Dylan Matthews says that Eliot Spitzer’s list of things Obama could do to help the economy is one of the more plausible he’s seen. I love me some plausible ideas, so I clicked. Turns out Spitzer only has two suggestions for Obama:
First, he should act dramatically to help the American homeowner….The administration, in conjunction with the Federal Reserve, should insist that banks, in return for all the taxpayer subsidies they have gotten and continue to receive, reduce any mortgage that exceeds the value of the house….Borrowers with reduced mortgages would have more money to spend, thus boosting the economy etc. etc.
….Second, the president should do more to help the American worker. He should establish a jobs program. Do the simple math: We are spending more than $110 billion annually in Afghanistan. Stop it. Or scale it back to the sort of covert operations and drone war that is warranted. Savings? Perhaps about $100 billion—per year. Use that money to create up to 5 million jobs at $20,000 each….Just as FDR did during the Great Depression, put these Americans to work in states, counties, schools, parks.
I have two questions. First: Under what plausible legal authority can the president unilaterally demand that banks — along with all of the assorted other note holders who would have to buy into this plan — reduce the principal of underwater mortgages? Second: Under what plausible political scenario will House Republicans agree to spend $100 billion on federal makework jobs even if Obama is willing to offset the cost by bailing out of Afghanistan?
I’m pretty sure the answers are (a) None and (b) None. At some point everyone needs to accept the plain political fact that on the jobs front Obama can do very little on his own and can’t do anything that requires cooperation from House Republicans. There are a few small-bore things he can do, and he can certainly mount a major PR campaign for his favorite employment ideas if he thinks it will help him politically. But actual, effective jobs programs? He’s a president, not a king. Republicans don’t want any jobs programs and that means we aren’t going to get any. End of story.