Did Obama bring criticism for the state of the job market upon himself? After all, he promised his stimulus package was going to create or save millions of jobs.
Eh, I'm underwhelmed. Bush made similar claims about the powers of his tax cuts. That's what presidents do: claim that they have magical powers over the economy. Then when things get better, they take credit, and when they don't, they claim things would have been even worse without them.
Perhaps they deserve to take a beating from the voters for the state of the labor market, which is sort of irrelevant, because whether or not they deserve it, they definitely will. But I'm as inclined to believe that presidents claim these magical powers because voters demand them, as that the causality runs the other way.
But op-ed columnists should not encourage these beliefs by writing columns demanding that the president exercise his magical powers. That energy would be better spent making fun of the president when he makes those sort of promises, and explaining that after all, the president is not the Labor God.
Copyright © 2010 by The Atlantic Monthly Group. All rights reserved.
I agree nearly completely with the idea that presidents have little or no control over the economy in the short to mid-term. Good and bad enacted policy can affect things with longer lags, but the Fed chairman has far more direct and immediate power.
However, I do enjoy watching politicians hoisted on their own petards, and my expectations of op-ed columnists have been pretty beaten down over the years, so I don't expect them to ever really educate public. So, yes- Obama deserves what he is getting. Maybe next time he won't make such foolish promises.
Agreed on all points. I think Megan has been generally consistent in holding the view that presidents have very little direct control over the economy which I think is her larger point.
That being said, Obama over-promised on a lot of things and was elected largely because he and his own were able to blame the state of the economy on the other party. I don’t think it’s unfair for him to now have to suffer from the unrealistic expectations he may have created.
I am trying to imagine a world in which Bush could have claimed to have "saved or created" millions of jobs in 2004 without being utterly destroyed in the MSM.
Little or no control?
The Obama Administration sent $77,000 in stimulus funds to Bridgewater State College. They reported back to Obama that they created 160 full-time work-study jobs for students.
Mission Accomplished! Jobs created! Right?
Except ... it was all a lie. Bridgewater spent the $77,000 all right. But they didn't create any new jobs for anyone. It was all a scam, according to an investigation by the Boston Globe. No new jobs were in fact created and the money is now gone.
The President has control over jobs, he's just doing a horrible job because his administration is incompetent and taking fraudulent credit to cover up its incompetence.
Here's another example of Obama Administration incompetence and fraud: $2.7 million going to a Boston housing project. Jobs created: 26. Except, really no jobs were created.
“There were no jobs created. It was just shuffling around of the funds,’’ said Susan Kelly, director of property management for Boston Land Co., which reported retaining 26 jobs with $2.7 million in rental subsidies for its affordable housing developments in Waltham. “It’s hard to figure out if you did the paperwork right. We never asked for this.’’
Barack Obama has control over all of this money, and he is wasting it and reporting to the American people that he's created or saved jobs with it. Which the media have revealed to be a huge hoax.
Impeach. Him.
http://www.boston.com/business/articles/2009/11/11/stimulus_fund_job_benefits_exaggerated_review_finds/
Do you have an actual link to a direct quote from President Bush making such a claim because the Op Ed piece you linked to doesn’t actually have any quotes other than from a left-wing advocacy group that opposed the Bush tax cuts.
Thanks!
No, Megan cannot provide any links directly quoting George W. Bush making fraudulent job creation claims.
But it is trivial to find links to Barack Obama making fraudulent job creation claims while wasting the money:
Media Fall For Phony Job Claims
http://online.wsj.com/article/SB124451592762396883.html
The money is gone. Virtually no jobs were created or saved and mainstream media evidence of fraud is rampant and growing.
It's time to impeach Barack Obama before it's too late.
"Did Obama bring criticism for the state of the job market upon himself? After all, he promised his stimulus package was going to create or save millions of jobs"
Well, yes he did. He may not have the mystical powers to create jobs himself....but he thought he did. He said he could take a heap 'o money and turn it into a million plus jobs and cap unemployment at 8%.
Unless that was the Jobs Czar doing a good impression of the President, i'd say he put himself front and center as the jobs creator guy. Heck, I even seen him on teh youtube :)
While it's true that Presidents have little control over the economy, they certainly have major control over the economic mood of businesses and people.
