Obama: Don’t Buy the Economic ‘Snake Oil’
President Barack Obama on Friday delivered an upbeat assessment of the still-healing economy, but he also warned against betting on “snake oil” and “chasing false promises” to continue the recovery. Yet, his message was often met with lukewarm applause by a Florida crowd.
The pejorative clearly was aimed at Republican presidential front-runner Donald Trump and the rest of the GOP field. And while the president did not name the Democratic Party’s likely nominee, his call for a “steady, persistent” hand to “finish the job” of healing the economy could be the start of a long wind-up to endorsing Hillary Clinton.
Part of the perception problem on the economy stems from the White House’s own messaging, Obama said. “We’re not talking about it enough,” he acknowledged. “And if we don’t talk about why it is that things got better, we may end up pursuing policies that will make things worse.”
Speaking at a battery plant in Jacksonville, Fla., that was built in part with funds from the massive stimulus package he pushed through Congress to jump-start the reeling economy in 2009, Obama told workers he is “optimistic” about America’s economic prognosis.
Why? “Because I’ve seen what you can do,” Obama told workers there.
And, assuming the role of cheerleader in chief, he added: “Our best days are ahead.”
His remarks were equal parts motivational speech and sales pitch for his own legacy. His top aides spent much of this week busily trying to make the case for Obama’s handling of the recovery after the Great Recession and a steadily tumbling unemployment rate as major feats.
Yet, despite his positive message, the crowd greeted the outgoing president’s remarks with a tepid response.
The loudest applause appeared to come when Obama thanked U.S. military veterans and mentioned the Saft-owned battery plant employs a large number of them. (The White House said 40 percent of the nearly 300 employees are military veterans). Another solid round of applause came when the president concluded his pep talk-like remarks.
That could be because, as one former Senate aide put it earlier this week in response to the White House’s rosy economic talk: “It just doesn’t feel that way.”
To that end, 93 percent of counties across the country have yet to fully recover from the “Great Recession,” according to the National Association of Counties. The organization has concluded that as of last year, only 7 percent of all U.S. counties (214 of 3,069) had hit their pre-recession levels in several key categories, including unemployment rates and home values.
The state of the national economy ranks near the top of most Americans’ priority lists in many respected polls. One reason is wage stagnation, according to Sen. Bob Casey, D-Pa., a member of the Joint Economic Committee.
“Part of the problem is the perception over a long period of time is wages haven’t grown over 40 years,” Casey recently told Roll Call. “I think that is a reality that, no matter what economic news shows progress, it isn’t always persuasive.”
For his part, Obama acknowledged there is work to be done.
“That’s not argue things are perfect,” he said of his own positive diagnosis. “There are people still looking for work.”
The White House is aiming to cement a major part of Obama’s legacy as an economist in chief whose judgment helped save the U.S. economy from the brink of another depression — while saving U.S.-based automakers and kick-starting what he calls the “clean economy.”
The Brookings Institution describes that as “the sector of the economy that produces goods and services with an environmental benefit.” At the Jacksonville plant, Saft makes lithium-ion batteries the White House says “are helping to drive our clean energy future,” noting they are “partially powered by solar panels on its roof.”
Though many Republicans and some economists continue to bash his stimulus, Obama on Friday dubbed it “a success.” He said many economists agree “if we hadn’t done that, and hadn’t bailed out the auto industry, [the country] would have plunged into a second Great Depression.”
He also jabbed at GOP lawmakers by noting European countries that in 2008 and 2009 adopted the austerity policies they advocated “still face double-digit unemployment.”
“We’re doing better than them on almost every level,” he said.
Still, before the president’s helicopter lifted off from the White House’s South Lawn on Friday morning, the Commerce Department’s Bureau of Economic Analysis delivered some negative news. During the fourth quarter of last year, real GDP grew at a rate of 1 percent, down a full percentage point from the third quarter growth rate.
Jay Shambaugh, a member of the White House Council of Economic Advisers, used a statement to put a positive spin on the numbers, saying “the most stable and persistent components of output — consumption and fixed investment — rose a solid 2.7 percent over the four quarters of 2015.”
Though Obama clearly views his economic stewardship as a legacy centerpiece — especially the steadily tumbling unemployment rate (currently at 4.9 percent) — Republican presidential candidates sharply disagree.
“Our economy is not doing well,” Trump said Thursday night during a debate in Texas. And he warned that Obama’s signature health care law “is going to destroy our economy completely.”
The billionaire real estate tycoon vowed, if elected, he would usher in policies that would spawn “a dynamic economy.” He signaled that he would slash taxes on businesses and individuals, warning the tax rate is “shutting off our economy” and “shutting off our country.”
“We will do my tax plan, and it will be great,” Trump said. “We will have a dynamic economy again.”
Ohio Gov. John Kasich, a longshot GOP White House hopeful, promised to slash taxes and cut federal spending below Obama-era levels “in order to get this economy moving again.”
“When I was [House Budget Committee] chairman, we cut that capital gains tax and we instituted a significant program to get … a balanced budget [for] four years in a row,” Kasich said. He added that during his run atop the panel (1995-2001), Washington “paid down a half a trillion of the national debt.”
“And why do you do it? Because you want job growth,” Kasich said. “If you don’t have regulatory reform, common-sense regulations, reasonable tax cuts … and a fiscal plan, you won’t get there.”
In north Florida, Obama warned the battery plant workers to reject any political candidate who spends time on the campaign trail “talking down on America.” Any politician who delivers pessimistic assessments of the American economy, he said, “is not leveling with you.”
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