The rising rates of unemployment could imperil the Obama Presidency: A ticking time bomb

[Better Believe It]

The Nation's Washington, D.C. Correspondent, John Nichols, explains how the rising rates of unemployment could imperil The Obama Presidency.

Will Unemployment Sink the Obama Agenda?
The Nation
July 17, 2009

Nation Washington correspondent John Nichols likens the recession to a ticking time bomb that has been handed to Barack Obama to defuse. "If the bomb blows up, he'll be blamed. He's Bruce Willis now, he's got the bomb, and he hasn't taken it apart yet." Nichols notes that the tipping point for America is often double digit unemployment, and that the higher those numbers go, the more frightened Americans get. This is why, he says, America needs a second stimulus bill, and its focus has to be on job creation. Obama's political future depends on it.

See the video at:

http://www.youtube.com/watch?v=ltVzelwzlm4

[drdtroit]

1. Even thought this was all set in motion by W! You gotta love it! n/t

[emilyg]

4. That may be so but

it's Obama's ship now.

[fasttense]

47. No, since the bush didn't get blamed for his epic failure of 9/11,

(except by rational, clear headed people of which there are very few in America) Obama has at least that long before he owns this problem.

[MannyGoldstein]

2. Had He Been Wise, He Would Have Listened To Nobel Prize Winners

such as Krugman and Stiglitz and at least double the stimulus, instead of playing the DLC's triangulation game.

Rightly or not, because unemployment is still skyrocketing while already far higher than Obama's highest estimates, people are starting to believe that the stimulus was a failure - even though this is Shrub and Bill Clinton's mess, Obama may own it soon.

[Better Believe It]

3. Only 101 billion of the 787 billion in stimulus money is for infrastructure!

Out of 787 billion dollars in job "stimulus" funding here is what will be spent for actual infrastructure and energy job creation projects:

Infrastructure - $101 Billion
$30B - Highways
$20B - School Renovation
$17B - Health Information Technology
$13B - Transportation Projects
$8B - Water Projects
$7B - Military and V.A. Construction
$6B - Accelerated Deployment of Broadband

Energy Efficiency - $59.5 Billion
$22B - Federal Energy Efficiency Grants
$19B - Other Energy Efficiency Grants
$11B - Smart Electric Grid
$8B - Renewable Energy Loan Guarantees

Tax Cuts - $314 Billion
$99B - Payroll-Tax Holiday
$90B - Business Expenses Tax Breaks
$25B - Earned Income Tax Credit
$20B - Renewable Energy Tax Credit
$10B - Tuition Tax Credit
$70B - AMT Tax Cut


That's pretty much it.

The three Republican Senators who wrote the stimulus bill took out 40 billion dollars for badly need school construction, tens of billions of dollars in other infrastructure funding and added the annual alternative minimum tax (AMT)fix to the bill in order jack up the amount of the stimulus bill without actually increasing any jobs! It was a non-stimulative addition to the bill. The 70 billion dollar tax cut was going to get passed by the Senate, as it has been every year, without including it in the stimulus package! Senator Grassley proposed adding the AMT fix.

The rest of the stimulus money is mainly for badly needed economic relief such as unemployment compensation and economic assistance to state/local governments. But, those monies won't create very many jobs for the unemployed while they will enable some government workers to keep their jobs for awhile.

Now you should understand why Roubini and other leading economists said the stimulus plan was totally inadequate for the task. Roubini was a little less diplomatic calling it "puny".

And now the Republicans have been put into the position where they can attack "the Obama stimulus" for not creating the millions of jobs promised!

Nice set-up. President Obama and Democratic Party Senate leaders fell for this Republican trap in their quest for a unnecessary and self-defeating "bi-partisanship".

The three Republican Senators (one now a Democrat) gutted the House stimulus plan. Mission accomplished!

