In “Salvaging Obama” Mr. Keller offers up a to-do list for a presidency in distress. Prof. Krugman, in “The Plot Against France,” says it’s another case of ideology posing as economic analysis. Here’s Mr. Keller:
President Obama is under water. His approval in the polls is low and sinking, his signature initiative is staggering from a combination of incompetence and sabotage, his foreign policy is a jumble. Congress is a Bermuda Triangle where the most elementary White House business disappears. The public is numbed and disgusted. Allies are theatrically furious about eavesdropping. Put it this way:
When the water-cooler buzz in Washington is focused on Obama’s near-death experience in last year’s campaign debates, it’s pretty clear he is not setting the agenda.
I have a few suggestions for how Obama might lift his presidency up from the bottom. The to-do list that follows consists of ideas that are worth doing on the merits and advantageous on the politics. Most of them are familiar, because this is a time to revive the best features of a stalled presidency, not to launch grand new initiatives. It’s not that I want the president to think small; by all means, address the threat of climate catastrophe and push ahead on early childhood education. But he needs to get a few wins on the scoreboard. I invite readers to post their own suggestions in the comments section.
The first job is obvious, not least to the president. The bungling of the health care rollout was a humiliation for an administration whose campaign wizards famously tamed the social network in 2012. It has given Republicans license to feign indignation even as they do their best to undermine the new program. It has distracted the press from both the success stories (like Kentucky, where the rollout worked the way it was supposed to) and the episodes of Republican mischief (like Georgia, where the state blocked the hiring of “navigators” to help applicants through the enrollment process). I have no doubt that the administration will get the system working and that the program will ultimately prove popular. But the longer it takes, the more the president squanders the already meager public confidence that he can do anything right.
If after a few more weeks the assembled experts are still struggling to make the website work, maybe it’s time to redeploy some techies from the National Security Agency.
Which brings me to…
Fire James Clapper.
Dismissing Clapper, the director of national intelligence, is not a new idea. Fred Kaplan of Slate suggested it in June, after Clapper lied to Congress about the N.S.A.’s data-mining. George Shultz, the former secretary state who belongs on any list of great living statesmen, called for it in September. (“I don’t know how the guy who’s in charge of national intelligence, Clapper, is still there,” Shultz told a World Affairs Council audience. “He lied!”) Better late than never. Obama should fire him not just because he lied, but also because Clapper has cast himself as the defender of the status quo, the apologist for excess. He seems to think what our government does is none of our business.
The president should draft someone widely viewed as tough-minded, clear-thinking and credible. I’d bring back Robert Gates, who, having run both the Defense Department and the Central Intelligence Agency, has the stature and the technical chops, and has shown he can run a gigantic enterprise without becoming a captive of it.
With a change of leadership should come systemic reform to make the spy agencies more accountable. Of the various options I’ve read, my favorite is Max Frankel’s idea of creating a specialized court with the expertise to watch over the intelligence agencies and enough transparency to inspire public confidence. The president should make that idea his own.
Double down on immigration reform.
Comprehensive immigration reform is both the right thing to do and a winning issue politically. A good, bipartisan bill has passed the Senate, with enhanced border security, a more sensible legal immigration regimen, safeguards against employers who cheat and legalization for many of the 11 million who live in the shadows. This sensible reform is trapped in the House by the crossfire within the Republican Party between those who would like to put out a welcome mat for Hispanic voters and those, including the former profile in courage Marco Rubio, who are cowed by the wrath of their base.
It’s conceivable that some House Republicans will take heart from the experience of New Jersey’s governor, Chris Christie, who embraced humane reforms and won half of the Hispanic vote in his re-election landslide last Tuesday.
But even if the chances of success are small, the more the White House presses the issue, the more it isolates the ideologues from the pragmatists, and the more it separates the right wing from business donors.
As Paul Taylor, who follows immigration for Pew Research, puts it: “It’s better politics if the president wins, but it’s still good politics if he loses.”
Rebalance foreign policy.
For years the administration has talked of “rebalancing” our military strategy to address an increasingly assertive China. The Pentagon, liberated from Iraq and drawing down in Afghanistan, has taken some modest steps in this direction, deploying more of the Navy to Asia, devoting more resources to China’s space and cyber threats. But our rivalry with China is not, and should never be, primarily military. We need to compete on the fields of economics and diplomacy. Unfortunately the civilian custodians of our foreign policy have been bogged down in the Middle East, a region that matters a lot, but not as much as it did when we were more dependent on imported oil.
