Much has been made of the completion of Barack Obama’s first one hundred days as the nation’s president. The identification of this period in a new presidency flows from the early months of Franklin D. Roosevelt’s first term, when the country was experiencing what became the Great Depression and the new president pushed a slew of new federal programs to combat the economic crisis.
While a snapshot at any point in an administration’s tenure is problematic, the landmark of the first hundred days provides as good a time as any to assess what its early efforts and accomplishments suggest about the intentions and directions likely to be revealed as the presidency matures.
The comparisons to FDR’s first term are most clearly apparent with respect to the economic meltdown that hit the nation (and shortly thereafter much of the rest of the world) in the midst of last fall’s presidential campaign. The similarities begin with the change in approach that both new presidents initiated to deal with the crises. Each followed a laissez-faire administration that many blamed for the economic collapses the new presidents inherited.
And just as Roosevelt sought to increase economic activity with major federal programs that created large budget deficits, so did Obama push Congress to adopt a “stimulus package” of almost one trillion dollars as his first major legislative achievement.
Properly understood, that measure reflects Mr. Obama’s basic approach to the economy, which, simply stated, is to respond aggressively to circumstances that threaten the nation’s underlying economic strength. Obama may be characterized as a socialist and a tax-and-spend liberal by his critics, but he is more properly identified as an activist: one who will not let market forces slowly work towards a recovery if he can speed that recovery along.
More fundamentally, the Obama administration can be expected to impose tight regulations on the banking industry and its compatriots in the real estate and equity markets. Left to their own devices, these institutions sought to push profits far beyond rational levels, with the meltdown almost an inevitable result. Unsecured securitizations and high-risk mortgages will soon be a thing of the past, if they aren’t already, under this administration.
Early on in his presidency (in both his inaugural address and his first speech to Congress), Obama identified three substantive areas that he asserts demand attention. And in the months since, he has continued to emphasize the goals of energy self-sufficiency, national health care, and an improved education system, from pre-school through college.
These priorities present major challenges for the new president for several reasons. First he must determine which specific options to pursue to achieve the general goals he seeks. And then he has to gain the support of the public and Congress, probably in that order, to get the options he chooses enacted into law. These will not be easy tasks, and many objective observers think he is tackling too much by trying to bring about fundamental change in three major areas of domestic policy.
Still, general support for some kind of health care reform is widespread, from labor organizations to corporate boardrooms. And the perceived urgency of achieving energy independence, while at the same time re-establishing a pre-eminent role in the world-wide efforts to combat global climate change, creates an atmosphere for fundamental change in the way the country uses and produces energy.
The country’s educational system also cries out for attention, and Mr. Obama is likely to seek increased funding for pre-school and some kind of federal program for post-secondary school education, while at the same time addressing deficiencies in the current “No Child Left Behind” initiative established by his predecessor.
He also has made clear his desire to address the knotty topic of immigration, albeit some of his advisers have privately suggested that any efforts in that area would likely take a back seat to the “big three.”
Meanwhile, in the foreign policy arena, the president has also charted a new approach, if not an entirely new course, from that of his predecessor, and it again suggests a change in philosophy that may lead to dramatic results.
In essence, the change is one of tone, but it reflects a turn from arrogance to humility, from hegemony to cooperation. Thus, where the Bush administration referred to an “axis of evil” and saw a threat to national interests in the rise of Islamic fundamentalism, Obama shakes hands with Hugo Chavez and sends messages of good will to the Islamic world.
These are not mere “window dressing” moments. Mr. Obama clearly has a different world-view than his predecessor and a different understanding of how the United States relates to that world-view.
Still, he is anything but oblivious of the horror the nation suffered on 9/11, and his focus on the nation’s security is apparent in his controversial decisions to maintain some Bush administration interpretations of surveillance and pre-trial detention.
In this respect, he is trying to thread a needle. On the one hand, he hopes to reduce anti-American sentiment by showing a more conciliatory and open attitude towards potential belligerents. On the other, he is maintaining a military presence in the region, particularly focusing on Afghanistan and Pakistan, thereby creating the same potential for radical elements to foment hostile feelings towards the U.S.
In sum, viewing his approaches to the economic crisis he inherited, considering his identification of the domestic priorities he intends to tackle, contemplating the signals he is sending to the rest of the world in his emerging foreign policy, and analyzing the quality of his commitment to national security, the president is probably less an ideologue than his critics fear and his supporters hope.
Rather, what emerges is a president who is ambitious but pragmatic, who has firm beliefs but is not doctrinaire, who is less likely to take risks based on theoretical constructs and more likely to chart courses of action that meet current needs.
The Obama presidency is still in its infancy, with much undoubtedly yet to unfold. But from what we have seen so far, this president may best be characterized as one who will seek to “do what works.”
Adam Hines says
I agree with the majority of this post and think it was well written. I agree with most of your assessments, especially your take on his approach to foreign policy. No doubt the Bush administration was “arrogant” in its foreign policy. I interpreted Bush’s foreign policy as “we will pursue objectives that are in America’s best interests, even if those objectives are at odds with or meet opposition from our own allies.” I applaud Obama for recognizing that even if there is something that is in America’s best interests, if there is no broad support and we alienate our allies, then that is not necessarily in our best interests. You litterally have to pick your battles.
I also agree with increased market regulation. I know that the few people who know me might be surprised by the fact that I fall more in line with his foreign policy and his market approach but so be it. Although the market “works” (i.e. will correct itself), sometimes that correction can be too painful, as we are seeing now. Ask any of Bernie Madoff’s investors (probably a lot of Republicans) or Enron employees how they feel about markets regulating themselves. In short, there needs to be markt regulation to minimize the corrections.