Here's the rest of the stimulus breakdown:

Aids For State and Local Gov - $217 Billion
$87B - Medicaid Cost Sharing
$79B - State Grants
$42B - State and Local Bond Tax Credit
$5B - Community Development
$4B - Rural Development

Relief - $120 Billion
$42B - Expanded Unemployment Insurance
$40B - Health Insurance for Unemployed
$20B - Expanded Food Stamps
$11B - Housing Assistance
$4B- Supplemental Social Security Income Payments
$3B - Welfare

Human Capital - $45.5 Billion
$25B - Education Programs
$15B - Federal Pell Grants
$4B - Job Training
$2B - Scientific Research

[foginthemorn]

5. I do not understand why the WH said a week ago that the plan was designed

to pay out later--rather than the last few months and now. They seemed proud of that that fact--.

[glowing]

9. 2 billion for scientific research is laughable.. If you really want a way forward..

Scientific research should have at least 1/2 trillion dollars.. How do they expect to really change the systems currently in place.. Scientists aren't supposed to eat.. and to say that Obama wants engineers and scientists in his vision for America's future means that he needs to fund it. Too many now with degrees in engineering and science are sitting idle. Exactly how does he propose to find ways to create better systems all the way around? Better energy systems, better transportation planning/ city planning, updated water/ sewer systems, better agricultural practices with sustainability in mind, sustainable fisheries practices, weather modifications to engineering designs for buildings and homes... All of these items are investments. All of these items are jobs. AND not all of these research ideas will lead to fruition. We may waste money on an idea that may not work or will become modified or made better with more minds utilized. If we do not spend some real money on science, engineering, and development of tomorrow's sustainable practices.. we will lose, and lose big time. Its time we think about socializing a bit on the R & D side of our country.. Wasn't it Japan that helped fund Toyota's R&D dept to get the hybrids out the door and into major production. What would the Big 3 look like had America invested into its larger manufacturing base? Would we be funding their bailout, or receiving more money from taxes because people were buying their products? It is seriously time to stop thinking "socialization" is all bad. Its not.

[dolphindance]

11. Would you rather no bill at all had been passed? Getting sick of all the bickering. (n/t)

[Better Believe It]

20. Of course not. But why do you think a more effective job creating stimulus bill was not passed?

[Cali_Democrat]

12. I would have loved to see Obama double the stimulus bill at the time

Unfortunately, what are the chances that Congress would have approved that? Not likely.

It's nice to talk about, but political reality is political reality.

[bvar22]

21. Political Reality is....

...that when Congress balked at his request for $100Billion in additional WAR funding, Obama sent his henchmen (Rahm et al) to twist enough arms to get what he wanted.

EFCA and Job Creation stimulus?
....not so much.

[Cali_Democrat]

39. The previous Democratic majority Congress also gave bush all he wanted in terms of war funding

I don't remember them "balking". At some point you have to point the finger at Congress for going along with this war.

Do you have a link for this henchman incident? Sounds like more of a mob tactic. I don't think the President engages in any such tactics.

[QC]

18. But those Nobel laureates were just jealous of Obama!

They don't look anywhere near as fetching in a swimsuit.

[MarjorieG]

24. What's happening with that $500 billion infrastructure bill?

[bvar22]

19. AND targeted it at job creation,

...and not wasted 1/2 of it on Tax Cuts.

[Zavulon]

22. The so-called "stimulus" IS a failure. Gee, let's spend more and get double the debt for no benefit.

We were warned about the "catastrophe," "disaster," "calamity" and so on if the so-called stimulus wasn't passed immediately, even though almost nobody had a chance to read it. If it weren't passed, we were told, unemployment could reach - GASP - EIGHT PERCENT!

It's well beyond that now. Krugman is a professional bitcher and overrated armchair quarterback. The so-called "stimulus" was an Edsel, and we don't need to throw good money after bad. The slow drip approach is a failure, almost all of the money spent on the stimulus has been on welfare / unemployment (to people who can't exactly flood the economy with extra cash), and our kids will have to pay for this mess. The economy is worse off than it was pre so-called "stimulus," and Biden admitted they misread the situation badly.

No benefit, no improvement, massive amounts of debt. I don't have kids, but for those of us who do, it's time to sit them down and tell them that their degree of financial sodomy in the future has just got a lot worse for no reason.

