Low Expectation for Obama on the Economy
One interesting finding in the latest NYT poll is that the public seems to have incredibly low expectations for the efficacy of Barack Obama’s economic policies. If the recession really continues until the end of Obama’s first term, that would be a shockingly long downturn of almost five years in total duration. Even the Great Depression saw an initial turnaround sooner than that (before, admittedly, falling into a new recession in 1937).
A finding like that could be paired with a generally dour judgment about Obama with people thinking he’s screwing up. But instead the poll shows Obama’s approval ratings to be very high.
In part, the public’s take on all this is probably colored by a not-particular-precise public conception of what it means for the economy to be in recession. But either way I do think it suggests that Obama can take advantage of a period of low expectations for his actual performance. And that might be all for the best, since I’m frankly not that optimistic that the banking strategy they’re pursuing is going to bring about good results.
29 Responses to “Low Expectation for Obama on the Economy”
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April 28th, 2009 at 5:35 pm
I agree this is most likely a definitional issue, but I also think it points to the fact that the American people are prepared to blame the Republicans for the economy for a LOOOONNNNGGGG time.
April 28th, 2009 at 5:37 pm
Speaking for myself, if unemployment is kept below 10 percent, i would be grateful.The expectations are low because we Americans are smarter than people think. We know this is no ordinarry recsession. And we know that we elected a man , not a magician .
I do not think people are panicking , or being too pessimistic.
I think they are simply being realistic about the size of the problem .I am glad that Obama is being honest about the size and nature of the problems. And not giving us a bunch of happy talk.
April 28th, 2009 at 5:51 pm
Agree with DTM and pete. Seems like most Americans just want to be treated like adults, instead of like ditzs with credit cards the way Bu$hco treated them for the past 8 years.
April 28th, 2009 at 5:59 pm
If the recession really continues until the end of Obama’s first term, that would be a shockingly long downturn of almost five years in total duration.
Sometyhing tells me that Americans don’t really follow the NBER definitions of the duration of the recession. If unemployment is over 10%, Americans may still think there is a recession even if NBER says it is technically over.
Find out how many Americans still thought we were in recession in late 2002, even though the NBER says it ended in 2001.
April 28th, 2009 at 6:11 pm
But Obama’s missing the mark on the banking strategy and the public’s expectations are in tandem, right? That is, it’s a very tough problem to solve, and the public treats it as a hard problem to solve. What am I missing here? MY seems to treat these as independent things.
April 28th, 2009 at 6:12 pm
It is also possible they will blame both, leaving the door open for this generation’s version of Ross Perot. And a non-batty one could very well succeed . Not sure who that would be though. It’s not going to be Bloomberg.
April 28th, 2009 at 6:43 pm
Let’s see, 3 months into a job and you’re trying to predict the 4 year outcome? Weird.
The fact is, no one knows if the current economic nostrums will be effective because no one has confronted such a disaster since 1929.
April 28th, 2009 at 6:57 pm
Kolohe wrote:
Ralph Nader? Not sure if he’d pass your battiness test, but he’s been railing against corporate influence over politicians for a long time. The public mood may catch up to him. Simon Johnson has been vocal lately on “catpure” and the need to remove the financial oligarchs from power, and if Geithner can’t reform Wall Street after four years, voters may get impatient.
I support Obama, but corporate interests — be they bankers, miners or AgriBusiness — seem to get everything they want from politicians, often to the public’s detriment.
April 28th, 2009 at 7:55 pm
It is also possible they will blame both, leaving the door open for this generation’s version of Ross Perot. And a non-batty one could very well succeed.
That would be the trick–getting a non-batty candidate to mount a credible third-party candidacy. My guess is the rough limit of non-battiness is someone like a Ron Paul, and that probably isn’t non-batty enough.
In any event, I’d guess that if we don’t see a recovery by 2012, at least we will see an L-shaped recession. And I’d also guess that in the event of an L-shaped recession, there won’t yet be enough disapproval of the Democrats to make space for a winning third-party candidacy (at most, they might split the GOP).
April 28th, 2009 at 8:17 pm
the future of the banks is an interesting and important problem, but the real issue for economic growth isn’t which way are the banks recapitalized: it is the transition from household spending running at 101% income to running at 95% income.
there are so many business models that don’t work in a world of $1T less activity by the consumer that it will be quite a long time before the economy transitions.
now, i doubt that most members of the public have thought it through in this way, but i do think the public at large recognizes the structural nature of the problem….
April 28th, 2009 at 9:13 pm
If the Obama Administration and the Democrats manage to increase the cost of transportation, energy, and employing people, then economic stagnation could become a semi-permanent fixture in the U.S. When you look at the long term problems of Detroit, it is not that hard to believe that with the right government policies that the U.S. could get itself into the same situation.