However, there are many troubling aspects of his young presidency so far. The first is the hypocrisy that surrounds his “bi-partisan effort.” The same rhetoric came from Bush (uniter not a divider) yet he is one of the most divisive political figures in recent memory. Obama mistakes bipartisanship with civility. Unlike Bush who would push through his own agenda without consulting the Dems, Obama will hear out McConnel, Boehner, and others from the Republican leadership and smile and laugh but in the end he really does nothing bipartisan. It changes the tone but not the effect. I think a lot of people mistake bipartisanship with civility.
The other major issue I have so far is health care and spending – the two are most certainly related. I think you are clearly wrong to label the Bush administration as laissez-faire. Just pull up the recent budgets and look at budgets under Clinton and Bush – granted a large portion was spent on the wars. Nevertheless, government spending rose 50% from FY 2001 to FY 2009. The Republicans have clearly lost their “fiscal conservative tag.” However, Obama is managing to spend far more than Bush, which is the scary thing. Mark my words… definitely in my lifetime maybe yours, this will come back to haunt us because of the “crowding out effect.”
The concept is simple, for every dollar we spend in excess of our revenues, we have to borrow. We have to pay interest on that dollar. How do we pay for that interest? We either borrow more or we have to take next year’s revenues and take a portion of that to pay interest on that dollar we just borrowed. 10 years ago before all of the deficits, I took an economics class at Vanderbilt, and we were spending approximately 1/3 of all our revenues paying INTEREST on the debt. When you keep adding to that amount, eventually you will default or there will be some even greater economic collapse. I firmly believe that we MUST balance the budget and cannot spend so recklessly. Hopefully, we can get someone who has some fiscal sense to occupy the White House in 3.5 years.
Ed Telfeyan says
Thanks for this thoughtful post, Adam. I appreciate your acknowledgement of the positive aspects of Obama’s approach to foreign policy and market regulation.
But I think “hypocrisy” is too harsh a judgment for what Obama is attempting to accomplish in his dealings with the loyal opposition, Adam. He may be engaging in civility as a means to encourage bipartisanship, but I don’t think you can accuse him of being a hypocrite for doing so.
His efforts have largely failed primarily because the Republicans have chosen to oppose almost everything he is pushing in his domestic agenda. Some of that opposition may be because of true philosophical disagreements, but much of it seems politically based.
As for the budget and the Obama deficit spending plan, I have addressed this point in an earlier post (“Debunking the Debunkers: The Truth About the New Deal,” March 19 post to “Meals from the Marketplace”). I compare what he is doing here to what FDR did in fighting the Great Depression. When taken together with the massive deficit spending created by WWII, those years put the lie to the idea that all deficit spending is guaranteed to kill an economy. It all depends on when the deficit spending occurs and for what purpose.
We can grow our way out of the massive deficits that are now being created. Recall that the last years of the Clinton administration saw projected surpluses that would have retired the entire national debt in ten years (before the Bush tax cuts and the wars in Iraq and Afghanistan destroyed that rosy prospect).
The key now if to revitalize the economy, and when the private sector isn’t creating any flow of capital, the only recourse is for the federal government to do so. That’s what Obamanomics is all about.
I compare it to fighting cancer. The cure, in this case massive spending, has the risk of killing the patient, but the alternative, doing nothing, is almost guaranteed to do so.
Another way to view the Obama’s approach is to compare Keynesian economics with Milton Friedman’s Chicago School philosophy. Keynes advocates government spending in times of economic recession; Friedman decries all government spending at all times.
I’m with Keynes. Other aspects of the Chicago School (unregulated markets/laissez-faire capitalism) have gotten us into the mess we’re in now. Letting the economy find its own path to recovery may have a purist ring to it, but it doesn’t address the immediate crisis in a timely manner.
Adam Hines says
Ed, perhaps “hypocrisy” was the wrong word to use, and you are correct that the GOP has not done itself any favors. They are quick to criticize how Obama i handling this mess – a mess that was, for the most part, created under the GOP’s watch and in some cases directly because of GOP policies (e.g. market deregulation). However, almost nobody (especially Dems) recognize that Clinton’s housing policies for minorities were a contributing factor, but that is for another post…
I merely bring up the “hypocrisy” to suggest that for an individual who championed slogans such as “Yes we can” and “change we can believe in”, I find a lot of backtracking thus far (delaying the close of Gitmo, for one. It remains to be seen whether there is a complete withdrawal in Iraq next year). My point is simply this: it was Bush’s way or the high way. He was very partisan and very divisive. Obama is very well spoken and polished, but at the end of the day he is as liberal as LBJ and JFK but just more civil about it. I would like to see him try to reach across the aisle and push through some GOP initiatives, and then maybe we will see if the GOP really wants to work with Obama like they say they do. Unfortunately, the GOP is acting like a bunch of petulant children and Obama has to be the adult.
As for deficit spending and the Great Depression… we had record levels of growth in GDP in WWII to help turn the tide. I don’t see WWIII on the horizon and with a massive decline in personal wealth and GDP over the past year, I don’t see anything that will come close to the boom we had in the 40s and 50s. I would argue that we really haven’t seen Keynesian economics work. It didn’t work in Japan in the 90s, and I think that he gets credit where no credit is due in the 30s. Whether you agree or disagree, I don’t believe that the sample size is too small to judge whether it is an effective policy. I think that there is a middle ground between Friedman and Keynes. I think that Keynesian economics might work if we weren’t to deplete rainy day funds (either through social spending or GOP tax cuts) so that we wouldn’t take such a deficit hit in times like these.