It occurred to me recently, that back in the bad old days of medicine when there was very little you could actually do for a patient, people understood their job to be “being with” the patient and making him or her comfortable. The illness was going to what it was going to do. Before germ theory came along, everything was even more mysterious than it is now. The bedside manner emphasized “I’m here for you” rather than “Take two of these and call me in the morning.”
When “take two of these” works, I’m pretty happy with it and I am delighted in the great progress medicine has made since it discovered germs. But I didn’t have these little medical reflections for no reason at all. There was something going on that had those same contours and it took me a little while to catch just what it was.
It’s the economy. It’s in bad shape and it’s going to go on being in bad shape for quite a while. Dr. Obama would really like to be a “take two of these and call me in the morning” kind of president. It’s his style. But Dr. Obama doesn’t have access to anything, two of which will help his patient. The president will, of course, do a lot of Republican bashing over the next year—as he should—but he is still going to be held accountable for the bad economy and he doesn’t have any way to treat it.
Let’s consider some possibilities. Let’s give the banks a bunch of money so they can loan it to people who will do something productive with it. Dr. Obama can see to it that the banks get a bunch of money. He cannot require them to actually lend it to anyone. When the banks get the money, they will consult their own needs for reserves, for security, for high return loans and when they have considered all those, they will just sit on the money.
Let’s encourage companies to hire more workers. This would help with the unemployment problem, one would think. As the economy picks up, the companies really could use more workers, but they make more money by reducing workforces than they do by increasing them. The new economic situation, in other words, allows quite a few currently unemployed workers to get their jobs back, but it doesn’t require the companies to rehire them. The new “leaner” companies are going to be much more profitable, even as the economy continues to crawl along in low gear. Nothing the President can say will cause these companies to make less profit so that the economy will improve.
The President could always raise taxes on businesses, of course, and use the new revenues to invest in new technologies and more employment. But there’s this problem with the businesses. They get the same services from the U. S. government whether they pay taxes or not and a business that has an accounting department that does NOT know how to keep the profits safe in an off-shore bank has a very uncreative accounting department.
The President could always cut taxes on the rich, of course, allowing them to create new jobs as their market savvy allows them to. That has been prescribed many times and actually tried several times and it turns out that the rich have better things to do with their money than use it to increase production and therefore employment. Yachts and corporate jets come readily to mind, but I am sure there are lots of less visible things to spend the money one. The point is that they don’t spend it in ways that help the economy in any broad way.
Robert Reich argues persuasively in his book, Aftershock, that the fundamental problem of the American economy is that we don’t pay our workers enough to enable them to buy what we make. Consumer spending is two thirds of the Gross Domestic Product, I heard yesterday on the radio. Increasing what we pay the workers would enable them to spend more money—and they would spend it—which would increase demand, which would increase employment, etc. This is the well-known Henry Ford solution. It was Ford who scandalized the whole world of business by paying his assembly line workers enough money that they could buy Ford cars. He sold a lot of Ford cars that way, but Reich passes along some of the commentary that appeared in the Wall Street Journal when he did that. Scathing!
So that is a “treatment” that would work. There is nothing Dr. Obama can do, unfortunately, to get that prescription filled. Nothing. Actually, there isn’t anything in the whole “take two of these and call me in the morning” world that the President can do. And that’s why I think it is time for him to break out his bedside manner and get into the “I’m here for you” mode. This guy’s got the idea, I think.