Wednesday, September 05, 2012

Upward Mobility or Misdirection

There is much irony in that the Republicans were supposed to run on the plank, "we're not Obama" but in fact it's the Democrats who are running on "we're not Romney."


It's fine to say you're for the middle class.  But the important thing is to talk about the policies needed to bolster their welfare.  The situation is not symmetric between the Democrats and the Republicans.  The Democrats want government to help ordinary people.  They need to say how that will happen.

The economy desperately needs a further large and sustained stimulus.  That should be the number one policy objective.   The Republicans have used scare tactics about the National Debt to confuse the public on this issue.  This convention should be about articulating precisely that and that we need an active fiscal policy now.

Per capita GDP has fallen since the housing bubble burst.  There won't be much in the way of upward mobility until per capita GDP starts to rise again on a consistent basis.  In the current political environment it seems the burden is on the Fed to provide stimulus.  But we need fiscal policy now.  Interest rates are already extraordinarily low.  What we need is spending.

We are unlikely to get it, even if President Obama is reelected.  Congress will remain obstructionist.  This should be at the core of what the convention is about.  This convention should be more about changing the composition of Congress than it is about reelection of the President.  There is an opportunity here to be much more aggressive in articulating what government should do and in explaining why it hasn't been doing it of late. 

I wonder if we'll hear any of this tonight.

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