Optimism, Cynicism and Expectation Management

Former New York Governor Mario Cuomo once said beautifully that politicians: 'campaign in poetry but govern in prose'

And so it begins. 'We as a people will get there' has morphed seamlessly in to 'it will get worse before it gets better' without so much as a wry smile or a knowing wink from our next president. We saw a glimpse of this linguistic retrenchment on election night: 'we may not get there in one year' the president elect declared confidently... 'we may not even get there in one term...' wait, what? Did you just launch your reelection campaign before your innauguration? You bet he did.

- PE Obama is about as astute and strategic a communicator as you are likely to find. He knows how closely his words are watched and he does not choose them lightly. So why this speech at this time?
- Well first of course he is playing down expectations so as to lessen the inevitable bump that will be felt by liberals, Europeans and everyone under 25 when he fails to walk across the Reflecting Pool of the Washington monument on January 20th - but there's more.
- Politically he has nothing to lose and everything to gain from a further (short term) deterioration in the economy.
- He has an ambitious wish list - including his multibillion infrastructure reconstruction which has been on his agenda since long before this crisis - and a desperate congress will be more likely to acquiesce to grand government intervention as it did in 1933 with the New Deal.
- A second, related strength this pervasive sense of panic gives PE Obama is the ability to - in the immediate term at least - sidestep the tricky deficit issue. The Budget Deficit stands at $438billion, nearly twice the deficit inherited by Bill Clinton in 1993 ($290billion). Clinton also inherited a severely weakened economy but its relative strength compared to the current climate meant that his first 100 days were spent, largely unsuccessfully, walking the tightrope between stimulus cheerleaders on the one side and deficit hawks on the other. Today's more pronounced crisis gives PE Obama the opportunity to shelve a potentially bedevilling issue and focus all his attentions on his favorite stimulus programs.
- Finally, and cynically, a rapid worsening under president bush's watch - yes, that's right, I'm afraid he is STILL President - is just that much more of a rebound once the economy is brought or finds itself back on track.