacerbated by both the content and the rhetoric of the bill. While the bill "saved jobs" especially in the public sectors of states that received stimulus money, it did little to "create" jobs for the millions of private-sector people out of a job. Added to that was the problem of rescuing banks that then refused to lend, and added to that was the end of year bonuses given to bankers. In the first year the president seemed to have forgotten, at least rhetorically, one of his most popular campaign pledges, the creation of a National Infrastructure Bank, an idea ideally suited to a period of high and persistent unemployment. Also lost in the first year was the idea of reforming bank regulations and creating a consumer protection organisation that would prevent the predatory lending practices that contributed to the housing bubble and then to its bust. And finally, with an astonishing number of American homeowners "under water" (owing more on their mortgages than their houses were worth), the anaemic performance of the government's mortgage assistance programmes added to the impression that the stimulus didn't work and that the president didn't care.

The biggest culprit in this lack of focus was, of course, health care. Because universal health care is the last stone in the social safety net edifice created by Franklin Roosevelt, it has been, for decades, an obsession of the Democratic Party's elite. Unfortunately for them, this obsession has never been shared by the public. Hillary Clinton's attempts at health-care reform met a bitter end and current attempts are faring no better. Beginning in April 2009 and up until the present there have been more than 100 national polls conducted on health-care reform and the vast preponderance of those polls showed that Americans were against the reform efforts. In the last month opposition to health-care reform is in double digits in five separate polls. For two full decades now health care has been a casualty of American scepticism about government. When push comes to shove they just don't believe that the government can improve things.

Nonetheless, in the set of presidential problems these are easy problems to fix. Obama has a fairly robust economic agenda—he just allowed it to be pushed to the side by health care. The public sent him a strong and early message in the comely persona of the newly elected senator from Massachusetts: talk about jobs. Congress will pass a jobs bill. Obama's pivot will be decisive and graceful. Forty minutes on the economy: two minutes on health care. That is about right. He need not abandon health care, just take it on in some smaller, confidence-building steps. While he objected to those who would advise him to go slow on all the things in his agenda, he got the most important message when he said, "We face a deficit of trust—deep and corrosive doubts about how Washington works that have been growing for years." This is not a man who will fail. This is a man who will learn and thrive.

http://www.economist.com/debate/days/view/457