The first press conference on television last night was more proof that Bush is an easy act to follow. How refreshing was it to have a president speak coherently without smirking and furrowing his brows at every question that protrudes and probes at future decisions the president may or may not make?
But, overall, it was a pragmatic press conference. The choice of Elkhart, IN over Cleveland, OH or Detroit, MI was pragmatic. And should Obama continue to play it safe on the issues?
Should he be the president of conventional wisdom at a time when conventional wisdom is so heavily doubted?
Being from Indiana, I can tell you that Elkhart’s economy thrived on the RV industry. When oil and gas rose to the level it did in spring and summer of 2008, jobs were being cut and RV companies, which had been experiencing a significant drop in businesses for quite a few months, could not continue operations.
Elkhart has the highest unemployment rate in the country. Nearly 8,000 jobs have been lost. (Its population is about 51,000.)
It is clear that Obama is correct when he says, “I can tell you with complete confidence that a failure to act will only deepen this crisis, as well as the pain felt by millions of Americans,” but I read some stunning economic analyses during the final two months of the presidential election by Michael Hudson, Ron Paul, Paul Craig Roberts, and Ralph Nader
I wonder what Hudson, Paul, Roberts, or Nader think of the current stimulus and believe they have the credibility to discern what would be good for economy and not good for our economy.
Danny Schechter described the hacking of the stimulus in “The Farts of Compromise: Hacking the Stimulus.” The quote he uses from Benjamin Barber, author of Consumed, seems to be relevant and must have been the backbone for Chuck Todd’s question during the press conference.
Benjamin Barber suggested the stimulus is all about “priming the pump.”
“Let's get people getting those credit cards again. Let's get people to the mall. Let's get people spending again. Back in 2001, after the terrorist attack in America, President Bush said, 'let's get back to the mall and get back to doing that good American thing of shopping.' Unfortunately, the new economic team of the new president may be saying somewhat the same thing.”
The exchange between Todd and Obama that looked at whether consumer spending is the way out of this crisis or not went like this:
In your opening remarks, you talked about that if your plan works the way you want it to work, it's going to increase consumer spending. But isn't consumer spending, or over-spending, how we got into this mess? And if people get money back into their pockets, do you not want them saving it or paying down debt first, before they start spending money into the economy?
MR. OBAMA: Well, first of all, I don't think it's accurate to say that consumer spending got us into this mess. What got us into this mess initially were banks taking exorbitant, wild risks with other people's monies, based on shaky assets. And because of the enormous leverage, where they had $1 worth of assets and they were betting $30 on that $1, what we had was a crisis in the financial system.- Advertisement -
That led to a contraction of credit, which in turn meant businesses couldn't make payroll or make inventories, which meant that everybody became uncertain about the future of the economy.
So people started making decisions accordingly, reducing investments, initiating layoffs, which in turn made things worse.
Now, you are making a legitimate point, Chuck, about the fact that our savings rate has declined. And this economy has been driven by consumer spending for a very long time. And that's not going to be sustainable. You know, if all we're doing is spending and we're not making things, then over time, other countries are going to get tired of lending us money. And eventually the party's going to be over.