Mid-Term Prep

It's time to Break It Down!


By the time I post again, you will have voted…or not. The pundits, the “talking heads,” and even a growing number of men and women on the street have been telling us for weeks, if not months, that there is an enthusiasm gap. That is a fancy way of saying, among the prospective electorate, it is anticipated that many more voters will opt for Republicans than for Democrats next Tuesday. In fact, if all goes as most analysts expect it to, the coalition of the GOP and the Tea Party movement will displace Democrats as the Majority in the U.S. House of Representatives, and threaten to do the same in the U.S. Senate.

One of the many beautifully brilliant aspects of our form of government is, as a felon-free adult, you have a choice, and are free to express it. Typically we think of that choice being shaped by the views, philosophies, ideologies, and voting records of candidates. Those are the main factors that tend to lead us to vote for one person or Party instead of another. However, in this election cycle, those elements, in conjunction with a case of prolonged economic doldrums, made worse by acrimonious, hyper-partisan debate in Washington and across the country, have served to discourage many would-be voters from going to the polls. This seems to ring true, particularly for those Democrats and Independents that supported President Obama and his progressive agenda in 2008.

At the end of the day, this discussion is not intended to tell anyone for whom they should cast their votes. However, I do believe, as a result of all the claims, insults, slurs, and stated aims to make this President fail, many of the facts about what the Obama Administration has accomplished in the last 22 months have been obscured, or quite simply lost in translation. Consequently, I want to spend a few minutes to reframe the discussion in a way that clarifies the record. I hope you will agree that regardless of your position on the issues, one is well served by knowing the facts, even when they do not support or complement the partisan rhetoric that so often carries the day.

Most often, I delve into and pull from a vast array of source material to develop my posts. I am deliberately taking an alternate tack today. I read a piece from Rolling Stone Magazine, at a friend’s urging. It is without question, the most compelling distillation I have seen of the various sides of the Obama accomplishment conundrum. The article discussed eight key areas in which President Obama has distinguished himself in historic and positive dimensions, through his legislative and policy achievements. Regardless of ideological bent, his work in these arenas is significant; made all the more impressive by the withering opposition from an opposition Party committed to defeat his every initiative.

You can read Tim Dickinson’s article in its entirety in the October 28, 2010 Edition of Rolling Stone. Here are the eight areas Mr. Dickinson detailed:

• Averted a Depression

The number that is most frequently used to pair President Obama with the concept of failure is 9.6. The trenchant unemployment rate that gives rise to the argument that Mr. Obama has failed to solve the nation’s most pressing problem.

And while that is a depressing number, consider the cavernous abyss we avoided, due to Mr. Obama’s conviction, commitment, and leadership. Based on analyses by economists from Princeton and Moody’s, more than 16 million jobs would have been lost without the interventions of TARP (Troubled Asset Relief Program), the Recovery Act (Stimulus), and the Federal Reserve, twice the damage suffered. Unemployment would have soared to 16.5 percent, and next year, the federal deficit would have more than doubled, to $2.6 trillion. Given what amounts essentially to deflation in prices and wages, the economists concluded, “this dark scenario constitutes a 1930s-like depression.”

The President played a pivotal role in avoiding such a cataclysmic disaster.

1. Re-nominated Ben Bernanke as head of the Federal Reserve

2. Backed the Central Bank’s use of record-low interest rates

3. Demanded transparency from the Fed (Federal Reserve) & Wall Street in administering “stress
    tests” (which restored confidence of panicked investors & allowed “zombie banks” to return to life
    without resorting to nationalization

Due to such deft stewardship, the Treasury now estimates the price tag for the TARP bailout has dropped from $700 billion (the equivalent of the Pentagon’s annual budget) to $29 billion (about one-fourth the spending on veterans). Moreover, Mr. Obama drove the passage of the Recovery Act, which the Princeton-Moody’s study concludes has created 2.7 million jobs.

“The stimulus did what it was supposed to do,” says Mark Zandi, chief economist for Moody’s, and a former adviser to John McCain. “It ended the Great Recession and it jumpstarted a recovery.”

