Unemployment is at 9.8 percent, and the figure is even higher when the long-term unemployed and dispirited are added in. What does President Obama do now?
He has already tried massive government spending, borrowing $3 trillion in just 22 months in order to stimulate the economy. He has extended unemployment insurance, taken over corporations, and expanded entitlements — the sort of things the EU countries did that led them to their present reckoning. And yet such infusions of printed money and entitlements have not restored job growth.
Meanwhile, his original economic team — Orszag, Romer, Summers — is leaving or gone. The voters don’t believe we are in a real recovery, as the largest midterm correction since 1938 reminds us. He can get no help from his left-wing base — they demand more deficit spending, higher taxes, and more “stimulus,” which the president knows would only stall the recovery and alienate the Democrats even more from the electorate.
And yet to adopt free-market remedies — lower taxes, massive spending cuts, less regulation — would require the president to abandon his base, reject 30 years of his own ideological activism, and endure hysterical criticism during the waiting period while those tough-medicine measures kicked in. An equally intolerable solution.
So I guess we’re left with the present stasis: Obama will sorta-kinda be forced now and then to concede a point or two to the Republicans, who still do not have the legislative clout to pass rather than merely block legislation. He will vote present a lot, and count on (a) the natural resiliency of the economy to kick back in, especially when business is assured that his own policies are now frozen and cannot be expanded, and (b) Republican budget-cutting to be unpopular, especially when demagogued in them/us class-warfare terms.
And when the Lala-land liberal base gets angry, Obama can privately and quite correctly remind them that he is the best they are going to get, inasmuch as the voters want less of them, not more, all while publicly making flashy liberal appointments and updated hope-and-change speeches on symbolic issues — appearing all the more radical in direct proportion to the insignificance of the appointment or policy.
In other words, the president counts on the fact that his policies have not damaged the economy too much to prevent its partial recovery, and he hopes that he can play ad hoc politics as things get better, taking credit for the good while blaming the opposition for their heartlessness in trimming the budget.
Who knows, it might work for a while.