Obama: It Became Necessary to Destroy the Economy to Save it

On February 7, 1968, US forces demolished Ben Tre, a provincial capitol in South Vietnam. An Army Major declared, 'It became necessary to destroy the town to save it." On August 2, 2011, President Obama signed the draconian law to raise the US debt limit and unravel our social safety net. He should have quipped, "It became necessary to destroy the economy to save it."

Sifting through the ashes of this catastrophe, Liberals can glean five grim lessons. First, Washington politicians do not understand how the US economy works. It's not that complicated: a robust economy depends upon steady consumption by average Americans, not millionaires and billionaires. Working folks aren't consuming because they either don't have the money or are saving it because they are fearful. These Americans aren't going to spend more because the debt crisis got resolved. They are worried about their jobs and the jobs of family members and friends. They understand the debt-limit crisis had nothing to do with jobs and that Washington pols don't get it. That's why average Americans are pissed off at both Parties.

Second, the Obama Administration has no jobs message because it doesn't know what to do to create jobs. Since Obama became President most of us have assumed that Barack, a smart person, would eventually figure out the US needs a massive stimulus program - a public works program similar to FDR's WPA - to create jobs. Initially Obama supporters believed he didn't do this because he was getting bad advice from people like Larry Summers and Robert Rubin. We waited. Summers and Rubin left and we expected Obama to pick up the jobs banner and run with it. Instead he repeated the Republican mantra: "Washington has to get its house in order and then there will be jobs."

The Republicans have a wrong-headed but consistent message: reduce taxes and government and the economy will magically blossom. The Reagan and Bush years demonstrate this ideology is BS, but there is no countervailing message because the Obama Administration is lost. If the President really believed the number one problem facing America was jobs he would have refused to negotiate with Republicans when they manufactured the debt limit crisis; Obama should have said, "This has nothing to do with creating jobs and will make the economy worse. Congress, get to work on America's real problems!"

Complaining the President "lost control of the narrative" assumes that he had a message but didn't know how to distribute it to the American people. This suggests that if Fox News and Rush Limbaugh disappeared then Obama would command the airwaves and we would all understand his "solution." But Obama doesn't have a message because he doesn't understand what's going on.

The third lesson Liberals have learned is that even if the President understood what is happening and had a compelling narrative it wouldn't have made any difference because Obama is not willing to fight for his position. To paraphrase the old Blues refrain, "He's a lover not a fighter."

We've now seen at least five examples where Obama had an opportunity to make a real difference and lost it by being overly accommodating: the amount of the original stimulus, whether or not to break up "too-big-to-fail" banks, health care, the federal budget crisis, and the debt crisis. (It's probably true that the President caved to the military on Afghanistan, but we don't know as much about that negotiation.) In the debt crisis negotiation, Republicans got what they wanted because the President was soft.

The fourth lesson is that, emboldened by success, Republicans are going to continue to follow their "hostage taking" strategy. We've already seen this with their attack on the FAA. It's street wisdom that submitting to a bully's demands only encourages him. Republicans will use the upcoming Federal budget negotiation as their next big opportunity to advance their slash and burn agenda.

The fifth and final lesson is that the economy continues to be in bad shape and - despite the Pollyannaish assurances of the Obama Administration - we're likely to find ourselves in the dreaded "double dip" recession. The United States of America is adrift, heading for a sea of icebergs, without effective leadership.

It didn't have to be like this. President Obama had two opportunities to call the Republicans' bluff and chose not to. In December he could have refused to sign any budget deal that did not include ending the egregious tax cuts for millionaires and raising the debt ceiling. On August 2^nd, he could have refused to sign a debt-limit agreement that did not include new revenues. In both cases he could have dared the Republicans to shut down the economy.

The bottom line for Liberals: we're on our own. It's naive to expect help from President Obama. The economy will continue to spiral downward and Liberals will have to figure out how to save it.