The Key to the Fall Debate: Staying Focused on the Economy

The last few months have not been particularly good ones for Democrats.  That's the bad news.  The good news is there a clear roadmap for how they can use the coming months to get back on track, and it revolves around staying relentlessly focused on the economy and the struggle of every day people.  

1) The Lack of Income Growth for Average Families is the Greatest Domestic Challenge Facing America Today.   Depending on how you cut the data, American families have not seen their incomes rise in at least eight, and perhaps, ten years.  Even in the Bush recovery, which was by many measures, robust, median incomes declined, poverty levels increased, debt loads exploded.  The typical American family ended the Bush era making $1,000 less than at the beginning. 

Basic economics tells us when productivity increases wages and incomes rise.  When GDP expands, jobs are created at a certain rate.  Neither of these events took place in the Bush era, leading us here at NDN to argue that there is a large structural change being brought about by globalization that is making it harder for the American economy to create jobs and raise the standard of living of every day people.

That median incomes dropped during a robust economic recovery made the Bush recovery different from any other recovery in American history, and has made the current Great Recession different from other recessions.  The American consumer was already in a very weakened state before the current recession, which is why the recession has been more virulent than many predicted, and why the coming "recovery" might be so anemic.  The economy seems to be going through profound, structural change, making old economic models anachronistic.  We are literally in a "new economy" now, one that is not well understood, and one that is confusing even the President's top advisers. 

Simply put, getting people's incomes up is the most important domestic challenge facing those in power today.  It is not surprising that other issues like health care, energy policy and climate change are being seen through a prism of "will this make my life, my economic struggle better today?" because so many families have been down so long, and things have gotten an awful lot worse this year.   Regardless of what they hope to be graded on by the public, the basket of issues that will do more to determine the success of the President and his Party is both the belief that things are getting better, and the reality that they are for most people. 

2) The Public Believes the Economy Is By Far and Away the Most Important Issue Facing the Nation Today.   In poll after poll this year, the public has made it clear that the economy is their most important issue, with really nothing coming in a strong number two.  The new Pew poll out this week maintains the basic ratio we have seen for months: mid 50s say the economy is number one; 20 percent of the American people say health care is their number one concern; and literally "zero" pick energy (see the chart to the right).

While one could mount an argument that one should not govern by polls, one can also ignore them at their own peril.  The country wants their leaders focusing on what is their number one concern - their ability to make a living and provide for their families in a time of economic transformation - which also happens to be, in this case, the most important domestic issue facing the country. 

My own belief is that one of the reasons the President and the Democrats have seen their poll numbers drop is that they have spent too much time talking about issues of lesser concern to people while the economy has gotten worse.   There is a strong argument to be made that the President and the Democrats have taken their eye of the economic ball, and are paying a price for it.  This doesn't mean the President shouldn't be talking about health care, climate change, education, immigration reform, but they must be addressed in ways that reflects both their perceived and actual importance; and as much as possible discussed in the context of long term and short term benefit for every day people and not abstract concepts like "recovery," "growth," "prosperity," which in this decade are things that have happened to other people. 

We have long believed that the lack of a sufficient governmental response to the increasing struggle of every day people has been the central driver of the volatility in the American electorate in recent years (see here and here).  Given the poll and economic data of recent months it is possible that the conditions which have created this volatility remains, and simply cannot be ignored for too long.

3) The Way Forward - Make The Struggle of Every Day People The Central Focus Of the National Debate.    The great domestic challenge facing President Obama is to ensure that, in this new age of globalization and the "rise of the rest," the country sees not "growth" or "recovery" but prosperity that is broadly shared.  Until incomes and wages are rising again, fostering broad-based prosperity has to be the central organizing principle of center-