GOP Fires Back at Obama Distortions on Economy Wednesday, 30 Jun 2010 07:48 PM Article Font Size By: David A. Patten Perhaps launching a pre-emp

GOP Fires Back at Obama Distortions on Economy
Wednesday, 30 Jun 2010 07:48 PM
Article Font Size

By: David A. Patten

Perhaps launching a pre-emptive strike before yet another dismal jobs report comes out Friday, President Obama blasted Minority Leader Rep. John Boehner, R-Ohio, proclaiming himself "stunned" by how "out of touch" he is.

But Republicans charged Obama was distorting Boehner's comments to distract voters from a troubled economy.

“The president was in a city with 14 percent unemployment and he talked about ants, rather than jobs?" Rep. Boehner answered in an e-mail to Newsmax Wednesday afternoon. "How out of touch can you get?”

The sharp exchange had its origins in remarks Boehner made to the Pittsburgh Tribune-Review regarding financial reforms purportedly intended to avoid another economic meltdown. Boehner criticized the proposals as overly burdensome to business.

"This is killing an ant with a nuclear weapon," Boehner told the newspaper. "There are faults in our regulatory system, some in terms of transparency, most as a result of ineffective enforcement by the bureaucracy who have no idea what these financial products look like today. That could've been fixed, but that's not what we have here."

The president took those remarks to mean Boehner was suggesting the financial crisis had the significance of an ant.

"That's right," Obama told his audience. "[Boehner] compared the financial crisis to an ant. The same financial crisis that led to the loss of nearly eight million jobs. The same crisis that cost people their homes and their life savings.

"Well," Obama continued, "if the Republican leader is that out of touch with the struggles facing the American people, he should come here to Racine and ask people if they think the financial crisis was an ant. ... These Americans don't believe the financial crisis was an ant. They know that it's what led to the worst recession since the Great Depression. And they expect their leaders in Washington to do whatever it takes to make sure a crisis like this never happens again."

Boehner spokesman Michael Steel's statement in response: "The president should be focused on solving the problems of the American people -- stopping the leaking oil and cleaning up the Gulf, scrapping his job-killing agenda, repealing and replacing ObamaCare -- instead of the House Republican Leader's choice of metaphors. It's clear Boehner was not minimizing the crisis America faced - he was pointing out that Washington Democrats have produced a bill that will actually kill more jobs and make the situation worse."

The administration clearly wanted the confrontation to receive wide media attention. It released an advance copy to the media of the president's remarks about the congressman.

Conservatives and some pundits charged the president is looking for ways to distract voters from the nation's ongoing problems with the economy that his policies have not yet been able to fix.

"Time after time since the start of the recession, Obama has used the crisis to expand the size and power of government -- even when doing so would not only fail to solve the problem, but would worsen it," Fox News commentator and best-selling author Dick Morris told Newsmax.

"The power grab in the financial regulatory bill is a perfect example. It was this disjuncture between a problem that could be solved with specific legislation, and the nationalizing of an entire industry, that Boehner was addressing.

"But Obama seized on a word to convey an impression that Boehner does not appreciate the gravity of the problem, a charge Obama knows to be erroneous," said Morris.

There are increasing indications the president is facing growing problems both economically and politically. The jobless figures for June are expected to reflect the loss of some 525,000 temporary workers who were employed from March to May to help gather 2010 Census data. Unemployment in Racine, where the president spoke, has doubled since he came into office.

Recent polls show public confidence in the president's ability to manage the economy is slipping. So is the Dow Jones average, which has dropped over 5 percent in the past five days. It lost another 96.28 points Wednesday. The Congressional Budget Office delivered more bad news, projecting the national debt will grow to 62 percent of the nation's economic output by year's end.

Prof. Allan H. Meltzer, a professor of economics at Carnegie Mellon University who serves on Boehner's informal cabinet of economic advisers, told Newsmax: "I think Rep. Boehner understands that we've had a serious recession. And I think the important part of that exchange is the president still hasn't learned the most important part of being president: You have to get along with a lot of different people. You need to get people to cooperate with you, and you don't do that by calling them names."

Asked to evaluate the impact of the nearly $1 trillion spent to stimulate the economy, Meltzer was blunt: "Hasn't worked. The economy is better than it was in January 2009, when [Obama] took office. But the unemployment rate isn't."

Meltzer, author of a recent Wall Street Journal op-ed titled "Why Obamanomics Has Failed," told Newsmax that there are two reasons why the president's economic policies haven't spurred job growth.

"His stimulus program was much more aimed at redistributing income than in creating wealth," Meltzer says. "And the second reason is, he creates enormous uncertainty about the future, and uncertainty is the enemy of growth, of jobs, of employment."

Meltzer, author of A History of the Federal Reserve, tells Newsmax that business leaders currently are facing unknowns on every side: They aren't sure what new taxes may take effect, they have questions about the cost of providing health insurance to their employees, they're worried over the prospect of carbon taxes, and they find it difficult to anticipate how a thicket of new federal will affect their businesses.

Such uncertainty, Meltzer says, makes CEOs skittish about hiring new employees.

University of Virginia Center for Politics director Dr. Larry J. Sabato tells Newsmax that there is plenty of political gamesmanship occurring on both sides of the aisle as the midterms draw closer.

"If Republicans gain 39 seats," Sabato says, "Boehner will be Speaker. Since the Republicans are making the current Speaker a prominent target, maybe the Democrats want to elevate the possibly future Speaker to target status.

"The White House believes the Republicans are making a mistake in not backing the financial reform bill," the political analyst says, "and they are trying to position the GOP as pro-big business, pro-bank, pro-Wall Street, and pro-BP. It's a classic Democratic populist campaign against the 'big boys.'

"When you look at the landscape, this is one of the only issues the Democrats can use to make hay," Sabato adds. "The bad economy, high unemployment, the Gulf disaster, soaring debt, and other problems are dominating the headlines, and setting up GOP gains for November."