The President’s Economics Speech, First Impressions

July 24th, 2013 at 3:42 pm

I thought the President gave a resonant and powerful speech today, as he often does when he’s covering this material on the road.  The analysis flowed insightfully from diagnosis to prescription, with a correct and strong emphasis on how the economy and policy has changed over recent decades in ways that exacerbate the disconnect between middle-class prosperity and the economy’s growth.

The policy agenda emphasized clean energy, infrastructure, manufacturing jobs, education (pre-K and community college), college affordability, affordable health care, help with refis, savings incentives for retirement, and help for vulnerable cities/neighborhoods.  It notably did not dwell on debt, deficits, and austerity (see Greg Sargent on that last point).

I’ll have more to say about the fine points later.  But what I found most interesting in the speech was this: there’s little in here the President didn’t touch on back in 2005, the last time he spoke about the economy and the middle-class disconnect at Knox College.  Neither his diagnosis nor his prescriptions have changed, nor should they—they were, and are, largely accurate.

What’s different is that in 2005 he was saying “here’s what a president should do,” in 2013 he’s saying “here’s what I’d be doing if we had a functional political system.”  He still sees a clear role for government in the economy but he now sees something else that he could not have foreseen eight years ago: the political barriers to implementing that vision.

And he still doesn’t know what to do about that dichotomy—a compelling economic vision on the one hand; a uniquely hostile Congress on the other—beyond making his case to the people as he did today, taking executive actions, and exhorting private sector actors (CEOs, college presidents; he clearly has some executive orders loaded; I’m hoping one involves improving the job quality of workers on government contracts).

But I’m sure anyone in this town could write the R’s press release rebutting the speech—”nothing on the Keystone pipeline, cutting corporate taxes, or repealing Obamacare!”

The arrival of Barack Obama on the national stage, offering the type of economic analysis we heard today, was a source of great hope for those like myself back in 2005.  He still makes a ton of sense to me and I’ve been around long enough not to give up hope.  Pendulums swing in this town, often quickly.

But at least this progressive economist, one who worked for his administration in the early years, hears him with a very different, and sadder, set of ears today than back then.

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14 comments in reply to "The President’s Economics Speech, First Impressions"

  1. Samuel says:

    I wish I could do something guys…but gee whiz I really can’t. Too little, too late.

  2. Kevin Rica says:

    I’m confused. Which is it?

    Is it on odd days of the month that we need to create more jobs for American workers and on even days of the month that American workers don’t wan’t jobs and we need to bring in more immigrants?

    Or is it the other way around?

    I get confused by Obama. I wish he had the same policies on every day.

  3. save_the_rustbelt says:

    I’ve done some speech writing and speech coaching, and any speech over 20 minutes or so is fraught with danger. Anything much longer becomes a college-style lecture.

    A speech with about four bullet points is about right, a speech with several dozen will soon be forgotten.

    Always remember that Lincoln guy. 🙂

    But then maybe the speech didn’t really matter, it is the after spin, the talking heads, the columns and the blogs that really matter.

  4. Mark Jamison says:

    As speeches go this one was good, full of wholesome inspiring rhetoric. Unfortunately this administration has has a problem with follow through and consistency.
    I work on postal issues –

    The postal “crisis” has been more a matter of accounting fictions driven towards ideological ends of breaking labor and handing essential communications and financial infrastructure over to limited interests. Yes, the postal system has seen volume drops due to technological change but a significant part of the volume losses have been directly attributable to the Great Recession and the ongoing stagnation.
    In the last five years we’ve lost 193,000 postal jobs, good middle-class jobs. We’ve also seen the quality of at least 100,000 more degraded. This was in response to a manufactured crisis that would have been amenable to creative solutions rather than ideologically driven knee-jerk austerianism.
    This administration’s policies have been, at best, unhelpful and, at worst, destructive. Mr. Obama has made appointments to the Postal Board of Governors and the Postal Regulatory Commission who have been hostile to labor and dismissive of any solution that didn’t put the postal network on the path to privatization.
    There are creative solutions that would preserve the postal network and good middle-class jobs but instead of exploring them the administration has taken harsh, myopic, and unnecessarily limited positions. This isn’t a matter of the administration having to actually do something or even use any political capital. Simply put, the administration has staked out positions that aren’t significantly different than the ideologically driven anti-labor anti-worker pro-privatization positions of the far Right.

