By Donald McLean
Just a few months ago, everything seemed to be going Barack Obama’s way. Despite the Republican’s mid-term surge, conservatives in Congress had made little progress in their effort to reduce federal spending. Long running negotiations to avoid a government shutdown did result in an agreement, but one that contained only minor reductions in expenditure. Speaker Boehner and his allies were forced to put on a brave face, and point to the fact that taxes would not be raised. By contrast, the President could congratulate himself on securing his budget, and conceding little in the process.
The economy, issue one, two and three in the minds of the public, remained sluggish. Yet it was stable, and while growth and joblessness figures were disappointing, key indicators were heading in the right direction. While voters remained discontented with the pace of recovery, their views had yet to impact their view of the President himself, whose approval ratings remained in the mid to high 40s.
Then, in May, came the national security holy grail: the successfully executed mission to kill Osama Bin Laden. Every decision made in Washington has political ramifications, and in this case the consequences didn’t even need to be spelt out. A young, first term President, portrayed as weak on foreign policy by his opponents, had achieved one of his highest priorities. The story wrote itself. By succeeding where his predecessor had failed, Mr. Obama proved himself to be firmly in control of the country’s national security policy, and insulated himself against the criticism that is likely to accompany his election year withdrawal of troops from Afghanistan.
It was all sufficient to scatter the Republican primary field. As summer approached, a raft of expected challengers ruled themselves out of contention: Barbour, Huckabee, Daniels. In doing so, they pushed second tier candidates such as Michelle Bachmann and Tim Pawlenty to the front of the pack. Conservative insiders stood aghast. A mid-term Congressional triumph was being followed up by a lacklustre effort to reclaim the White House. Liberals were going to party like it was 1996.
What a difference a few months make.
It began with the publication of May’s job figures. Hiring slipped, resulting in just 25,000 new positions being added to the economy. Any hope that the numbers could be written off as a one-off setback evaporated with news that even fewer jobs were added in June – just 18,000. (To give context, the US needs to add approximately 139,000 positions a month just to keep pace with its growing population).
As if that were not bad enough, the depressing economic numbers came amid the protracted fight over raising the federal debt ceiling. Embittered by the lack of progress made during the budget negotiations, Congressional Republicans threatened national default should cuts not be agreed. Whereas a Government shutdown would have rebounded on Republicans in Congress, a sovereign debt default would have been a mortal blow to the White House. Yet oddly, the administration pressed on, determined to test Republican resolve.
In retrospect, it was a poor strategy. Having been elected on a budget-cutting platform, and then outdueled in the budget negotiations, Republicans were unlikely to shift their ground. Moreover, every day the prospect of calamity played out on national television was a day in which the President’s grip on the situation seemed to weaken. Mr Obama’s ill fated attempt to secure a grand compromise that would have incorporated entitlement reform only made things worse, by placing him at odds with both his liberal base and congressional allies.
As doomsday approached the President was forced to back down, agree a deficit reduction plan in exchange for additional authority to borrow, and endure a humiliating credit rating downgrade by Standard and Poor.
Things have not improved since then. Although hiring increased in July, concerns about the health of the real economy have gathered pace, contributing to major stumbles on Wall Street that have wiped 1000 points of the Dow Jones Industrial Average. More worryingly for the President is that the bad news is starting to have a political impact. His approval ratings have now slid to a record low of 38%, and a clear majority believe that he does not deserve to be re-elected.
November of next year is a long way off, and there are plenty of things the President can do to prevent his miserable summer from sparking a further run on his popularity. In a much publicised speech next month, the President will announce new measures aimed at stimulating the economy, which could reverse the slide. Moreover, the Republicans have yet to choose their candidate – the biggest determinate in next year’s race that remains unsettled. Nevertheless, the last few months have shown just how vulnerable the President really is. Unless there is some improvement in his fortunes, the next few months could seal his fate.