Critics labeled the Recovery Act a failure because it did not hold unemployment to below eight percent, as the President’s economic advisers said it would. Alternately liberal economists accused Mr. Obama of failing to fight hard enough for a bigger stimulus that would have saved more jobs. Together, these positions reflect both the refusal to consider how much worse the situation would have been without any stimulus, and the fact that the bill just squeaked through in the form that was passed.

However, the President also won, subsequently, a series of stand-alone measures – including three extensions of unemployment benefits, the Cash for Clunkers program, a second round of aid for states and a package of loans and tax cuts for small businesses – that have infused another $170 billion into the economy. The Recovery Act itself has grown from $787 billion to $814 billion thanks to provisions pegged to metrics like unemployment.

In fact, should President Obama secure passage of two new programs he has proposed — $50 billion in infrastructure spending and $200 billion in tax breaks for investments in new equipment — he will have surpassed the $1 trillion stimulus that many liberal economists believed from the beginning was necessary. "As the need became more obvious to people, we were able to take additional steps to accelerate progress," Obama senior adviser David Axelrod tells Rolling Stone. The president, in effect, has achieved through patience and pragmatism what he was unlikely to have won through open political warfare.

• Sparking Recovery

The day to day assessment and evaluation of the Recovery Act tends to be big-picture and two-dimensional. Has the stimulus put us on the path to recovery – yes or no? The stimulus, however, was far more than microeconomic medicine. Yes, it was designed to deal with the economic catastrophe at hand, but it was also framed to make investments critical to reviving the middle class and improving the nation’s long-term competitiveness.

Quiet as it is kept, the law included the most progressive middle class tax cut ever enacted – delivering benefits to 95% of working families. It invested $94 billion in clean energy and $100 billion in education – unprecedented levels in both areas. In addition, it devoted $128 billion to health care and $70 billion to mending America’s safety net – including direct cash payments to the elderly, the disabled and impoverished parents, as well as billions invested in low-income housing, food stamps, and child care.

"If you passed each of those as separate pieces of legislation," says Norman J. Ornstein, of the American Enterprise Institute, "that in and of itself would make for a very significant record of accomplishment." Seen through this prism, the stimulus alone represents a strikingly progressive presidential legacy — rivaling the biggest reforms of the Clinton presidency. And it passed on Obama's 24th day in office.

• Saving Detroit

The angry left paints President Obama with the brush of a corporate lackey unwilling to take bold action on behalf of average Americans. The fact is, this picture does not resemble the President who made a $60 billion bet on the future of the U.S. auto industry — and hit the jackpot.

Michiganders, auto workers, and their families aside, the prospect of recycling TARP funds to save GM and Chrysler from liquidation was wildly unpopular — a fact that Obama's top political counselors, warning against the intervention, vigorously impressed upon him at the time.

Politically unpalatable as it were, inaction was simply economically intolerable: Had the administration allowed GM and Chrysler to go under, it would have triggered a collapse of parts suppliers and dealerships nationwide, creating such collateral damage that even Ford would likely have gone belly up. The collapse would also have led to the loss of more than 1 million jobs, primarily in the devastated economies of Michigan, Ohio and Indiana, where unemployment is among the highest in the country.

Rather than bailing out the automakers by providing them wads condition-free cash, as the Bush Administration had proposed, President Obama went for broke and used the government’s leverage to set the companies on a more competitive course. Despite cries of "socialism" and "Government Motors," the administration bought a 61 percent stake in GM, ousted its chief executive, forced both bondholders and UAW members to make concessions and steered the company through bankruptcy in record time. Simultaneously, the administration invested $8 billion in Chrysler — a dowry, of sorts, to secure the company's shotgun marriage to Italian automaker Fiat.

