Obama state of the union

All the rhetorical flourish is still there, but has Obama, in reality, run out of puff?

The BBC commentator on Obama’s annual address to America mentioned him having had the idealism beaten out of him.

At the Wellthisiswhatithink outpost we find that perceptively accurate, and as a corollary  think that the speech was a lost opportunity to appeal over the heads of the Republican leadership and make a general appeal for genuine national unity and bi-partisanship.

Yes, any President has a perfect right to point to falling unemployment and so on, but Obama often tends to the triumphal in his commentary on current events and the performance of his administration, and in our opinion it’s always the wrong note to strike, and right now, especially so.

Despite having supported him in general since before the primaries, and still doing so, we think it’s fair to say that he has generally been a disappointment as a president, with some good marks for attempting things that matter (whatever one thinks of Obamacare seeking to extend health cover in the USA is laudable and productive – a healthier nation is not only morally correct it’s also good sense economically) but then again the expectations on him at the start were ludicrous, born of both his soaring rhetoric and the excitement of the country actually electing someone who was half black.

It is too early to write his political obituaries, and we think (others will disagree) that he will ultimately win praise for co-ordinating an effective response to the financial/Wall Street collapse. (The alternative, after all, was unthinkable.) But he has squandered his political capital, and a new style and approach would recover some of it and leave the refuseniks on the right blind-sided.

The problems America faces are very substantial, so it is questionable whether anyone would do a really “good” job at the moment – the weaknesses are structural and ingrained, not at surface level. We are not sure the American people are ready for the pain of a root-and-branch reform of the Government, though unquestionably the size of their Government, at all levels and under both parties, is vastly over-bloated. If the pain of restructuring was accompanied by less overt politicking, more transparency and more obvious progress towards recovery it might be welcomed. But we are not holding our breath.

In general, whilst a recovery is underway, it is weak, patchy, and it will do nothing to address the overall problem of Government (and private) debt. Congressional sabre-rattling cannot obscure the fact that besides cutting social programs there are no real solutions being offered. There seems no appetite at all on the right for increased taxes – an inevitable component of any long-term effort to solve the debt crisis that needs to accompany reducing expenditure – nor for cutting back the ludicrously large military budget. As always, political posturing wins out over simple commonsense.

As the website “Science Progress” pointed out three years ago, “As the debate in Washington pivots this week from deficit reduction to job creation, progressives and conservatives will be vying to convince the American people that they have the best plan to get America working again. But any jobs plan will fall flat if it doesn’t lay out a strategy for investing in innovation. Conservative proposals largely echo now-defunct Reagan-era thinking that tax cuts alone can spur the private sector to create jobs. Yet effective corporate tax rates are lower today than they were under President Reagan and are certainly much lower than many of our competitor nations. The same is true of the effective tax rate for top-, middle-, and low-income families. Tax cuts neither created the jobs of the past nor will they create the jobs of the future. Investing in innovation will.

Innovation is what has created the bulk of American jobs today and it will most certainly be the force that creates the jobs of tomorrow. America is home to the world’s best jobs and most prosperous economy quite simply because we’ve invented and made the things that the world wants to buy. And then we’ve invented ways to make those things better, faster, and cheaper.

The cotton gin, the trans-continental railroad, interchangeable parts, assembly line manufacturing, the automobile, the airplane, the personal computer, the photovoltaic solar cell, GPS technology, the Internet, the mapping of the human genome, the iPhone—these inventions and the companies that produce them have directly or indirectly supported millions of American jobs.”

President Barack Obama delivers a speech on innovation at Hudson Valley Community College in Troy, N.Y. But America needs to move beyond fine words and onto a national effort.

President Barack Obama delivers a speech on innovation at Hudson Valley Community College in Troy, N.Y. But America needs to move beyond fine words and onto a national effort.

Indeed, as President Barack Obama said in his 2011 State of the Union address, “In America, innovation doesn’t just change our lives. It is how we make our living.” Yet progress is painfully slow.

This goes neatly to the real issue behind everything, which is that whilst America will continue to be a vast and powerful player in world markets, it has really not wrestled with the growth of Asia and what it means, and it shows no real signs of doing so. As the middle class in Asia grows and provides adequate markets for its rulers to sell to, their desire/need to sell their goods cheaply to the West will fall, as will their appetite for bailing out the West with their profits to keep the overseas markets liquid. At that point, all economic hell breaks loose.

