Sunday, November 23, 2008

Lucky to Become President in This Period of Economic Turmoil

Almost two months remain before President-elect Obama takes office on January 20, and he is already acting fast not only to cement his soon-to-be administration, but also to complete his first task upon inauguration. The US is in a precarious economic situation, to say the least, and the world is looking at Obama to assume a leadership role in stabilizing our financial circumstance. One small mishap – perhaps due to the obstinacy of Congress, or due to a handful of campaign promises that Obama is looking to fulfill – might be enough in our present dire circumstance to dent the enormous amount of confidence and hope that citizens have in him. But Obama should actually feel lucky that he is coming into office during a period of economic disaster because he has to worry less about the means of getting his plan passed and more about the quality of his actual plan.


Congress is very willing to act in a new direction after eight years of Republican ideology. Some Republicans are disillusioned with President Bush’s economic plans – or, as a possible criticism, the lack thereof. These Republicans wince at the trickle-down effect of Bush’s unpopularity and might be more willing to acquiesce to a different approach, if only to feel the relief of having someone else take the brunt of responsibility. Democrats, on the other hand, have been mostly frustrated since the 2006 midterm elections, having swept away the reins of Republican power in what many celebrated as a mandate for change, only to face the biting reality of the president’s veto power. These Democrats are salivating for a “partner in the White House” who will help pass legislation, as Senator Harry Reid expressed (Calmes). Not much hard persuasion, in fact, is needed on Obama’s part to spur Congress to action when the majority of citizens clamor for something to be done to alleviate the current crisis. The responsibility, that is, lies with Obama not to focus on the means of persuading Congress to pass his plan. Rather, Obama merely has to focus on the effectiveness of his plan: less emphasis on political maneuvering, more emphasis on solid ideas.


Some may object that most presidents are successful in their first hundred days of office, a standard that became popular after Franklin Delano Roosevelt’s immensely active first hundred days, during which Congress passed 15 major bills. Johnson, for example, used his first hundred days to define his presidency as a continuation of Kennedy’s. Reagan convinced the Democratic majority in Congress to support his tax cats during his first hundred days. But those processes were not easy. Johnson was forced to define his presidency as the legacy of Kennedy because of Kennedy’s surge in popularity after his assassination. Knowing that he would not have the clout to pass his bills in Congress without Kennedy’s buttressing legacy, Johnson was forced to retain most of Kennedy’s former cabinet and continuously make speeches praising Kennedy. Likewise, Reagan had to use the power of the bully pulpit to force Senate Democrats into submission regarding taxes. He appealed strongly to ordinary Americans to pressure their congressmen into voting for the tax cuts, and once Democrats saw how fervently many Americans wanted the tax cuts, the Democrats reversed their position and countered with proposed tax cuts of their own. But Obama’s situation is different. Unlike Reagan, he does not need to appeal to citizens in order to fight Congress, because most citizens agree with most Congressmen that something needs to be done during the financial crisis. Nor does Obama need to worry about political decisions to gain clout like Johnson, because the yet unofficial Obama presidency is already a legacy that is made even stronger in light of the current situation. In other words, presidents like Johnson and Reagan had a double burden: they had to somehow persuade Congress to implement the plans of new presidents, and then they had to hope for their plans to work. Obama, on the other hand, only has the single burden of hoping that his plan works because Congress is already mostly persuaded to follow the new leadership. Like Roosevelt, then, Obama’s way forward is actually made easier due to the terrible economy that he inherits.


Another advantage that Obama has is that he can fulfill almost all of his campaign promises by packaging them into one comprehensive stimulus package. This benefit primarily lowers the “transaction cost” of passing bills. Rather than risk Congress’s decreasing enthusiasm for each successive bill to be signed into law, Obama can have multiple successes by passing one bill. For example, Obama can cut taxes for middle- and lower-class workers and improve public infrastructure in one bill: stimulate more demand among consumers by giving them some tax money back, and stimulate artificial demand by hiring workers to rebuild roads that were in need of improvement in the first place. Without the financial crisis to relate these two separate goals, Obama probably would have passed two separate laws. Other campaign promises, likewise, can also be formatted to fit into the stimulus package, for example the creation of green jobs by providing incentives for corporations that abide by green technology. This is not to say that Obama would not have fulfilled all of his campaign promises without the financial crisis, but he certainly has an easier time of achieving much more of them within a much smaller time period, leading to the possibility of higher approval ratings and more praise from American citizens.


It is true that even with a more pliable Congress, Obama might not fulfill all of his campaign promises. This negative scenario, however, leads into Obama’s final advantage. Obama does not need to fulfill all of his campaign promises to receive admiration, because there are certain campaign promises one which he can afford to renege. In fact, it might be better if Obama broke his word on those campaign promises. One possible candidate is Obama’s pledge to repeal the Bush tax cuts before they expire in 2011. Many of those who voted for Obama supported his position on the Bush tax cuts for the wealthy, but the financial crisis makes it hard for people to ardently favor repealing tax cuts, even for the wealthy. Between getting no money for oneself but seeing the wealthy pay more taxes, and getting money for oneself but not seeing the wealthy pay more taxes, the average citizen would probably choose the latter. Americans are more focused on their own financial circumstances right now. It would actually help Obama if he broke his campaign promise and let the Bush tax cuts expire in 2011 instead of actively repealing them before 2011. Then Obama would seem more practical for not effectively raising taxes on the wealthy at a time when both the non-wealthy and the wealthy are suffering. Furthermore, Obama could reconcile himself slightly with Republicans who still would not be happy that the Bush tax cuts will not be made permanent, but who would be less unhappy than if the Bush tax cuts were actively repealed before 2011. The financial crisis, therefore, presents a way for Obama to cross party lines and gain some support from Republicans even if he cannot fulfill a campaign promise that seems untimely during this turbulent period.


The above arguments should not be construed as to belittle Obama’s ability to be president. Obama already has made great choices thus far, in fact, when selecting new members of his administration. He has reached across the partisan divide by choosing Peter Orszag to be the head of the Office of Management and Budget, someone who is respected by both Democrats and Republicans (Brooks). He has reached across the Democratic divide by hinting that Hillary Clinton will be Secretary of State. Obama has given the impression that he will be a pragmatist, not an ideologue who will pursue his ideals at any cost. These are all accomplishments. But these accomplishments do not change the fact that Obama still enjoys an advantage of coming into office in a time of economic despair. Of course Obama has a hard road ahead of him; no one can deny that. Huge burdens of responsibility rest on Obama to show Americans and citizens of other countries that the plans and proposals he has will work to improve the economy. But Obama can devote all his energy to ensuring that his plans are sound instead of wasting time worrying about whether Congress will listen to a new president. He can piece together the details of his plans without worrying about whether Congress has the stamina to pass all of them one by one. Obama became president because the majority of voters believed that his plans would work. Now the financial crisis has greatly cleared the road of potential political hindrances that could have prevented Obama from implementing his plans. Now is the best opportunity for Obama to vindicate his supporters and prove that his detractors were wrong.


Sources:

http://www.nytimes.com/2008/11/24/us/politics/24transition.html
http://www.cnn.com/2008/POLITICS/10/27/zelizer.hundred/
http://www.nytimes.com/2008/11/21/opinion/21brooks.html?em
http://www.cnn.com/2008/POLITICS/11/18/obama.omb/

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