Polls have consistently shown that far more Americans still blame George W. Bush for the country’s economic difficulties than those who were prepared to place responsibility on the man who has been president for the last few years. That fact, along with an economy that wasn’t very good but still not as terrible as many thought it might be, was enough to re-elect Barack Obama earlier this month. In doing so, Obama became the first president to successfully run for a second term, while blaming his predecessor for his own failures, since Franklin Delano Roosevelt, who buried Alf Landon in 1936 by running against his predecessor Herbert Hoover.
That was quite a trick, but President Obama should be wary of emulating FDR in every respect. As Amity Shlaes wrote yesterday in Bloomberg News, Roosevelt’s second term provides some ominous precedents for an Obama second term. As our colleague John Steele Gordon wrote earlier this year, it may always be 1936 for liberals who believe conservatives are doomed to perpetual defeat. But what the president and his supporters should be worrying about is whether 2013 turns out to be a repeat of 1937, when a country mired in the Great Depression suffered another economic setback that heightened the country’s misery. As Shlaes points out, signs abound that the “Great Recession” that Obama claimed to save the country from during the campaign may be about to get worse.
The key clue is the drop in industrial production that set off a decline in the stock market in the aftermath of the president’s victory. One can’t compare that drop to the precipitous decline that America suffered in 1937 (when most stocks lost half their value). But as Shlaes writes, the link between the two situations may be the federal government spending sprees that both Democratic presidents engaged in, followed by tax hikes that spiked any chance for growth.
Another troubling parallel is what she calls the fallout from first-term legislation. In FDR’s case, the New Deal may have given many Americans hope, but the result of the vast expansion of federal power and the consequent diversion of money from taxpayers to the government was “reduced available cash, increased uncertainty and lower business confidence.” As Bethany wrote earlier today, the impact of the implementation of ObamaCare on business has the potential to raise unemployment and send the country into another “Great Recession.” In both cases, governments that have tried to “play God” with the economy may bring down on the nation policies that can “spook markets and employers whatever the decade.”
While FDR was able to keep blaming the country’s ills on Hoover until Tojo and the Japanese imperialists bombed Pearl Harbor and finally ended the Depression, it remains to be seen whether Americans will still be grousing about George W. Bush if a year or two from now that they are stuck in another “Great Recession” brought about by Obama’s policies.