April 28th, 2009 at 9:20 pm
Well, considering that any recovery is going to be squashed by an energy price spike, getting used to the idea that economic growth is not likely for a very long time is probably a good thing.
April 28th, 2009 at 9:49 pm
This doesn’t necessarily mean low expectations for Obama. It could quite likely be that the public has an appreciation for just how bad the economic situation is and know that it will take time to dig our way out. Understood that way, the poll is entirely consistent with Obama’s high approval ratings and HIGH expectations. Indeed, if Obama manages to navigate the situation and eventually turn the economy around, that should be seen as quite an accomplishment.
April 28th, 2009 at 11:00 pm
It wouldn’t be that shocking because Obama (like Bush) has the same beliefs that FDR did, that what we individuals need is a government that changes rules often, that “stimulates” the economy by putting labor and capital into failing or non-starter businesses (GM and high-speed rail, anyone), and that inflates the dollar massively because a little deflation of prices is apparently so deadly.
A recession is just what happens when a bubble bursts. If Obama “successfully” gets GM making cars again by funding it with tax dollars and then stops the funding once he thinks he’s fixed the problems (nyuk nyuk) then GM’s resultant crash won’t be for any other reason than that its Obama-bubble was burst.
There’s one answer: 1920’s inactive government after the worst GDP fall ever. We were out of recession by 1921.
April 29th, 2009 at 12:13 am
I don’t think the numbers reflect the public having “incredibly low expectations for the efficacy of Barack Obama’s economic policies.”
The public seems to understand this not about economic upturns and downturns, that this is in fact a life and death struggle for survival. I think it has dawned on John Q Public that Obama’s economic policies could work perfectly and it would still be 5 years before the economy begins to see any light at the end of the tunnel.
April 29th, 2009 at 12:15 am
You missed the biggest piece of red meat in this poll.
71% consider waterboarding torture. Kudos to Greg Sargent for catching that.
April 29th, 2009 at 1:29 am
Wrong, Obama’s economic policies could work perfectly and it’s guaranteed we’ll still be in recession 5 years hence. Obama, like FDR, likes having a panicked society (which both Hillary and Rahm have pointed out, and Bush before them) because it lets him pay off his moneyed constituents and say it’s all for “stimulus.” Obama’s platform plan and his stimulus plan are the same things. When he started his campaign he wanted socialized medicine, government investment in “green” technologies, government investment in rail, and for government to be generally more activist. Tell me what the differences are between his platform and what he’s doing now in the name of “stimulus.”
April 29th, 2009 at 3:12 am
Markup, I must admit, part of me agrees with you. Part of me wants to see total anarchy before I die. Let’s rip away the artifice of the command economies of nation states and just have the freest system of them all, one world wide black market. Fuck governments. Bring on total freedom. Bring on the chaos.
I would like to think, with luck, I would survive. I am plucky and resourceful, and expert shot. I also know what would be a premium in this brave new one-world free market economy, firepower and friends with firepower. You must organize for yourself or attach yourself to a gang, a tribe, a mafia, a band, a faction; any group with the strength to acquire and exchange barterable goods. I feel I am psychologically prepared for this world.
And we have arrived at that delicate tipping point that leads to that world, haven’t we. 30 plus years of free market ideology and the interminable wars that go with it have placed us right on the edge. A most conservative estimate of the Unites States’ public debt would place it at 100 trillion. It is logical to assume there is no escaping this debt, that the country will soon be sold off and hauled away piece by piece.
But call me parochial or call me a fool, I am still a patriot, I still believe in the old crumbling nation-state into which I was born. I think America has one, last, desperate chance.
So don’t talk to me of trillion dollar stimulus packages, it’s chump change. America’s immediate future survival depends on two things, near full employment by whatever means necessary and crushing Wall Street into powder.
If Obama fails at either of these two tasks, you will have what you desire. Soon enough.
April 29th, 2009 at 6:56 am
Would be interested on where you divined this statement from. More like 90 years of intimate government intervention in the economy and money system has produced yet another recession that is deeper and very possibly longer than necessary.
April 29th, 2009 at 7:19 am
Governments should protect individual rights. That’s what ours was formed to do (outside of mistakes like slavery).
Maximum freedom of markets requires minimal taxation. Minimal taxation leads to little money for wars. The Soviets seemed to do pretty well in the war department, as did the Nazis, Pol Pot, North Vietnam, etc. Beyond that, you’re right, we do have a free-market ideology, just not free markets.
You don’t understand this at all. Our government intends to inflate our currency until our nominal-dollar debts are manageable. Holders of our debt will be shafted. This is what countries with a central bank, a freebie-demanding citizenry, and no scruples do. It’s exactly what happened in the Weimar Republic.
Here’s the numbers, since you don’t seem to know. We can have “full” employment in no time. Get rid of minimum wage laws, the excessive powers of unions, quit scaring entrepeneurs, stop the bailouts.
