Debates

The 6 Biggest Debate Promises Obama Failed to Keep

Warm up for tomorrow night's empty promises with some of 2008's forgotten pledges.

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Barack Obama and John McCain's first debate took place in a gentler, more civilized era before partisan rancor polarized our political culture.

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). 

Many pundits agreed: "Strong on substance. Few mistakes" (Ezra Klein); "I'd give the edge to Barack Obama" (Rogers Cadenhead); "It was very effective" (Daily Kos).

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

How much U.S. debt has David Lo Pan accumulated in his thousand years on earth?

"[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

Henry Paulson keeping his ears warm

"[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 

Kenneth Feinberg didn't rationalize CEO pay, but he's still got his good looks.

"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

Even Rich Uncle Pennybags is getting poorer under 24-hour Quantitative Stimulus.

"[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 

It hasn't fallen completely off the cliff yet, so that's not nothing!

"[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 

Finns say "kiitos" to U.S. taxpayers!

"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. 

NEXT: White House Bypasses Congress To Buy Illinois Prison

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  1. Come on! No alt-text for that photo?!

    1. Damme, now my browser works….well done, well done indeed!

    2. They have used it a few times…I think an entire article explaining what the fuck is going on is in order.

      alt-text will not cut it.

  2. “Com’ere, youngster. Gimme some of that sugar.”

  3. Wouldn’t it be easier to take all of Obama’s promises and list the ones he kept? I’ve got one–he ran for the presidency and actually took office. Can’t deny that.

  4. Hey, Lo Pan! He may be my favorite villain ever.

    1. Which Lo Pan? Little old basket case on wheels or the ten foot tall roadblock?

      1. One and the same person, Episiarch.

        1. Not sure Lo Pan qualifies as a “person”. Can we get a ruling?

          1. If you substitute “Jack” for “Episiarch”, I’m quoting the movie.

            1. I am Episiarch’s complete lack of surprise.

              1. Episiarch Kennedy. Episiarching off.

                1. Episiarch you, ProL.

                  1. No, no, you’re doing it wrong, Episiarchass.

  5. household net worth [pdf] is still $3 trillion below where it was at the start of the recession.

    Why start there? That was six months before Obama took office. The housing bubble popped and home prices won’t see bubble prices again for decades.

    And CEO pay? The TARP banks paid back their loans ASAP when their pay was threatened as wards of the state.

      1. Shrike rarely even reads the articles he sources.

        My favorite was him citing Warren Buffet’s support for Simpson-Bowles as evidence of his desire to see the debt paid down, when in the same article Buffet said, “So you have to get expenditures, in my view, down to about 21 percent of GDP. And you have to get revenues up to 18 1/2 or 19.”

        1. The big banks did pay TARP back meaning all nine that were forced into it by Hank Paulson. And they did it fast when their exec pay was threatened. Give Geithner his credit.

          The loan profit from just those nine was over $25 billion.

          1. Fuck that tax cheat:

            WASHINGTON (CNNMoney) — Regulators were under pressure to cut the biggest banks loose from the Wall Street bailout program, a federal watchdog said in a report issued Friday.

            Congress and regulators made it easier for the biggest banks to pay back tens of billions of dollars borrowed under the Troubled Asset Relief Program (TARP), according to a Friday report released by the Special Inspector General for TARP.

            The report zeroed in on regulators who ignored their original requirements to ensure eight of the weaker big banks had enough of a capital cushion when they exited TARP.

            The report suggests that if regulators had required Bank of America (BAC, Fortune 500), Wells Fargo (WFC, Fortune 500) and PNC Financial Services (PNC, Fortune 500) to raise as much capital as Citigroup (C, Fortune 500) had to, the banks may have been in a stronger position

            http://money.cnn.com/2011/09/3…../index.htm

    1. You mean six months before he became President. Senator is pretty much the next level down in terms of power for elected officials.

  6. Just for laughs.

  7. Does it need to be said that these promices are so farcially stupid in the first place that we almost shouldn’t even care if he kept them or not?

    1. Bush hurt us so bad. We were desperate.

      1. You know. Now that I think of it, Bush did a lot for the Democrats. I mean, Obama is at least as nutty as Gore or Kerry, but Americans weren’t ready to buy the load of crap.