Just threatening to pass legislation that will make it more expensive to hire people will have a direct effect on hiring. Businesses would have to be nuts to hire people right now. President Obama is in the process of such sweeping changes that the only decision that makes any sense is to wait and see how things turn out. No one knows what new taxes or expenses businesses may face a year or two from now. All we know is that President Obama is working as hard as possible to make many, many changes.
FDR did the same thing during the Great Depression and Big Capital simply stuffed its cash in the mattress until the war pulled them back into the market.
So, yes, Presidents don't control the economy, but they do have strong role in the level of uncertainty.
Said in the previous posts, properly repeated here by you, and still very much the heart of the matter.
Obama has used the bully pulpit NOT to bring calm to the economy, but to instead spread panic. Some would say intentionally, given how often he threatened the world with economic disaster if they didn't adopt his TARP, Spendulous, or Health Care demands.
Obama has the small business community on tenter hooks. Every survey shows this. If this is true, then Obama is *significantly and directly responsible* for the still non-existent recovery in the job market.
To go a step further: even if (a huge, unlikely "if") he reverses his course today and pours TLC all over small businesses, his past actions have set expectations. There is no way that the small business community will respond as rapidly and as aggressively as they would have, had Obama not initially shown such disregard for them.
He *has* damaged the job market, and he is now saddled with some of the damage going forward.
This is irrefutable.
While it's true that Presidents have little control over the economy, they certainly have major control over the economic mood of businesses and people."
And don't forget they also have control over the billions.
That money is being spent on something. But not jobs.
We know it's not being spent on new jobs or else they wouldn't be faking jobs data to pull a hoax on the American public as has been reported by numerous media outlets including the NY Times and Boston Globe ... media outlets normally not hostile to the Barack Obama administration.
So where did the money go? Who stole the money?
While any president may not have the magical powers of job creation, surely we could agree in abstract that some hypothetical policy can destroy jobs, quickly, and in great numbers?
Precisely, though it bears elaboration, as some have done below. It's not just "hypothetical polic[ies]" that destroy jobs. The President has little direct power to improve any aspect of the economy, especially something as complex as job formation. He has a great deal of power to harm it. Congress has more power to do both.
Obama's actions have been almost universally harmful to the economy, especially from a long-term perspective, with only modest short-term improvements to offset that harm (e.g. the stimulus package he encouraged Congress to pass).
And Megan, why should we not hold Obama accountable for his promises? Or do we give a pass to everyone who gains immense power via transparent lies?
That was the point i was trying to argue, but I fear getting caught up in an argument about the economic benefits of the stimulus, healthcare reform, tarp, or heaps of magic dust.
All Obama has to do to destroy millions of jobs overnight is to say he's going to increase the marginal tax rates back to 1980 levels. We Americans deserve to get it good & hard - we elected this idiot.
Yes, but we could also remove him from office.
The Constitution isn't a death pact. We are not required to allow a President to present fraudulent evidence of our money spent. Fraud is a crime. And we don't have to allow our President to engage in it.
The Constitution allows us to remove a President from office for committing these sorts of high crimes and misdemeanors. We are not required to allow this to continue to go on for 3 more years.
If we get it good and hard, we have only ourselves to blame for not impeaching this fucking idiot.
Or promise a vague energy tax.
Or threaten to help unionize your workforce.
Or work on raising the healtcare costs for you and your workers.
Or use his bully pulpit to denigrate the profit motive and private enterprise every chance he gets.
Tu Quoque
Obama=Bush ?!?
Never. What, never ?
No, never...well; Hardly ever. :)
Voters looking for a Golden Calf ?
Yes, and replacing gods who fail
to deliver.
Obama the Labor God.
The Union's prayers were answered.
Sigh; Memory trick: Conflated
"The God that Failed"
with
"The Light that Failed"
and
"The Man who would be King"
can't imagine why. :>
big picture: Megan is right. Short term, Presidents can do little to juice employment.
but also -- at the very least, directionally Bush was right while Obama has been wrong.
Both proposed measures that increased deficits --
Bush's measures provided certainty immediately -- here are your new lower tax rates, at least through 2010. Those lower rates meant that at the margin, a cohort of investment projects that didn't make sense previously now did. Bush created a favorable, pro-growth environment for business with a bottoms up approach.
Obama choose to stimulate from the top down. Thus, all he really has done is create a modest amount of government jobs. In addition, he is proposing a bunch of measures that still, one year in, have enormous uncertainty attached to them. The overhang is anti-growth.
