Republicans providing Obama’s bailout
It is increasingly difficult to argue that the GOP is benefiting from the struggle between Mitt Romney and the challenger—alternately outsider and insider, hefty and svelte, conservative and more conservative—who isn’t Romney. Internal Republican ideological debates, while interesting to Republican ideologists, have little relationship to electoral needs. The longer these controversies continue, the longer President Obama has to regain his political balance.
This is increasingly obvious on the economy, where the election will be won or lost. Republican candidates have a strong case to make against Obama’s dismal, craven economic performance. Instead they are competing to be viewed as the most resolutely anti-bailout. Given the beliefs of Republican primary voters, this is a rational political move. It makes little sense as a national message.
Rick Santorum has attacked Romney for seeking a bailout of the Salt Lake City Olympic games. He feels compelled by ideology to attack a patriotic success story—an event that attracted 2 billion viewers and inspired America five months after the terrorist attacks of 9/11. Perhaps he should call on American athletes to melt down their 34 medals won at the games to repay the government.
Both Santorum and Romney have also stumped across Michigan criticizing the auto bailout, which Romney describes as “crony capitalism on a grand scale.” This at a time when General Motors has announced the largest profits in its history.
You can’t prove a counterfactual, so Santorum and Romney can claim that GM and Chrysler would have been even more successful without public loans, emerging from Chapter 11 leaner, meaner and better able to survive. But this requires an intentional, determined amnesia.
In 2008, GM and Chrysler were not prepared for a Chapter 11 filing. President George W. Bush’s economic advisers studied the firms’ numbers and determined they might be forced to liquidate without a loan. So Bush provided a three-month bridge loan, allowing the automakers time to restructure before entering bankruptcy and giving Obama some time to make his own policy choices. There are valid questions about the way Obama and Steve Rattner structured their auto bailout. But GM and Chrysler did eventually enter a managed bankruptcy, which was the endgame that Romney himself recommended.
Specific bailout policies can be disputed, but one fact cannot: No president—Republican or Democrat—would have allowed the economic collapse of the Upper Midwest in the midst of a national economic panic. A conservatism that prefers ideology to reality is not particularly conservative.
Meanwhile, back at the general election, Obama is happily avoiding serious scrutiny. America’s economy may be improving, but it remains pathetically weak. Unemployment has remained north of 8 percent for three years—the longest period since the Great Depression. Long-term unemployment is at its worst since 1948. The collapse in housing prices is worse than during the Great Depression. Since 2009—when Obama predicted his stimulus package would raise 2 million people out of poverty—more than 6 million Americans have fallen into poverty.
“The standard of living for Americans,” reports the Christian Science Monitor, “has fallen longer and more steeply over the past three years than at any time since the U.S. government began recording it five decades ago.”
Obama can claim that financial crises produce particularly durable recessions, or that past failures were so severe that they challenge even his economic genius. We’ll see how those excuses play. But right now, he is not even being forced to offer them.
Obama’s economic message in the general election is a difficult balance. He must claim credit for the direction of the economy (assuming it stays positive) while shifting blame for the depth of current problems.
Republicans have a simpler task. They need to offer a credible economic alternative while pointing out that Obama has missed his own objectives on reducing unemployment and the federal debt by a mile. Obama—having pledged to cut the deficit in half during his term—has produced four massively unbalanced budgets that put America on the road to Athens. He has done little or nothing—this is the craven part—about the unsustainable growth of entitlement spending, which threatens the security of the elderly and the future stability of the economy.
But as long as Republicans are focused elsewhere, they are providing Obama with his own private bailout.
Michael Gerson is a columnist for the Washington Post Writers Group; email email@example.com.
Last updated: 7:41 pm Thursday, December 13, 2012