A Political Hit
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Barack seems like a nice enough bloke but he's blown too much cash and now he's stuffed.
The Worm Turns
ISAAC LEVIDO Political Editor
O
n Tuesday, November 2, Americans go to the polls.
This ‘mid-term’ election – coming in the middle of a president’s four-year term – is much the same as our federal elections. The whole of the House of Rep- resentatives and a third of the Senate seats (in Australia it’s half) are being contested.
Having doubled down on big gains made in 2006, and thanks in no small part to Barack Obama’s coattails, the 2008 election delivered the Democrats healthy majorities in both Houses. Presented with this rare op- portunity of united government across Congress and The White House, Obama and his friends on Capitol Hill wasted no time in getting down to work, enacting a near-trillion dollar stimulus pack- age in response to the economic downturn and taking on what had become somewhat of a legislative
86 • the Beast
holy grail for Democrats – com- prehensive health care reform. Now, on the eve of the first election of the ‘Obama era’, these two supposedly landmark achievements have become the Achilles’ heel of the Democratic Party as they desperately try to avoid an electoral bloodbath. Why? In one word, it’s the economy. While admittedly inher- iting a fiscal basket case, Obama and the Democratic congressional leadership made two fundamental errors – they overpromised, and at the same time underestimated. The overpromising relates to the stimulus. This $700 billion debt-financed spending bill was sold to a skeptical public as a gateway to economic recovery. Its proponents ambitiously forecast it would create and preserve of up to 4 million jobs and add nearly 4% to GDP growth within 12 months. Unfortunately, the reality has been otherwise. The jobless rate has continued to grow from 7.7% when Obama
took office to 9.6% at last check for the month of September – roughly 15 million people un- employed. The quarterly growth rate, after showing a promising spike initially, has retreated back to 1.7% most recently, casting the daunting spectre of a double-dip recession over the economy. What Obama and Congres- sional Democrats underestimated was the loud and concerted pushback they received on their healthcare reform plans. At a time of enormous economic uncertain- ty, Obama proposed to fundamen- tally reshape a system that few Americans understood to start with, and highlight an issue that is a cause of great anxiety at the best of times. This has turned out to be - at least in the short-term - a severe political misjudgment. All this has played right into the hands of a once-thought moribund Republican Party. Re- publicans have been hammering away at Democrats by tapping into genuine public concerns of excessive debt, deficits and runaway spending. This has been an extremely simple and effec- tive message, albeit somewhat cynical considering they bear a large portion of responsibility for America’s dire fiscal health. The upshot – Democrats are all but certain to lose control of the House and come close to giving up the Senate. The period of divided government that will follow is likely to be character- ised by deadlock and division, as the Republicans struggle to form a governing agenda and Obama scrambles – a mere two years out from his re-election battle - to turn lemons into lemonade.
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