Crushing Wall Street isn’t going to happen. Remember the TARP? It’s coming from Obama. He’s the same guy that’s holding up that Fortune 500 Company: GM.
Then you’re already convinced America’s doomed, which I am not. It’s going to weather this nonsense much better than will many places: England, Italy, Iceland, etc. Plus, you’re being a drama queen. The Weimar Republic was horrible, the Nazis were worse, WWII was amazingly destructive, yet Germany’s still there. Be cool.
April 29th, 2009 at 9:06 am
Not only that, but people are going to be lined up at soup kitchens if Congress passes Clinton’s economic plans. The 1990s will be one long recession.
It’s guaranteed!
April 29th, 2009 at 9:38 am
Totally wishful thinking, I suspect. It’s not going to happen tomorrow, but if the economy stays in the toilet long enough Obama and the Dems will get blamed. And that time period is a lot shorter than four years.
And I’m positive that the economy means employment to 90% of people, so a bunch of happy banksters aren’t going to mean much to Obama.
April 29th, 2009 at 10:23 am
healthy markup, our country was not formed to protect individual rights. where’d you get that one? it’s of a whole with your entire commentary.
here’s what our country was formed for: “We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.”
i continuously find it amazing that right-wingers invent some basis for the country being founded in adam smith when the founders told you quite specifically what the point of the country was.
indeed, the question of individual rights was uncertain enough that they went back and added the bill of rights just to be clear.
your deranged notion probably contributes to your silly thought that really, we’re just like the weimar republic right now. sheeesh.
April 29th, 2009 at 10:39 am
I was including the Bill of Rights in the formation of this country. You disagree with that notion?
The Weimar Republic did inflate away its debts. I don’t know for a fact that it’s our intention to do so, but based on how much our base money supply has been inflated and what would happen if banks started to loan it out en masse, it’s not odd to think that’s the plan. China has been making public requests for us not to ruin our currency for a while, so they obviously see it.
And based on the jokes Obama is making about cutting $100,000,000 out of the budget, our government isn’t very serious about our money problems.
April 29th, 2009 at 10:59 am
yes, markup, i disagree with that notion: the formation of the country was the declaration of independence and the constitution. the bill of rights was an amendment to the constitution passed several years later precisely because some of the founders felt that the commitment to individual rights wasn’t clear enough in the constitution.
if “individual rights” were the point, which was your argument, then there would have been no need for coming back.
as for the weimar republic, here’s what you said: “Our government intends to inflate our currency until our nominal-dollar debts are manageable.” if you (didn’t) “know for a fact that it’s our intention to do so,” then you shouldn’t have stated it as a fact that it is our intention to do so.
as for your youtube link, get serious. wouldya?
April 29th, 2009 at 1:52 pm
@20 Healthy Markup: “The Weimar Republic was horrible, the Nazis were worse, WWII was amazingly destructive, yet Germany’s still there. Be cool.”
Comforting words, Markup. I feel much better. I also like the idea of getting rid of unions and the minimum wage. Let’s create a slave state so that we can compete in the world labor market. Slavery would bring back manufacturing, that’s for sure.
We need to move fast, though, because Free Market forces are at work. The United States is bankrupt. It has failed in the market place and can no longer compete. By the Laws of the Free Market the United States should be dissolved.
April 29th, 2009 at 5:47 pm
[...] Combine these numbers with Obama’s 60% and above approval ratings, and as Matt Yglesias remarks: [...]
April 30th, 2009 at 3:18 am
Some of the people who wrote the initial documents created a codicil. So you’re splitting hairs.
It sure looks like it’s the case. Even George Soros has stated he expects high inflation. Beyond that, you may have come across a situation before where a person confidently states a prediction as fact. This is no cause for alarm, especially when said person clarifies in short order.
Why is Obama highlighting the cutting of 100,000,000 out of a budget as huge as that? If you believe him, all government spending is good right now as “stimulus” so there should be no reason to even bother. But if he is, it’s hilarious to come up with such a tiny number. Plus, you didn’t actually watch all 98 seconds, did you?
April 30th, 2009 at 3:29 am
Unions are labor cartels who bid up their prices so that fewer people can work in their industries. You must be a fan of monopolies and industry-wide stagnation. Minimum wages are obviously crazy. If you want to subsidize some poor worker, just send him a check (preferably one of your own money.) Employers add new workers if the workers can generate more revenue than costs. (THIS SHOULD BE OBVIOUS TO ANYONE WHO’S SPENT FIVE MINUTES THINKING ABOUT IT.) Some people are such terrible workers that they can’t generate the minimum wage. They are unemployable. If you like the idea of forced unemployment, that’s on you.
Many countries are bankrupt. They’ll just default on their loans instead of declaring so outright. The U.S. is much better off than much of Europe. Breath!