That’s why long-term solution for America has to be innovation. The country cannot compete with a vast Asian population producing run-of-the-mill goods more cheaply. Creating and manufacturing products that reflect the finest pinnacle of American ingenuity and forceful determination is really the only option available. Goods that the rest of the world want to buy, and are willing to pay a premium for. To his credit Obama did mention the need for new hi-tech industry hubs. But those remarks already seem to have disappeared without trace in the commentariat. Yet public investment in the human genome project, for example, had a return on investment of more than 14,000 percent in terms of economic output per federal dollar invested since 1988, and has led to the creation of millions of biotech jobs that could not have existed without it. Similarly, a seemingly tiny investment of the Defense Advanced Research Agency, or DARPA, spawned the Internet, giving rise to trillions of dollars in worldwide economic activity, new businesses, and, more importantly, new ways of doing business.

It seems so obvious, yet the political elite seem unable to bend their mind to the opportunity. Fort example, the response to the speech from Republican Cathy McMorris Rodgers was timid, one might almost say “vapid”. One tweeted review of it read “We have a plan. The plan is to come up with a plan.” Quite.

In our view there is little doubt that the entrepreneurial flair for which the country is famous is flagging: running a business now seems as much about rapidly merging your firm with someone else’s, taking a big payoff and bonus tranche of shares, and heading off to enjoy your new found wealth – aided and abetted by so-called rain-maker brokers who exist merely to grease the wheels of deals that make little or no economic sense, as often as not, beyond enriching the participants – as it is about dreaming new dreams, innovating, creating markets, and selling to them.

One of the reasons is that many American businesspeople have spent their entire careers wallowing around managing businesses cautiously to avoid a loss rather than to create a profit – and doing so for so long that they have actually never experienced the sort of drive and courage needed to create real new wealth. They are risk-averse managers, not passionately-driven owners. There are honourable exceptions, of course, but not many, and their numbers decline.

All that stuff? That’s not capitalism. That’s corporate laziness. And the Republicans are as much to blame as anyone else, for markedly failing to use their cosy relationship with corporate barons to urge them to do something useful with their economic power instead of just lining their own pockets, for fear of the endless flow of donations into their re-election coffers drying up.

A President who dared to tackle all that nonsense? Who put the country’s problems squarely in front of the population, and dared Americans to recapture their brighter past?

Yes, we’d like to see that. No, we don’t expect it. Especially from a man who seems to have lost much of his appetite.

Incidentally, one curiosity. The speech is a constitutional tradition given in front of a joint session of all the members Congress each year. The exception is one “designated survivor” who remains separate in a secure location in case the Congress and President are wiped out in an attack on the Capitol. This year, it was Obama’s Energy Secretary, Ernest Moniz, who also happens to be an expert on nuclear weapons. Cheerful thought.

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Comments
  1. Excellent analysis, Yolly, and very well stated. I echo your concerns about the lack of innovation in my country, about the overall political climate there, and the power of the 1% that sit on top of it all.

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  2. Simon says:

    I hate it when I agree with you….and I totally agree with you on this beautifully crafted and thoughtful piece. I totally support the idea that Obama has been, on balance, a disappointment . One only has to look at his mismanagement of the Syrian ‘crisis’ to appreciate a man out of his depth. I can’t recall the exact statistic but it goes something like there were more drone strikes in 2013 than since the commencement of ‘drone strikes’, so much for the man of peace! His rhetoric simply doesn’t match his deeds…if I hear one more regretful speech about semiautomic weapons after yet another mass murder, I will throw up. A man of talk not action.

    Yolly your article is spot on, the US will always have the major advantage over the rest of the field because they generally are a smart, innovative country and one only has to look at what’s happening in Silicon Valley to realise the US is on the up! ( there demographic profile is also strong!)
    And this is what separates the US from a China and an India and the rest of the world.

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  3. Simon says:

    Sorry Yolly, I was typing on a damn IPad and I meant to say, ‘ I don’t share the view regarding a ‘ lack of innovation’ , so please forgive my last par.

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  4. James Mahoney says:

    A couple of thoughts about your thoughts, Yolly. First about innovation, and second about the President.

    Regarding innovation and your view that progress is painfully slow. Progress is *always* painfully slow. There are no lightning bolt timetables for innovation. The idea or the breakthrough discovery at the core of innovation may strike like a bolt, but turning those into viable invention takes time. Look at the timeline of just the two examples you cite: the genome project and the DARPA seed that led to the internet.

    Innovation continues apace. It just does so, as it always has, at the edge of business, society, academia, whatever. The innovators, as they always have, represent somewhat less than a percent of the overall number of people involved in commerce. If you look at any given time in history, I venture that the number of people cashing in (or “wallowing around managing … cautiously”) far exceeds the number of people who are innovating. That’s just the way it is, regardless of whichever discipline you’re talking about: business, academia, medicine, politics, life…

    I don’t see any flagging of entrepreneurship in this country. There are tons of people diligently working on creating value, building on the ideas and discoveries of others, and exploring new avenues. They may not be visible, but then, they seldom are. When he was in Paris, Hemingway commented on the café society of writers, saying something like, “The real writers are in their rooms writing, not sitting around cafes.” The same is true of the innovators. Just because you can’t see them doesn’t mean they aren’t there.

