Presidents generally enjoy a honeymoon both because the public wants their presidents to succeed and because in the early stages of a presidency the mistakes, lies, and screw-ups have not yet materialized. But soon they do. And in the case of this presidency, the non-stimulus plan is proving to be the equivalent of the first serious fight between the newlyweds.
The stimulus plan was bad policy, poorly conceived and oversold. It isn’t working, yet the president insists his policy was perfect. The result now is a surprising agreement between the Left and Right.
On the Left, Bob Herbert chimes in:
Vice President Joe Biden told us this week that the Obama administration “misread how bad the economy was” in the immediate aftermath of the inauguration. Puh-leeze. Mr. Biden and President Obama won the election because the economy was cratering so badly there were fears we might be entering another depression. No one understood that better than the two of them. Mr. Obama tried to clean up the vice president’s remarks by saying his team hadn’t misread what was happening, but rather “we had incomplete information.”
On the Right, House Minority Leader John Boehner calls foul:
I found it … interesting over the last couple of days to hear Vice President Biden and the president mention the fact that they didn’t realize how difficult an economic circumstance we were in. … Now this is the greatest fabrication I have seen since I’ve been in Congress. I’ve sat in meetings in the White House with the vice president and the president. There’s not one person that sat in those rooms that didn’t understand how serious our economic crisis was.
Hmm. We have consensus. And the president has a problem, both on policy and on credibility.
On the policy side of the equation, we have an economy still reeling. Unemployment, consumer and investor confidence, the Dow, and credit delinquency rates reflect that we are far from the end of the recession. As Herbert points out, “The roof is caving in on struggling American families that have already seen the value of their homes and retirement accounts put to the torch.” There will be less consumption and the doldrums will continue so long as unemployment increases. As David Wessel of the Wall Street Journal explains:
In December 2008, forecasters surveyed by the Wall Street Journal predicted the jobless rate would hit what then seemed a very high 8.1% at the end of 2009. Surveyed again this past week, forecasters now anticipate year-end unemployment of 10%. That suggests 775,000 more Americans will join the ranks of the jobless in the next six months. Because most Americans depend on their paychecks for their shopping, a weak job market and lousy wage growth have cast an ominous shadow over consumer spending and the overall economy.
Liberals are clearly getting nervous. Their Keynesian religious-like faith rests on the notion that government spending “creates” economic activity and wealth. So the answer must be: more stimulus!