Obama’s 5 big mistakes

Written by David Frum

Washington (CNN) — If the debt ceiling crisis were a movie, President Barack Obama would deserve an Oscar for his performance in the role of “the last reasonable man.”

But of course the crisis is not a movie. The crisis is a deadly serious clash of ideas and interests. And there, the president has lost his way

Obama has lost his way so badly that even his core liberal supporters should be questioning whether they have got the right man in the job.

The indictment has five headings:

1.Obama has ceased to lead on the economy.

The management guru Stephen Covey famously said: “The main thing is to keep the main thing the main thing.” Economic recovery is — or should be — the main thing. In 2009, Obama advanced a series of bold proposals to accelerate recovery: his big fiscal stimulus, the auto bailout and so on.

The president’s proposals did not fail, exactly. But they did not work as advertised. The American economy limps weakly forward, leaving millions out of work.

During the Great Depression, President Franklin Roosevelt demanded from his administration “bold, persistent experimentation.” By contrast, Obama put measures in place at the beginning and waited for them to yield results. And waited. And waited. And waited.

Finally, at the end of 2010, he added one more measure to the mix: a partial cut to the payroll tax, included as part of the deal that renewed the Bush tax cuts.

The payroll tax holiday is welcome if late. But it was small (2 percentage points out of the 12.6% paid by workers and employers) and was almost immediately offset by the surge in oil prices after the so-called Arab Spring. That surge took back from workers every dollar of the $110 billion in tax relief delivered by the payroll holiday.

And since December, Obama has surrendered entirely to the claim that we can somehow fix the economy by fixing the debt problem. The truth is the opposite: Fix the economy, and the debt problem will shrink to much more manageable proportions.

2.Obama does not effectively use the domestic powers of the presidency.

Talk radio shows accuse Obama of acting like a Third World dictator heading a thug government. That’s a devilishly ingenious line of attack on a president who actually makes weaker use of his domestic power than any since Jimmy Carter.

Example: The U.S. recovery that commenced in the summer of 2009 stalled in the spring and summer of 2010. Many economists blame the stall on the Federal Reserve’s April 2010 decision to stop providing additional monetary stimulus for fear of igniting inflation. Those inflation fears proved utterly misplaced, and in late 2010 the Federal Reserve resumed its monetary stimulus.

Where was the president during this crucial debate? AWOL.

Yes, yes, the Federal Reserve is independent and all that. But other presidents have succeeded in making their views known and respected on monetary policy. Obama had a unique chance to influence the debate, because through the summer of 2010 two of the seven seats on the Fed’s Board of Governors stood vacant. The president nominated expansion-minded governors to fill the seats. The nominations were put on hold by Republican senators. And what did the president do? Did he take to the airways to demand action on his nominees? Did he punish the senators by stopping federal projects in their states? Did he fill the seats with recess appointments?

To borrow the answer from Fred Armisen’s imitation of Obama on “Saturday Night Live”: “I’m seeing two big accomplishments: jack and squat.”

3.Obama cannot communicate empathy for Americans in economic distress.

Remember that video of the Obama supporter expressing her exhaustion and disappointment with the president’s record of help to the middle class?

Watch it again, and pay careful attention to what the president does. He first makes a perfunctory effort to connect with the woman in front of him as a fellow-parent. Then he rattles off a list of small programmatic changes: in the student loan program, in credit card regulation, none of them especially relevant to the woman in question. He finishes with a “stay the course” message that must ring hollow in the ears of all those for whom the “course” means unemployment of 38 weeks or longer.

Notice what the president does not do. He does not thank his questioner for defending him. He does not ask her questions of his own. He is so determined to sell his narrative, that he cannot hear or honor her fears. And indeed the questioner did lose her job a few weeks after the town hall meeting.

For two years, Obama’s economic message has been “recovery is around the corner.” He has delivered this message from factory floors and restaurant tables. He has not spoken in front of groups of unemployed; he has not spoken at welfare offices.