It's difficult to overstate how effective and efficient the government's intervention has been. By risking $60 billion, Obama saved a third as many jobs as the entire stimulus package, which cost 13 times more. In fact, the auto industry has not only survived, it has roared back to life. GM is profitable and preparing to go public in an IPO that could allow the government to recoup its investment. Ford is prospering, edging out Japanese rivals for quality. Even Chrysler is expanding its market share. "The bailout of the auto industry protected against absolute devastation in the economies of the Midwest," says Ornstein. "And it is now turning out to be a huge financial boon for taxpayers."

• Reforming Health Care

Obama's crowning legislative achievement is health care reform. And true to Joe Biden's pithy and profane assessment, it's a Big F…..g Deal. "All progressives since Theodore Roosevelt wanted it, all Democrats since Harry Truman fought for it, and only Barack Obama got it," says historian Douglas Brinkley. "This is his huge accomplishment."

Obama's $1 trillion reform is neither simple nor elegant. But over the next decade, it will extend health coverage to 32 million uninsured Americans — the equivalent of New York and Illinois combined — by expanding eligibility for Medicaid and subsidizing insurance for low- and middle-income citizens. By the end of this decade, 95 percent of Americans will have health insurance. The law also:

1. Establishes a new bill of rights for patients

2. Bans denying coverage based on pre-existing conditions, beginning in 2014

3. Precludes annual caps on benefit payouts, beginning in 2014

4. Prevents arbitrary revocation of coverage of those who get sick, beginning September 2010

5. Children with existing illness can no longer be denied insurance

6. Younger Americans can remain on their parent’s insurance until age 26

7. 1 million elderly citizens are receiving checks fro $250 to fill the gap in Medicare’s coverage of
    prescription drugs

8. All of the above is accomplished while extending the solvency of Medicare by twelve years, and cutting
    the deficit by $143 billion over the next decade

Historians rate President Obama highly for finding a way to push through health care reform even after the surprise election of Republican Scott Brown to Ted Kennedy's former Senate seat in Massachusetts. "One of the most extraordinary moments of this presidency was the decision to go for broke on health care after Scott Brown," says Doris Kearns Goodwin. "Instead of deciding to pull back — we'll get half a loaf or whatever — Obama was willing to take a risk at that point. They could have lost that whole thing, and it would have been devastating for his presidency. Somehow, even though we saw the ugly process, it did work in the end."

In gaining passage of the health care bill, the President defeated the anti-government Republicans who sought to destroy him politically and created a program that will benefit Americans for decades to come. It was a costly victory. Many liberals and conservatives attack it from polar ends; conservatives because it costs too much, they say, while the left contends it does not go far enough without a public option, and single-payer apparatus.

The administration remains unapologetic. "We couldn't have gotten there with the public option," says Axelrod. "The choice was between letting the thing fail or taking a huge leap forward for everyone who will benefit from this now and for generations to come. It wasn't a hard choice to make."

• Cutting Corporate Welfare

Although Obamacare, as his critics call it, does not contain a public alternative to for-profit insurance, the President did succeed in dismantling a major corporate gravy train. The health care bill is paid for, in part, by cutting $136 billion paid out under Medicare Advantage — a Bush-era boondoggle under which private insurers were larded with subsidies for the dubious service of inserting themselves as middlemen between patients and government-run Medicare.

Simultaneously, President Obama also used the health care bill to end corporate welfare in an entirely different arena: student lending. For decades, megabanks like Sallie Mae have reaped billions by doing the paperwork on loans to college students — even though Uncle Sam sets the rates and assumes virtually all the risk. The president's Student Aid and Fiscal Responsibility Act, which piggybacked to victory as an add-on to health care, kicked private banks out of the federal lending game. The unalloyed victory over corporate lobbyists will cut lending costs by more than $60 billion over the next decade — $36 billion of which is being reinvested to expand federal grants for low-income and middle-class students. The law also makes unprecedented investments in historically black schools and community colleges, caps student-loan repayment at 10 percent of a borrower's income and pays for a program to forgive the debts of students who make their careers in public service.

"We've stopped this incredibly wasteful practice where there was effectively no benefit for taxpayers, and we were able to recycle that for families and students," says Rep. George Miller, who spearheaded the reform in the House. "We've been fighting for this since the Clinton administration — and Obama had the courage to do it straight up."

