It’s Always the Economy, Stupid


‘Stupid,” in the famous quotation from 1992’s Clinton vs. Bush campaign—”It’s the economy, stupid”—is whoever thinks a U.S. presidential election is about something else. All presidential elections are about the economy. Yes, there are other issues, but it’s also true that a whale has pilot fish. Still, most politicians would rather talk about anything but the economy, which they see in one of two ways—as a personal piggy bank or a mystery. Neither is discussable in public. This is the sixth presidential election since “stupid” was first identified, and nothing has changed.

Barack Obama has reduced the whole economic record of his first term to one word: Bush. He’s talking about the next U.S. economy, in which, he says, some people will be making windmills. Or capturing the rays of the sun.

His rebooted challenger, Mitt Romney, led an audience in Nevada last week through his plan to revive the economy. Mentioned first, and so presumably most important, he’d pursue “energy independence.” Second most important: Crack down on trade “cheaters.” That would be China, which is a long way from Vegas.

Next Wednesday night, these two will be hauled onto a stage in Denver for their first debate on “domestic issues,” a euphemism for the economy. Nothing—and that includes Jim Lehrer—can make these two talk about the economy as it’s understood by the average American voter. But the odds are Mitt Romney will talk about it and Barack Obama won’t.

Mr. Obama will stay on message in Denver, redirecting his opponent and interrogator to the economy before he was president (or even in politics)—”challenges that have built up over decades”—and about the wind-driven economy that will exist after he’s re-elected. But not about the economy in between. If this were an episode of “Homeland,” Mitt Romney’s first question to his evasive competitor would be: “Mr. President, what are you hiding?”

It’s true, as Mr. Obama argues, that the numbers of unemployed Americans began to rise abruptly after September 2008 when the financial crisis erupted, and that the president’s name then was George W. Bush. What Mr. Obama won’t say is that the financial crisis resulted from the implosion of a housing market transformed into a toxic landfill by Congress, regulators, Fannie, Freddie and mortgage packagers. The Bush presidency was a bystander.

Also left unsaid by Mr. Obama but free for the telling by Mr. Romney is that as the U.S. unemployment rate hit 9.5% in June 2009 and a shocked public was looking for a response, the new president introduced the Affordable Care Act. Whatever else one may say about ObamaCare, it has nothing directly to do with U.S. employment. For the next nine months, as unemployment ran between 9.5% and 10%, Congress at Mr. Obama’s insistence worked on his health-care legislation. When Mr. Obama signed the bill into law in March 2010, the unemployment rate was 9.8%. If an opponent wanted to describe this in partisan terms, he might say that the president legislated an entitlement dream while the economy burned.

Last Sunday in his “60 Minutes” interview, Mr. Obama referred vaguely to “some emergency actions” he took to deal with the post-2008 economic crisis. His primary emergency measure was the $831 billion stimulus bill, which was written by House Democratic committee chairmen and passed in February 2009, a few weeks after his inauguration. As a partisan might put it, the Obama-Pelosi stimulus was a fire-and-forget ballistic missile shot into the economic ozone. Even today, no one knows where the stimulus landed. There was also cash-for-clunkers.

In 2009, Mr. Obama’s economic forecasters said the economic growth rate would be 3.2% in 2010 and 4% each year the rest of his first term. That would have been great. Even partisans would have been happy with 4% growth. That is closer to the average U.S. growth rate of 3%, which, as the politicians say when claiming credit, made America strong.

We didn’t get that growth rate from 2010 to 2012. Instead, it has averaged just above 2%. In the first quarter of this year, growth dropped below 2%. In the second quarter it fell further to 1.5%. That Barack Obama simultaneously was president is a coincidence.

In May 2010, someone in Washington decreed a moratorium on deepwater oil-drilling in the U.S. The unemployment rate that month was 9.6%.

In July 2010, Mr. Obama signed the Dodd-Frank Act, which he said would prevent Wall Street from ever “writing its own rules.” Or doing much of anything productive. The unemployment rate then was 9.5%. A year later it was 9.1%.

In August 2011, Standard & Poor’s released its historic downgrade of U.S. debt. It’s hard to remember who was president then, but the unemployment rate was still 9.1%.

U.S. unemployment is now flatlined at 8%, at 17% for young workers and at infinity for everyone who has given up looking for a job during the nearly four years Mr. X has been president.

This isn’t George Bush’s economy. It isn’t the windmill economy. It’s the economy we’ve got right now. With luck, someone in Denver next week will think it’s worth talking about.

A version of this article appeared September 27, 2012, on page A17 in the U.S. edition of The Wall Street Journal, with the headline: It’s Always the Economy, Stupid.

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