        It took 8 whole years of Bush to soften up Americans for the Dems to regain presidential power.

        1. If Romney wins, it’ll be a repeat of the big warfare/welfare state, the economy will remain in the tank, and Democrats will regain Congress (possibly in 2014) and then Democrats will control all branches in 2016. Followed by more Democratic thieving such as Obamacare.

          I say vote for Johnson (if not then Obama) as we’ll have a divided government, and Republicans will be less likely to allow new spending increases.

  8. We all know why Obama’s plans have not all succeeded: the Republicans cock blocked him!

  9. Godamnit, why won’t you just give Obama a chance?! //deluded Democrat

    1. Obama had his chance with his $800 billion stimulus (and he also voted for TARP and signed every spending bill). He increased the debt by over $5 trillion. That’s not giving him a chance? If not, what does it take?

      Obama will say anything to get elected, but then so will Romney. One must look to their records (not their rhetoric) to see what they might do. And it’s about the same, and they both offer more government.

      I’ll be voting for less government. The only candidate with that record, is Gary Johnson.

  10. 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.

    This is one of the most egregious bits of double-speak by the administration, as the payment of household debt is counted as “savings” in the government lexicon.

    If the savings rate went up, it was primarily because people were vastly overleveraged and trying to reduce their debt profile.

  11. Didn’t Obama talk about proving the cynics wrong – whatever happened to that?

    1. Something something obstructionist Tea Party terrorist Republicans.

    1. This might be the best cartoon of all time

  12. None of this matters to most of the large bloc of women voters.
    He’s dreamy, his wife is fabulous, and he’s for free contraceptives.
    What else do you need to know?

    1. I’m not laughing because it’s funny; I’m laughing because it’s true.

      1. I am laughing so I don’t effin, cry

    2. Pay reparations:

      $1.45 for every dollar a man makes. Lilly Ledbetter II. Comparable worth+ coming in Obama’s second term.

      1. They do realize that we can pretty much revert to caveman mode whenever we want, right? I mean, it’ll have to be single guys with nothing to lose in terms of pussy to get the ball rolling, but once they do…

  13. Yeah, but Romney’s rich. and that’s eviiilll now… Don’t you pay attention?

  14. I watched the first 2000 debate over the weekend and I had forgoten how much of a jackass Al Gore came off as. He was sighing and interupting all over the place! But I don’t think any Democrat will give that bad of a performance in my lifetime.

  15. Lockbox!

  16. Since my man Gary Johnson isn’t welcome, I’m paying the debate back in kind by not watching. I’ll just watch a Beavis Butthead DVD instead. I’d rather watch two funny imbeciles than two unfunny imbeciles.

    1. I have a class tomorrow, and I plan on watching The Avengers when I get home.

      Tell me, will anyone who doesn’t subscribe to the TEAM-sport political paradigm actually be interested in the debates?

      1. It’s kinda cool that we don’t have to watch anymore:

        (a) The right and left press predict how each player is going to perform.

        (b) And the right and left press tell us how well their player actually did perform.

        What’s amazing is that they don’t have to stay up late tonight to write (b).

        They’ve already written it.

    2. This makes me smile a little

  17. Will Obama failed to the new presidential campaign ? I think he is a competent president, chaussures asics.

  18. Really? This is what you got?

    Wasn’t the Fisker loan part of a Bush administration deal, not the Stimulus?

    Didn’t Obama need help from Congress to reduce the deficit and create jobs? Didn’t the TOP Congress reject the Jobs bill? WHere is the TOP Congress effort to create jobs? Didn’t Obama push through the key benefit to the middle class – the payroll tax holiday – over Bohener’s objection? Is a 3% tax break only good for Matt Lauer’s $25 million annual income but not the bricklayer’s $50,000?

    I agree it is ridiculous to me that not one bankster apparently did anything criminal in the 2008 meltdown. I would certainly take another look at that.

    Good luck with all that. We’ll see how it plays out.

    1. ^
      Sarc? Stupidity?

  19. US/EU must peg Outsourcing/BPO/IT projects/jobs to Human rights/Caste system in CHINDIA.
    http://www.rediff.com/business…..110504.htm
    http://news.rediff.com/report/…..-abuse.htm

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