For the more than 54 million Americans who passed up a perfectly good Friday night in September 2008 to watch the first presidential debate between Barack Obama and John McCain, the exchange seemed like a win for Obama.
According to a CBS News/Knowledge Networks poll conducted at the time, 39 percent thought Obama (then a Democratic senator from Illinois) won the first debate; 24 percent gave the nod to McCain (then and now a Republican senator from Arizona); and 37 percent called it a tie (which still may have helped the relatively unknown Obama as the debate was weighted toward foreign policy, supposedly McCain's strong suit).
But while he may have gotten the most debating points, Obama blew enough smoke to raise global temperatures by several degrees. Debates are forums for signaling how you will govern, laying out ideas for change, and putting your policies up for review. By that standard, President Obama's time actually running the country have borne little resemblance to his 2008 rhetoric. He has vindicated some of his foreign policy claims (focusing on Osama bin Laden; unfocusing on Iraq). But on what George H.W. Bush used to call "the domestic side," the last four years have been as punishing for Obama's truthiness as they have been for the American people.
Tomorrow night President Obama will go up against former Republican Massachusetts Gov. Mitt Romney. In the which-one-would-you-rather-have-a-beer-with dynamic of presidential contests (a contest in which Romney, who doesn't even drink coffee, already has a handicap), Obama again has a good prospect of winning.
But before subjecting yourself to a new round of Obama fish stories, take a look at how the ones from 2008 have held up:
1) We Need to Reduce Our Debt to China
"[W]e've got challenges, for example, with China, where we are borrowing billions of dollars," Obama announced in 2008. "They now hold a trillion dollars' worth of our debt."
China bashing is the little black dress of presidential politics: It never goes out of style. Tomorrow night you should expect to hear the candidates excoriate the Middle Kingdom for such completely un-American practices as subsidizing its politically connected businesses, manipulating its currency, and aggressively seeking favorable markets for its products.
How did Obama address the supposed problem of a trillion dollars in Chinese-held debt? As of the most recent Treasury Department report, China held…$1.1 trillion of U.S. public debt.
Granted, that's a relatively smaller portion of a total debt that was about $10 trillion in 2008 and is more than $16 trillion today (China's declining appetite for American public debt being another friendly warning from our second-biggest trading partner that the United States has chosen to ignore). But we're guessing that's not the solution voters thought Obama was proposing.
Next: Make the banksters pay! (Part I)
2) Incredible Shrinking TARP Repayments
"[W]e've got to make sure that taxpayers, when they are putting their money at risk, have the possibility of getting that money back and gains, if the market—and when the market returns."
Obama's if/when statement revealed plenty. Tripling of the monetary base has created a series of fool's rallies on Wall Street, helped keep real estate prices from reaching affordable levels, made grocery shopping a painful ordeal, and induced four years of stagnation. So has all that suffering at least allowed taxpayers to collect from firms that received funds from the Troubled Asset Relief Program (TARP)?
Big no. While plenty of useful pundits have claimed TARP is being paid back with interest, the repayment actually follows a funny sliding-scale pattern: Every month or so you hear a figure about TARP profit, then a few months later you get a new figure that's lower than the earlier figure. Actual repayment has been limited almost entirely to the too-big-to-fail banks, which have gotten bigger and failier since 2008. There is little prospect that taxpayers will ever be repaid in full, let alone with interest. As the TARP Special Inspector General noted in a January report [pdf]: "TARP will continue to exist for years. TARP programs that support the housing market and certain securities markets are scheduled to last until as late as 2017, and the Treasury can spend an additional $51 billion on these programs during those years."
To be fair, Obama inherited TARP from the Bush administration (though as a senator Candidate Obama voted for it). But what about the part of the TARP disbursement the Obama Treasury Department brags about: the bailout of General Motors? GM still owes the taxpayers more than $23 billion in TARP money, has realized losses on more than $5 billion, and paid back another portion by borrowing from the other public funds.
Next: Make the banksters pay! (Part II)
3) Incredible Expanding TARP CEO Pay
"We've got to make sure that none of that money is going to pad CEO bank accounts or to promote golden parachutes."
Reining in excessive CEO compensation was one of the most melodious rallying cries of the Obama campaign and of the early days of the Obama administration. And there was no more logical place to start than with the CEOs of firms that were getting broad-daylight public assistance via the TARP. The president even created an office of the Pay Czar – er, "Special Master for TARP executive compensation" – to deal with this problem.
How did it work out? CNN reported earlier this year:
[A] watchdog over the $700 billion Troubled Asset Relief Program found that the special pay czar Kenneth Feinberg—whose job it was to cut pay—failed to "effectively" rein in executive compensation.
In a report released Tuesday, the Deputy Special Inspector General for TARP Christy Romero doesn't blame Feinberg. Instead, she blames pressure from those banks—and from the Treasury Department—aimed at keeping the CEOs in their jobs, which was thought to be the best way to get banks to repay the bailout quickly.
Companies pressured him to let the companies pay executives enough to keep them from quitting, and Treasury officials pressured him to let the companies pay executives enough to keep the companies competitive and on track to repay TARP funds," the report said.
Feinberg tried to shift CEO pay away from large cash salaries and toward stock tied to company performance. But he still approved multimillion-dollar compensation packages for many of the top 25 bank CEOs, the report said.
