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Obama's Fall by the Numbers

A big part of the problem for the president at the moment is that his first big initiative -- the $800 billion stimulus package -- was sold with high expectations of success in turning the economy around. It was advertised as creating or saving 4 million jobs and preventing unemployment from getting any higher than 8%. The bill was passed with great haste, under enormous pressure from the president and a compliant, supportive national media.

Four months later, job losses are two million higher than then they were when the bill passed, and the unemployment rate has hit 9.5%. In China, a stimulus bill 2/3 the size of the American stimulus seems to have been far more successful, leading to a much higher growth rate in the economy (up from 6% to 8%). In China, stimulus money went largely for infrastructure projects and was out the door quickly. The Obama stimulus has been trickling out, and only 6% was for infrastructure ("shovel ready") projects.

There is also anxiety among the public over a near two trillion-dollar federal deficit for fiscal 2009, and the prospect of trillion-dollar plus deficits each year in the near future.  The health care debate plays into this anxiety, as Americans are concerned about more federal spending, bigger deficits, and higher taxes to pay for the broader access the reform bills propose. Climate change legislation is not a priority for most Americans, and if the Obama team is forced to pick one policy initiative to apply its declining political capital, it will surely be health care, not cap and trade. .

Policy wise, it is apparent that to get bills passed the Obama administration has chosen the path of taking pretty much anything Congress sends it. Obama Chief of Staff Rahm Emanuel seems to have concluded that the failure of a Democratic-controlled Congress to pass health care reform in the first years of the Clinton administration was due to creating “the sausage” in the White House and then trying to stuff it down the mouths of Congress. Better, he has decided, to have the process run the other way this time around.

The “logic” seems to be that  something beats nothing and Congress will not give up its design prerogatives. The problem is that allowing Congress to have free reign designing monster size legislation (in terms of dollar impact on the economy and number of pages and provisions) inevitably leads to ideologically driven (and ineffective) special-interest pleasing bills. Americans are, by and large, not nearly as far to the left as the Obama administration or House Democratic leaders like Nancy Pelosi or Henry Waxman.

The longer the bills are discussed and picked over, and the provisions become public, the less popular they will be. Much like some of my favorite baseball teams, there could be a bad summer swoon ahead for President Obama.