U.S. Economy Sputters
-- Estimated growth rate of the U.S. economy in the first three months of the year
Global inflation, high gas prices, shaky consumer confidence, regional unrest in the Middle East, a tsunami and nuclear meltdown in Japan, tanking real-estate values, tight credit markets and bad weather. January, February and March don’t sound like much fun in retrospect.
Certainly the already weak U.S. economy didn’t think so. Economic analysts say the economy cooled off in the first quarter of 2011 to a growth rate of 1.8 percent – a rate not seen since the spring of 2010 when fears of a double-dip recession gripped markets.
The third and fourth quarters of 2010 had shown what the White House and the Federal Reserve had been hoping for: slow, but steady advancement. The third quarter had seen 2.6 percent growth, breaking through the 2 percent threshold required to simply compensate for a growing population. Then the fourth quarter bubbled up to 3.1 percent, the kind of number that economists had hoped to see for the whole of this year.
The operant theory was that the sugar high of stimulus (which produced a 5 percent growth rate in the fourth quarter of 2009) was being replaced by a modest recovery in the 3 percent to 4 percent range.
Even that growth rate would have been a political liability for President Obama, since re-election amid anemic growth is pretty tough. The forecasts are much more like the weak growth numbers that dogged George H.W. Bush in 1992 than the explosive growth rates of more than 7 percent that lifted Ronald Reagan into a landslide victory in 1984. High unemployment and low growth are never what an incumbent president wants to see.
Obama Tries to Make “Birther” Lemonade
“It was a profoundly low and debasing moment in American political life.”
-- New York Times editorial on President Obama’s press conference discussing the release his birth certificate
On Wednesday morning, President Obama told the American people that he had “better things to do” than listen to questions about his place of birth.
On Wednesday afternoon, Obama used the discussion to highlight his disgust with Washington during a lengthy interview with his longtime political patron, Oprah Winfrey, whose new cable network he is helping to launch.
On Wednesday evening, Obama used the controversy to raise money from Wall Street donors on a campaign trip to New York, using it as both a punch line and a serious point of political juxtaposition in three successive big-money events for his re-election.
As Obama, appearing with his wife, told Winfrey: “We can't be distracted by sideshows and, as I said at my press conference, carnival barkers who are going around trying to get attention instead of actually solving the problems.”
A funny kind of thing to say while appearing on a daytime talk show, yes? Particularly for a president of whom the central, bipartisan criticism is failing to take the lead on the most pressing issues of the day.
The president can’t be blamed for trying to get some political advantage out of a very embarrassing situation. When a reality-show host makes the president of the United States cough up his birth certificate, it’s not exactly a demonstration of executive might.
Donald Trump’s open questioning of Obama’s birthplace, and the obsessive coverage of it in many outlets usually friendly to Obama, was leading to an alarming decline in the number of Americans sure about the president’s nativity. Add in crummy poll numbers overall, and Obama felt forced to step in and assert his citizenship. Not exactly a strong hand to be playing.
And playing the victim when talking to his supports doesn’t make it any stronger.
The other downside of the moment for Obama is that it obviates Trump as a political player. Democrats were salivating at the idea of having the bombastic Trump continuing to be a contender in Republican polls. But Trump got so much attention because he was the only potential Republican candidate pushing the birth certificate story. He’s not going to get all the attention he did now that he’s talking about trade policy or Obama’s college transcripts, even from his home network, NBC.
Trump’s initial popularity among Republicans may have stemmed from his cocksure attitude and blunt attacks on Obama, but it was the birth certificate issue that provided his platform.
Reid Feels the Squeeze on Debt Hike
"Republicans seem to be in love with the Ryan budget. And so they are going to have an opportunity here in the Senate to vote on the Ryan budget and see [how many] Republican senators like the Ryan budget as much as their House colleagues did."
-- Senate Majority Leader Harry Reid taunting Senate Republicans
Senate Democrats are in a row over how to pass President Obama’s pending request for an increase in the $14.3 trillion federal debt ceiling.
Majority leader Harry Reid has little prospect of keeping his 53-member caucus together to deliver a so-called “clean” increase: one not conditioned on spending cuts or budget restraints. To keep his team together and add the seven requisite Republicans to pass a debt increase, Reid will have to make some serious concessions.
With the 2012 elections looming large in the minds of red-state Democrats like West Virginia’s Joe Manchin and Nebraska’s Ben Nelson, Reid’s fractious and factious caucus is bordering on the unmanageable.
Reid was able to be a minor player in the debate over funding the government for the final 25 weeks of the federal fiscal year, but on the debt-ceiling question, he must deliver for Obama or face a partial government shutdown this summer. House Republicans aren’t interested in any debt limit increases, so it will be up to the Democratic Senate to move the ball.
Reid lost a lot in the current spending deal, including promises to hold politically punishing votes on abortion and Obama’s national health care law. He is trying to get his mojo back by promising next week to force Republicans to make a painful vote on a budget blueprint passed by the House.
This stings because it will make some GOPers cast votes for a plan that Democrats and allied interest groups like AARP will clobber with scary ads aimed at seniors that warn of the destruction of Medicare. Other Senate Republicans will vote against the plan, making them more vulnerable to primary challenges.
