Why Is the President Giving a Speech on the Economy Today?

July 24th, 2013 at 8:44 am

I’ve been getting that question a lot lately, so I thought it might be useful to offer some thoughts here.

President Obama is giving an economics speech later today at Knox College in Illinois, focusing on the economy from the perspective of the middle class.  As he did in a speech at this same locale back in 2005, I suspect he’ll talk about a central theme here at OTE: reconnecting middle class prosperity to economic growth.

Why go there when Congress will block you?  A few good reasons, I’d say.

First, the President can’t allow Congressional gridlock to force him to abandon his economic vision.  DC’s dysfunction makes it all the more important that he explain to anyone who’s listening which policies we should be pursuing if we actually wanted to do something about middle-class income stagnation.

While there’s clearly some improvement in the economy, as I noted yesterday, it’s not reaching middle and lower-income families.  That’s a long-term trend related to both structural and political changes, but it’s not something the President, any president, can blithely accept, even in the face of staunch and unyielding opposition.

Second, there’s some strategery going on here.  The DC debate will soon shift into dysfunctional overdrive as fiscal deadlines approach, including the debt ceiling and the need for another continuing resolution (I’m assuming a regular-order budget is out of reach).   That debate is going to sound intensely awful to most people who have had it up to here with the political class.  It’d be one thing if they were working at cross-purposes to the economy if things were humming along.  It’s quite another to be self-inflicting wounds at a time of sloggy growth and high unemployment.

So before the next phase of the debate begins, the President would like to remind people that his priorities are much the same as their own.

What are those priorities?  We’ll see later this afternoon, but I expect him to revisit themes of investment in clean energy, building up our manufacturers, college affordability, implementing the health care law, early learning, and infrastructure investment.

Nothing new there, but unlike Dana Milbank this AM, who wants to hear “bold new proposals,” I don’t see that as a problem.  Why is it important to provide Congress with new ideas to shoot down?  Does Milbank believe the problem is that the President just hasn’t found the formula for middle-class prosperity upon which he and the Tea Party can agree?

According to my advanced mathematical model, that formula returns the null set.

It’s like this TV spot I did last night with Larry Kudlow and Grover Norquist.  They argued that the President should get out there and explain to the middle class why the best thing we could do to help them is to cut the corporate tax rate.

Welcome to my world.

So, as Bernanke did last week, I think it’s perfectly legit for the President to remind the people that the Congress is blocking the path to stronger, more balanced growth, and to lay out the agenda that he’s believed in and movingly articulated since well before he arrived in this benighted town.  It’s not like we’ve tried it and it hasn’t worked.

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5 comments in reply to "Why Is the President Giving a Speech on the Economy Today?"

  1. Steve Bannister says:

    Nice job, but can you explain your support of Keystone?

  2. Tyler Healey says:

    New Proposals For Prosperity Upon Which The Tea Party Can Agree

    – corporate income tax cut
    – payroll tax cut for incomes under $50,000
    – increase the EITC
    – federal income tax cut for incomes under $50,000

  3. Amit says:

    While I usually love your analysis and wit, I think you’re being too generous to the President here, Jared. I mean, the expiration of the payroll tax cut this year, the increased rate on student loans (along with the ridiculous compromises being bandied about), the way Obama gave in to the deficit scaremongers and his blind faith in failures like Geithner, Lew and now Summers (as Fed Chairman, no less) has led me to believe that Obama is a smooth talking moderate conservative at best in the garb of a Democrat.

    I agree that he is better than any Republican option, but there are now two conservative parties in Washington – the moderate conservatives aka the Dems and the Tea Party to the far right. It is dispiriting to note how the political spectrum keeps shifting to the right. The Republican obstructionism deserves most of the blame for the truly terrible economic policies that are stagnating this economy for what seems to be an eternity, but the President deserves some of the blame too for some truly stupid policies. Obama is as much a friend of Wall St as any before him.

    PS – why on earth did Harry Reid let go of the opportunity he had for filibuster reform?

    Sorry for the rant Jared, but these guys in Washington have made me completely cynical, much like the rest of the population.

  4. urban legend says:

    At this point, politics is policy, and it has a medium to long-term time frame. Because political compromise is impossible, the central policy objective should be getting as many Republicans out of office as possible, first in 2014 and even more in 2016 (resulting in an overwhelming Republican minority status in the House and a filibuster-proof Democratic majority in the Senate — with a Democratic President, of course. The sole determinants of every action should be (1) will it provide the message basis for ridiculing obstructionist Republicans beyond repair; (2) will it pull independents and moderates to the Democratic side — and polls prove that only progressive policies argued persuasively on their merits, and not DC-centric formulations splitting the R and D difference, will do that, i.e., policies like no messing with Social Security, the core elements of the ACA, and full employment for putting people back to work,thereby raising wages and increasing demand, ; and (3) will it energize the Democratic base to drive turnout?