Clueless About the Economy

Debate-o-matic: Which way should Obama go on the economy and health care?

President Barack Obama and Treasury Secretary Timothy Geithner

It’s hard to say which had a worse week: the U.S. economy or the Republican Party. Unemployment rose to 8.1 percent on Friday, the highest in more than a quarter of a century, while Republicans continued to squabble among themselves, and their chairman faced a call to resign. President Obama, meanwhile, held a bipartisan health care summit at which everyone agreed—surprise!—that something needed to be done. Disagreement came over what that something is.

To help you keep up with the debates in and about Washington, Slate offers this guide to the issues of the week. Here are a few arguments on a few key topics.

The Economy

Washington is clueless (liberal version). What Paul Krugman said: The administration is lurching from plan to plan without any real direction. What it needs to do is just give in to the inevitability of nationalization already.

Washington is clueless (conservative version). WhatMichael Boskin said: The administration apparently thinks that higher taxes and greater government spending will jump-start the economy. In fact, the opposite will happen. Just look at Europe.

Washington isn’t clueless, just overwhelmed. TreasurySecretary Timothy Geithner just had two deputies withdraw from consideration and none of his top 17 deputies has been named. “He shouldn’t be sitting there alone,” said Paul Volcker, a senior economic adviser to Obama. The administration notes that the problems facing the economy defy easy answers and that Geithner has plenty of staff and other advisers, such as former Treasury Secretary Larry Summers, working closely with him.


It’s finding its way: Sure, things are a little bumpy now, with some nasty intramural spats and confusion over its leadership and principles. Being in the opposition will help the party rediscover its conservative principles. In fact, it already is, by calling for fiscal restraint in Obama’s budget.

It’s totally lost: Fiscal restraint is fine—but where has the party been for the last eight years? Calling for fiscal restraint now is not only hypocritical, it’s also dangerous. Even respected conservative economists admit that budget deficits are usually necessary during economic downturns. And Rush Limbaugh? He’s the conservative version of Michael Moore—except that Limbaugh is taken far more seriously within the GOP than Moore is among Democrats.

The White House Health Care Summit

This time, it really is different. Few would argue that the health care system is better now than it was 16 years ago, the last time a Democratic administration convened a meeting about it. At this week’s meeting, Obama was careful to include several opponents of the Democrats from 1993. And as the president pointed out, the faltering economy makes health care reform more important, not less. This week’s inclusive discussion—150 people participated—won the president good will and shows that there is finally a consensus on the need for reform.

There is no talking cure. So the president listened to a bunch of people complain about the current system, and the White House put up yet another Web site to foster further “discussion.” It also put together a slick slide show. As soon as the meeting was over, though, the Republican critiques started rolling in, saying that a government plan could crowd out private insurers, while the complaint from the left was that the forum didn’t go far enough in advocating for a single-payer government plan. This summit may have made Obama look good, but it hardly advanced the cause of heath care reform.

Obama’s Gray Hair

It’s work-related. Both the Washington Post and the New York Times noted Obama’s graying temples and attributed them to the stress of managing a struggling economy and two wars (the Times) as well as the pressures of running for president for the last two-plus years (the Post).

It’s age-related. Slate’sown William Saletan pooh-poohed that hypothesis. “Obama is 47,” he writes. “As the Times and Post photographs show, he’s only marginally gray. He’s right on schedule.”