• Restoring America’s Reputation

Senator Barack Obama was among the earliest Congressional opponents to the war in Iraq. His clearly articulated opposition was a key factor in propelling him past early favorite, Hillary Clinton, in Democratic primaries. As President, Mr. Obama has stuck to the timetable he laid out, withdrawing nearly 100,000 troops from Iraq — including the last combat brigade, which came home in August. The move meant quietly overruling his top general on the ground, Ray Odierno, who wanted to delay withdrawal.

"Obama gets credit for checking off that box," says Steven Clemons, director of American strategy at the New America Foundation. "Bringing Iraq to a resolution like this is a very big deal." Although 50,000 troops remain — ostensibly in an advisory and training capacity — they too have a date certain for withdrawal: December 31st, 2011.

While Obama has yet to put an end to the fighting in Afghanistan — a war that has now dragged on longer than Vietnam — he has managed to boost America's standing in the rest of the world. Despite the continuing loss of NATO troops, U.S. approval ratings in Western Europe have soared into the 60s and 70s — far higher than during the unilateralism of the Bush era. U.S. approval is up more than 10 points in Poland and Russia, 20 points in China, and 30 points in Indonesia, France and Germany. Overall, global confidence in America's leadership has leaped from 21 percent in 2007 to 64 percent today.

The President himself has shown a deft diplomatic touch: He has thawed icy relations with Russia and negotiated historic cuts in nuclear arms, re-establishing American leadership and credibility on nuclear nonproliferation. He has also convinced Security Council veto-holders Russia and China to back new sanctions to punish Iran's nuclear ambitions — a degree of international cooperation that was unthinkable during the Bush years.

"President Obama has already repaired much of the damage wrought during the eight years of the Bush administration," former secretary of state Madeleine Albright observed in September. "He has restored America's reputation on the world stage."

• Protecting Consumers

President Obama has taken heat from progressive critics — much of it deserved — over the weakest aspects of his effort to reform Wall Street. It remains unclear whether the new law — the most sweeping overhaul of financial regulations since the Great Depression — will do enough to rein in high-risk trading and end the era of Too Big to Fail. But the law does take bold steps to avoid a repeat of the current meltdown. The Federal Reserve and the FDIC now have the power to seize and dismantle firms like AIG and Lehman Brothers and to force the financial industry to pony up the costs of their liquidation. Banks can no longer gamble federally insured deposits on high-risk investments, and they are required to risk a portion of their own assets in the dubious investments they sell — a move designed to prevent firms like Goldman Sachs from profiting off of "shitty deals."

But the most significant facet of the legislation is the creation of the Consumer Financial Protection Bureau. For the first time, a single regulatory authority will have the power to protect consumers from bad loans and credit deals, the same way the FDA protects patients from dangerous drugs. Armed with an annual budget of $500 million — exempt from congressional cost- cutting — the agency will police everything from payday loans to jumbo mortgages.

For a taste of the kind of regulations the consumer bureau is likely to deliver, look no further than your credit-card bill. Another measure pushed by Obama — the Credit CARD Act — has already forced Visa, MasterCard and American Express to include a box on your statement spelling out how long it will take to pay off your debt making only the minimum payment. It also bans credit-card companies from jacking up your rate without warning, and places stiff restrictions on luring college kids into mountains of debt with easy credit.

The consumer bureau matters not simply to individual borrowers but to the overall stability of the financial system. "Predatory lending played a very big role in the collapse of the financial system," says Joseph Stiglitz, the Nobel Prize-winning economist. The champion and acting head of the bureau, Elizabeth Warren, put it even more bluntly to Rolling Stone earlier this year: "Our financial crisis started one lousy mortgage at a time, one family who got fooled, tricked or cheated at a time," she said. "If nobody can build mortgage-backed securities on trillions of dollars of unpayable instruments, there's a lot less risk in the overall system."

