POTUS Ponderings: I Didn't See the Economic Crisis Coming
If someone asked me, "What was the most enchanting thing about the Obama press conference on Wednesday night?" I'd have to point to this nugget, which is also the most surprising and most troubling: President Obama was asked about the biggest surprise he'd faced.
Me, I'd say, "Who knew that somebody could take Air Force One out for a joyride without my permission or even my knowledge, and terrify thousands of people? Actually, I'm not sure I believe that myself, but I'm sticking to it as long as everybody else clams up." Or maybe I'd say, "Who knew I'd be taking over the car industry and finding myself forced to stand up here talking about government-backed warranties and pitching people Chevy Malibus?" Or maybe I'd play dumb and say, "Who knew the CIA would take umbrage if I revealed the top-secret details of all the things they have to do to obtain priceless information from terrorists to save American lives?"
Yet Obama said his biggest surprise since arriving at the White House was the economic crisis. This was wrong. It happened last fall, before he took office. And it's the primary reason he was elected. But it was uncommonly revealing when he said that when he began running for president (that would be in 2007), "Obviously I didn't anticipate the worst economic crisis since the Great Depression."
Show me all the speeches where he said lax financial regulation was causing banks to write too many sub-prime mortgages, which in turn would cause bank failures, a stock market crash, a recession, and a big increase in unemployment. Obama's sole issue back then was Iraq. To the extent he talked about the economy at all, he talked a little about trade, hinting that he was for protectionism and against outsourcing while simultaneously sending out advisers to say that he actually didn't mean any of this. Then Lehman Brothers collapsed.
Obama is like a shaman standing next to a house, warning that there's a severe risk that an earthquake will destroy it. Instead, the house is suddenly hit by lightning. So he segues seamlessly into saying, "Obviously we need to make sure nobody's house gets hit by lightning again. Haven't I been warning you that this house was in danger?"
In his Feb. 25 "Day of Reckoning" speech, Obama could scarcely contain his demon glee at the downturn that his inauguration and policies accelerated, thus creating his opening, "The fact is, our economy did not fall into decline overnight. Nor did all of our problems begin when the housing market collapsed or the stock market sank." Then he began talking about health care, energy, and education, all of which had zero to do with the sub-prime mortgage crisis. Picture a Wall Street trader saying: "Wait a minute, Bill, you mean we're importing oil from the Middle East? Sell, sell, sell!" The price of oil was, of course, plummeting at the same time the stock market was collapsing. Without a script to turn to Wednesday night, Obama said the opposite: When he began his presidential bid, "The economy appeared on the surface to still be relatively strong." In other words, he didn't see it coming.
Obama is like a weather forecaster who has never managed to accurately predict the weather but can't stop making forecasts. "We have lived through an era," he intoned, "where too often, short-term gains were prized over long-term prosperity. ... Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn't afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day."
If all this were true, why didn't Senator Obama notice these things? Why didn't he, for instance, take some time out on the campaign trail to make a few speeches about these shadowy, unspecified regulations that were being gutted? Why didn't he denounce the way Fannie Mae and Freddie Mac had not only "pushed bad loans" but had done so by gambling our money? Maybe because he was too busy being the second-largest Senate recipient of Fan and Fred donations. Or maybe he was so busy running for president in 2007-2008 he just didn't notice what was going on, as he candidly admitted Wednesday night: "Obviously, I didn't anticipate."