- By Mark R. KennedyMark R. Kennedy is president of the University of North Dakota, author of the forthcoming book "Shapeholders: Business Success in the Age of Activism," a member of the Council on Foreign Relations, and chairman of the Economic Club of Minnesota. He previously served three terms in the U.S. House of Representatives, was senior vice president and treasurer of Federated Department Stores (now Macy's), was a member of the Advisory Committee on Trade Policy and Negotiation under Presidents George W. Bush and Barack Obama, and led George Washington University’s Graduate School of Political Management.
Faced with the threat that his low popularity could hurt his party and the reality that there is no money to spend on new initiatives, President Obama chose in his State of Union address to go small and stress action, no matter how fleeting, rather than working across the aisle to achieve permanent policy changes. This may mitigate Democratic losses at the ballot box in the fall, but doing so sacrifices the ripe opportunity to reignite economic vitality by removing uncertainty about debt and immigration, while sparking growth through expanded trade.
There is no doubt that President Obama’s low poll numbers are in significant part due to his inability to get things done. It is also clear that Republicans show little enthusiasm to embrace his prescriptions, whether raising the minimum wage, a further extension of unemployment insurance, or increased funding for early childhood education.
Possible executive orders increasing pay for some federal workers, ordering the Treasury to create the "MyRA" retirement savings account, and working with Governors to expand early childhood education can be trumpeted as action and may boost the President’s standing temporarily, but they have little lasting impact.
Bypassing Congress could backfire for the President and his Democratic allies as well, as it could inadvertently boost the popularity of Congress as the media focus shifts from legislative obstruction to executive fiat.
More importantly, this tactical approach could miss the opportunity to take bold actions that would be to the strategic advantage to the entire nation. The State of the Union did not present a plan to address the nation’s long-term debt. Immigration reform and trade expansion — two proposals that could boost the economy and create jobs — received only passing attention.
Currently the most serious impediment to business investment and hiring is the great uncertainty over how the country will ultimately address its unsustainable fiscal future as baby boomer retirements balloon federal deficits. Nearly every political leader would confide in private that there is a deal to be had that includes both revenue generating tax reform and a reduction in entitlement obligations. Yet this opportunity was ignored last night.
Failing to address this looming financial reality will make the recent expansion of federal healthcare obligations seem like reckless folly. Conversely, taking the lead now to address our long-term fiscal imbalances would help the country afford President Obama’s signature policy achievement and add another significant legacy accomplishment to his belt.
While only addressed in passing, the president’s approach to immigration may in the end prove fruitful. By only lightly touching on it, President Obama perhaps increased the likelihood of success.
Aggressively pushing for results could jeopardize action by Republicans. With Speaker Boehner telegraphing his hope to begin work, now is not the time for Obama to derail efforts in the House by inserting himself into the debate.
Perhaps most disappointing omission in the State of the Union address was the issue of trade. While he mentioned the need for Trade Promotion Authority, he did not even mention the pending Trans Pacific Partnership (TPP) or the Transatlantic Trade and Investment Partnership (TTIP).
These economic propellants are essential to the nation’s job creators. The Administration’s able Trade Representative Michael Froman has been vocal about their resolve to advance. Yet accomplishing these transformative agreements will not happen without the president bringing Congress and the public along with him.
Passing NAFTA was one of President Clinton’s most significant accomplishments. Passing TPP and TTIP could be amongst President Obama’s most lasting and beneficial legacies, but they will not happen unless he champions their benefits.
Trade expansion, with its potential to jumpstart economic growth and project power around the world, has been left in the shadows to its detriment. Giving it short shrift last night was a disappointment.
Yes, taking a series of small steps and shouting about them from the rooftops may slow the decline in the president’s poll numbers and help Democrats at the margins in Congressional contests this fall. But going small did a disservice to the big problems the nation faces.
Moving towards the twilight of his administration, President Obama may find that he missed a golden opportunity to build a lasting legacy that could put this nation on a path to deliver enriching opportunities for its citizens and strong leadership to the world.