Can Obama's rhetoric lift the economy?
Optimism by a president can be a force multiplier in the economy as much as government action. Obama's speech to Congress is a chance to restore his credibility as an inspiring orator and economic leader, able to persuade Americans to invest and spend.
Whenever public optimism about the American economy drops sharply, as it has in recent weeks, a US president tries to revive it with words of optimism – offering solutions in a soaring speech and assuming a positive outlook.
On Thursday, President Obama will try again during a televised speech to Congress to fulfill that role as cheerleader in chief. During the 2008 campaign, when he spoke of America as “a magical place,” he was a master of sunshine rhetoric.
But now, faced with widespread “talk” of a double-dip recession as well as a decline in his credibility, Mr. Obama faces his biggest challenge as an inspiring orator, one able to shoo away the naysayers feeding a negative feedback loop.
Obama’s specific proposals, or his latest “jobs agenda,” are expected to be modest, with $300 billion in tax cuts and new spending, compared with his previous stimulus packages. That makes the need even greater to buck up the nation’s confidence and lift the mental gloom.
Presidents walk a fine line between offering feel-good speeches and acknowledging the tough times that Americans face. They can try to reframe economic reality with the hope of government action and reminders of past triumphs over adversity. But they cannot appear out of touch with everyday life, which these days consists of fear about losing jobs, homes, and retirement savings.
An unusually high 77 percent of Americans are pessimistic about the economy, telling pollsters that it is getting worse. They’ve also lost confidence in the president and Congress to help private companies create new jobs. Their worries about the future may be driven by a concern that more government spending or further tax cuts will only result in big tax hikes later on.
A “confidence recession” has hit Americans, even though the economy has lately been in a slow recovery with some bright spots, such as low interest rates and high corporate profits. Last week’s report of zero growth in net jobs may have hit public confidence the hardest. Six out of 10 Americans now say the recovery hasn’t even begun.
Obama’s ability to encourage optimism depends on convincing enough Americans to start investing and spending in the economy. Individual fears of another recession can be overcome with a commanding hope that collective action is possible.
Franklin Roosevelt tried to end the Depression by attacking fear of fear. Ronald Reagan helped end a recession with his “morning in America” eternal optimism. What will be Obama’s upbeat lines that push Americans to pull up their socks, take on an appetite for risk, and revive the economy?
So far, his phrases like “Win the future” and “We do big things” haven’t worked. If bully-pulpit persuasion still counts in economic leadership, this president needs to do better. We know he can.