Commentary Magazine


Topic: General Motors

Reality Fact-Checks Obama

Although the Obama campaign is happy to report the recent drop in the unemployment survey, the Republican critique that the drop is due in part to those leaving the labor force and giving up on finding work is more than mere spin. That’s because of a simple truth, and one that has hurt the Obama campaign’s narrative of recovery: it is quite a challenge to convince an unemployed person that they have a job. At the beginning of the year, the Obama campaign tried selling the economy as being on the upswing, and voters pushed back.

In February, Democracy Corps released polling on the most recent State of the Union address, and here is what they wrote:

One of the President’s weakest operative frameworks highlights recent progress on job creation. This message is potentially dangerous for Democrats. During the State of the Union, we watched the dial lines go flat, with even Democrats peaking below 70 when the President highlighted recent jobs numbers.

In post-speech focus groups, respondents explained why this part of the speech did not resonate for them: first, and most importantly, they have not seen these jobs or felt the effects of job creation. But they are also deeply concerned that these jobs are not permanent, that these new jobs belie much deeper structural problems in the economy, and that the new jobs that have been created are far inferior to the more stable, full-time, well-paying middle class jobs that have been lost over the last decade.

Of course, this was almost a year ago, and in that time economic data has improved, so it’s possible the message would be better received today. But the point is, the Obama campaign had to drop certain overly optimistic language from the president’s campaign speeches because the public wasn’t buying it. Something similar may be happening with regard to the president’s message that al-Qaeda is on its heels.

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Bin Laden’s Dead. How Long Will GM Live?

If you heard it once last week, you heard it 100 times. General Motors is alive and Osama bin Laden is dead. That juxtaposition of the federal bailout of the car manufacturer and the killing of the terrorist is supposed to be the argument for President Obama’s re-election. While both are good things, neither tells us much about the administration’s value. It is likely that GM would have survived in one form or another no matter what the president did. Nor, despite the unseemly chest-thumping braggadocio about the bin Laden operation, is it reasonable to assert that it was only possible because Obama was president. Nevertheless, this catch phrase, made popular by Vice President Joe Biden, is an effective campaign slogan. Indeed, the car bailout is thought to be a crucial factor in propping up the president’s poll numbers in key swing states like Ohio and Michigan that may decide the election.

However, for all of the cheering for GM plants done at the Democratic convention, the notion that the company that once dominated the industry has been set back on the path to prosperity by the president may be something of an illusion. Last month, Forbes published a sobering piece on the company’s prospects that should give even the giddiest of Democrats pause. According to Louis Woodhill, the GM revival is all smoke and mirrors:

President Obama is proud of his bailout of General Motors.  That’s good, because, if he wins a second term, he is probably going to have to bail GM out again. The company is once again losing market share, and it seems unable to develop products that are truly competitive in the U.S. market.

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Flotsam and Jetsam

Among the top 10 places Ahmadinejad won’t be going to in New York: “Down on Houston Street sits Katz’s Deli, a venerable New York institution since 1888. But Ahmadinejad’s punim is unlikely to join the sea of faces smiling out from the walls of the not-quite-kosher deli, which is festooned with pro-Israel signs and a world-famous slogan: ‘Send a salami to your boy in the Army.’ While Ahmadinejad probably won’t be tearing into one of Katz’s juicy triple-decker pastramis any time soon, even a Holocaust-denying would-be genocidist can hardly say no when you throw a knish into the bargain.”

Giving thumbs up to Sarah Palin (“All responsible energy development must be accompanied by strict oversight, but even with the strictest oversight in the world, accidents still happen”), Jonathan Capehart writes: “I won’t join the chorus demanding that off-shore drilling be stopped forever in the U.S. for one simple reason: Until renewable energy sources are more widely available we have no choice. We need the fuel.”

So why isn’t he pressing for regime change or objecting to the administration’s attempt to undercut congressional sanctions? “Iranian President Mahmoud Ahmadinejad should be arrested and tried with war crimes while he’s in the United States, Rep. Steve Israel (D-N.Y.) said Monday. Ahmadinejad is in New York for the United Nations nuclear summit, and Israel wants to use the opportunity to have the Iranian president taken into custody. ‘Ahmadinejad shouldn’t just be protested in NYC, he should be arrested and tried for incitement to commit genocide,’ Israel said on his Twitter feed.”

Joe Sestak is gaining on Arlen Specter in the Pennsylvania Senate primary race. Maybe the party-switching wasn’t such a great idea. But even if Specter loses in the primary, he could pull a Crist and run as an independent. Hey, he’s not a party man anyway.

Trouble (for Democrats) in paradise: “The White House and top Democratic officials are circulating a new, private poll to suggest that only one of two Democrats splitting votes in a tightly contested Hawaii special election has a chance of winning the race.” This follows another poll showing Republican Charles Djou leading the race.

