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Wednesday, Feb. 1, 2012

President Obama's dreams are suffering nightmares

Special to The Japan Times

HONG KONG — President Barack Obama's oratory soared again when he made his State of the Union address to Congress in the very House of Representatives chamber where Republicans have done so much to taunt Obama and snuff out the hopes that so many American people had of the new young, intelligent, telegenic president.

It was great theater. Unfortunately for Obama and for America, too many contradictions remain between his promises and the dirty real world. You had only to watch the deadpan expression and almost permanently glazed eyes, hauntingly hostile, of John Boehner, the speaker of the House of Representatives, sitting behind Obama's left shoulder, to realize that Republicans will oppose Obama tooth and claw, whatever it takes.

Yes, this is election year and Obama was laying out his stall to create, as he put it, "A country that leads the world in educating its people. An America that attracts a new generation of high-tech manufacturing and high-paying jobs. A future where we're in control of our own energy, and our security and prosperity aren't so tied to unstable parts of the world. An economy built to last, where hard work pays off, and responsibility is rewarded."

Later he came down from his folksy heaven to below the rumbling proliferating clouds of political and economic thunderstorms. America has a choice, he declared: "We can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by; or we can restore an economy where everyone gets a fair shot, everyone gets a fair share, and everyone plays by the same set of rules."

Such marvelous presidential dreams — but unfortunately Obama has had three years in the White House, and the lot of many ordinary Americans has got worse. He is fighting not only against his own failures to turn soaring rhetoric into political reality, but also against determined opponents who deride Obama as either a socialist or, worse, a closet European.

In addition he faces economic headwinds of slow growth and unemployment not seen since the 1930s. On top of that, America's place in the world is rapidly changing and its predominance being challenged in ways that Obama seems unable to admit and Republicans are dangerously determined not to.

The president suggested various ways to revive the economy and employment, including giving tax credits to companies bringing jobs back and denying them to those outsourcing jobs, and for pumping money saved from fighting wars into badly needed renewal of U.S. infrastructure. But there seems little hope that Republicans, determined above all to pay down the debt and pander to the rich, will agree. They don't want to give him any credit: They want him out of the White House.

In laying into the rich who benefit from tax breaks that reduce the rates they pay to 15 percent or less, Obama was both taking a dig at Republican rival Mitt Romney, who paid just 13.9 percent tax on his 2010 earnings of $21.7 million, and presenting himself as the leader of ordinary Americans.

Romney's tax bill was entirely legal, since he took advantage of lower taxes on capital gains. "I pay all the taxes that are legally required, and not a dollar more," Romney said. (In fact, Floyd Norris of the New York Times discovered that Romney overpaid his taxes by about $44,000 because a trust had miscalculated the capital gains actually realized.) Obama and his wife paid tax of about 26 percent on their $1.7 million income, including from sales of the president's books.

Even being clad in the mantle of Man of the People does not help Obama against determined Republicans who persist in their belief that it is the rich people who create jobs, and should be encouraged. Romney's main Republican rival, Newt Gingrich, said he wants to reduce tax on capital gains to zero.

The U.S. economy is in a mess, still growing, which is more than can be said for Europe, but so slowly that the Federal Reserve has departed with tradition of setting interest rates month by month to declare that it will keep rates low until late in 2014.

The loss of American manufacturing jobs is serious. In the January-February issue of The Atlantic, Adam Davidson tells a joke from the heartland of cotton country, where the textile mill has been almost completely automated, and is run by a man and a dog: the man's job is to feed the dog, and the dog's job is to see that the man does not get anywhere near the machines.

Obama made much of the revival of the U.S. auto industry, although the bailout was started under President George W. Bush. This was also a dig at Mitt Romney, who had called for the industry to go through a pre-packaged bankruptcy.

However, Obama began to tread on dangerous ground in announcing plans to create a special trade unit to investigate "unfair trade practices in countries like China." Singling out China is a potentially dangerous game of trying to steal Republican clothes. The U.S. and China are both members of the World Trade Organization, which is the global forum for settling trade disputes.

Why blame China? Recent research by economists at the Federal Reserve Bank of San Francisco shows that China accounts for a mere 2.7 percent of U.S. consumption expenditure. Moreover, that figure overstates China's dominance because for every dollar of goods sold in the U.S. labeled "Made in China," U.S. businesses take 55 cents and Chinese get 45 cents.

One reason is that Americans like to regard themselves as citizens of God's only favored nation. Obama again publicized the myth, proclaiming that, "Our workers are the most productive on Earth, and if the playing field is level, I promise you — America will always win." But in the following few minutes he was lamenting failures in American education and training and finance and infrastructure and government and taxation and Congress.

I have to sympathize with Obama. Republicans have long taunted him with being un-American. Even with the evidence of his birth certificate, some claimed he was foreign-born, or was a Muslim because of his middle name "Hussein." Later, he was accused of being a socialist. Now Romney calls him a European, claiming that he wants to bring European social welfare systems to protect poor people from hard times and break the budget.

So Obama overcompensates. The U.S. may still be "the one indispensable nation in world affairs" as he put it, but it needs to learn from and to cooperate with others, especially in matters of great global moment, or all human beings will be sunk. No one appreciates American bullying. But humility is the one lesson lost on U.S. politicians.

Kevin Rafferty is editor in chief of PlainWords Media.

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