There isn’t much that I can add to BD’s excellent coverage of the President’s State of the Union address. From a policy perspective, the expansion of the Earned Income Tax Credit (helping the working poor without making it more expensive to hire them) is a good idea; mandating leave (which does raise labor cost) is not. I am also struck that the President is still touting “free” community college despite it being so obviously a policy that redistributes income upward. Noting that capital gains taxes stood at 28% during the Reagan Administration was cute, except that it gives Republicans the obvious retort that it was Bill Clinton who reduced them.
What I found most interesting about the president’s address was the off-key optimism. Somehow, in the last two months, America had stumbled into the sunlit uplands. For most Americans, it must have come as a profound shock. For me, however, it was somewhat familiar, for I’d read similar comments from across the ocean.
Less than a week before the president’s speech he met with British Prime Minister David Cameron. The two men have got along very well for years, even before Cameron was PM. Last week, Obama called the British PM “one of my closest and trusted partners in the world” (Isabel Hardman, Spectator Coffee House). Then there is Obama campaign alumnus Jim Messina, whose running Cameron’s campaign this year. So it shouldn’t surprise anyone that, as Hardman notes, the president insisted that “the US and the UK economies are the ones that stand out in the world.”
More to the point, in the UK at least, the happy words have worked. Cameron has been highlighting the British recovery for years, and it appears the British people are listening: recent polling is showing the Conservatives (Cameron’s party) are pulling ahead of the Labour opposition after trailing them for almost three years. Clearly, Obama is taking a page from Cameron’s playbook.
That doesn’t mean it will work, though. The British recovery is shorter than ours, but also stronger. It has come with a dramatic (albeit incomplete) welfare reform that, in part, is being credited with a surge in overall employment (and sparing the Brits the employment-participation problem that plagues our economy).
Meanwhile, there is no guarantee that Cameron will actually win the election in May, as I noted earlier. Even if he does, Cameron (who, like Obama, is far more popular than the party he leads) is running himself, while Obama must find a way to shift his support to someone else in 2016.
Most importantly, while Cameron clearly sings Obama’s tune in Washington, the song sheet is decidedly different in London. There, Cameron defends spending reductions, and acknowledges more are coming. While Obama continuously demands higher taxes (including last night), Cameron pledges to cut them.
In other words, following the Lego model (everything is awesome) might not be a winning political strategy. Then again, what else does the president have? He’s is clearly in 2016 mode, doing what he loves best…campaigning.
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