It will be harder to pull the wool over American eyes this time around regarding Mr. Obama. The rotten state of the economy will see to it.
In 1979, of course, Jimmy Carter was the incumbent President, and no sophisticated, intelligent person in Washington thought Ronald Reagan had a serious chance of beating him. The RNC was convinced Reagan would be another Goldwater, and its entire focus was to deny him the 1980 nomination. You know what happened.
In 1995, President Clinton had just suffered a shocking, historic defeat in the midterms, with the Republicans taking both houses of Congress for the first time in 40 years. At first, he seemed to be on the same trajectory as Carter. But he pivoted to embrace the policies of the new Republican Congress, while still managing to play off them to hold his Democrat party base. The Republicans nominated the clueless Bob Dole in 1996, and you know what happened.
Hence the question, is today 1979, or 1995? You can’t answer that question by looking at where we are today. You have to look at the underlying trends to gauge where we are going to be in the fall of 2012.
Meet the New Boss
Obama partisans can be cheered by the uptick in Obama’s polls. But the roots of that are the roots of his downfall. Dick Morris has called this one wrong. The uptick is not due to Obama’s Tucson speech, which will have no significant lasting effect (unless the Republicans are stupid enough to be browbeaten into silence). The uptick is due to Obama’s extension of the Bush tax cuts, which has allowed breathing room for a real economic recovery to begin this year, long overdue.
But note the fatal flaw in that hopeful policy turn, like in a Greek tragedy. The extension is only for two years, and all that it involves is extending the same tax rates that have been in effect for the last 10 years. There is no tax rate cut to provide additional incentives for economic growth. Worst of all, President Obama has vowed to come back and impose that tsunami of tax increases in the top tax rates of every federal tax in 2013.
What is already scheduled under current law is precisely that. The top two tax rates would increase by nearly 20%, counting Obama’s phase-out of deductions and exemptions. The capital gains tax rate would soar by close to 60%, counting the Obamacare tax increase also going into effect in 2013. The tax rate on corporate dividends would triple, counting the Obamacare tax increase as well. Obamacare will also increase the Medicare payroll tax by 62% as well on upper income earners. All these tax increases will pile on the nation’s employers and investors at once.
The economic effect of that, and the resulting further political implications, are discussed further below. But the immediate political implications are that this tsunami of tax increases, as currently framed, will be a top central issue in the 2012 elections.
A second top central issue of that election is being framed right now. Obama and the Democrats have already begun attacking the Republicans because they don’t want to spend enough, in the Democrats’ enlightened view. In the current political environment, this is an incalculable blunder, and the Republicans must recognize that and embrace the issue framed just this way.
The Democrats are married to the view that this will be 1995 all over again. But it is actually much worse for them than 1979, because Obama’s leftward extremism has awakened the grassroots, as witnessed by the rise of the Tea Party. In this environment, the 1995 attack on the Republican budget because it doesn’t spend enough will be as politically fatal as Obamacare was in the midterms. This year, there will be a widespread grassroots expression that even the Republican budget spends too much. Sen. Jim DeMint and his cohorts are already fanning those flames. That argument will resonate at the grassroots, and among independents in particular, throughout 2012.
In last night’s State of the Union, President Obama actually just reiterated the fundamental guiding premise of Obamanomics over the past two years. That is that more government spending is the key to economic growth, both short term and long term. But the reality is that still more government spending will just subtract from rather than add to the economy. More on the State of the Union fallacies next week.
Meanwhile, the Obamunistas are back to their calculated deception, and so certain that us Homer Simpsons out here will fall for it again. Investor’s Business Daily framed the issue exactly correctly in its lead editorial yesterday, entitled “The Grand Pivot — Who’s He Kidding?” The editorial began, “Will the man who conned the public into believing he was a moderate, but who has governed as the most immoderate leftist in the country’s history, now try to pull the same con so he can be elected again?”
Yup. Even before last night, the Great Con was already underway. On January 18, the Wall Street Journal published a commentary by the President himself announcing a new Executive Order commanding an Administration-wide review of regulatory burdens “to remove outdated regulations that stifle job-creation and make our economy less competitive.”
In the business world, this strategy is called “bait and switch.” In politics, it’s called “Boob Bait for Bubbas.” On Monday, the explained what was in the actual Executive Order, saying, “When the agencies weigh costs and benefits, the order says, they should always consider ‘values that are difficult or impossible to quantify, including equity, human dignity, fairness, and distributive impacts.’”
The Journal further explained what this means:
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?