Due to the state of the economy the past few years (particularly the high unemployment numbers), so many hound Obama for not doing enough to get people back to work. When I hear such comments in the news, I ask my TV… “so tell me, what are specific things the President can do to get you back to work [in the time frame you need a paycheck to pay the bills]?” I envision the person being quoted in the news stammering around and unable to come up with an answer to the question.
On the one hand I sympathize with the unemployed (I’ve been there, too), but on the other hand it is a bit disappointing that people can so easily get caught up a situation that they don’t think through sound bites. I’m sure part of it, too, is when we feel pain or feel like we’ve been dealt an unfair hand, we want to blame someone.
Listening to the program Marketplace the other day, the host, Kai Ryssdal, spoke with a gentleman who nailed the answer to this question. Kai’s guest was Stephen Dubner, co-founder of freakonomic‘s radio. The bottom line in his response was the President is “extremely limited”. I say a hearty “THANK YOU!!!”. This confirms my conclusion when thinking through this sound bit question.
This is not to say the President or the Federal Government’s hands are tied. Based on my recollection from Economics 101, the Federal Government has two main tools for influencing the economy; fiscal and monetary policy. The affect of these tools is not immediate, though, and it takes time for any policy changes to propagate through the system to where the rubber meets the road… for those quoted in the news slamming the President for not doing enough to get them back to work.
I’m no expert, but I’d say there are a few other strategies the Government can pursue to influence the economy… trade policy, industrial policy (if the US had one) and leveraging the bully pulpit.
The Marketplace program with Kai interviewing Steve: “Does the president actually influence the economy?“
This source topic on freakonomic’s web site is titled “How Much Does the President Really Matter?“
Related freakonomics topic: “It’s Not the President, Stupid: A New Marketplace Podcast
Your Average Joe’s 2 cents