Good points. If you are looking to put money into the economy, deficit-funded or not, tax reduction is the best way to do it.
Tax reductions are immediate, as you point out.
They are also tangible. People feel the impact, directly. This underscores how they had better be meaningful, or you look like an idiot.
They are also, as you point out, much more certain. Or at least easier to foster certainty with. If the best you can do is pass a tax rebate that will likely be overturned before it is enacted, or soon after, you are wasting your time - and you know that, so you won't bother.
They are also more widespread, if done correctly. If/when every taxpayer feels the benefit, then you've de facto covered every taxpayer.
The trouble is, there's much less room for pork and corruption with this approach. While the press will point out that Bill Gates doesn't NEED the rebate, they'll ignore the fact that the money he's getting back is his own money. That same press is happily ignoring the fact that the top-down approach that Nancy, Harry, and Obama have funded is funneling all kinds of dollars to union bosses, political hacks, "administrators" and other such people who are lining their pockets... not with their own money, but with yours.
In New Jersey, Michigan, Illinois, NY, Louisiana, etc. this kind of corruption is known as "how things work."
Indeed. However, there is some use in illustrating that the President has not used the powers of the Labor God after he has spent a year campaigning and a year governing on that premise. Perhaps if the op-ed had closed with general ridicule of the proposition in general, it would have been more generally useful.
Megan, I agree with your premise.
They promise things they can't deliver, millions believe their lies, and we get the democracy we deserve, good and hard.
The question is what can we do when the presidents play this game? The answer is we hold them to account for their promises.
Yes, many of us knew they couldn't deliver, but unfortunately millions of voters did not.
It is our job, and particularly yours (as a commenter), to point out that they utterly failed to deliver on their promise. If you want to point out that it was an impossible promise, even better. The fact that it was impossible when they promised it is no excuse. The fact that you and I both knew it was a lie when Obama promised it is even less of an excuse.
The empty promises will continue as long as they are effective, and the only way to make them ineffective is show them for what they are, instead of giving them a pass in the name of being underwealmed.
Do you have values or do you not? I assume you do, but I mean, you're just so dismissive of any lie, because you expect lies, it's like, I just don't even know.
Sorry for rambling, but it is just pitiful what is going on.
Said above by Jay: "The question is what can we do when the presidents play this game? The answer is we hold them to account for their promises."
Bravo.
And this is why I am disappointed in both today's and yesterday's posts on this subject. Megan repeats a general truth upon which many agree -- Presidents have limited direct job creating power.
But, what Megan seems to advocating is accepting the sunny promises of politicians who vow to "create or save" jobs, who also criticize predecessors who supposedly destroyed jobs. If this is acceptable because politicians can say silly things by virtue of being politicians, when then is it unacceptable for opinion columnists to do what they do -- which is to hold the President to a standard which they themselves set? They're surveying the promises and commenting on the success or failure of the efforts implemented. In other words, they're operating on the same playfield as the politicians. To me, this is defensible.
Megan wants to hold opinion journalists to a higher standard than the most powerful man in the world. Since she is a journalist, this is noble and all, but uh...
Here's a question:
Do Presidents have the power to fake jobs data? Is that a crime? Is it fraudulent to submit fake reports to Congress? Isn't it illegal to lie to Congress?
It's time to get some people under oath and determine where the money went - because the money is missing and there's very few jobs that were actually created.
I agree with Thorley.
I'm still looking for a reference to a direct quote by W. that he would create jobs. The link you provided cites an unattributed statement by a member of the Council of Economic Advisors (CEA.)
Please note the Austan Goolsbee is a current member of President Obama's CEA and if my memory is correct, I believe that he too made some rather impolite statements during the campaign.
How about this quote from W: "We need immigrants to do the jobs Americans won't do." Regarding Obama, most have heard the saying, "The President proposes, Congress disposes," and the former cannot effectively act outside of concert with the latter to create jobs. I observe that Obama has high expectations that Congress can function well, as it should, and some may point out the unrealistic nature of that assumption. Certainly, if jobs are to be created, members of Congress must concentrate to employ their deliberative powers, more than their lacrimal glands.
Pablo - 'this quote from W: "We need immigrants to do the jobs Americans won't do."'
I just googled "We need immigrants to do the jobs Americans won't do."
and got a total of five (5) hits - one is this very comment from you, two more are in the comment section of a TPM memo and an additional one attributes the statement to a "Chamber of Commerce Hack."
