The U.S. economy has added jobs for 55 consecutive months, bringing unemployment below 6 percent. The budget deficit has fallen from $1.2 trillion when President Obama took office to less than $500 billion today, from an unsustainable 10 percent of GDP to a relatively stable 3 percent. More than 10 million Americans have gained health insurance through Obamacare, while medical costs are growing at their lowest rate in decades. Gasoline prices are gradually dropping. Medicare’s finances are dramatically improving.
The sky, in other words, is not falling. On the contrary, things keep getting better. Which means a lot of people have a lot of explaining to do.
To recognize that America is doing better is not to suggest that America is doing great. Wages are too low. Washington is dysfunctional. There’s too much depressing news about Ebola, gridlock and our perpetual conflicts abroad. But the Cassandras of the Obama era ought to admit their predictions of doom were wrong. There has been no hyperinflation, no double-dip recession, no Greece-style debt crisis, no $5-a-gallon-gas, no rolling blackouts, no “insurance death spiral.” Despite “job-killing tax hikes” and “job-killing regulations” and “job-killing uncertainty” created by the “job-killing health care law,” private employers are consistently creating more than 200,000 jobs a month. Our gradual recovery from the 2008 financial crisis continues apace.
Some of the wrong predictions of the last six years merely reflected the paranoia of the Tea Party right—or the cynical exploitation of that paranoia. In 2008, Newt Gingrich got some attention by warning that President Obama would muzzle Rush Limbaugh and Sean Hannity; it worked so well that in 2012, he predicted that Obama would declare war on the Catholic Church the day after his reelection. The National Rifle Association’s fever-screams that Obama would cancel the Second Amendment and seize America’s guns have not come to pass, either, although they helped boost gun sales. Sarah Palin’s “death panels” also have yet to materialize.
It’s doubtful that those opportunists ever believed their own Chicken Little rhetoric; when their doomsday warnings were proven wrong, they simply issued new doomsday warnings. But other prophecies of doom reflected a sincere view of the economy and other public policy issues that simply happened to be incorrect.
The government response to the financial crisis probably inspired the most wrongheaded commentary. Critics complained that the Wall Street bailouts begun by President Bush and continued by Obama would cost taxpayers trillions of dollars. “If we spent a million dollars ever day since the birth of Christ, we wouldn’t get to $1 trillion,” fumed Darrell Issa, the top Republican on the House government oversight committee. Ultimately, the bank bailouts cost taxpayers less than nothing; the government has cleared more than $100 billion in profits on its investments. Obama’s bailout of General Motors and Chrysler also inspired some overheated commentary; Mitt Romney wrote that if it happened, “you can kiss the American automotive industry goodbye.” But it did happen, and the American automotive industry is now thriving, saving an estimated 1.5 million jobs.
It’s fun looking back at misguided crisis predictions. Liberal critics like Paul Krugman warned that the banking system would collapse unless it was temporarily nationalized; Krugman scoffed that Treasury Secretary Tim Geithner’s “stress test” would never end the crisis. “He was right,” Krugman later admitted, “I was wrong.” Conservatives like Dick Morris warned that the president’s $800 billion fiscal stimulus package and other activist policies would create an “Obama Bear Market”; in fact, the Dow has soared more than 250 percent since bottoming out in March 2009. Conservatives like Paul Ryan have also consistently warned that the Federal Reserve’s aggressive monetary stimulus would weaken the dollar—their preferred phrase is “debase the currency”—and create crippling inflation. They have been consistently wrong, as inflation has remained stubbornly low.
After the Great Recession ended in the summer of 2009—sooner than anyone (especially historians of financial crises) predicted—Republicans quickly turned their attention to the budget deficit, which had ballooned to $1.4 trillion. They complained that America was becoming Greece, that we were spending our way into a sovereign debt crisis, that brutal increases in interest rates were on the way. But America did not become Greece. There has been no debt crisis. Interest rates have remained historically low. In fact, despite the howling on the right, non-military spending (excluding mandatory expenses like Medicare) has dropped to its lowest level since the Eisenhower administration. Oh, and speaking of Medicare, its financial position has gotten so much better—thanks to a general slowdown in health care costs—that its trust fund, which was expected to go bust in 2017 when Obama took office, is now expected to remain solvent through 2030.
That slowdown in medical costs is another example of a phenomenon that critics confidently predicted would never happen in the era of Obamacare. Also, the administration would never meet its goal of 7 million signups by April 2014. (The actual figure topped 8 million.) Yes, but they would never pay their premiums. (The vast majority did.) OK, but those premiums would surely soar. (They haven’t.) Still, the entire program will be doomed to a “death spiral” unless healthy young people sign up in large numbers. (They have.)
Nevertheless, most Americans seem to think that Obamacare is a failure, that the economy stinks, that the deficit is getting worse. There are many explanations for those beliefs, but one is surely that initial predictions of doom are uncritically reported at the time and conveniently forgotten once they’re disproven. There is no penalty in American politics for being wrong. Republicans paid no price for their confident predictions that President Clinton’s tax hikes would destroy the economy, that the Bush tax cuts would pay for themselves, that the Obama tax hikes would create a double-dip recession. Even after the BP spill, petroleum interests proclaimed that tighter regulations on offshore drilling would ravage the oil industry and punish Americans at the pump; domestic production is at an all-time high while gas prices are steadily dropping, but they haven’t changed their tune at all. Similarly, even after the financial meltdown, Wall Street moneymen said financial reforms would shred our free enterprise system; they’re still whining despite their record profits.
Obama is often guilty of rhetorical overkill, too. He’s always warning that Armageddon is just around the corner—when Republicans blocked his American Jobs Act and other infrastructure bills, when they insisted on the deep spending cuts in the “sequester,” and when they threatened to force the Treasury to default on its obligations. (Actually, that last one almost did create Armageddon.) But because he’s president, the media correctly holds his feet to the fire, pointing out that he didn’t keep his promises to fix Washington or let you keep your insurance if you like it. There’s less accountability for his critics on the left and the right.
There’s no need for sympathy; Obama volunteered for the job. He gets a cool plane and a nice house regardless of public perceptions about the state of the country. But if you want to know why voters think the false prophets were right, maybe it’s because nobody ever corrected them.