One of the good things that came from Obama’s election is that the press is somewhat back to ‘normal’. Of course it is still deeply biased and non-objective but at least now you hear more people asking the tough questions and not taking everything Obama says to be the word of the Messiah.
One of the things the press is slowly doing is to wake up to the reality of this plan to rescue the economy by huge government spending. Most of them are still for it of course, but some are trying to remind us that this is not a ‘new strategy’. We’ve been there before and everything that happened on the 70s was a direct consequence of many decades of Keynesian policies.
I don’t even think they say these things because they are too worried about inflation or high interest rates… What they really fear is that Democrats would be once again paving the way to another Reagan’s Republican revolution.
For all the talk about bipartisanship and unity, the real dispute going on in Obama’s administration is within the Democrats. The Clintonian side pulls Obama to the mainstream/90s style of government while the far left side tries to push towards a more Carter like intrusive government. Some of you might think all democrats are similar but let me tell you, they really are not. These two don’t even look each other in the eye:
So after all the rhetoric and fluff are out of the way, Obama’s hope is to find a ‘middle ground’ between these two factions. Bottom of the list are the Republicans, which might be willing to play dead for the Clinton side, but will not go down easily for Carterism. This whole dynamic is creating this multitude of conflicting signals, and just like many of Obama’s inclusive ideas, this whole act is easier said than done.
So that is the mess we are in. At one point Obama appears to genuinely want to follow Larry Summers advice and increase government spending a lot in the short term but not in the long term, but then you look at his latest proposal and he is not actually doing so. He mixes up protectionism and free market, pro-business and pro-union messages.
At this point, nobody really knows what to expect. And that is never good news.