Can you direct me to your source for the quote?
See Richard W. Stevenson and Steven Greenhouse, January 8, 2004, New York Times.
Re:''Reform must begin by confronting a basic fact of life and economics -- some of the jobs being generated in America's growing economy are jobs American citizens are not filling,'' Mr. Bush said to cheers from an audience that included cabinet members and representatives of Hispanic groups. ''Out of common sense and fairness, our laws should allow willing workers to enter our country and fill jobs that Americans are not filling. We must make our immigration laws more rational and more humane, and I believe we can do so without jeopardizing the livelihoods of American citizens.''
Bush's remarks were from January 7, 2004 at the White House. Other sources may record different portions of his remarks. My source was hearing the President say it as replayed on the radio news that day, and I heard it as the words I quoted above.
Pablo - I appreciate your passion, but please look at your two quotes you attributed to GWB:
1. "We need immigrants to do the jobs Americans won't do."
With no reference from you where it came from which suddenly morphed into -
2. "...our laws should allow willing workers to enter our country and fill jobs that Americans are not filling."
Hopefully, I don't need to discuss the difference between an undocumented farm worker and an H-1B high tech software programmer.
Should we not hold astrologers accountable when their predictions do not come true? Or when their predictions are so open-ended and ill-defined that just about anything could satisfy them.
That said, the President can certainly exercise the equivalent of moral suasion, even if his policies may not have a direct effect on economic conditions over short to medium term - as other commenters have noted. I think that Congress's and his threats are scaring off job creation.
Should the president not promise things he obviously can't deliver on? Obviously.
But you act as if there is no body of knowledge as to what policies are likely to create jobs under certain conditions. Why should editorialists hold their tongue? Why shouldn't they push the president to make wise policy? Some policies are better than others. This is true and completely independent of whatever presidents promise they can deliver.
Yes disingenous Kuehn, why should Krugman not spew his vile hate? Now you're trolling over here. Cafe Hayek isn't enough for you?
OK, unlike Cafe Hayek there's usually pretty decent decorum on The Atlantic blogs. For their sake, don't bring that crap over here.
Besides - you all undulate in praise over Don Boudreaux whenever he expresses his thoughts on what creates or saves jobs in print - so you're in agreement with me - op-ed columnists should absolutely get explicit about what the president should do to create jobs.
If you think a small business owner's ability to hire new employees is not directly affected by taxes, employee benefit requirements (e.g., healthcare), and energy costs, then you are a complete buffoon.
Heretic! How dare you claim the great Obama does not possess magical powers! Have you not heard his magical health care plan that reduces costs, increases coverage, lets everyone get the same care they get now, and all for free?
Fortunately for the economy, it looks like his two massive tax hikes may stall in the Senate, but I'm still not convinced he isn't dumb enough to start a major trade war.
To be fair, there is one sure way of extending the president's control over jobs and the economy: extending government! Why kowtow to the fat cats of the market when you can have experts control and plan everything centrally?
Aagh, I shouldn't attempt that again, I'm having difficulties retracting my tongue from out of my cheek...
I'd like to question what it means when we say the President has "a little" or "a lot" of control over job creation.
Even in a fairly narrow sense, most would agree he has some. I know, for example, the SAEE survey (Survey of Americans and Economists on the Economy) found that most everyone things the President can have some effect:
21. Do you think improving the economy is something an effective president can do a lot about, do a little about, or is that mostly beyond any president's control?
I've always wondered what, exactly, people were thinking when answering this question. What does "A lot mean"? What does "A little" mean?
When it comes to something as frustrating and nebulous as job creation and economic growth, I think the context of things matters a great deal. Megan's condescending 'well gee, Obama can't hire people from his book proceeds' argument completely ignores the roles of expectations about future policy, debt and taxation levels, and those are things the President has a lot to say on. Especially when his party controls Congress and will follow his agenda.
Context matters. People generally don't think the President can directly control the economy much because
1. Presidents typically don't have this much power.
2. Presidents typically don't have an agenda that involves changing things in so many ways. That is, we've tended to be successful economically, and thus generally expected our Presidents to not utilize *every* tool at his disposal to change the economy.
That is, we expect the President has little power because the generic, survey question President is more checked by an opposing Congress and less likely to try to fundamentally alter what has been a fairly successful model.
"That's what presidents do: claim that they have magical powers over the economy."