Next: Broke and broker
4) Helping Ordinary Americans' Balance Sheets
"[T]he nurse, the teacher, the police officer…frankly, at the end of each month, they've got a little financial crisis going on. They're having to take out extra debt just to make their mortgage payments. We haven't been paying attention to them."
Obama has certainly been paying attention to the unionized employees he mentioned in 2008, in all ways but one: He has not done anything to help them, or any other Americans, avoid taking on more debt. A spike in personal savings rates that began late in the Bush administration has meandered downward throughout the Obama era, from a high above 6 percent to a mere 3.7 percent in August (the most recent month for which the Bureau of Economic Analysis [pdf] has figures).
Even adjusting for inflation (which is universally described as being "moderate" though it has amounted to more than 10 percent in a period of nearly flat GDP growth), household net worth [pdf] is still $3 trillion below where it was at the start of the recession. Even with this year's widely celebrated reinflation of house prices, the equity portion of real estate owned in the United States is still only 43 percent, close to the lowest it's been since the Federal Reserve began measuring it in the early 20th century.
Sure, Obama has merely followed the same pneumatic strategy employed by his predecessors – using every known policy tool to discourage savings and spur spending – and it would not have been realistic to expect any different. But his administration has continued to spin new fictions of fiscal responsibility, with Treasury Secretary Geithner repeatedly claiming that personal savings rates are higher than they were under President George W. Bush.
Next: HAMPer diving
5) Keeping 12 Million 9 Million 4 Million Maybe a Million People In Their Homes
"[W]e've got to make sure that we're helping homeowners, because the root problem here has to do with the foreclosures that are taking place all across the country."
In a grim parody of the way McDonald's advertised specific numbers of satisfied customers until the figures grew so large that a simple "billions served" had to suffice, the Obama administration has grown increasingly nebulous about how many bad mortgage borrowers it was keeping "in their homes." But in this case it's because the number keeps getting smaller.
During the 2008 campaign it was unclear how many underwater and/or defaulted borrowers the government would rescue (and on this issue Obama was actually to the right of McCain, who wanted the taxpayers to buy up all the nation's distressed mortgages). But figures as high as 9 million and sometimes 12 million have been thrown around in the last four years. When Obama rolled out the Home Affordable Modification Program (HAMP) and Home Affordable Refinance Program (HARP), he said the Treasury would eventually rescue 4 million mortgage deadbeats.
The actual number looks to be coming in at about one-fourth of that figure. The Washington Examiner's Conn Carroll surveys the wreckage:
Creating a new mortgage modification program from scratch would be like ripping out hundreds of pages from both guides, rewriting them, shuffling them, throwing them in the air, and then telling the banks to pick them up.
Instead, Treasury just let banks implement the program using the same practices that caused the crisis in the first place. Where mortgage servicers had issued no-doc mortgages before the crash, Treasury allowed them to issue no-doc mortgage modifications after the crash.
And, surprise! The program was a complete failure. Of the 1.3 million mortgages modified by HAMP through June 2010, only 43 percent were converted to permanent modifications. Treasury did start requiring verified income documentation after that date, but the final numbers are not impressive either. As of June 2012, only 1 million mortgages had been permanently modified, far less than the 4 million Obama had promised.
The failure of HAMP and HARP is good news for America: There's something daft about a policy of keeping a home out of the hands of every American except the one American who has been shown to be unwilling to pay for it. But the actual-rescue figure is a big comedown from the promise Obama outlined in 2008 and specifically made after his election.
Next: American jobs for Americans in America
6) Stop Shipping Jobs Overseas
"What I do is I close corporate loopholes, stop providing tax cuts to corporations that are shipping jobs overseas so that we're giving tax breaks to companies that are investing here in the United States."
How has the Insourcer In Chief delivered on his promise to create great American jobs for Americans right here in this country (America)? ABC News' Brian Ross provides one handy example:
Vice President Joseph Biden heralded the Energy Department's $529 million loan to the start-up electric car company called Fisker as a bright new path to thousands of American manufacturing jobs. But two years after the loan was announced, the company's manufacturing jobs are still limited to the assembly of the flashy electric Fisker Karma sports car in Finland.
"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."
Henrik Fisker said the U.S. money has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went to a rural Finnish firm, Valmet Automotive.
"We're not in the business of failing; we're in the business of winning. So we make the right decision for the business," Fisker said. "That's why we went to Finland."
It turns out Fisker may be in the business of failing after all. The company has sold just 1,000 of its $100,000 Karmas, about enough to pay back a fifth of its taxpayer-backed loan.
Republican National Committee Chairman Reince Priebus piles on:
Thanks to President Obama, taxpayer money, mostly in the form of stimulus funds, ended up in the hands of companies overseas. Instead of creating jobs in America, the stimulus and other Obama policies created jobs or sent money to Finland, New Zealand, Indonesia, India, Mexico, Germany, Australia, Switzerland, China, Denmark, South Korea, the Dominican Republic, Thailand, Vietnam, Italy, Russia, Luxembourg, El Salvador, Great Britain, Spain, Japan, and France.
It's good to see Obama at least tacitly admitting that there are legitimate reasons to do business, send resources, and even create jobs overseas. It would be even better if he weren't using our money to do it.