The more than 300,000 Americans who attended tea parties across the country this week to protest the explosion of spending in Washington will not deter President Obama from pursuing the most ambitious expansion of the role of government since the Great Society.
For now, Obama has little reason to worry about the pesky opposition, because he still enjoys the support of a comfortable majority of Americans. His approval rating hovers above 60 percent, and a new Gallup poll showed that 71 percent of the public has a “great deal” or “fair amount” of confidence that he will “recommend the right thing for the economy.” In contrast, the Republican leaders in Congress only enjoyed the support of 38 percent of respondents.
Conservatives also got a scare last week when a Rasmussen poll found that only 53 percent of American adults favored capitalism over socialism.
Yet lurking beneath all of these numbers is a longer-term skepticism about the role of government that has the potential to seriously damage Obama’s political standing over time. The results of a USA Today/Gallup poll released on Wednesday were a lot more mixed for Obama and proponents of big government. While it showed majorities support Obama’s housing plan, the stimulus package, and more regulation of financial institutions, only 39 percent of those polled said they supported bank and auto bailouts. And while most Americans (52 percent) believe that bigger government is necessary during the current economic crisis, by a 3 to 1 margin they said they favored cutting back the expansion of government once the crisis is over.
Additionally, questions found that 55 percent of Americans think that Obama’s economic proposals spend too much money, and by a 50 percent to 42 percent margin Americans say government is “trying to do too many things that should be left to individuals.”
Taken together, these results suggest that while Americans are willing to tolerate a greater role for government in the short-term, they don’t want to spend their lives in the shadow of a leviathan state.
The reason that this poses a problem for Obama is that the central argument for his domestic agenda is that he doesn’t merely want to address the current crisis, but wants to reshape the American economy and drastically expand the role of the federal government in people’s lives.
Thus, Obama is making a huge bet on big government. He’s betting that his spending spree will stimulate the economy, get credit flowing again, and revive the housing market; that his energy polices will yield new alternative fuels that will clean the environment and reduce our dependence on foreign oil; that throwing more federal money into education will improve the economic prospects of the younger generation; and that he can do all of these things while limiting our debt, keeping taxes low, and tackling entitlements.
In his speech on the economy delivered at Georgetown University on Tuesday, he lectured the audience about the need to get serious about addressing entitlement reform. But even the Washington Post was skeptical.
“Many of the savings identified in the president’s budget are phony, and the real ones are used to offset the costs of his new spending increases or tax cuts,” the Post editorialized. The newspaper also noted that “the health-care savings he has identified are all directed to new health-care spending, and, even then, they cover only a fraction of the likely costs of a health-care bill — of what would become yet another entitlement program.”
In fact, the cost of implementing the type of health-care plan that Obama proposed during his campaign has been estimated at roughly $1.5 trillion over ten years. The only way Obama would be able to seriously reduce costs of medical care under a government-controlled system would be to ration care to the sick and slash reimbursement rates for doctors, which will trigger longer waiting times for patients. While Europeans may be used to this, it is harder to imagine Americans standing for it.
All told, Obama’s agenda is projected to more than double the public debt to $17.3 trillion by 2019, according to the Congressional Budget Office, equal to a staggering 82.4 percent of the economy.
Obama will be hard-pressed to pay off that debt without either massive, broad-based tax increases, or printing enough money to pay off the debt, which would trigger massive inflation.
So while, like any gambler, Obama may be having a good run at the moment, the long-term odds are working against him.