• Launching a Clean Energy Initiative

The President’s failure to curb global warming by passing a comprehensive climate bill stands as his most glaring legislative defeat. But the absence of a cap on carbon pollution has been offset in large part by the enormous strides he has made toward a cleaner, lower-carbon economy. With the Recovery Act, the President effectively launched what greens have long agitated for: an Apollo-like moonshot on clean energy.

Consider that the stimulus targeted $94 billion for clean energy — making unprecedented investments in everything from weatherizing federal buildings to building solar thermal plants in the Mojave. Roughly half of the money involves direct federal spending. But the administration structured the other half — $46 billion — as matching funds and loan guarantees that are realized only when the private sector steps up with capital of its own. According to a report from the President's Council of Economic Advisers, every dollar of federal co-investment is attracting more than $2 in private capital. Add it all up, and the Recovery Act is driving more than $200 billion in public and private investment in clean energy — $20 billion more than the Apollo program would have cost in today's dollars.

"Everybody calls Obama the first black president," says Van Jones, the former green-jobs czar. "But if you were from Mars, and couldn't see race, you'd call him the first green President. That's what distinguishes him on a policy level from every preceding president: this incredible commitment he's made to repowering America in a clean way."

What is the country getting in return? The investment is on track to double the nation's renewable-energy generating capacity by 2012 — bringing enough clean energy online to power New York around the clock. It will also double the nation's manufacturing capacity for wind turbines and solar panels, driving down the cost of clean energy so it can compete with fossil fuels — even if Congress doesn't pass a carbon cap.

The President has also moved aggressively on other fronts to reduce carbon pollution. Cash for Clunkers retired nearly 700,000 gas guzzlers and replaced them with cars that, on average, are 58 percent more fuel-efficient. In the first-ever CO2 restrictions imposed on cars and light trucks, automakers are now required to boost fuel standards high enough to save nearly 2 billion barrels of oil and to reduce carbon emissions by 21 percent over the next two decades. In January, the EPA is expected to do what Congress refuses to: set limits on carbon emissions for large industrial polluters like coal plants and cement factories. And the president has already put America's biggest greenhouse polluter on a carbon diet: By executive order, all federal agencies are now required to reduce their carbon pollution by 28 percent in the next decade. That act alone is enough to scrub 101 million metric tons of carbon from the atmosphere — as much climate-heating pollution as Ireland and Hungary generate combined.

"We have running room to push this forward," says Axelrod. "We can hit the targets we want to hit in terms of reducing emissions, while hopefully spurring a whole lot of economic activity around these new technologies. We're going to keep pushing on that door."

Yes, “Mid-Term Prep” covered a lot of territory, but when the term is four years, you have to expect that. I certainly do not expect every GOP member/Tea Party activist to read this and go out and burn their membership card, or abandon their ultra-conservative views. Rather I would expect those who favor a progressive agenda to reflect on this substantial body of work, and consider the economic and political environment within which it were wrought, and to feel better, if in fact your sense of this Administration's accomplishment were flagging in the first place. Beyond that, I would hope moderates, progressives, and liberals would drop you enthusiasm gap, if you have one, and get to work, recognizing what is at stake.  The fact is, there are those who would like to pretend this President was never elected.  While hisorical records make that next to impossible to achieve, the next aim it seems is to roll back President Obama's accomplishments.

Your vote is a valuable commodity. It is yours with which to do with as you choose. I urge you to use it…early, and to encourage others to do the same.  After all, such a rollback will affect most Americans in more incidiously detrimental ways than it will President Obama's legacy, which is already quite secure.  He is number 44...that is what it is.  I’m done; holla back!

Read my blog anytime by clicking the link: http://thesphinxofcharlotte.blogspot.com/. A new post is published each Wednesday. For more detailed information on a variety of aspects relating to this post, consult the links below:

http://www.rollingstone.com/politics/news/17390/220013?RS_show_page=1

http://en.wikipedia.org/wiki/Troubled_Asset_Relief_Program

http://en.wikipedia.org/wiki/Norman_J._Ornstein

http://en.wikipedia.org/wiki/Doris_Kearns_Goodwin