In the Middle East, Obama is now pretty much where he wants to be — jaw-jaw, not war-war, as Churchill liked to say — and that is clearly where the American people prefer him to be. Talks (hopeful) are underway to rid Syria of chemical weapons and (less hopeful) to find a diplomatic end to that country’s civil war. There is fitful progress in the talks aimed at testing whether Iran’s new president has the will and the authority to put a verifiable lid on that country’s nuclear program. Talks are taking place on the eternal conundrum of Israel’s coexistence with the Palestinians. Success at any of those tables would be a blessing to humanity and a great lift for the president.
But while diplomats are patiently tending these negotiations, there is time to pay attention to unfinished Asia business. The biggest item awaiting some Washington juice is the Trans-Pacific Partnership, an immense, stalled, Asian free-trade agreement that would do more to counter burgeoning China than any number of battleships.
Like most free-trade agreements, it has opposition, from critics who fear it would insufficiently protect labor, consumers, the environment and intellectual property. It’s time for the administration to cut some deals, crack some heads and open up those Asian markets.
Forget the Grand Bargain. Go for little bargains.
The idea of a grand fiscal bargain — a megadeal that wins bipartisan support on the whole complex of spending, taxes and entitlements — was all the rage a year ago, but it has passed its sell-by date. Not only has it proven politically unattainable as long as the House is in thrall to a band of least-government ideologues, it has also been overtaken by reality. Even relatively conservative economists concede that the deficit — a very sustainable 4 percent of gross domestic product — is not the problem, at least not in the foreseeable future. There is a distant problem for Social Security and Medicare as my baby-boom generation retires, and it would be nice to address it before young Americans find the cupboard bare. But the immediate and urgent problems are sluggish growth and too few jobs.
Michael Strain, an economist at the American Enterprise Institute who often speaks sense to conservatives, suggests a “humble bargain,” a menu of smaller deals.
For example, Strain says Republicans should be willing to agree to a bit more spending on job-stimulating federal programs if Democrats agree to slow the long-term growth of entitlements a little by, say, employing a more realistic cost of living formula.
If the president wants to be a bit bolder, he should look at systemic fixes. Fareed Zakaria at CNN proposes that we do away with the practice of funding our decaying roads, bridges, airports and railroads by annual appropriations and create instead a national infrastructure bank. Backed by federal bonds, it would fund meritorious projects rather than those based on pork and patronage. Christina Romer, former chairwoman of Obama’s Council of Economic Advisers, suggests a policy of “automatic stabilization”: “We could set up a system that automatically cuts tax rates and increases unemployment benefits and food stamps when the economy weakens.” The costs would be offset in good years by automatic debt reduction. Justin Wolfers, a University of Michigan economist who leans Democratic, refers to this as “Congress-proofing the economy.” After the last few years, you have to like the sound of that.
It may well be that — despite the evident voter unhappiness with Washington gridlock — Congress will continue to be unmovable. In which case…
Nationalize the midterm elections.
President Obama, of course, will not be on the ballot a year from now, but the midterm elections will be treated as a verdict on the state of America under his leadership, and the outcome will have a lot to do with how he spends his final years in office. He should miss no opportunity to portray the 2014 elections not as 435 House contests and 33 Senate races, but as a national referendum on our government dysfunction.
The message could be: “Divided government has brought us paralysis and crisis and made us a global laughingstock. Send me Democrats, and we’ll get things working again. Or at least, send me Republicans with a trace of pragmatism.”
We know the litany of reasons this will be a long shot: the gerrymandering of Congressional districts and the natural clustering of like-minded voters tends to make House seats one-party fiefs; the hegemony of narrow-interest money distorts voting; it has become hard to get a presidential message out through the media noise machine; the public has not fully grasped that the problem is not everyone, it’s mostly the Republicans.
Norman Ornstein, the veteran Congress-watcher, points out that the last time someone succeeded in nationalizing a midterm election was 1994, when Newt Gingrich led a Republican uprising; it took Gingrich 16 years of preparation, and he was mobilizing against the president. But if the radicals persist in hostage-taking, brinksmanship, shutdowns and extremist rhetoric, Ornstein says, “Then you might see a greater backlash.”