It's time to cancel unspent portions of the so-called "stimulus." Rushed bills are always bad bills, and the so-called "stimulus" is no exception. You wrote that "people are starting to believe that the stimulus was a failure," and I respectfully ask you how it could be called anything else - especialyl when VOPTUS himself admitted they blew it.

[Better Believe It]

25. How about something entirely different? A job creating stimulus plan!

Which is what progressives are proposing.

The right-wing Republicans are suggesting that we end the unemployment benefits, state assistance and other important programs that were adopted in the name of "job creating" stimulus.

While these other badly needed programs haven't and won't create jobs they should be continued to help people during this economic crisis.

Now the hundreds of billions of dollars in tax cuts including those that the three Republican Senators put in the stimulus plan haven't helped much but that can't be undone. That 300 billion could have been used for public works projects which Republicans were also opposed to!

[Zavulon]

26. Sounds wirth a try.

The thing I'd want is a bill that is crafted with care, not with haste and urgency. I've said this at least a dozen times on DU, but I have to say it again: rushed bills are bad bills. ALWAYS.

Your idea is clearly better than the crappy bill we're pissing away money on now. The Republicans aren't wrong in claiming that the current so-called "stimulus" is a bad bill, wasteful with money going to a lot of stupid projects that aren't even designed to stimulate the economy, and should be stopped for the most part (I mean unspent portions), but their idea of stopping unemployment benefits and state benefits is yet another example of how fucked in the head they are and why they're slipping into a complete lack of relevance.

[Zavulon]

40. "Wirth" - forgive my wretched typing, folks.

[TankLV]

34. Get off your Clinton Hatred - this is ALL bush*

Clinton left a SURPLUS - but of course you always "forget"...

[Orsino]

59. You mean that Congress should have listened, and doubled the stimulus.

I think Obama had a pretty good grasp of what he could get through Congress.

[grillo7]

60. Why not do some sort of New Deal-style job corp.?

This would be a direct investment in job creation, would stimulate the economy through wages being spent, and would have societal benefits through the work being performed. I don't see any big drawbacks here...why isn't this at least being considered?

[Fearless]

6. Not so long as he dangles the health care carrot.

People are sheep and will keep out hope so long as they have something to hope for.

[Oregone]

7. And once that ship sails...

There is going to be a lot less to keep people hoping for. Should be interesting

[Fearless]

8. Clearly.

[dolphindance]

10. You're hoping it fails? That's nice. (n/t)

[Oregone]

14. Not at all.

I meant sailed as in when the "promise" is either fulfilled or discarded and can no longer be used.

[ipaint]

16. Hope... boy is that overrated

I've come to believe the concept is just another clever diversion much the same as the american dream and spreading democracy.

[jcarterhero]

23. Indeed

Change my ass.

[PurityOfEssence]

52. Think of the definition of "hope"

It's basically passive optimism. It's cringing prayer from the downtrodden that something will save them. It's an abstract and unfounded belief that bad things will go away, but there's no component there for MAKING them go away; it is, indeed, extremely passive.

There's a connotation of the acceptance of oneself as inferior to others, or at least CERTAIN others. It's tailor-made for religion: permanent childhood, beseeching daddy to make things good if we're only sweet enough and do all our chores and dutifully sustain the system.

Hope is like praying: it's akin to emotional panhandling from the self-condemned powerless.

Yet, somehow when one sells this sticky-sweetness, it makes one look honorable. To me it just reeks of snake-oil salesmanship if done more than occasionally.

[dipsydoodle]

13. How does it follow

that unrecommend was used at all ?

Maybe the reason for the lack of recommends is that it boring to state an inevitable invalid criticism given that Obama didn't create the recession - he's a victim of it.

[alcibiades_mystery]

15. Wow, what insight

Unemployment rate and support are inversely proportional. I guess John Nichols college education was worth it after all...

[ipaint]

17. Well if that doesn't the 650,000 that exhaust

their unemployment ins. benefits and hit the streets in Sept might.