Here we see step two in the defense of liberal spending. Step one (before passage) is to use Krugman's credibility to demonize the opposition. Step two (after passage) is to claim everyone knew the magic bean didn't exist so what's all the fuss? Nice. I wonder why opinion columnists seem to believe it's inappropriate to notice we were right all along.
When Obama admits the stimulus package had no effect on unemployment we can start discussing that. Until then he will be and should be hammered with the unemployment numbers.
My general impression is that while the President as an individual cannot exercise that much power, a concentrated effort by the entire government certainly can through the magic of multipliers.
However, the majority party in Congress has apparently decided to be more concerned about passing their ideological agenda with their temporary majorities, instead of more fiscal stimulus and job creating efforts. Even financial reform, to ensure that this doesn't happen again, is being put on the backburner for the time being.
So, no, the President isn't directly at fault. But the majority party has a good bit of blame, and the President is an extremely important part of said party.
McArdle - you are just as guilty as any of the pundits for ascribing magical job-creating powers to the POTUS. Fess up already.
What makes columnists moral agents accountable for making looney claims about themselves, but Presidents not?
Presidents are morally accountable if their names are Reagan or Bush. Obama, no.
But he is accountable. To the people.
We have the power in 2010 to elect a Republican Congress on promises to impeach this moron.
So, he's accountable. Directly. To us. If we only wake up and do the thing that our Constitution allows us to do:
Impeach. Him.
Megan,
The President isn't nearly so powerless as you would portray him. Federal outlays as a percentage of GDP have averaged ~20% in recent years. That is pretty significant. It seems to me that you imagine the President is powerless to help the economy because you have ruled out increases in outlays as an option. If the President increases outlays by 5%, GDP goes up by 1%. IMO that's pretty substantial change. The President also has wide administrative power to change the effectiveness of previously allocated spending.
An alternative way of looking at your position, is to "reverse the causality" Your political position presupposes that the government is the problem rather than the solution. Thus this economic opinion follows as a corollary of your politics. If the government can do only harm, you must conclude the President, as a government official, cannot improve our economic outlook. Flawed logic, but I'm not surprised one bit.
Of course if you believe in New Deal-ism that is.
No.
This isn't an ideology thing, it is a basic economics thing. By definition, increased government outlays increase GDP.
GDP = consumer_spending + gross_investment + government_spending + exports - imports
Nope, this isn't a definitional thing.
How does the government fund these increased outlays? If it's by taxation, then some combination of the following needs to fall: consumer_spending or gross_investment.
If it's by deficit spending then it is also possible that consumers could cut back on their spending in expectation of future tax increases to pay back the deficit. This is more doubtful than the idea that raising taxes reduces consumer spending, but it's logically possible (look up Riccardian Equivalence).
Before you can say that increased government outlays increase GDP you need to think through how consumers are going to react.
I think it is fair to say that Presidents in general have less control over the economy than they think they do and certainly less than they like to claim they do. But Obama is an exception.
For whatever reason he has unleashed a series of initiatives that are scaring the sh*t out of private businesses and consumers. While there is limited upside to what Presidents can do, there is no real limit to the downside and Obama is exploring that side unfortunately.
The best Presidents can do is make conditions favorable for growth and let businesses thrive secure in the knowledge of what the playing field is going to look like, this will only lead to as much growth as businesses generate based on their own situation and what consumers are willing to consume. You can get some nice 4% growth a year during the expansion maybe but each business has to work hard for its success and consumers need to comfortable that their situation isn't going to deteriorate.
But you scare business to death with uncertainty, make clear that you are going to ream them endlessly for every worker they hire and dollar they make, plus you steal trillions from consumers to give to mega banks to paper over their losses while they give bonuses to guys who should have GS ratings and you can make the economy shed jobs pretty damn fast.
We spent an unimaginable amount of money to 'fix' the economy but all we really did was eliminate accounting standards and let the banks hide the toxic assets. Lost decade here we come and the money that could have been used to help is now gone just to delay the reckoning by a couple years. I am as depressed as hell about this and spend no more than I have to and that won't change for years.
So businesses are looking at higher taxes, more cost per worker, more expensive compliance with new regulations, and if they get over all these hurdles, they then find me at the end not buying their products.
Obama deserves every bit of derision he gets for his preening.
What's interesting is that the lefty columnists generally want him to take lots more control over the economy, so from their perspective claiming he can affect the economy makes sense.
Unfortunately for the country, the government is bad at running an economy.