Weak economy shouldn’t overexcite Obama rivals

December 29, 2010

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

WASHINGTON — The Federal Reserve economic forecast is bleak. It predicts high unemployment will plague the rest of President Barack Obama’s four-year term. The assessment provides the strongest reason yet for any Republican who ever dreamed of occupying the Oval Office to launch a campaign in 2011 to be the party’s candidate to challenge Obama in November the following year. And many will. But the president remains a formidable opponent.

The midpoint of the November 2010 economic outlook from Fed policymakers has unemployment ending 2012 at around 8 percent. Even if Obama’s trillion-dollar stimulus spared millions of jobs, Republican candidates will surely remind voters that the president’s economic advisers promised to keep unemployment from ever hitting that lofty level.

Obama’s team likes to compare its political plight to that of President Ronald Reagan. Unemployment was 8 percent or higher for half of the Republican’s first term, the last time the country experienced a recession anywhere near as bad as this latest one. And Reagan still won by a landslide. But the economy was racing and the jobless rate tumbling when he faced voters in 1984. Another White House incumbent who looked a guaranteed loser was Harry Truman in 1948. But blistering 7 percent GDP in the first half of that year helped Truman pull off the biggest upset in U.S. presidential election history.

Obama probably won’t have such wind at his back. An overhang of debt and housing problems should keep GDP growth moderate. Some at the Fed also reckon that even if growth picks up sharply, workers still won’t have appropriate abilities for available positions.

Perhaps with that in mind, a herd of Republicans are sure they have just the right skills for Obama’s job. The frontrunner, whether measured by polling, financial or betting market performance, is Mitt Romney, the former Massachusetts governor and head of private equity firm Bain Capital. But he will need to contend with a group of rivals that may include Sarah Palin, Minnesota Governor Tim Pawlenty and Senator John Thune of South Dakota. By late spring, the crowded field will be set.

GOP contenders shouldn’t get cocky, however. By 2012, Obama could have unexpected economic improvements to boast about. And the president’s own finances should be sound even if America’s aren’t. He could raise $2 billion for a second run — and sitting U.S. presidents rarely lose. What’s more, midterm election beatings seem to have little bearing on re-election odds. For now, those too are working in Obama’s favor, suggesting a better than even chance at four more years.

Comments

The president remains more than just a formidable opponent… he is a lock for two terms, no matter what you jokers(Republicans) may like to think or make up and say .

Mr. President also has one other thing going for him, he is not Racist or a stiff like the Republicans listed in here.Lets not kid ourselves, we all know the presidency is about who is more liked on a personal level, have you all forgot the charisma from 2008?

Posted by SwissMaestro | Report as abusive
 

The theme of the op-ed is absurd and irrational. Obama is doomed to a one-term footnote in history because he is grossly incompetent, not for any other reason. All the myriad reasons why he is despised have very little relation to the economy. The PC kooks may not want to criticize him solely because he is black, but he is regarded with contempt by the overwhelming majority of all Americans because he is an inept, blundering fool, not because of his skin color. He blew his oath of office. Surely that would indicate something to even the most rigid-minded extremist.

Posted by FirstAdvisor | Report as abusive
 

Not voting for Obama.

Posted by axiom321 | Report as abusive
 

Good for you The president is still gonna be the president in 2013 though and don’t you forget it .

Posted by SwissMaestro | Report as abusive
 

Ah. Apparently dissent is verbotem. Interesting. But not surprising. It seems many who work for Reuters are very vain, and hypersensitive to any view opposing theirs.

Posted by FirstAdvisor | Report as abusive
 

President Obama is a mind regulator. No joke!

Posted by walker-g | Report as abusive
 

Conservative Republicans, who’ve been wrong about every major economic challenge for the last several decades, have seized on the unemployment numbers, in the hope they would pay political dividends. That may very well have proven effective — the employment picture is still bleak and discouraging, which is good news to the GOP, because they can then claim the Democratic approach didn’t work.

But let’s pause to appreciate how backwards this is.

What is it that Republicans are complaining about? The economy is clearly still struggling, but we’d be far better off if the GOP weren’t already getting its way.

Consider exactly what Republicans think we should be doing right now: keep Bush-era tax rates; slash public-sector employment; stop infrastructure investments; let the private sector grow without any additional economic stimulus.

Then consider: we have Bush-era tax rates in place, in addition to middle-class and small-business tax cuts the Democratic majority passed over GOP opposition; the public sector is shedding jobs by tens of thousands of people per month; infrastructure investments are being blocked; and the private sector is trying to grow without any additional economic stimulus.

In other words, the GOP is getting its way and still complaining about the results. Every measure that’s come up over the last 24 months that could help create jobs has been fought, watered down, and sometimes killed by Republicans … who in turn broadcast far and wide that the weak job landscape, which they created in the first place, is Obama’s fault.

Posted by GetpIaning | Report as abusive
 

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