[mvd]

27. I think there needs to be less caution from the President on the economy

He thinks it will help draw in voters if he stays on the center-left. But I think it's liberal thinking like not ruling out a second stimulus, pushing harder to nationalize banks, and starting from a position of single payer that will help the majority of Americans the most. And therefore he will win over more voters.

We need to be patient - the Bush-wrecked economy will not be fixed right away - but half measures proposed by Obama and even more so by the Blue Dogs could hold us back.

[SemiCharmedQuark]

28. I agree completely.

[mvd]

30. Hi SemiCharmedQuark - thanks

Despite what I said, the people really do need patience - if people think they would be better off with the Repukes after the Repukes wrecked things, they only have themselves to blame. Hopefully Obama sees the urgency of the economy, and that the Blue Dogs put people before corporations more and support the President on major items. What to the Blue Dogs think gets done by obstruction?

[Better Believe It]

32. People expected to be better off with the Democrats. And if they are not, what will happen?

We all know the answer to that question.

So does Obama.

In fact, he publicly said that if the economy is not better in 2012 he will not remain in the White House.

[mvd]

33. True, if it's not better by 2012 we will have a problem

I expect people will be better off. Right now I'm trusting the President to learn from mistakes and adjust.

[Better Believe It]

35. If he proposes a strong, targeted job creation bill that would be a really good sign.

And don't worry about having a bi-partisan stimulus bill.

It ain't gonna happen!

Just a good bill that will get 50 Senate votes which is all we need. (Vice-President Biden would cast the tie-breaker)

Let the Republicans waste their time with a filibusters. All filibusters end.

[mvd]

38. Agreed!

Take care. :hi:

[Lorien]

54. He's on the center-right and always has been

[theothersnippywshrub]

29. The unemployment rate was higher during Reagan's first term and lower during Carter's only term.

The unemployment rate rose steadily during the first two years of Reagan's first term, especially after he got his tax cuts passed, and reached a high of 10.8% in the last two months of 1982. The unemployment rate under Carter declined steadily during his first three years in office from 7.6% when he took office to a low of 5.6% midway through 1979 and then rose to a high of 7.8% shortly before the election in 1980.

http://www.miseryindex.us/urbymonth.asp

These facts seem to infuriate republican economic critics of Obama.

Obama has plenty of time for the economy and the unemployment rate to improve.

[Better Believe It]

31. This is not the "normal" recession. This is "The Great Recession" and hopefully not worse.

If the economy isn't a lot better in 2010 and 2012 than it is today, the Republicans will regain control of Congress and the White House.

Some are beginning to think they never lost control of Congress!

[theothersnippywshrub]

36. Every recession is different. Democrats likely will lose seats in the House in 2010

regardless of economic conditions at that time. The cyclical improvement in the economy already has begun, although the unemployment rate will not begin to improve for several more months. No one can possibly have any idea now what the economy or the unemployment rate will be like in 2010. But the current unemployment rate will not cost any democrat an election in 2010 or 2012.

[Better Believe It]

43. This is not the "normal" cyclical recession.

Last fall Roubini and other leading economists knew that the unemployment rate would reach 10% before the end of this year.

How do you think they figured that out?

All the objective economic data one needs is out there to make reasonable and likely economic projections.

The real unemployment rate is now over 16% and will remain at near depression levels for at least a few more years.

Even when the misleading government statistics are used (jobless people whose unemployment benefits have been exhausted are no longer counted as being unemployed and laid off people who have given up looking for a job are not counted as unemployed!) the unemployment rate will continue in double digits until the beginning of 2011 or perhaps later.

[uponit7771]

46. This recession is credit based, without credit the GDP will be smaller and people wont spend

...like they usually did when our economy had credit.

[earth mom]

37. Give a chunk of money to every one-5K to 10K. I've been saying this for months. nt

[notesdev]

44. I agree

On average, the average person will do more for the economy with that money in his hands than will the average "financial wizard".

[invictus]

50. +1

[sendero]

41. Duh...

... I've been saying this for months. Obama's economic team is a bunch of banking insiders who don't give two shits about anything but bailing the big banks out of their folly.

Obama is a one termer. Count on it.

