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"Hit the road, Barack"

By Chris Clancy
web posted August 27, 2012

NewsweekIn the world of academia there is one person who can be fairly accurately described as a "superstar". His name is Niall Ferguson. He wrote the cover story for a recent edition of Newsweek – "Hit the Road, Barack".

At over three thousand words, plus charts, it's a bit of a grind – but too good to miss. So here it is in one thousand words – mostly his – and no charts.

In a nutshell, his article begins with Obama's broken promises, moves on to highlight his many failures in leadership and ends with the possibility of a return to political and economic sanity.

Ferguson starts with the president's inaugural address

"Obama promised "not only to create new jobs, but to lay a new foundation for growth." He promised to "build the roads and bridges, the electric grids, and digital lines that feed our commerce and bind us together." He promised to "restore science to its rightful place and wield technology's wonders to raise health care's quality and lower its cost." And he promised to "transform our schools and colleges and universities to meet the demands of a new age.""

And concludes:

"Unfortunately the president's scorecard on every single one of those bold pledges is pitiful."

This is followed by facts and figures to support his conclusion.

He then goes on to talk about what he considers to be the Obama's most serious failure:

"The president's supporters will, of course, say that the poor performance of the economy can't be blamed on him. They would rather finger his predecessor, or the economists he picked to advise him, or Wall Street, or Europe—anyone but the man in the White House.

There's some truth in this. It was pretty hard to foresee what was going to happen to the economy in the years after 2008. Yet surely we can legitimately blame the president for the political mistakes of the past four years. After all, it's the president's job to run the executive branch effectively—to lead the nation. And here is where his failure has been greatest."

In the first two years of his presidency Obama could push through whatever he wanted. But in no way could he be described as "leading" what unfolded. It was more a case of, "The president proposed; Congress disposed". Pelosi and Co. handled the stimulus bill, "stuffed full of political pork", while Dodd and Frank dreamt up the Wall Street Reform and Consumer Protection Act – "a near-perfect example of excessive complexity in regulation".

The same abdication of leadership went for health care, which he dubs "Pelosicare", since it was she who really forced the bill through congress.

"Pelosicare was not only a political disaster. Polls consistently showed that only a minority of the public liked the ACA [Patient Protection and Affordable Care Act], and it was the main reason why Republicans regained control of the House in 2010 … The president pledged that health-care reform would not add a cent to the deficit. But the CBO and the Joint Committee on Taxation now estimate that the insurance-coverage provisions of the ACA will have a net cost of close to $1.2 trillion over the 2012–22 period."

The next thing to get the treatment is Obama's failure to deal with out-of-control government spending.

"The president just kept ducking the fiscal issue. Having set up a bipartisan National Commission on Fiscal Responsibility and Reform, headed by retired Wyoming Republican senator Alan Simpson and former Clinton chief of staff Erskine Bowles, Obama effectively sidelined its recommendations of approximately $3 trillion in cuts and $1 trillion in added revenues over the coming decade. As a result there was no "grand bargain" with the House Republicans—which means that, barring some miracle, the country will hit a fiscal cliff on Jan. 1 as the Bush tax cuts expire and the first of $1.2 trillion of automatic, across-the-board spending cuts are imposed. The CBO estimates the net effect could be a 4 percent reduction in output."


"The failures of leadership on economic and fiscal policy over the past four years have had geopolitical consequences."

He cites anemic economic growth compared to countries like India and China, the possibility of huge cuts in defence spending and threats to American influence around the world.

"For me the president's greatest failure has been not to think through the implications of these challenges to American power. Far from developing a coherent strategy, he believed—perhaps encouraged by the premature award of the Nobel Peace Prize—that all he needed to do was to make touchy-feely speeches around the world explaining to foreigners that he was not George W. Bush."

Ferguson saves his best for the Middle East:

"Obama completely missed the revolutionary wave of Middle Eastern democracy … When revolution broke out—first in Iran, then in Tunisia, Egypt, Libya, and Syria—the president faced stark alternatives. He could try to catch the wave by lending his support to the youthful revolutionaries and trying to ride it in a direction advantageous to American interests. Or he could do nothing and let the forces of reaction prevail … In the case of Iran he did nothing … Ditto Syria. In Libya he was cajoled into intervening. In Egypt he tried to have it both ways, exhorting Egyptian President Hosni Mubarak to leave, then drawing back and recommending an "orderly transition." The result was a foreign-policy debacle. Not only were Egypt's elites appalled by what seemed to them a betrayal, but the victors—the Muslim Brotherhood—had nothing to be grateful for. America's closest Middle Eastern allies—Israel and the Saudis—looked on in amazement."

He finishes:

"Mitt Romney is not the best candidate for the presidency I can imagine. But he was clearly the best of the Republican contenders for the nomination. He brings to the presidency precisely the kind of experience—both in the business world and in executive office—that Barack Obama manifestly lacked four years ago. (If only Obama had worked at Bain Capital for a few years, instead of as a community organizer in Chicago, he might understand exactly why the private sector is not "doing fine" right now.) And by picking Ryan as his running mate, Romney has given the first real sign that—unlike Obama—he is a courageous leader who will not duck the challenges America faces.

The voters now face a stark choice. They can let Barack Obama's rambling, solipsistic narrative continue until they find themselves living in some American version of Europe, with low growth, high unemployment, even higher debt—and real geopolitical decline.

Or they can opt for real change: the kind of change that will end four years of economic underperformance, stop the terrifying accumulation of debt, and reestablish a secure fiscal foundation for American national security."

If you're looking for some ammunition in the run in to the election Ferguson has provided it. The broken promises, the failures in leadership and a viable alternative. I do not subscribe to the view that America has had its day – far from it in fact. But only if there is a change in government – now.
There will not be a second chance. Certainly not a peaceful one. This is the reality of the choice which the American people are faced with. ESR

Chris Clancy lived in China for seven years. Most of this time was spent as associate professor of financial accounting at Zhongnan University of Economics and Law in Wuhan City, Hubei Province. He now lives in Thailand where he spends his time reading, writing, lecturing and, whenever he gets the chance, doing his level best to spread Austrian economics.


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