RightChange: Obama Uses False Recovery as a Reason to Reelect Him

The one question voters ought to ask themselves in 258 days is whether or not $6 trillion made them better off.  Obama and his entire campaign are asking for another shot at fixing the economy after almost four years of no Hope and no Change.  They’re using the recent positive numbers to prove that the economy is improving, and that four more years is what we need to finish the job.  Are these recent numbers a sign that things are looking up?  Or are they a repeat of history?

Derek Thompson from The Atlantic would argue, history repeats itself:

“Let's play "Name That Year of the Recovery." In the first quarter of this Mystery Year, the economy adds more than 200,000 jobs in consecutive months. Manufacturing is roaring. Investors are giddy and stocks improve for the third month in a row. The Dow breaks 12,000 for the first time since 2008. Economists are screaming, "Recovery Winter!"

Surprise! It's 2011. The economy accelerated around the '10-'11 bend with practically every conceivable tailwind: accelerating employment, strong industrial production, and a decent, if spotty, normalization in housing.

But you all remember what came after. Unrest in the Middle East sent oil over $100 a barrel. Europe's crisis weighed on banks, confidence, and exports. A showdown over the debt ceiling made a mockery of Washington. By the summer, the boomlet has wilted, job creation has slowed to a pathetic trickle, and economists were talking seriously about a double-dip recession.

Fast-forward to 2012. The economy has added more than 200,000 jobs in consecutive months. Manufacturing is roaring. Investors are giddy. Stocks have hit 2008 highs. Economists are screaming, "Recovery Winter!"

But here they are, the same old threats. Oil is breaking $100 a barrel again, with Iran halting exports to European countries. Europe is practically in a continental recession, anchored by a full-fledged depression in Greece. And some budget analysts are worrying that we might hit the debt ceiling a few months early, which would mean a redux of the great debt-ceiling space opera of 2011.

The payroll tax cut package signed last week isn't fully paid for. We're now scheduled to hit the debt ceiling in January rather than early spring, according to the Bipartisan Policy Center. Treasury Secretary Timothy Geithner has said we won't hit the ceiling until "significantly after the end of the fiscal year," but oil shocks and a growth slowdown could reduce tax revenues and move the debt-ceiling deadline into 2012, The Hill reported.

There are all sorts of reasons to be confident that this isn't a replay of 2011. We're one year of growth -- and 1.7 million jobs -- stronger than we were in February '11, and this recovery is even broader. If we close in on the debt ceiling in September, Treasury can seek out wiggle room to keep us from touching the ceiling until after the election. Europe's recession is much more likely than an Israeli strike on Iran, and a weak Europe should keep a lid on oil prices.

But the United States is still a recovering patient in a world that's ready to fall apart, like somebody re-learning to walk on a sheet of thin ice. The economy is looking good from the home-front. But remember the last time we looked so good, the ice broke beneath us.”

The example he used about the gas prices is spot on.  Once gas prices spike, it causes an economic domino effect that is one huge mess to clean up.  Economists estimate gas will soar above $4/gallon, and $5/gallon in areas like California.  The cost of food and everything else will skyrocket and businesses that use fuel for anything will ultimately pass the cost onto the consumer.  This is a recipe for economic disaster and a double dip recession.

When Obama tells you he needs four more years, remember that all of his policies failed to help us out in the first place.  If he actually fixed the economy, then we wouldn’t be discussing the possibility of a double dip recession.   We cannot afford to repeat history in November 2012.

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