[Wednesdays]

42. K&R

:kick:

[lexanman]

45. I've always thought

that people are just not desperate enough yet. Not enough unemployed. Give it time and the tent cities and the homeless and the single mothers are going to become very angry. So far its the status quo. Laid off IT, manufacturing, trades, all are being wiped out. Unemployment only lasts so long and the anger boiling will explode sooner rather than later

[ipaint]

48. pain and misery index

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x6100484

[invictus]

49. Obama can give over one million jobs to Americans by abolishing the H-1B visa. n/t

[denem]

51. he rising rates of unemployment didn't cripple REAGAN.

Obama only needs a 'Morning in America' by 2012. That's the cold, political calculus.

[totodeinhere]

53. How could the American people be so stupid as to blame Obama for this economic mess?

Did they just arrive from Mars? Can't they remember that Bush created this mess and that Obama inherited it? It takes years to turn an economy around. Obama has done wonders so far, but there is no way around it. Unemployment is a lagging economic indicator, and it will take time. Nobody, including McCain, Clinton, or anyone else, could do any better.

So how could voters possibly turn on Obama over this issue?

[Better Believe It]

55. They aren't blaming Obama. They expect him to clean up this "mess". That's why he was elected.

They voted for change .... a better life, universal health care, the right to form unions, jobs for all, an end to imperial wars, the restoration of our Bill of Rights, etc.,

They expect their lives and the government to be much better by the end of his term

If the masses of common people aren't better off, in 2012 the Republicans hope to regain control of Congress and the White House by asking working class and middle class people a very simple question .... "Are you better off now than you were four years ago?"

The answer had better be yes. If it isn't, President Obama and the Democratic Party are toast.

[totodeinhere]

56. If Obama despite his best efforts does not turn the economy around fast enough to suit everyone,

it would be totally illogical to elect the GOP next time. Things would be infinitely worse if they got back in power. The GOP is not the friend of working people. Anyone who can't see that is totally out of touch with reality.

[Better Believe It]

57. The problem is that most people don't look at it your way or my way

They've been taught to jump from the Republicans to the Democrats, from the Democrats back to the Republicans, from the Republicans back to the Democrats and than back to the Republicans whenever they are dissatisfied with the government.

Why do you think people jumped from the Republicans to Democrats in Congress and the White House beginning in 2006?

Now most of the Democratic party "liberal base" will always stick with Democrats no matter what while some will vote for independent or 3rd party candidates. They understand what the Republican party stands for, but, they are a minority of voters.

Most of the Republican Party right-wing fundamentalist base will always stick with Republicans no matter what while some will support independent or 3rd party candidates. They are also a minority of voters.

Meanwhile millions of voters are prepared to jump from the pot into the frying pan if the economy is worse in 2010 and 2012! And more and more independent voters may see it that way who just won't vote for the Republicans or Democrats in 2012.

[ChimpersMcSmirkers]

58. Employment will be better and Obama will get re-relected.

That's my opinion and is just as valid as the shit you constantly post. No one know for sure if it will, but given the signs so far it probably will. Obama is not doing a second stimulus and rightly so. The first one has barely begun.

So, what's the fucking point of you posting this on a daily basis, other then to antagonize? So that we know how bad it is? Yeah, I think we already know that. So, what else?

[Better Believe It]

61. Where are your hard facts and credible links to back up your economic forecast?

You see, here's the difference between my posts and your posts regarding the state of the economy.

I prefer dealing with hard, documented, objective facts and present credible links to back up my opinions.

You like to engage in fantasy economics and you ignore all objective economic facts as somehow being "anti-Obama".

I'm sure that sticking your head in the sand makes you less fearful, but it also blinds you to economic realities!

It seems you don't have a clue on just how bad this economy is and/or maybe you're doing just fine, not a worry in the world.

However, I and my wife along with tens of millions of others aren't doing so well.

And you expect all of us to accept your fantasy and join you in a joyful rendition of "Happy Days Are Here Again".

Here .... you can sing it all by yourself!

http://www.smart-central.com/happydays.htm