Free Markets, Free People


Obama and the “New Normal”

The  President is in trouble, so the “New Normal” is what he’s trying to sell now, according to James Pethokoukis:

Even a talker as talented as President Obama can’t do the impossible: Persuade Americans that the three-year-old economic “recovery” is anything other than pathetic.

Growth is sinking back toward the recession red zone and unemployment’s firmly stuck at over 8 percent for 42 straight months.

It’s no wonder a new Gallup poll finds 75 percent of us “dissatisfied” with the direction of the country. Or that a CNN survey finds that twice as many Americans (39 percent) think the economy is still mired in recession than think it recovering (19 percent).

So Obama isn’t even trying to make the “Morning in America” case for his re-election. He now concedes that “the economy isn’t where it needs to be” and that “we have a lot more work to do.” But he’s quick to add that the Not-So-Great Recovery isn’t his fault, saying: “Throughout history, it has typically taken countries up to 10 years to recover from financial crises of this magnitude.”

Obama, you see, is a believer in the “New Normal,” a phrase popularized on Wall Street, where gloomy economists cite the slow growth, high unemployment and high debt that supposedly afflict countries after severe banking crises.

The two implicit points Obama wants those who buy into (and I use “buy into” purposefully, because this is political snake-oil) this paradigm are a) he’s not at fault and b) it takes a long time to climb out of these sorts of holes so he should be given more time as well.

Well, it may not be his fault per se, but that’s irrelevant.  He’s had 3 plus years to do something about it and his efforts to this point have been an abject failure.  In fact, it does a disservice to the word “abject” to characterize them that way since abject doesn’t begin to describe the depth of that failure.   This president and his administration are clueless and incompetent.  When you add the desire to push their ideological agenda regardless of the economic circumstances it becomes even worse.

Instead of concentrating on the economy for the first two years of his presidency, he used that time and the energies of an all Democratic Congress to pass … health care?   And then, when voters kicked his political rear and that of the Democrats by putting Republicans in the majority in the House in 2010, suddenly everything was the GOP’s fault.

As for the second point, yes, relatively speaking it does take a long time to climb out of these sorts of holes.  That is unless you are ignoring the economic first law of holes – if you’re in a hole quit digging

This administration has made recovering from this crisis infinitely worse than it had to be.  For instance, instead of turning to proven fuels, an infrastructure that exists to exploit them, and creating jobs,  he and his administration played the “green card” and threw billions at companies that soon went under or created jobs at multiple millions of dollars spent per job.  Meanwhile, federal land was closed to oil and gas production and the Keystone XL pipeline was shelved.

As for shovel ready infrastructure jobs … well ask the Chinese how well they’re enjoying your tax dollars while Obama prattles on about “outsourcing jobs”, ok?

There is absolutely no reason to buy the snake-oil he’s trying to sell or accept this as the "New Normal”.  That’s failure talking, and we simply don’t have to accept it.

~McQ

Twitter: @McQandO

Facebook: QandO

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26 Responses to Obama and the “New Normal”

  • Yeah, Pres. Paracosm might TRY that, but at the end of the day…
    everybody knows the New Normal is just DoubleSpeak for “The Old Crap”.
    And, at this point, pretty much everyone understands where the crap is coming from.

  • Still, “not my fault” when you distill it down to it’s bullshit essence.

    • Not his fault unless you consider all the BS sub-prime loans he foisted as an ACORN activist/lawyer.

  • One need only look at the Unemployment Rate With And Without The Recovery Plan chart that Obama’s team itself created.  They haven’t hit any of the metrics outlined on that chart.  In fact, it’s been worse than they even projected without their great plan.  That issue alone should disqualify Obama from receiving anyone’s vote.  They told us that unemployment would be 5.6% in July of this year with their plan.  It wasn’t conditional on anything (even though team Obama has absurdly laid the blame for the sluggish economy on everything from the Arab Spring to the Japanese tsunami).  Obama himself stated that he should be able to turn it around in one term.  What changed?  Is anyone in the media going to press them on this (rhetorical question)?

  • To what ten year recovery period is he referring? The Great Depression perhaps? In that case, it took so long because the Fed govt kept experimenting with various nostrums. The 80-82 recession did not take ten years to disappear, the 73-74 recession did not take ten years to disappear although the recovery was a bit wimpy, the S&L debacle recession did not take ten years to clear. I really want to know to what “history” The Dear Golfer is referring

  • “Instead of concentrating on the economy for the first two years of his presidency, he used that time and the energies of an all Democratic Congress to pass … health care? ”

    Let’s do calendar math.

    January 20th, 2009, Obama is inaugurated. On February 17, 2009 Obama signed the American Recovery and Reinvestment Act. While you may (and do) disagree with the effectiveness of that act, it was an attempt to mitigate and shorten the recession. Most studies on the stimulus have concluded that it did work, and where it fell short, it was mostly faulted for being too small.

    http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/08/08/the-romney-campaign-says-stimulus-doesnt-work-here-are-the-studies-they-left-out/

    On March 5th, 2009 Obama formally requested that Congress begin work on a healthcare reform bill.