Hillary is thinking big again: “The United States and the great majority of the nations represented here come to this conference with a much larger agenda: to strengthen a global non-proliferation regime that advances the security of all nations, to advance both our rights and our responsibilities.” How about just stopping Iran’s nuclear program? Really, do the Saudis, Jordanians, Egyptians, and the Gulf States really think Israel’s nukes are the problem?

Double-talk from the Obami again: “Herbert M. Allison, Jr., Assistant Secretary of the Treasury for Financial Stability, told three House Republicans in a recent letter that ‘Treasury has never represented that the loan payment represented a full return of all government assistance.’ … Interestingly, however, the first sentence in the April 21 news release circulated by the Treasury Department said: ‘The U.S. Department of the Treasury today announced that General Motors (GM) has fully repaid its debt under the Troubled Asset Relief Program (TARP)’ So the truth is exactly the opposite of what Treasury’s Allison claimed in this regard.”

The Health-Care Backlash

Here are some thoughts on where things stand in the aftermath of the certain passage of the Senate health-care bill.

1. Few Democrats understand the depth and intensity of opposition that exists toward them and their agenda, especially regarding health care. Passage of this bill will only heighten the depth and intensity of the opposition. We’re seeing a political tsunami in the making, and passage of health-care legislation would only add to its size and force.

2. This health-care bill may well be historic, but not in the way the president thinks. I’m not sure we’ve ever seen anything quite like it: passage of a mammoth piece of legislation, hugely expensive and unpopular, on a strict party-line vote taken in a rush of panic because Democrats know that the more people see of ObamaCare, the less they like it.

3. The problem isn’t simply with how substantively awful the bill is but how deeply dishonest and (legally) corrupt the whole process has been. There’s already a powerful populist, anti-Washington sentiment out there, perhaps as strong as anything we’ve seen. This will add kerosene to that raging fire.

4. Democrats have sold this bill as a miracle-worker; when people see first-hand how pernicious health-care legislation will be, abstract concerns will become concrete. That will magnify the unhappiness of the polity.

5. The collateral damage to Obama from this bill is enormous. More than any candidate in our lifetime, Obama won based on the aesthetics of politics. It wasn’t because of his record; he barely had one. And it wasn’t because of his command of policy; few people knew what his top three policy priorities were. It was based instead on the sense that he was something novel, the embodiment of a “new politics” – mature, high-minded and gracious, intellectually serious. That was the core of his speeches and his candidacy. In less than a year, that core has been devoured, most of all by this health-care process.

Mr. Obama has shown himself to be a deeply partisan and polarizing figure. (“I have never been asked to engage in a single serious negotiation on any issue, nor has any other Republican,” Senator McCain reported over the weekend.) The lack of transparency in this process has been unprecedented and bordering on criminal. The president has been deeply misleading in selling this plan. Lobbyists, a bane of Obama during the campaign, are having a field day.

President Obama may succeed in passing a terribly unpopular piece of legislation – but in the process, he has shattered his carefully cultivated image. It now consists of a thousand shards.

6. This health-care bill shouldn’t be seen in isolation. It’s part of a train of events that include the stimulus package, the omnibus spending bill (complete with some 8,500 earmarks), and a record-sized budget. In addition, as Jim Manzi points out in the new issue of National Affairs:

[Under Obama] the federal government has also intervened aggressively in both the financial and industrial sectors of the economy in order to produce specific desired outcomes for particular corporations. It has nationalized America’s largest auto company (General Motors) and intervened in the bankruptcy proceedings of the third-largest auto company (Chrysler), privileging labor unions at the expense of bondholders. It has, in effect, nationalized what was America’s largest insurance company (American International Group) and largest bank (Citigroup), and appears to have exerted extra-legal financial pressure on what was the second-largest bank (Bank of America) to get it to purchase the ­country’s largest securities company (Merrill Lynch). The implicit government guarantees provided to home-loan giants Fannie Mae and Freddie Mac have been called in, and the federal government is now the largest de facto lender in the residential real-estate market. The government has selected the CEOs and is setting compensation at major automotive and financial companies across the country. On top of these interventions in finance and commerce, the administration and congressional Democrats are also pursuing both a new climate and energy strategy and large-scale health-care reform. Their agenda would place the government at the center of these two huge sectors of the economy…

Together, these actions tell quite a tale. Mr. Obama has revived the worst impressions of the Democratic party – profligate and undisciplined, arrogant, lovers of big government, increasers of taxes. The issues and narrative for American politics in the foreseeable future has been set — limited government versus exploding government, capitalism versus European style socialism, responsible and measured policies versus reckless and radical ones.

Barack Obama is in the process of inflicting enormous damage to his presidency and his party. And there is more, much more to come.