For the past week, the White House has been deliberately low-balling its estimates of what the plan the president unveiled tonight would actually include. When word started getting around this afternoon that this new stimulus would be set at $447 billion for the next year -- a rate higher than the $787-billion-over-two-years stimulus that Congress enacted in 2009 -- leaders of groups representing the Democratic base breathed a sigh of relief. The size and the substance of this new stimulus give Obama and his party the ability not only to rally many of his disenchanted core supporters but to reach out to voters in the middle of the political spectrum.
That’s partly because more than half the package -- roughly $240 billion -- takes the form of a one-year payroll tax reduction for employees and employers that will be difficult for Republicans to oppose. The tax credits for employees who hire veterans are also a political winner, though the tax credit for companies that hire the long-term unemployed (which in Republican-speak will mean minorities, whose votes they’re not going to get anyway) is one that the GOP is almost sure to resist. Also likely to meet a Republican rejection are Obama’s proposals to build roads and schools, and to fund the retention and rehiring of tens of thousands of teachers.
But Obama also used the occasion of tonight’s speech to lay out a more long-term vision for the reconstruction of the American economy -- one that centered on reviving manufacturing and (in one of the night’s biggest applause lines) reclaiming our pre-eminence in that field from China. He was studiously vague on how exactly we’ll do this, and, for now, Mitt Romney’s promise to declare China a currency manipulator and impose tariffs on Chinese imports trumps anything Obama has suggested as a plan for jumpstarting American manufacturing.
Nonetheless, Obama’s account of America’s onetime rise to the summit of world economies, and the role that public investment (beginning with Lincoln) played in that rise, laid the basis for the campaign he hopes to run next year, a campaign in which he will contrast his vision for economic revival with the Republicans’ Ayn-Randian mumbo-jumbo. Based on his performance tonight, and the performance of the Republican field in last night’s debate in California, Obama has the more compelling and plausible message. Problem is, he won’t be able to limit the discussion to comparative economic visions. The state of the actual economy will intrude.
There is, by the way, a touch of the German in some of Obama’s proposals, which is only fitting as the German economy is perhaps the only advanced economy on the planet that has gotten through the Great Recession in better shape than when it started. Obama’s plan calls for altering unemployment insurance so that more employers can put workers on part-time status rather than lay them off altogether, with the unemployment insurance fund covering a portion of the worker’s reduced wages. The proposal builds on the stunning success of kurzarbeit, short work, the German system that enabled employers to return their workers to full-time status quickly when the economy turned up. As well, the renewed emphasis that Obama gave to manufacturing tonight is partly a recognition that the key to Germany’s success has been its ability to retain and expand high-end manufacturing, while nations like the U.S. that de-industrialized and built up their financial sectors instead have seen a huge rise in economic inequality and instability.
So -- a good speech; a good proposal for beginning to revive the American economy; and a good start, which he desperately needed, of the president’s 2012 election campaign. This is a president who’s had plenty of good starts, however; it’s in sustaining his momentum that he’s come up short. We’ll see if he does that better this time around.
More on Obama’s jobs speech from PostOpinions