    That bill was signed into law on March 23rd, 2010.

    March 10, 2009 to March 23, 2010 is how many years?

    And how could this have been shortened if Republicans had not decided before there was even a bill to disagree with that they were going to try and make it Obama’s Waterloo?

    It’s funny how a year gets exagerrated into two, paying for end of life counseling is exagerrated into death panels (lie of the year winner), trying to get uninsured people insured is a government takeover of healthcare (Lie of the year winner), telling states if they can present a method to improve the employment outcome of welfare they may be be granted some waivers is exagerrated into gutting the welfare work requirements.

    I guess once you start stretching the truth, it’s a hard habit to break.

    (and yes, for the record, I am aware of the stretches on the other side, but no need for me to point them out, y’all have identified 700% of the lies of the other side.)

    • What an amazing, LYING phuc….!!!!
      Immaculation: January 20, 2009
      ObamaCare passage (after various “this kills it” attempts): March 21, 2010
      Whadda moron.
       

    • Most economists…LOL. You do know that many of those economists aren’t really experts on stimulus, right?
      And one of the true experts was Christina Romer, and she did a projection and it came up stunningly wrong. Now, she is not an idiot, so that should tell you something…1) If you cannot measure the problem and your model is that far off, maybe the rest of your theory is as well, and 2) the stimulus had problems. Keep in mind she knew the size of the stimulus so her model’s numbers took that into consideration.
      Its also now known that Obama thought green investments would create tons of jobs, and even when his advisors explained they wouldn’t he still doubled down.
      And, why not do XL pipeline or Yucca Mountain if you really care about stimulus…how does paying off unions by keeping states afloat make more sense then those projects? It makes huge sense if you realize that’s a legal way of recycling stimulus money into political donations via unions.

    • Yeah, that GM thing, wow, that worked great didn’t it for the country and the non-union GM workers and the non-democrat dealership owners, didn’t it?

      And all those green company investments, a smashing success (for Finland and China)

      and we just didn’t spend enough.  Okay, I’ve been waiting for THAT dead horse to get dragged around the track, it’s been a while.

      Again, you’ll be voting for Obama then in November, for smaller government, and because of his success rate, and because he’s such a uniter,  right?

    • With the increased deficit spending that went into the delayed FY2009 budget after Obama was elected and the years since, the stimulus spending is really about $4 trillion. How much bigger should it have been ?

      • Doesn’t matter now, it’s the excuse for why it didn’t work.   We just didn’t dig the spending hole deep enough, see?   He’s already rolling out the play for why the Messiah’s vision didn’t get realized if the election falls through.  It was failure to spend enough, and the obstructionist filibuster Republicans, and racism.

        Not to worry though Cap, exploding objects all over the Middle East will usher in a new chance for Big Ears to make a bigger fool of himself.

  • Also, the Dems have a allergic reaction to cutting taxes or they would have done tax reform and lowered the corporate income tax when they had power…but that doesn’t interest them, does it? Buying more votes, bigger government, that does. Cap and TRade was even discussed for a year or so until that finally died.
    The Dems could have eliminated the corporate tax and raised individual taxes for the highest while flattening the tax structure and I think that would have been a winner politically, and helped the economy. “Hey we are raising your taxes, but they won’t be taxed twice” sort of thing. Anathema.
    Dodd-Frank is a monstrosity that you know is killing small banks who can’t have 70 attorneys on staff and institutionalizing TBTF. Simple regs are best. They could have just limited the size of banks to a % of GDP or something.

  • Let’s get real … Obama really is awlful at legislation.  Nothing that he was chief sponsor of ever passed in the Senate, he outsourced the “stimulus” along with health care to Harry and Nancy.  He has been truly awlful negotiating with Republicans in the House.   If the Senate goes Republican, a second Obama term will be like one continuous root canal.

    • Or an executive emperor.

    • “He has been truly awlful negotiating with Republicans in the House”

      “Or an executive emperor.”

      Interesting couple of choices.

      Imagine walking into a car dealer to buy a car for your company, expecting to negotiate. You see the sticker price, you make an offer. The dealer salesman says no, the sticker price is the price, non-negotiable. You say no one is going to buy the car at that price. The dealer says, I don’t care, if I don’t sell at that price, I get fired. You say, if I buy the car at that price, I’ll get fired. The dealer says, “I want you get fired.” You say,” but don’t you want to sell cars?”. The dealer says, “No, right now I only want to get you fired, I’ll sell cars later.”

      That is the nature of negtiating with Republicans since January 2011.

