Monday, April 05, 2010

Obama will still face angry voters in Nov

Business Times - 06 Apr 2010

Obama will still face angry voters in Nov

Despite favourable recent news, the rate of long-term unemployment is still climbing


PRESIDENT Barack Obama 'has kept all his promises' and was 'truly the greatest president ever', declared the Republican National Committee last Thursday, April 1. The statement issued by the governing body of the Republican Party went on to praise Mr Obama for solving global warming 'by replacing cars with low-emission unicorns' and achieving an unemployment rate of 'negative 39 per cent', among various 'accomplishments'.

And if you still didn't get it, the statement concluded by reminding the readers that it was, well, an April Fools' Day joke from your very funny Republican Party.

But President Obama himself was probably not laughing a lot this week. A new USA Today/Gallup survey issued the same day was not a joke. It suggested that the number of Americans blaming Mr Obama for the recession has nearly doubled, according to the new national poll.

Twenty-six per cent of people questioned in the poll said that Mr Obama deserved a 'great deal of blame' for the difficult economic times - nearly double the number of people who felt that way last July. (The only good news in the poll for Mr Obama was that more Americans still blamed former president George W Bush for the nation's economic problems.)

Moreover, according to another poll that was conducted by CNN/Opinion Research Corp and was released on Monday, 44 per cent of Americans approved of how Mr Obama is handling the economy, with 55 per cent saying they disapprove. The 44 per cent approval on the economy is down 10 points from last September, with disapproval up 10 points.

Other surveys that have measured the American public's response to the vote on healthcare reform suggested that most Americans are still opposed to the measure backed by Mr Obama and approved by Congress and that the president's approval ratings have not risen in the aftermath of the vote. Even more depressing were the indications that Democrats could suffer major setbacks in the election races in November and could lose their control of the Senate and the House of Representatives.

Indeed, the findings of these and other opinion polls that were conducted after the passage of the historic healthcare reform bill in Congress have confounded the White House and its allies on Capitol Hill who had expected that the major legislative victory on healthcare for the president and the Democrats would provide them with a new political momentum as they prepare for the midterm elections.

In fact, trying to build up on the political force that the Congressional vote was supposed to provide to the president, the White House was doing its best to demonstrate to the American public and the world that an energised President Obama was on the move towards even more victories at home and abroad, that he was working with lawmakers to fashion new legislation on reforming the financial regulatory system as well as immigration policy.

Hence, after signing the healthcare reform bill, the White House announced that Mr Obama concluded a major arms reduction deal with Russia and that he was ready to challenge Republican opposition to some of his appointees by using a rule that permits him to make those appointments during the Congressional recess. And on top of all that, he surprised the media by making a surprise trip to Afghanistan to address US troops there and to put some pressure on the country's regime to end corruption and embrace reform.

President Obama may have regained his political mojo - he clearly seems to project a greater sense of confidence and a fighting spirit - but as long as economic recovery remains sluggish, the chances for the political recovery of the president and the Democrats do not look very good.

And, ironically, there has been some good economic news in recent days. A monthly report issued by the Institute for Supply Management pointed out that the US manufacturing sector grew at its strongest pace in more than five years, with industrial companies leading the recovery. At the same time, retailers are reporting new orders for goods (although consumer spending remains low by historical standards) and are restocking their store shelves, which could in turn put even more pressure on companies to accelerate production and increase the momentum towards economic recovery.

Indeed, one could even spin the employment numbers for March, released by the US Department of Labor last Friday, in a positive way: the much anticipated report noted that the economy created 162,000 new jobs last month - a clear improvement on the 700,000-per-month job losses last year - with some gains in manufacturing, construction and many service industries. At the same time, the issue of healthcare remains at the bottom of the concerns of these Americans.

But what is troubling the White House is the fact that the rate of long-term unemployment, measuring the number of those who are out of work for more than 27 weeks, climbed 414,000 in March, to 6.5 million, suggesting that close to 50 per cent of all those who are unemployed have been out of a job for more than six months.

President Obama and the Democrats will be trying to convince Americans in the coming months that reforming the healthcare system as well as repairing Wall Street's regulatory system and dealing with global climate change could help speed the economy recovery and create new American jobs.

At least all unemployed Americans would now have access to healthcare, they'll argue, and ask voters to demonstrate they agree with that proposition in November.

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