The Obama administration had the sort of week they’d rather see disappear down the memory hole. But unfortunately for the president, the trouble may just be beginning.
First, on the economic front the notion that we are going to bounce back soon from the recession is proving to be a pipe dream. The CBO predicted double-digit unemployment continuing to rise into 2010. Rasmussen reported:
The Rasmussen Investor Index dropped 15 points on Friday, the largest single day decline ever recorded in its seven-year history. The drop caps a week of extreme volatility for the Index and now shows investor confidence at the lowest level in two months.
The culprit — both for the volatility and the current low level of confidence — is shifting perceptions on where the economy is heading next. Today, just 24% of investors say the economy is getting better while 47% say it is getting worse. A couple of days ago, the outlook was much less pessimistic: 34% better and 40% worse.
And the every-growing mound of debt is triggering concern among purchasers of U.S. debt. The Wall Street Journal reported:
The yield of the benchmark U.S. 10-year bond, which moves in the opposite direction to the price, rose by 0.15 percentage point from Wednesday to 3.355%, its highest level in six months. … Thursday’s selloff in U.S. and U.K. government bonds highlights the risks the two countries face as they try to jump-start their economies. The two governments hope that all the money they are borrowing will spur so much growth that the debt will shrink as a portion of their economies. The risk is that growth will be weak, leaving the economies still struggling but with heavy debt loads.
Moreover, the result of the president’s spend-a-thon and the Fed’s hyperactive printing press has been a plunge in the U.S. dollar and renewed fears of stagflation.
This, of course, is the economic picture which Republicans painted when they inveighed against Obama’s stimulus and budget plans. They (and all those Tea Party protestors) warned that the sea of red ink spilling from the U.S. Treasury couldn’t be readily absorbed by purchasers of U.S. debt and the result would soon be higher interest rates and slowed growth. It is the argument they continue to employ in objecting to the gigantic spending items still on the Obama budget. They now have some evidence to support their arguments. This week the reality was driven home: the Obama economic plan is a faulty and unsustainable one. And those Democrats on the ballot in 2010 had better buckle up — it is going to be a bumpy ride.
On the national security front, the week brought a bevy of problems and complications for the president. His own party is in revolt, voting 90-6 in the Senate to defund his scheme to relocate Guantanamo detainees to the U.S. Nancy Pelosi is now reduced to “stonewalling” to fend off reporters’ queries about whether the CIA “misled” her.
Under siege, the president was forced into a speech face-off with Dick Cheney, once the source of eye-rolling and derision from Democrats who couldn’t believe one of the least popular politicians in America could cause a stir. But a stir was indeed caused by the former vice president’s insistence on defending the Bush administration’s record in the war on terror. As Politico observed:
For the first time in his presidency, Americans are getting a glimpse of Barack Obama on defense. Over the past few weeks, Obama has been back on his heels over torture and terror, issues on which he surely thought he had the upper hand. And he spent Thursday charges from a man he surely thought he had vanquished in November, former Vice President Dick Cheney.
But Obama’s speech was devoid of specifics on the issue of the day: what to do with the Guantanamo detainees. And that left congressional Democrats twisting in the wind, as Politico reported:
And even the speech, which stopped short of laying out a detailed plan for the Guantanamo detainees, left some frustration among congressional leaders. “In our perfect world, he would have given this speech before the vote [on stripping funding to close Gitmo]. It was a good speech, but there weren’t enough specifics in it that he couldn’t have nipped this in the bud last week or the week before,” said another leadership aide.
The problem for Obama is obvious: he has committed to closing Guantanamo with no viable plan for dispersing its detainees. In the process he has rekindled concerns as to whether he and his party are tough enough to fight the war on terror. Added to that dilemma is the challenge to manage disappointed allies on the Left who have figured out that despite his rhetorical broadsides against the Bush administration he has adopted many of its policies in the war on terror.
The Los Angeles Times summed up his predicament:
But his lengthy address, in which he conceded that his policies were still evolving, laid out a mixed approach that could be portrayed as squishy.
He defended actions that have angered conservatives, such as ordering the closure of Guantanamo Bay. But he also had to explain to frustrated liberals why he had accepted some of the Bush administration’s detention policies, such as the system of military commissions that tries many of the detainees captured in battle.
The bottom line: this week was one in which reality rudely intruded into the Obama feel-good continual campaign. The bond markets can’t be spun. The unemployment figures can’t be ignored. The value of the U.S. dollar can’t be sustained when we are printing gobs of dollars. And neither congressional Democrats nor the American people can be convinced it makes sense to move hardened terrorists from a distant, secure location to their neighborhood prison for the sake of currying favor with the American Left and European opinion makers.
This governing business is hard stuff. And it is made harder by an administration which has used photo-ops and speeches in lieu of thoughtful policy. This week we saw, as the president’s former pastor once said, that the chickens are coming home to roost.