      Remember the budget negotiations, when the White House thought they were negotiating with the House, when in fact they were just negotiating with a tangerine that could negotiatiate all day but couldn’t get a vote to support any deal he made that include compromises?

      And how’s Romney going to do when faced with the same situation?

      As Matt Bai puts it, “Assume for the moment that Mitt Romney is elected president and is forced to confront, even before staffing his administration or taking the oath of office, an imminent budget crisis. Romney would have been elected despite the deep ambivalence of his own party’s conservative base, whose support he would need in order to govern, and who would be watching his every blink for proof of ideological fealty. Does anyone really think he could risk infuriating that base, in his first move as president-elect, by hammering out a compromise that increases tax revenue and cuts Medicare? ”

      The CBO says it is flat out impossible to even the address the debt crisis without some new revenue, and unless Republicans win the Senate, which is not likely, there won’t be a deal that includes cuts and no revenue, and don’t ignore the revenge factor. Democrats in teh Senate with a President Romney would have no problem refusing to compromise on revenue, and they have the CBO to back them up.

      Once upon a time, divided government served us best, now we are on a path to assure that until or unless one party gets total control, nothing will be done, and when one party does get control, they are going to go crazy, like they always do. Rock – American People – Hard Place

      • Yep.  Another day, another set of bullshit lies inverting reality.
        What a moron!
        Remember how Bad Luck Barry earned the nickname “The Won”?  No, of course not.
        Remember the little set-piece melodrama of the “Health Care Summit”.  Naw, never happened.
        Remember how Deemocrats earned that name?  Wha…???

      • “And how’s Romney going to do when faced with the same situation?”

        Right, there we are again, the avoided issue for you Cap – you’re going to vote for Obama anyway, right?  Despite everything that you say, and write, about government, you’re going to vote for Obama and you’re only here to argue in his favor while pretending not to argue in his favor.

        It’s okay, we get it.

  • By the way, this may be the new normal, no matter what we do. We could lower tax rates to zero and if it’s cheaper to increase productivity and/or profits through efficiency (read technology, innovation, and foreign labor), then that’s what will happen, regardless of the regulatory environment, tax rates, or any other factors.

    As anthony Randazzo from Reason points out…

    “Economic growth and productivity are clearly not only dependent on labor force participation. Ideally, productivity is growing from expanded production of goods, growing consumption, and innovation. Recent productivity is being driven more by efficiency gains (output per hour of work has been increasing post-recession) than new products, which is part of the reason that the output gap remains.
    The story of the recovery certainly gets more complicated when considering the host of non-labor factors influencing the economy — such as national debt, household debt, monetary policy, innovation, income stagnation, rising health care costs, etc. However, as Stock and Watson have pointed out, there is a very real impact on economic growth from a declining labor force.
    Ironically, the growing productivity numbers actually help make the case that the labor market and economy could be setting into a “new normal” pattern. Consider that growing productivity despite high unemployment does not create incentives for firms to hire. A circular problem then develops where the productivity from efficiency gains leads to weak hiring practices pushing labor force participation further down, which in turn leads to more output gains coming from efficiency rather than economic expansion.
    This cycle can be broken, and perhaps it will in the coming years. However, the Congressional Budget Office suggested earlier this year that because the labor force decline is so “unusually large decline over so short a time,” it does not anticipate the situation will change for at least another five years.”

    Not that either side will ever say anything like accepting a “New Normal”, which neither side has said, even though this story clearly asserts that Obama is a believer in the “new normal”.

    Believing may not be a necessary element for the new normal, and not believing may not have the slightest impact on it.

    We’ll come around, but whether it’s Romney or Obama, it’s going to take some time.

    • In reality, Obama is the author of “The New Normal”.  The Obamic Decline is not merely extremely clever polemics…it is a fact.

    • There is a point where demand outstrips mere productivity increase – that’s where it has to go.   With a dead economy it’s easy to force people to be ‘more efficient’, the correct translation is, force hourly employees to work unpaid time, and force salaried employees to work more than 40 hours a week.  After all Chuck, someone else will be glad to have your job if you don’t like it.

  • The CBO forecasts the unemployment rate to average around 8.7 percent in 2013 and then fall to an average of 7.9 percent for 2014.  http://www.cbsnews.com/8301-503544_162-20096650-503544.html
    Some things are just beyond the immediate remediation of any single President.

    • Really? Don’t forget this president said if we’d let him spend a trillion dollars he’d keep it below 8% and, per his own graph, we’d be at 5.x% right now. So should we hold him accountable for his promise since he went ahead and spent the trillion?

    • So, either Obama knew that affecting the unemployment rate was beyond the President’s control and was just talking out of his ass, or else he was so economically ignorant that he truly believed he was able to control unemployment.  Pick one.

    • “Some things are just beyond the immediate remediation of any single President.”

      Really, are you saying we can stop blaming Bush?

      Another brilliant pass by QandO’s Washing Machine Charlie.