The second major theme was the continued attempt to portray himself as an outsider to Washington. His repeated mantra was “Washington has been unable or unwilling to solve any of our problems.” It is a time-tested tactic for campaigners to portray themselves as outsiders. America habitually wants new visions and ideas and elected Obama a year ago largely based on this successfully transmitted message.
However what worked during his ‘real’ campaign will largely fall on deaf ears now. After a year in office, Obama is Washington. He said this much when castigating his party for their failures, “To Democrats, I would remind you that we still have the largest majority in decades, and the people expect us to solve problems, not run for the hills.”
Obama’s insistence on railing against Washington is interesting to say the least. It shows that he has yet to fully leave the campaign trail. From his perspective, this should be worrying as America has shown that it does not appreciate this politicking. America wants a president that leads not one that is on the campaign-trail.
The final major theme was his insistence on Big Government. Roughly two-thirds of his speech focused on the economy and rightly so. However, his entire approach of a paternalistic big government saturated his rhetoric. While his healthcare discussion was moderated, his language elsewhere continued the same cadence that drove the healthcare issue during the first year. A prime example of this misguided economic policy was his discussion on college affordability. He stated:
And let's tell another one million students that when they graduate, they will be required to pay only 10 percent of their income on student loans, and all of their debt will be forgiven after 20 years –- and forgiven after 10 years if they choose a career in public service, because in the United States of America, no one should go broke because they chose to go to college.Now this sounds noble and, on the surface, profound. After all, every America should have access to college and most understand the heavy load from student loans. However, if one spends a few seconds considering the ramifications of the plan the economics simply fail.
For starters, if debt is forgiven it means someone has to cover the costs. There seem to be three options – the taxpayer, the lenders, or the schools. If it falls on the lenders, well they simply will stop lending. No business will be willing to operate at a loss and so such a plan will reduce available loans. If it’s the taxpayers, well we all know the problems there. If the schools have to shoulder the burden it will reduce the quality of education as schools would be forced to cut programs, salaries, and other expenditures. Alternatively, it would give schools incentives to only admit those who could pay their own way, thereby restricting access to universities (particularly the elite) to the rich.
Likewise, Obama’s plan could create a perverse incentive for individuals to get frivolous degrees. Higher education is an investment in one’s future. While many enjoy learning, a higher degree should generally only be pursued if it offers a positive return. Such a program would encourage people to complete degrees that have little bearing on their career paths. While this is certainly noble and learning is a paramount value, it should not be done at the expense of demolishing our education system.
This is but one example of the administration’s warped economic perspective. Obama, while often pure in aims, far too often attempts to correct the symptoms rather than address the underlying problems. It is economically unwise to expand government in order to force changes in the price one pays without addressing the underlying cost of the product. This backward economic principle only serves to grow government and exacerbate problems.
However, despite the many flaws of the address, credit must be given where it is due. Obama did make a number of strong points and called for some positive changes. First he stated, “We need to make sure consumers and middle-class families have the information they need to make financial decisions.” The flow of information is a principal aspect of free competitive markets and should be applauded. Second, he called for off-shore drilling and the construction of nuclear plants (amongst other proposals) both which will create jobs and promote energy independence. Third, Obama invited both parties to offer ideas for healthcare reform. He stated, “But if anyone from either party has a better approach… let me know.” Hopefully this is not mere rhetoric and the Republicans will take advantage.
Obama has work to do. Hopefully, he can step up as a leader, dismiss the big government, partisan, and populist focus of his administration and end his political campaign. He seems to have learned some lessons from the past year, and particularly Massachusetts, but he is not quite there yet.