Alex Spillius: Why Obama has plenty of reasons to smile again
The conventional wisdom in Washington decrees that Barack Obama should not have a prayer of re-election this year. Since the Great Depression, no United States president has won a second term when unemployment has been above 7.4pc.
For each of his three years in office it has been well above that, peaking at 10pc in 2010.
But crucially for the White House, and for the country, this most vital indicator is moving in the right direction.
Unemployment is now at 8.5pc, the lowest since February 2009, Mr Obama's first full month in office. And it is not the only encouraging number. Gross domestic product is creeping up, the stock market is nearly double the low reached following the financial debacle of autumn 2008, and consumer confidence is returning.
Republican activists and voters caught up in the excitement of their party's primary campaign tend to assume rather gleefully that the sluggish economy will doom Mr Obama to a single term. They lap up candidates' routine denigrations of the president as a "radical" driving the United States to "European-style socialism", and harp on about the danger of the world's most powerful economy facing a Greek-style collapse.
With the national debt at a record $15trillion (€11.5trn), the housing market stagnant and unemployment high, it is an easy argument to make. To the Right, Mr Obama is the king of bailouts and subsidies and big government waste, the progenitor of a $787bn (€604bn) stimulus that didn't work and a rescue of the car industry that handed over ownership to the trade unions, which is only partly true.
To his supposed friends on the Left, he has been a letdown. With the big banks back on their feet and back in profit, the White House is seen as a Wall Street stooge. Mr Obama's major reforms -- healthcare and financial regulation -- are dismissed as too weak. They ask why a liberal president couldn't close the prison at Guantanamo Bay and took so long to repeal the "Don't Ask, Don't Tell" rule.
They wonder if he was too timid to reintroduce higher tax rates for the rich and too feeble under attack from Republicans.
It is not unusual for a president to be bashed from both sides. Some on the Left still haven't forgiven Bill Clinton for the landmark welfare reform he passed in 1996. But both sides ignore the reality of a creeping regeneration of the US economy.
American manufacturing is undergoing a quiet renaissance. In Ohio, four major car companies have recently announced investments in new plants worth hundreds of millions.
GM is investing $2bn (€1.5bn) at 17 facilities in eight states. Chrysler will create 1,100 jobs in Toledo on a new truck production line. Airbus announced last Friday that it would establish an aerospace research and development consortium in Dayton.
"I don't want to over-promise and overstate it because there are still too many people not working, but the growth is starting to happen," said Sherrod Brown, a Democratic senator for Ohio. "As we come out of national recession, we are going to see a lot more growth in Ohio in manufacturing."
The White House last week held a rather unsexy and unreported forum on "insourcing" jobs, hosting company directors who were relocating employment from overseas and listening to how any bureaucratic obstacles could be lifted.
Among those present was Bruce Cochrane, the owner of a furniture-making business in North Carolina, who last week resumed production.
He had sold the firm in 1996 to another that outsourced production to China, but with the costs of shipping and Asian labour rising, and American workers proving themselves more productive, he said reopening the works made good business sense.
"The 'Made in the USA' label is very important right now. Consumers realise that it means jobs in America and it doesn't necessarily mean more expensive," he said.
Economists warn that the recovery will be slow and that many low-skilled, well-paying manual jobs will never return.
American education and high-skills training lag behind some other developed countries. The numbers of unemployed or partially employed people is, moreover, much higher than the official statistic.
But when Mr Obama delivers his State of the Union address to the nation tonight, he will be able to present what he has called a "hopeful trend". He will portray the overarching objective of his presidency as building a lasting economic recovery from the ruins of the mess he inherited, based on manufacturing, education and energy.
When he begins campaigning in earnest, Mr Obama will be able to boast about saving the car industry, stopping a financial collapse and keeping taxes low for the middle classes. Having run as a change candidate in 2008, his task will be to convince Americans that change would now be too risky.
"The sell will be that change is dangerous," says Morris Reid, a Washington consultant and a Democrat.
"He will say, 'My policies are working, now give me more time -- it didn't take four years to get into this mess and it will take more than four years to get out of it'."
Mr Obama's key challenge will be connecting to the deep anxiety of middle-class America, which has always felt that tomorrow would be better for its children, but is now not so sure. Mr Obama is not great at Clinton-style empathy with the less fortunate, but nor are his likely Republican opponents, Mitt Romney and Newt Gingrich.
As ever in politics, luck will play its part and the pace of the recovery will be crucial.
"The economy is improving; by any objective measure it's turning. It's just a question of how fast," says Mr Reid, who sees parallels with George Bush's re-election bid in 1992, which was also attempted in an economic downturn.
The elder Bush could see the economy was mending but it wasn't happening quickly enough for voters to appreciate. It was only felt in the second or third quarter of the year after the election, by which time Bill Clinton was in the White House.
Mr Obama has made plenty of mistakes, but he will be facing a weaker candidate than Mr Bush faced in Mr Clinton.
He has retained his personal popularity with the public and remains unblemished by scandal. His temperament is also better suited for campaigning than governing and he will have a war chest approaching $1bn.
Just as his election in 2008 broke with the past, the first black US president could succeed in being the first since Franklin Delano Roosevelt to be re-elected when the country is getting up off its knees. (© Daily Telegraph, London)
Irish Independent