    The President’s speech comes off as hollow posturing.

    • smith says:

      I have read all is needed is to increase first class postage from 46 cents to 75 cents.

      For the average lower income American and senior who pays their rent check, electric, and water bill every month by mail, this is 3checks x 12months x (.75 – .46)increase = $10.44/year

      But let’s double that and say $20/year just to be on the safe side.

      So what’s preventing that increase? Follow the money. Who else uses first class mail extensively and has influence with congress? Banks and utilities.

      Investigative reporting would help but I guess saving postal jobs and Saturday delivery isn’t sexy enough even for the New York Times. Wouldn’t want to miss more Weiner stories and royal baby naming news. Besides, figuring out the accounting and getting the data, interviewing congress involves actual work.

    • purple says:

      The post office problem is based around the fact they aren’t allowed to significantly raise prices or cut small town services, which lose a ton of money. That’s all fine, because the value of a post office goes beyond its immediate profit/loss calculation. Many small towns would go under without a post office as their nexus. But should stop expecting the post office to make money like private sector company when it has socialist-style constraints.

  5. Tyler Healey says:

    I loved Michael Hudson’s review of the speech, which can be read at the following web address:

    • PeonInChief says:

      Yes, I too liked Hudson’s take-down. Obama could have been honest and said, “I could have prosecuted the bankers, but instead I played golf with them. I could have forced the banks to refi mortgages, but instead I got 4 million homeowners and tenants evicted from their homes. I had two years before the Republicans took the House, and I could have raised the minimum wage, but I didn’t do that either.” Instead we got this tripe.

  6. SeattleAlex says:

    Nice analysis JB. I just spent the last hour listening to O’s speech and I’m right there with you. Only 1,000 views on YouTube though…the involved citizen is a dying breed these days brother.

    Also who are these new weird people commenting on your blog?

  7. Pablo says:

    Robert Samuelson-

    “Firms seek to minimize fixed labor costs by using contractors, “temps” and part-timers. Obamacare intensifies the pressures, because the incentives against hiring full-time workers are so obvious. A survey by the New York Federal Reserve of manufacturers in the state found that 6.5 percent had already refrained from hiring or had fired workers to stay below the 50-worker threshold; 5.4 percent said they had substituted some part-time for full-time workers.”

  8. urban legend says:

    The President needs to change his cadence. The dynamic preacher thing worked in 2004 through at least January 2009, but it’s a different time now. It reinforces a message that he is all talk and no action. The emphasis must be on substance now, with personality being downplayed.

    Sure, whatever executive action available should be done. Have to put your money where your mouth is. But the only really workable policy now is to get Republicans out of Congress. Educate the people that the basic spending to create directly non-outsourceable infrastructure, manufacturing and renewable energy jobs is the only way we are going to speed up the re-employment of America. Make the convincing case explaining all the things that full employment will help, including higher incomes and reduced inequality. Get the American people on his side, getting ready for a powerful “Clean Out the Obstructionist Republicans” message in 2014, and re-vitalize an energized base to knock on enough doors for maximum turnout. (That’s the main reason why pissing off the base, as in 2010, is supremely stupid.)

    • Jared Bernstein says:

      I agree, Urb. At this point, the solution is one of political composition. Probably less “getting rid of Republicans” and more sending us R’s you can work with.

      • urban legend says:

        In the 50 or so districts where the Dems have a fighting chance — GOP victory of about 55% or less — it should be get rid of them once and for all. It looks to me like Rs putting in reps you can work with will take two devastating losses, first in 2014 (losing the House majority or at least almost losing it), and being utterly destroyed in historic proportions at all levels in 2016. Until then, the Tea Party and fellow travelers will control the party.

        Considering the overwhelming popularity of traditional Democratic economic populist positions, you can destroy the Rs with nothing but the facts, too — no need to be disagreeable even when your objective is total victory and unconditional surrender. No need to pretend to bipartisanship, either.

      • purple says:

        The Republicans will probably gain seat in the next cycle. Neither the House or Senate are representative of the popular vote, for reasons you already know.