Obama’s disconnect from those in distress may explain the remarkable collapse of his support among younger whites, once one of his most important groups of supporters. Pew reports a 10-point surge in Republican identification among whites under age 30 since 2008. These are some of the voters hardest hit by this recession. They are voters to whom this president has spoken least.

4.Obama over-relied on banks and bankers.

Like President George W. Bush before him, Obama took bold and necessary action to save the U.S. financial system in the early spring of 2009. A lot of ugly things were done. A lot of reckless people got away scot-free — in fact, richer than ever. But apocalypse was averted, so congratulations all around. Afterward though: Where was the reckoning? The administration remained focused on reassuring bankers long after it had finished the job of saving the banks.

Yes, Congress did pass a law, Dodd-Frank, that addressed some of the worst abuses of the 2000s. For example, Dodd-Frank exposes ratings agencies to private lawsuits for “knowing or reckless” failures to conduct proper investigations of the bonds they rate.

Unless you follow banking law closely, however, you would have little idea that any preventive measures have been taken against the next bubble. What got the headlines instead was the president’s appointment of one high-profile banker, William Daley, as his chief of staff — and a rumor that he intended to appoint another as his second secretary of the Treasury, Jamie Dimon of JPMorgan Chase.

Little enough justice was done. Almost none was seen to be done.

5.Obama is not a good negotiator.

It’s really striking that any time the president inserts himself into a negotiation, he ends up with zero results and all parties mad at him. The Middle East may be the most extreme case, but there are domestic counterparts, too.

When he negotiated the renewal of the Bush tax cuts in 2010, why didn’t he get himself an increase in the debt ceiling at the same time? The tax cuts expanded the deficit beyond what it otherwise would have been. Republicans dearly wanted the tax cuts extended and would have paid for them. But no.

In this round of debt negotiations, the president has drawn red lines. He has threatened to veto a small increase in the debt ceiling, one that would force him to return to the argument before the election in 2012. By contrast, he has not threatened to veto debt-ceiling measures that cut too deeply into social programs. His red lines are drawn for his political advantage — not to protect his core supporters’ values and interests. His red lines are not theirs.

Whether it was health care or the deficit or now the debt ceiling, direct encounters between Obama and his Republican opposite numbers have always ended badly for the president. Yes, the president faces unusually extreme and intransigent opposition. But that’s a description of the difficulty, not an excuse for failure. Presidents win negotiations when they can mobilize the public behind them. That was Ronald Reagan’s secret weapon in 1981. It has never been Barack Obama’s. And the results are as we all see.

The opinions expressed in this commentary are solely those of David Frum.

An earlier version of this commentary incorrectly attributed a quote from Stephen Covey.


Bonus: F**k Pennies

5 thoughts on “Obama’s 5 big mistakes

    1. FarmerJohn

      Hey ‘Guest02’
      1) $900,000,000 stimulus that had no effect.
      2) The ObamaCare debacle. How we gonna pay for it, dimwit?
      3) Cash for Clunkers What happened there?
      4) Unemployment. Remember the promise to keep it under 8%? hahaha
      5) Everywhere he goes he tells the unemployed to ‘stay the course’. No understanding how America’s economic engine runs.
      6) Tax the “RICH”. uh, he never says who these ‘rich’ are.
      7) American oil companies are shackled with regulations and taxes that foreign oil companies do not have; and what’s he want to do? Encourage Brazilian oil companies to drill and he’ll be there to help them (spelled: our tax dollars to them.
      8) Increase the deficit 8 times over what Bush did; and Bush was a closet liberal Republican.
      9) Tried to slap Israeli leader Netanyahu over Israeli borders and got beat down by Bibi on American live TV.
      10) Touts the great Arab spring for bringing Democracy to Yemen, Egypt, Syria and Libya. That’s democracy spelled “HAMAS” dimwit.
      on and on and on and on we could go.

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