The Political Tsunami Is Now Threatening Obama

The political tsunami triggered by the global financial crisis, which has already devastated governments of all tendencies from Iceland to France, is now threatening the biggest piece: the presidency of the United States. The prospect of less growth, more unemployment and an overall impoverishment in the population has created a worrying electoral scene for Barack Obama, whose status as the President in office may cause a great disadvantage in November for the current international cycle, even though this was historically an advantage.

Republican candidate Mitt Romney, now released from his ties with the most radical conservative grassroots, has started to believe in victory. As shown by surveys, his message is beginning to make a deep impression on all citizens affected by financial crisis. Having money and arguments, his party has joined the hunt for Obama, who is strikingly on the defensive.

Though, the president still has several factors to his advantage before the November elections. Unlike other defeated European leaders, Obama is not unpopular. (50 percent of the population supports his administration, and the esteem for his way of being is ten points higher.) An electoral system not demanding the majority of votes is another advantage for him. (He is ahead in nearly all decisive states.) However, the frustration of Americans with the economic situation is against him. It is true that this situation has improved compared to 2008, but it is not enough as to set aside the annoyance caused by unemployment, evictions and social imbalances.

It seems voters are not paying attention to the universal debate about austerity or growth policies. They may be more interested in policies that work, no matter what the tendency is. In Europe, all leaders who called for the adjustment and reduction of the deficit were crushed. Obama may be punished because of the opposite. Signing an expenditure of $800 million in order to boost economic activity was his first important decision. The members of the G-8 backed this line of action a week ago. Nevertheless, the same strategy has been unsuccessful here.

Even in Chicago, his hometown, one can easily notice the anxiety of the electorate, an electorate that respects the efforts made by Obama but needs better results. Sitting with his wife in a fast-food restaurant of the city centre, a builder operating in the whole Midwest region explains his dilemma in a meaningful way: “Obama seems like a good guy. He has tried to change some things, and the opposition has not given him a respite. I voted for him, and I’ll do it again probably. But the truth is that the business is not getting over, and people are still suffering.”*

The level of unemployment has dropped, but it has come to a standstill of 8.1 percent. This could possibly get worse next Friday, which is when the figures of May will be disclosed. No president has been re-elected with an unemployment rate of more than 7 percent. Large companies, such as the ones within the automotive industry, have obtained some profits, but they have not created any jobs. Consumption, which represents two-thirds of the American economy, has gone slightly up, but average expenditures are still 30 percent less than in early 2008. The optimism of the population has slightly grown in the last year. However, 60 percent still think the country is moving in the wrong direction, and 63 percent think their children will live in worse conditions. Even the stock exchange, which had the same shares as before the financial crisis, has considerably moved back in the last month due to the impact that uncertainty is having in Europe.

The European crisis is acting as a burden over the American economy. Obama has tried to intervene so that European leaders could take urgent measures to increase the citizens’ well-being and purchasing capacity, but it has all been fruitless. An overall recessive atmosphere is joining this hindrance, which can already be seen in China and that the Wall Street Journal is predicting for the next few months “in India, Brazil, South Africa and elsewhere.”

In today’s world, it is impossible to analyze the electoral horizon in the U.S. without regard of this reality. In recent times, the slight recovery of American economy has been based on exports, which grew by more than 7 percent in the last year. The European Union represents nearly 20 percent of the purchases of American products abroad. So if we put together the crisis within the European Union and the crisis in other regions, the risk of facing a forthcoming recession becomes more acute. Economists have downgraded the rise of the American Gross Domestic Product from the 3 percent achieved in the last quarter to 2 percent, which is foreseen for the end of this year, not to mention the danger of a technological bubble that can be seen behind the price problems that Facebook shares are having in their stock market debut. Even if the worst predictions do not come true, Obama seems forced to face the elections within an atmosphere of economic slowdown and, therefore, restlessness among voters.

Because of the danger that would mean going to the polls with the same question that Ronald Reagan himself asked in 1984 – “Are you better off now than you were four years ago?” – Obama’s campaign is focused on emphasizing the personal contrast between the President and his half-unknown rival. Reagan, who achieved a strong economic recovery during his first term, succeeded because the answer to his question was a categorical “yes” and because he had a strong personality in the Oval Office. Moreover, he was competing against a weak rival, Walter Mondale.

Obama is trying to copy these last circumstances. The president has shown himself to be an assertive man in the use of strength and management of foreign policy, which is his most valued point on all the surveys. Osama bin Laden’s death, the end of the Iraq War and the beginning of the end in Afghanistan have created a feeling of trust and have contributed to establishing the image of a well-represented country in the world. His campaign will try to make the most of it.

Romney’s fragility is one of the targets of electoral exploitation. These days, Obama prefers to let the public know about his rival’s career as the head of Bain Capital, an investment firm whose work entails purchasing bankrupt companies, reducing their size, restructuring them and subsequently selling them for the highest profit. Some Obama’s advisers have called this “vulture capitalism.” For instance, the President himself declared this week in Iowa that “the worldview that Romney gained from his experience as a financial CEO explains why the last time he visited these very same fairgrounds, he famously declared that corporations are people.” “The job of the President is not to maximize profits,” says Obama.

In his answer, the Republican candidate has accused Obama of not understanding the working of capitalism and showing an ideology that condemns both wealth and prosperity. Obama’s criticisms are “attacks on the free enterprise system,” Romney replied. Even if only 53 percent of those polled by an NBC-Wall Street Journal recent survey found that the name Bain sounds familiar, Bain and the undeniable fact that Romney now belongs to the exclusive circle of millionaires is going to have important electoral weight.

What has to be decided in the next five months is whether the unease caused by the crisis will give preference to any doubt about the category of transition. The candidate believes so, especially after his rise in attempts to vote amongst independents, who do not share the suspicion about Romney’s fortune. For the first time, the Republican Party, once its wounds were healed after the primary elections, is confident about the victory. The harvest machinery is working at full capacity. The candidate collected as much as the President last month. He now clearly surpasses the president in the volume of available funds for the so-called political action committees (PACs), a tool with limitless legal capacity for spending money in favor of or against a candidacy.

Obama is keeping some advantages though. His current position in the states which traditionally put the presidency at stake is his main advantage. To a greater or lesser extent, the president is ahead on surveys in Ohio, Wisconsin, Florida, Pennsylvania and Virginia and is competitive in Colorado, North Carolina and even Arizona, John McCain’s birthplace. The unemployment rate in all these states is lower than the national average.

Obama’s campaign trusts these counts in order to remain in the White House. However, he will need his electoral bases, namely the young and the Hispanic, to mobilize if he wants to succeed. In this regard, the fact that the president has recently backed marriage between same-sex couples may help. With respect to Hispanics, a group that Obama has a 40-point advantage over Romney on surveys, the main threat is electoral turnout, as it may be really different from the last one.

In the Democratic campaign headquarters in Chicago, the possibility of a win for the President is being naturally accepted; but this would not be a landslide victory even if he won, and he might lose some votes.

Obama’s work for the nation has been considerable, especially when it comes to compensating for some serious damage that he inherited from the previous term. However, for many reasons, his presidency has not been excellent. Healthcare reform, which is his biggest achievement, is not even an electoral trump card. In November, he could not aspire to the culmination that he maybe dreamed of someday. However, he is still a good candidate. As a last resort, elections are about deciding if option A is better than option B, and here Obama is a good resource. Nevertheless, these elections will be held in a time of upheaval in which both the impatience and lack of consideration of the voters are jumping barriers, crossing oceans and following an avenging trip that does not meet friends.