The Obama Legacy

As we prepare for the nation’s greatest tradition (the peaceful transition of power), it is time to take stock of where we are, where we have been, and where are we going.  A quick glance backward towards the Obama years reveals a mixed record.  TL;DR: so much potential wasted.

I doubt that history will look kindly towards Obama’s tenure.  The problems that he inherited were (at best) only partially solved while new problems at the end of his term appear able to critically wound the republic.

The Economy: C

Obama inherited one of the deepest recessions in American history.  Bush had approved TARP, a once-in-a-lifetime bill to save the banking industry.  This stop-gap gave Obama time to implement a strategy to revive the economy.  Obama’s efforts met mixed results.  Based on top-line numbers (GDP growth, unemployment), Obama’s record is stellar.  Based on a deeper dive into the data (income inequality, full-time employment), Obama’s record is far more troublesome.

Policies

Obama’s economic policies feature three main pushes: American Reinvestment Act, Dodd-Frank banking reform, and continued free trade.  The Reinvestment Act echoed the New Deal strategy of building public works.  Allocations made in 2009 and 2010 continued through the early 2010s, finally meeting Obama’s goal of less-than-eight-percent unemployment in four years.  (Granted, it took four years to get there.)  There are no landmark infrastructure improvements or bands that serve as a symbol of the Reinvestment Act’s success, which likely hampers its legacy.  That said, the strategy (combined with free-money monetary policy from the Federal Reserve) did help get the economy off of its back.

After questionable lending practices (many enabled by policies under the Clinton and Bush administrations) led to the bubble and meltdown of the housing financial markets, Obama directed Congress to develop new regulations on the financial industry.  Dodd-Frank is the main result of this initiative.  The law was heavily influenced by leaders in the banking industry, and appears to have added new agencies to regulate financial and similar institutions; however, these organizations have very little authority and punitive power to actually incite changes to offenses by these groups.

Obama continued the multi-decade tradition of pursuing free trade agreements with allies around the world.  The largest measure (still to be ratified) is the Trans-Pacific Partnership, a free-trade deal with Japan, Australia, Singapore, and a handful of other nations.

Economic Response

Overall, the economy has a widening gap between the very wealthy economy represented by Wall Street and the typical American’s economy represented by Main Street.  Wall Street has prospered, while Main Street has generally stagnated.

The United States’ GDP has increased by roughly $2,000,000,000,000 under Obama, roughly a 1.6% growth rate.  Wall Street has seen much better improvement, with the Dow Jones Industrial Average growing nearly 150% in the last eight years (from roughly 8000 in January 2009 to just shy of 20000 today).  Unemployment has improved as well, falling from 7.8% when Obama took office to 4.9% today.  Notably, the unemployment averaged in the mid-9% range during Obama’s first term and the mid-6% range in his second term.

Unemployment numbers are a bit tumultuous, especially as definition seems less appropriate in the current economy.  First, the work force is changing rapidly as the Baby Boomers leave the marketplace.  This exodus might mask discouraged workers – those who normally would work but have given up hope – leaving the market as well.  Increased levels of disability and long-term unemployment in rural areas with little economic growth indicate that both Baby Boomers and discouraged workers are leaving the market — which skews the unemployment rate downward.

Second, unemployment rates only reflect those without work.  Part-time workers who seek full-time employment are counted as fully employed.  Digging deeper into the data reveals a large amount of growth part-time employment.  This shift indicates an alarming trend that people are underemployed and are working with less pay and fewer benefits (if any) — placing additional stress on the Main Street economy.

Finally, the expansion of “experience pay” internships (the new first job out of college), coding of independent contractors (7% of workers), and the rise of the gig economy (4% of workers) confuses this metric all together.  Young people now often face a difficult job: take an internship at a potentially lucrative career path for no pay for “experience” and “networking” or try their hand at a less lucrative career path. Once hired, many are classified as “independent contractors” – a regulatory loophole that allows companies not to extend benefits to their employees.  Companies like Uber, Fiver, AirBNB and others provide alternative streams of income for Americans — however, whether or not someone who tries to make a living off of these gigs classifies as employment remains debated.  The inconsistent pay, lack of benefits, and additional stress on Main Street is not debatable.

Final Grade: C

All together, the economic data shows a mixed response for the Obama economy.  For the wealthy with investments in the stock market or those with stable jobs in thriving markets, the Obama economy has been great.  For the less wealthy who rely on their wages to make ends meet or millennials entering the workforce, the economic picture is bleak.

Domestic Politics

The United States’ internal politics is far more nasty than it has been at any other point in my life.  The perpetual temper tantrum by the Republican party and the Obama administration’s tepid response has led to a dysfunctional politics.  The resulting political slapfight has been six years of inaction, despite increased racial tensions, gun violence, a shrinking middle class, a struggling working class, and political dischord.

Obama swept into office in 2009 with a filibuster proof majority in the House and Senate.  Obama’s greatest legislative achievement (and, is perhaps one of three notable laws alongside Dodd-Frank and the Reinvestment Act discussed above) is the Affordable Healthcare Act.  Obama passed the torch to Congressional leadership (and health insurance companies) to write the law – a critical mistake.  Over the next year, Congress produced a nearly 2,000 page piece of legislative sausage that included some of Obama’s requests and a bunch of legal junk.  After a series of court cases that confirmed it’s constitutionality, the law appears to have expanded health insurance coverage to a few million people.  Unfortunately, the healthcare plans offered are often only for catastrophic cases with incomplete access to the highest levels of medicine.  Some parts of the law are positives (no denial of preexisting conditions and allowing family plans to cover young adults working those no-benefit internships), yet the law is hardly a widespread success.

