Until Obama's return from his Martha's Vineyard vacation, he was insisting the economy was still "heading in the right direction," when, in fact, the revised GDP economic growth rate had plunged in the second quarter from 2.4 percent to a comatose 1.6 percent, unemployment claims were climbing, and the stock market was in a steep decline.
Harvard economist Paul Krugman, a liberal cheerleader for the president's $800 billion spending stimulus (although he believed it should be much bigger) now complains the government's present policies have "landed us in what looks increasingly like a permanent state of stagnation and high unemployment."
"It's time to admit that what we have now isn't a recovery, and do whatever we can to change that situation," Krugman wrote in his New York Times column last week.
Diehard Democratic economist Laura Tyson, a member of the White House's Economic Advisory Board, doesn't think the stimulus has worked, either, but she is calling for another spending stimulus bill.
Despite growing alarm among voters and throughout the business community about the administration's unending trillion-dollar budget deficits, Tyson dismisses them out of hand. There is "far too much focus on the deficit" and "too much worry about the size of government," she complains. This is the kind of advice Obama has been getting from his advisers on his economic and fiscal policies.
And it's going to get much worse, economists say. The jobless rate is expected to creep closer to 10 percent as employers hang on to their cash reserves, hoping to survive the long-term decline in the Obama economy. Growing numbers of workers are tapping their retirement funds just to get by. "In July alone, 381,000 adults chose to quit looking for work altogether, and that trend will continue in President Obama's land of dashed dreams and squandered opportunities," writes University of Maryland Business School economist Peter Morici.
Democratic lawmakers will be returning after Labor Day from their August recess with tales of an angry electorate, with many avoiding face-to-face town hall gatherings because of it.
"Democrats thought things couldn't get much worse on the electoral front -- and then they went home to campaign," the Politico website reports this week. "The Gallop poll, coming at the end of a brutal August for Democrats and Obama, reinforces the rapidly forming prevailing view that the horizon is as bleak for Democrats as it ever has been."
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