It’s a thumb in the eye that reflects dwindling options. The forecast for the Gang of Six group trying to negotiate a grand bargain on debt and deficits is getting gloomier. Democrats had hoped that the team would produce a bipartisan plan ahead of the start of the debt-ceiling negotiations led by Vice President Joe Biden next week. A Senate aide tells Power Play that the Gang is stalled in a quarrel over tax rates.
If Reid can’t lean on the Gang members to broker a compromise plan ahead of the debt-ceiling crunch that will mean he will have to muscle through a narrower plan to get a debt bump for Obama. Antagonizing Sens. Olympia Snowe and Scott Brown with a symbolic budget vote ahead of such a task won’t help that task.
Egypt Brokers Deal for Palestine Terror Group
"The Palestinian Authority needs to choose: either peace with Israel or peace with Hamas. Peace with both is impossible because Hamas aspires to destroy Israel and says this openly. [Hamas] is firing missiles at our cities and anti-tank missiles at our children.''
-- Israeli President Benjamin Netanyahu in a statement on the reconciliation between Palestinian terror group Hamas and leading political party, Fatah
The first major foreign policy achievement of the new Egyptian government was to broker a deal to unite Hamas and Fatah, the two main political factions in the Palestinian Authority.
This was greeted with a shudder in Washington and Tel Aviv. Hamas is an unabashed terrorist group, believing that the only way to force Jews out of contested lands is through violence. Fatah, meanwhile, had renounced violence under leader Mahmoud Abbas and had been focused on negotiations with Israel in pursuit of an independent Palestinian state.
The Palestinians have been diving deeper into a political stall since the death of kleptocratic leader Yasser Arafat in 2006, leaving Abbas without a functional government for more than two years. The Islamists in Hamas have refused to support the conciliatory gestures made by Abbas and have continued to launch their own attacks on Israel from their Gaza Strip demesne.
The new Egyptian government includes the Muslim Brotherhood, which was one of the founding elements of Hamas when the resistance group began in 1987. The Egyptians used their influence with Hamas to broker an accord with the enfeebled Fatah that did not apparently include any renunciation of violence or terror.
This is all part of a run-up to this fall when it is widely expected the United Nations will confer statehood upon the Palestinian Territories, Islamist islands strewn inside Israel. The effort now is to get a functioning government together for the photo op at Turtle Bay. This agreement gives the Palestinians time to get on the same page and for the least savory elements of Hamas to take a low profile ahead of the coming out party.
The Israelis are ratcheting up the pressure on the U.S. to oppose the U.N. recognition when it happens. The Hamas-Fatah deal, at least in the short term, makes that task easier.
The Egyptian people are increasingly concerned that they have made a bad bargain in accepting military-Islamist rule in exchange for strongman Hosni Mubarak. That concern is now available for export.
If Syria Survives, Look Out
"We believe that all sides in Syria should resolve their differences through political dialogue, appropriately deal with the present crisis, maintain national stability and normal order."
-- Chinese Foreign Ministry spokesman Hong Lei explaining why his country helped block a U.N. Security Council resolution condemning the Syrian government’s brutal crackdown
Given the military misadventures of the Libyan rebels –- there is no end in sight to the civil war after six weeks and nearly a billion dollars of U.S. involvement – the Obama administration is not pushing too hard over the ongoing crackdown in Syria.
On the surface, Syria would have been a better candidate for U.S. intervention. The Libyan strongman, Col. Muammar al-Qaddafi, had been cooperating with America for years and was providing a steady supply of oil to Europe. Syrian strongman Bashar Assad is an ally of the Iranian Islamists and a fomenter of terrorism in the region.
But Syria is in a tougher neighborhood than Libya. Syria is the keystone of the volatile region. Also, Qaddafi had cut his deal with the Bush administration, while Syria has long been a pet project for Democratic politicians. President Obama, having normalized diplomatic relations with the Assad regime might feel funny about then trying to bomb it.
Whatever the reasons, the prospects of the U.N. weighing in against Syria as it did on Libya seem remote. Russia and China are opposed to any intervention and the U.S. does not seem inclined (or, given the morass in Libya, able) to build an international coalition on Syria.
If Assad, who has reportedly killed hundreds in his crackdown, survives this uprising, he will mean major trouble for the U.S. With China and Russia eager to keep America off balance in the region (at no cost to them) Assad will have fast friends and reliable trading partners.
Plus, with the Obama administration having been moved, after a fashion, to denounce him in strong terms, Assad will have more reason to deepen his alliance with his fellow Shia in Iran. Obama, though, has kept his ambassador in Damascus and declined to use the passive-voice call for regime change he has favored elsewhere in the region: “_______ must go.”
This looks like a hedge that suggests Obama believes Assad may survive and wants to keep his options open. Explaing why this is different than Libya gets a little dizzying, but, again, the Middle East is hell on consistency for politicians.
No matter what, though, if Assad survives this there will be hell to pay as he digs in. Once you decide to roll tanks on your own citizens, it’s kind of hard to go back to the old reform-and-repress two-step that had for so long kept Assad in good stead with Europeans and Democrats.
And Now, a Word from Charles
“Conspiracies never die. They only become irrelevant. This one is now completely irrelevant.”
Power Play offers its deep condolences and prayers to the people of the Alabama and the Southeast in the wake of devastating storms. With the death toll now approaching 200 and poor communities hit hardest, the nation’s sympathies are with you.