Obama’s Journey to Re-election

The history that was made when Obama was sworn in as the first black president of the United States is still vivid to many. Today, he wants to create history yet again. But this time, the project that he is undertaking is far more difficult than the previous one.

The great history which Obama seeks to create is to become the first president of the U.S. since the Second World War to get reelected even with a rising unemployment rate. But the fact is that since Roosevelt Jr.,* no U.S. president has been successfully reelected when the unemployment rate has been as high as 7.2 percent.

In the past few weeks, whether it is the booming of the manufacturing industry, factory purchase orders, consumer confidence or housing and so on, America’s economic indicators clearly point to a slowing down of economic recovery. The jobs report for May lists the unemployment rate as high as 9.1 percent and the number of employed persons dropping to its lowest point in the past eight months brings no relief whatsoever.

What is more disturbing is America’s attitude in dealing with the worsening unemployment. In the past, whenever there was a drop in the unemployment rate, the White House would immediately publish a press release indicating that the job market was surging under the recovery policy of the Obama administration. Unlike now where Obama would give tons of excuses whenever the unemployment rate rises. He remarked, “This economy took a big hit… It’s just like if you had a bad illness, if you got hit by a truck, it’s going to take a while for you to mend. And that’s what’s happened to our economy.” In other words, instead of coming up with a new strategy, Obama is merely pleading for his people to be patient.

On the other hand, there has also been a drastic change in the Fed’s attitude. Back in 2008, when the U.S. was plunged into recession due to the financial crisis, the Fed injected $2 trillion to stabilize the market as well as to restore the economy; this includes the $ 600 billion which will be coming to an end by June. But now the Fed is no longer willing to hand out any more money. Bernanke, the Chairman of the Fed, stated that the economic growth of the U.S. is lower than expected but they cannot look to monetary policy as a panacea. Bernanke was no doubt declaring to everyone that there would not be a third round of Quantitative Easing (QE3).

In Congress, prominent members of both the Democratic and Republican Parties promised to increase employment, but their actions run contrary to their words. On the one hand, the Republican attempts to force the Obama administration to cut down spending by threatening to raise the upper boundary of the national debt. On the other hand, the Democrats are deeply involved in the political fight with the Republicans in the name of deficit reduction.

There are 17 more months before the next presidential election. Should Obama carry on with this attitude, he would very likely then be added to ranks of the jobless.

*Editor’s Note: Roosevelt Jr. refers to American president Franklin Delano Roosevelt, who was a cousin of previous president Theodore Roosevelt, not his son.