There’s a disconnect between the economy’s relentless slowdown in the fourth year of Barack Obama’s presidency and the sideshow issues he’s raising on the campaign trail. Actually, “issues” is a gross exaggeration of the sleight-of-hand politics he’s practicing right now in a desperate bid to save his presidency. These are political “distractions” he hopes will keep voters from focusing on the policy failures that have led to an increasingly lethargic economy that is now on a precipitous downhill slide.
To wit: keeping student loan rates at their present levels is an issue no one disagrees with. The only issue is how to pay for it. The story was wholly manufactured by the White House to win back college graduates who can’t find work in a jobless economy and have soured on Mr. Obama’s presidency.
Before he switched to that issue, he was demagoguing tax “fairness” and bashing offshore tax shelters. These are strange issues to raise at this juncture when he hasn’t offered any full-blown reform plan to deal with either one, despite tax overhaul proposals his own commission made two years ago but that he ignored.
What Mr. Obama is hoping is that if he pulls enough rabbits or distractions out of the hat over the course of the next six months, the voters and the news media won’t focus on the issues that matter right now: a weakening economy and unemployment levels that remain stubbornly high in much of the country.
The Commerce Department report on Friday that Mr. Obama’s economy grew at an anemic 2.2 percent annual rate in the first quarter was Exhibit A in the president’s 2012 report card. The economy grew by a feeble 1.7 percent throughout all of last year, a subpar performance in the third year of a very weak recovery that promises no improvement.
In Mr. Bush’s last four years, the unemployment rates were 5.1 percent, 4.6 percent, 4.6 percent and 5.8 percent. In Mr. Obama’s four years: 9.3 percent, 9.6 percent, 8.9 percent, and 8.2 percent as of March.
Mr. Obama’s spokesmen and campaign strategists had the temerity to say that at least the economy was still growing, as weak as that growth was.
The national news media did its best to soften the 2.2 percent growth rate story by either downplaying its impact or looking for silver linings in a looming dark cloud. “Economy continues on path of growth,” the Washington Post’s headline blustered in a front-page story that said the nation’s consumers were “energizing the recovery.”
Let’s put Mr. Obama’s growth rate into a sharper context. To go from a 3 percent growth rate in the last three months of 2011 down to 2.2 was the economic equivalent of going from barely a C grade down to a D-minus. CNN explained the mediocre growth in more bread-and-butter terms: “Growth at that rate is considered too weak to lead to the hiring needed to put millions of unemployed Americans back to work. … The data was also lower than the 2.5 percent rate economists had been expecting.”
But what’s new? Despite the Washington news media’s attempts to play down, whitewash or merely overlook the harsh reality of Mr. Obama’s extended recession, the numbers tell the tale of an economy that was often barely breathing.
Here are the economic growth rates in the first three quarters of 2011: 0.4 percent, 1.3 percent and 1.8 percent in a year that ended with a fourth quarter anomaly of 3.0 percent. Fourth quarter over fourth quarter yielded only 1.6 percent annual growth.
The year ahead isn’t looking much better, according to University of Maryland business economist Peter Morici’s forecasts. (He nailed last week’s 2.2 percent gross domestic product a week before it was announced.) He is predicting the Obama economy will turn in an election-year quarterly performance that has failure written all over it: “Second quarter growth will likely slow to about 1.6 percent, as consumers pull back and inventories slow. Business investment should not be expected to pick up the slack, stabilizing oil prices will likely boost imports a bit, and government spending will stay neutral or decline in the face of tightening fiscal conditions,” Mr. Morici forecasts in his latest analysis.
As the presidential race heads into the homestretch, he predicts the 2012 economy will finish the last three months with a job-crippling 2.1 percent growth rate. In terms of the politically pivotal unemployment rate, he says the jobless rate “is not likely to fall much more.”