krebscycle

[..]President Obama was celebrating the “green shoots of recovery” less than two months after the passage of the stimulus, at a time when the economy was still losing hundreds of thousands of jobs a month. Rather than trying to explain to the country that the hole created by the downturn was much bigger than they had recognized at the time they designed the stimulus package (which was true), President Obama talked about the need to pivot to deficit reduction.

As a result, he lost control of the economic narrative. Rather than the downturn being a story of a collapsed housing bubble leaving a hole in demand in the economy of more than $1 trillion a year, due to reduced construction and housing equity fueled consumption, the Republicans made the story one of out of control government spending.

So the underlying claim here is that if only the President had spent last part of 2009 explaining to the country that “the hole created by the downturn was much bigger than they had recognized at the time they designed the stimulus package”, the President would not have “lost control of the economic narrative” and the Republicans would not have been able to make “the story one of out of control government spending”.

Part of the difficulty in discussing these things with the Disgruntled Progressives is that they appear to believe that their arguments, like the one above, are self-evidently true, while to many of us those arguments are haplessly naive.   The original stimulus bill, the ARRA, reported out of the Senate conference committee to be sent to the President February 13 2009. The Republicans were nearly unanimously intransigent. The bill overcame a Republican filibuster only because Republicans Arlen Specter, Olympia Snow, and Suzanne Collins provided the 61 votes needed to stop debate. They, especially the two Maine Senators demanded and received many concessions for their votes.The President signed the bill February 19 2009. On the same day, the President announced a major mortgage relief initiative called the “Homeowners Affordability and Stability Plan”. Rick Santelli’s famous rant on CNBC that sparked the Tea Party came  the same day February 19 2009.

Watch the video of Santelli’s rant, presumably before the President “lost control of the economic narrative”. Santelli is not making the argument that the economy didn’t need a stimulus or that Keynes was wrong, he made that argument that “losers” were getting welfare from the government.  Imagine President Obama explaining “the hole created by the downturn was much bigger than they had recognized at the time they designed the stimulus package"  – to  persuade Mr. Santelli, the CNBC staff, and all those who either cheered this rant on or winced in fear. The dominant influence that Santelli’s rant had in the media over the next few weeks is not possible to square with Baker’s claim that Obama "lost control of the narrative” later on. In fact, Obama never had control over the narrative – he had a narrow majority and a implacable well funded opposition that had sympathizers in the Congressional Democratic caucus and a powerful ability to terrify opponents. 

To pass bills over Republican filibuster in the Senate in early 2009, the Democrats needed Jo Lieberman, Even Bayh, Blanche Lincoln, Ben Nelson, and at least two of the three Republican apostates. Collins and Snowe were so shocked by the vitriolic reaction of their primary voters that I do not believe they ever trespassed orthodoxy again. Specter became a Democrat.  Evan Bayh said on that very same day, February 19 2009 that ARRA was too big and contained to much spending.  Lieberman endorsed McCain in 2008 – he was not particularly reliable. Ben Nelson was about to become deeply estranged from the Obama WH because they pushed through an end to welfare for student lenders (a BIG stimulative action that, like the auto rescue and the UI extensions are never mentioned by Baker and friends).  Claire McCaskill, was so worried by her political exposure to the stimulus that

In April of 2009, Senator McCaskill reacted to questions at a town hall meeting by asserting that spending on the stimulus and TARP were necessary, but that in the following budget spending was cut on discretionary spending

By August of 2009 

A USA TODAY/Gallup Poll found 57% of adults say the stimulus package is having no impact on the economy or making it worse. Even more —60% — doubt that the stimulus plan will help the economy in the years ahead, and only 18% say it has done anything to help improve their personal situation.

76% were very or somewhat worried that the money was being wasted.

So let’s summarize. The original “inadequate” stimulus bill barely beat the GOP filibuster thanks to strenuous lobbying and many concessions to the GOP defectors and conservative democrats who never really wanted it. The passage of the bill and additional stimulus actions by the admin were met with a storm of bitter protest in the media and by the Republicans based on the theory that someone (and we know who) was getting too much welfare. The conservative Dems started backing away immediately. Even “moderate” Dems like McCaskill were weak and defensive – and for good reason, if she had not lucked into an insane pro-rape Tea Party opponent, McCaskill would have lost her seat.  And yet according to Baker it is self-evident that if that Obama guy had just kept hammering on the need to spend more money, he would have produced a tidal wave of popular pressure that would have overcome all resistance – would have controlled the narrative. Baker, speaking from his authoritative position as an economist who has never had to persuade a single voter or convince a town council to change a local ordinance doesn’t just think that the President dropped the ball by failing to do lecture his way to legislative victory, he’s unable to understand how anyone could disagree.  He’s totally sure that opposition to further stimulus was produced by lack of explanations of the watered down Keynsianism he advocates. Totally sure.