South By North Strategies, Ltd.

Free Exchange is not impressed by the economic message being advanced by the Obama administration. In response to an op-ed penned by Treasury Secretary Tim Geithner, Exchange notes the following:

The public is unlikely to be fooled. Export growth slowed in the second quarter, and the drag on growth from net exports (net of imports) grew sharply (due largely to a BEA adjustment to petroleum imports, but still). Job growth did return faster than in the previous two recessions, but is proceeding far more slowly than occured in the early 1980s, which was the last time unemployment was this bad. Americans are all too well aware of the extent of joblessness, and forecasts put a return to full employment around mid-decade. Banks and businesses have repaired their balance sheets—and are too concerned about the state of recovery to do much new investment. American saving has risen, but is below long-term averages and indebtedness remains a problem (as does a shortfall in personal consumption). And it’s lovely that the Big Three aren’t in banruptcy anymore and TARP is less expensive than expected, but that means little for the path of recovery.
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I’m trying and failing to imagine just who might be convinced by this. And the strategy it indicates is a doomed one. The Obama Administration is arguing that the recovery was bound to be a hard slog and is nonetheless proceeding acceptably. And that implies that there’s little more that the White House can or would do to improve economic conditions. Given the choice between a party asking voters to be patient and a party promising action (however ill-defined and ill-advised) there is no choice.