The law passed with much controversy which fueled the 2010 TEA Party electoral success.  Republicans seized control of Congress and subsequently checked Obama at nearly every turn.  Republicans tilted towards the far-right under Obama, and he was unable to coordinate with center-right leadership to curtail the fringe elements gaining a foothold.  As a result, Obama was reduced to governing through executive actions (which can be reversed) on key issues like homosexuality in the military, immigration policy, and marriage.

With Congress paralyzed and the far-right inflamed, old issues came back onto the agenda.  Mass shootings became more frequent.  Crimes clearly influenced by racism, sexism, and religious intolerance become more frequent.  Cyber attacks increased in intensity and became more frequent.  Yet the government was unable to act.  Republicans blamed Obama, and Obama blamed Republicans.

Final Grade: D

Yes, Obama faced the headwinds of a belligerent Congress for six years.  However, with two years of unchecked power and legislative mistakes that led to the rise of that belligerent policy lie at Obama’s feet.  As a result, Obama’s decisions deserve a significant share of the blame for the domestic paralysis for the past several years.

Foreign Policy

In 2008, my greatest concern with Barack Obama was his foreign policy strategy.  It appears that my concerns were justified.  Obama’s run as President had a couple of successes, however America’s position on the global stage is significantly worse than it was eight years ago.

Obama’s best moment on the foreign stage was likely when he and Secretary Clinton barged in on a meeting to force the issue of climate change.  This confrontation led to a series of trade and regulation agreements, along with a fairly productive dialogue with East Asian counterparts.  From there, the general goodwill Obama enjoyed from foreign populations is remarkable – which is particularly highlighted when compared to his two neighbors in history.  Obama also thawed relations with Cuba and Iran – both were once bitter rivals and are now on a path to a improved relations.

Obama’s most celebrated moment was the extrajudicial killing of Osama bin Laden.  This extremely risky mission is arguably a war crime (bin Laden received no trial, assassinations are generally frowned upon in international law), and if things had gone wrong we could have ended up in an armed conflict with Pakistan — a nuclear power.  Despite those risks, the mission’s success is widely seen as a positive.

The rest of Obama’s foreign policy — especially the war on terror — is a mess.  Instead of pressing American influence in the region, Obama stepped backward and asserted that regional powers needed to pick up the slack.  This experiment has been a dismal failure.  China is increasingly belligerent in East Asia while the Middle East is literally on fire.

Several opportunities to support calls for democratization in the region went untouched, from the Neda protests in Iran to the Arab Spring in Egypt, Syria, and Libya, among many other examples.  One note that will likely be missed is the potential contagion effect of liberal and democratic values in illiberal and undemocratic regions.  The influence of republics like Israel and post-regime change Iraq may have destabilized authoritarian governments enough for democracy to break through.  Without American assistance, these efforts were damned to failure, and parts of the region have been hell on earth for years.

The American withdrawal from Iraq created a power vacuum and opening for al-Qaeda Iraq (now the Islamic State) to take territory.  The resulting power has systematically raped and pillaged along the Iraqi and Syrian countryside, while gaining proficiency in social media to attract homegrown terrorists.  Their influence has also hijacked a potentially good moment throughout the region: the Arab Spring.

Most of the Arab Spring movements were cut off at the knees by strong government responses.  Many of these governments are difficult partners in the region and impose wildly different policies than American preferences.  The largest example is the atrocities that have occurred in Syria.  The Syrian Civil War saw the utter destruction of Aleppo, a major cultural center in the region.  Obama has attempted to tip the fight against the Islamic State with targeted drone attacks against ISIL operatives.  This policy (which is potentially a violation of the Geneva Convention) has soiled what goodwill Obama had garnered throughout the Middle East.

Despite bipartisan calls for intervention, Obama hesitated, drew a red line, ignored violation of that red line, and sat on the sidelines as the Russians and ISIL increased strength in the region.  The result was an emboldened Russia – one that has forcibly annexed Crimea from Ukraine with minimal response from NATO or the United States.

 

Yet the largest failure of the Obama administration is not protecting the sanctity of American elections from the Russian government.  The sacred cow of American politics is now widely questioned.  Obama suggested that he had told Russia’s leadership – including Putin – to “cut it out” regarding their meddling in American elections.  Clearly that verbal warning was ignored, and the sanctity of the American election system is in doubt.

Final Grade: D-

Yes, Obama faced an incredibly complex and difficult world stage as President.  His inexperience showed.  It often appears that Obama’s inexperience led to hesitation, and that hesitation led to the correct, time-sensitive policies not being available by the time POTUS made a decision.

Overall: D+

In 2009, many looked to Barack Obama as a President with potential.  Unfortunately, hesitation and inexperience led to a series of mistakes that have made the American interest worse than it was eight years ago.  Worse yet, those mistakes enabled someone who appears even less equipped for the office in power.

 

Written by Sam

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