    As far as President Obama is concerned, in my view he has been one of the most divisive presidents we’ve ever had. Lecturing, hectoring and demonizing “them” is his stock in trade—and you can fill in the blank of “them” with your favorite choice: the wealthy, bankers, insurance companies, Republicans, oil companies, cocker spaniels… None of the other presidents that I’ve experienced have so consistently and maliciously used this device as he does. From nearly day one he’s used this cudgel as a hedge excuse for his “difficulty” in getting ideas enacted.

    Unfortunately, I think Steve Jobs was right in his assessment of an early meeting he and other CEOs had with President Obama: Jobs told his biographer that Obama’s focus on the reasons that things can’t get done “infuriates me.” To my eye and ear, the president hasn’t changed this point of view. There always has to be some bogeyman in the mix, and it’s usually someone who Obama says is simply sucking the lifeblood out of all of us good folks.

    Has he done some good things? Undoubtedly. But the cost to the country’s psyche and reputation outside the US seems to me to be very high. I fear that it will take some time to repair both of those. And that is a sad legacy for someone who rode into the White House on a tsunami of goodwill and optimism, and who so badly bungled the opportunity for genuine reenergizing.

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  5. James Mahoney says:

    President Obama never was, nor did he ever claim to be during his initial campaign, a “man of peace” as far as I remember or noted at the time. The wonder of his first campaign is that people of vastly different political and social outlooks read their own interests into what he was saying, or they selectively listened. For example, he talked about ending the Iraq war, but was clear that he was going to refocus on the Afghanistan war.

    I recall at the time seeing a bumper sticker that had the peace symbol as the O in Obama. I immediately thought, “There’s someone who’s not really paying attention to what he’s saying. If Obama wins, they’re in for a rude awakening.”

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  6. James Mahoney says:

    First of all, Yolly, I don’t accept your characterization of W as a war criminal. As unpopular as the following opinion of mine about W still is, I think that history will judge his presidency to be much better than many people currently think. For the record, I didn’t vote for him in either election. I did, however, come to respect the job he did under extremely challenging circumstances. That doesn’t mean I agree with or approve of everything he did, but the same can be true of every voter about every president.

    That said, if you’re talking about the campaign pronouncements, Obama had the “luxury” of running six years after 9/11 when tempers had cooled somewhat, the reality of the length and difficulty of the struggle had set in, and the second-thoughts were rampant. When he was “just” a US Senator and an undeclared contender (which began the moment he made that tremendously inspiring speech at the Democratic convention when he was an Illinois state senator), his pronouncements were largely populist (as they mostly still are). Given the tenor of the times, and Obama’s personality, it’s not surprising that they would be substantially less bellicose than W’s had been at times.

    Again, people who were viscerally anti-Bush–and therefore anti-McCain in that election–zeroed in only on the parts of what Obama said that *seemed* to resonate with their own beliefs, hopes, and desires, and were completely deaf to the the parts that didn’t fit their worldview. That was a remarkable deviation from the norm.

    Since his election, nothing has happened *in this country* on the scale of 9/11. So in that sense, Obama has never had to forcefully reassure the country that we would answer, as Bush had to. Given his personality, if such an occasion again arises, I’ll be astonished if Obama’s pronouncements match W’s in terms of clarity and bellicosity. But I would hope that he would rise to the defense and respond as those circumstances would demand.

    Separately, where W was classically bellicose in literal circumstances, Obama is obliquely bellicose. As I said above, he consistently demonizes “them” in this country, and I think his and his cohort’s continuous use of this device is extremely damaging.

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    • James, the invasion of Iraq was illegal. The indiscriminate slaughter from aerial bombardment was deliberate. “Shock and awe.”

      In the initial assaults, the occupation, and the resulting chaos, 500,000 civilians have been killed. The country is about to descend into civil war again.

      George Bush Jnr, aided and abetted by the neo-con conspiracy that spanned the White House, leading manufacturers, oil companies and many opinion formers, was – and is – a war criminal.

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  7. James Mahoney says:

    “Experts disagree as to whether the war was legal under international law.”–http://www.hrcr.org/hottopics/Iraq.html. This site, which notes that it is “no longer being updated. March 26, 2008” was “maintained by the Arthur W. Diamond Law Library at Columbia Law School.” Pretty good credentials.

    Obviously, neither you nor I are the deciding votes as to whether the war was illegal, and I certainly don’t dispute your right to conclude and assert that it was.

    As to whether W was/is a war criminal, we shall have to continue to disagree.

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