August 16, 2010 08:39 PM UTC

The Man and the Plan

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• by: JO

For purposes of efficiency, cliches accepted as true in this post:

–the “Great Recession” that started in 2007 was the worst downturn since the Great Depression that started in 1929.

–The Great Depression, as measured in unemployment, didn’t really end until Lend Lease (March 1941), almost 12 years after the Crash, i.e. until manufacturing military gear got the United States started on what evolved into the military-industrial complex that continues today.

–There is a lag between what economists call the “end of the recession” (economic growth resumes, however slowly) and what many/most people regard as recovery (when jobs are plentiful).

That said, Obama appears to be arguing that really, things aren’t that bad, the Bush recession has ended under his watch, things have stopped getting worse and will eventually get better, so be patient, don’t blame me for your unemployment or job insecurity, and give it time.

Bad plan, won’t work. Truth (from On High): Unemployment is Issue #1 at a time when the combination of unemployment + underemployment (involuntary part-time) + discouraged and out of the market totals at least 16% (and probably more; we don’t know with any accuracy how many people stopped looking for a job because they figure the prospects are poor to none). Beyond the numbers of un- and underemployed there is also an amorphous sense of insecurity among many who are still employed, which can be just as damaging in the political arena. Thus this is no longer mostly an economic issue (although it is that, too); it’s primarily a political issue, not entirely separate but definitely distinct. Whatever the statistics, inching up and down from month to month, the general perception is that the job market stinks. And it is General Perception who rides atop his Great Charger in elections, not poor old Lt. Factoid hunched over his computer, madly manning his Google Fact Generator.

If the Great Depression, as defined as unemployment, lasted a decade or more, it’s hardly surprising that Obama hasn’t caused the Great Recession to go away in 18 months, especially in light of stubborn intransigence and obfuscation by Republicans. It was in light of that obfuscation, and efforts to mollify certain Blue Dog Democrats in early 2009 (some locally known and now running for office) that Obama had to ratchet down the scope of the economic stimulus. The package that eventually emerged helped, but was insufficient. (I refer skeptics to Krugman et al.; I personally refuse to argue this point on this site.)

Matters not. The public turns to the president to do something, and that Something ain’t happening fast enough.

So, what to do?

As I suggested in another thread over the weekend, Obama needs to articulate The Plan. A plan that can be described and sold as a specific course of action. A plan that lets Republicans defend the Do Nothing position if they so choose (and they certainly will do that). A dramatic, specific plan to put lots of people to work pronto. A plan that simultaneously makes needed investments to renew aging infrastructure and lays the groundwork for a new non-carbon energy economy, including a new national transportation system that relies more heavily on rails (both passengers and freight), that retakes the global lead in telecommunications networking (i.e., 30 gigabyte broadband everywhere at low cost), puts in place a smart grid that, broadly speaking, also includes a new network of renewable electricity generation (mostly wind power), and a national network of recharging stations for electric cars, alongside more efficient switching of power where it’s needed and the ability to manage demand…the list goes on and on and on. The Plan to Invest in Our Future. Investments involve spending (building a building, for example), but are distinct from spending for ongoing operations, and thus distinct from a “deficit.” A company isn’t accused of operating at “a deficit” when it invests in new facilities, equipment, etc., cash flow notwithstanding; neither should be the government.

During the previous worst downtown, in the 30s, a similar Plan by FDR went under the name New Deal and had acronyms like WPA and CCC, which not only employed people temporarily until the normal civilian economy revived (or, should we say, until the military-industrial economy got rolling), but also left behind lasting improvements (including many visible in national parks in Colorado). FDR himself said it: let the Republicans attack, let them resist. He recognized the futility of trying to persuade people who refuse to even consider the possibility of consideration.

Time is late, and I fear that Obama is rightly criticized for lack of boldness in addressing deep-seated economic problems that go way beyond the current downturn (notably deindustrialization and the loss of jobs that elevated many working families into the vaunted middle class).

The fact that it’s late to get started on presenting a coherent Plan for Recovery doesn’t mean it’s too late. But it does mean there’s not a moment to lose.