The president has said that he hopes to bring about "sustained economic growth," a critical goal if he hopes to sustain his place in the White House. But with a full economic recovery will likely take years, or even a full decade, and the November 2012 elections only 15 months away, Obama's challenge is not only about jobs, but about perception.
There is much work to do on both the economic and political fronts. This week brought news of increased jobless claims, as well as decreased growth forecasts from the Federal Reserve. Even Federal Reserve Chair Ben Bernanke appears stumped. "We don't have a precise read on why this slower pace of growth is persisting," he told reporters at a press conference. The public is clearly discouraged; a Pew Research Center poll released Thursday shows that 91 percent of Americans see the economy as "only fair" or "poor," and 69 percent believe the economy will be "worse" or "about the same" in a year. To counteract all these forces, the White House is working not only to improve the economy, but also its image, political strategists say. [Check out editorial cartoons about the economy.]
The president's announcement that the United States would release 30 million barrels of oil from its Strategic Petroleum Reserve as part of a an international agreement to release a total of 60 million was just the latest example. Oil prices have risen by 25 percent over the last year, leading to soaring gas prices that are still over $4 per gallon in some parts of the country. A June 16-20 AP-GfK poll showed that gas prices are where the president polls the worst, with only 34 percent of respondents saying they approved of his handling of the issue. By taking measures to lower gas prices, the president can quickly and directly affect both Americans' pocketbooks and psyches, says Democratic strategist Peter Fenn (who also blogs for U.S. News & World Report). "[The price of gas] really affects Americans' psychology. It really makes them pessimistic towards the economy, towards the future," says Fenn. Karlyn Bowman, a senior fellow at the conservative American Enterprise Institute, agrees that gas prices play a major role in how people view their economic well-being. "Clearly this White House is concerned about addressing public perceptions," she says. "As all of us have to fill up our gas tanks, it's not surprising that they're trying to address it."
Driving down gas prices is a short-term fix, but longer-term, sustainable economic growth will require greater efforts. The president today extended new assistance to the hard-hit manufacturing sector, with the announcement of the creation of the Advanced Manufacturing Partnership. This $500 million program intends to bring together the federal government, universities, and major manufacturing corporations like Caterpillar, Intel, and Procter & Gamble in identifying and investing in new technologies to "drive a revitalization of American manufacturing," as Assistant to the President for Manufacturing Policy Ron Bloom described it. Manufacturing companies have historically criticized the administration over regulations, the corporate tax structure, and trade agreements that they perceive to be harmful to their bottom lines. Winning over the support of business is crucial for the White House not just for garnering votes or campaign donations, but also to show more broadly that the president is working to create jobs.
Obama also used the economy as a rationale for withdrawing troops from Afghanistan, highlighting the war's high cost and the need to focus American attention elsewhere in his Wednesday prime time address. "Over the last decade, we have spent a trillion dollars on war, at a time of rising debt and hard economic times. Now, we must invest in America's greatest resource–-our people." He added, "America, it is time to focus on nation building here at home." Bowman says that mentioning the economy during a foreign policy-focused speech shows the extent to which the White House is emphasizing its economic efforts. "I think we're going to hear about that every day going forward," she says.