It’s worth trying. However low the president’s ratings sink, Congress’s are bound to be lower.
Now here’s Prof. Krugman:
On Friday Standard & Poor’s, the bond-rating agency, downgraded France. The move made headlines, with many reports suggesting that France is in crisis. But markets yawned: French borrowing costs, which are near historic lows, barely budged.
So what’s going on here? The answer is that S.& P.’s action needs to be seen in the context of the broader politics of fiscal austerity. And I do mean politics, not economics. For the plot against France — I’m being a bit tongue in cheek here, but there really are a lot of people trying to bad-mouth the place — is one clear demonstration that in Europe, as in America, fiscal scolds don’t really care about deficits. Instead, they’re using debt fears to advance an ideological agenda. And France, which refuses to play along, has become the target of incessant negative propaganda.
Let me give you an idea of what we’re talking about. A year ago the magazine The Economist declared France “the time bomb at the heart of Europe,” with problems that could dwarf those of Greece, Spain, Portugal and Italy. In January 2013, CNN Money’s senior editor-at-large declared France in “free fall,” a nation “heading toward an economic Bastille.” Similar sentiments can be found all over economic newsletters.
Given such rhetoric, one comes to French data expecting to see the worst. What you find instead is a country experiencing economic difficulties — who isn’t? — but in general performing as well as or better than most of its neighbors, with the admittedly big exception of Germany. Recent French growth has been sluggish, but much better than that of, say, the Netherlands, which is still rated AAA. According to standard estimates, French workers were actually a bit more productive than their German counterparts a dozen years ago — and guess what, they still are.
Meanwhile, French fiscal prospects look distinctly nonalarming. The budget deficit has fallen sharply since 2010, and the International Monetary Fund expects the ratio of debt to G.D.P. to be roughly stable over the next five years.
What about the longer-run burden of an aging population? This is a problem in France, as it is in all wealthy nations. But France has a higher birthrate than most of Europe — in part because of government programs that encourage births and ease the lives of working mothers — so that its demographic projections are much better than those of its neighbors, Germany included. Meanwhile, France’s remarkable health care system, which delivers high quality at low cost, is going to be a big fiscal advantage looking forward.
By the numbers, then, it’s hard to see why France deserves any particular opprobrium. So again, what’s going on?
Here’s a clue: Two months ago Olli Rehn, Europe’s commissioner for economic and monetary affairs — and one of the prime movers behind harsh austerity policies — dismissed France’s seemingly exemplary fiscal policy. Why? Because it was based on tax increases rather than spending cuts — and tax hikes, he declared, would “destroy growth and handicap the creation of jobs.”
In other words, never mind what I said about fiscal discipline, you’re supposed to be dismantling the safety net.
S.& P.’s explanation of its downgrade, though less clearly stated, amounted to the same thing: France was being downgraded because “the French government’s current approach to budgetary and structural reforms to taxation, as well as to product, services and labor markets, is unlikely to substantially raise France’s medium-term growth prospects.” Again, never mind the budget numbers, where are the tax cuts and deregulation?
You might think that Mr. Rehn and S.& P. were basing their demands on solid evidence that spending cuts are in fact better for the economy than tax increases. But they weren’t. In fact, research at the I.M.F. suggests that when you’re trying to reduce deficits in a recession, the opposite is true: temporary tax hikes do much less damage than spending cuts.
Oh, and when people start talking about the wonders of “structural reform,” take it with a large heaping of salt. It’s mainly a code phrase for deregulation — and the evidence on the virtues of deregulation is decidedly mixed. Remember, Ireland received high praise for its structural reforms in the 1990s and 2000s; in 2006 George Osborne, now Britain’s chancellor of the Exchequer, called it a “shining example.” How did that turn out?
If all this sounds familiar to American readers, it should. U.S. fiscal scolds turn out, almost invariably, to be much more interested in slashing Medicare and Social Security than they are in actually cutting deficits. Europe’s austerians are now revealing themselves to be pretty much the same. France has committed the unforgivable sin of being fiscally responsible without inflicting pain on the poor and unlucky. And it must be punished.