US foreign policy measures post terrorist attacks on
twin towers in New York coupled with US citizen’s security concerns and fears secured
the re-election of George W Bush in 2004. However, peoples disenchantment over considerable
economic and human losses in its war with Iraq and Afghanistan coupled with
credit crisis in 2007 and 2008 catapulted Obama in to the White house in 2008
elections. The continued weakness in US economy, despite strong economic measures by Obama administration and Federal Reserve, has put the security concerns and foreign policy issues on a backburner for the ordinary US citizen. Obama has succeeded, to a great extent, in fulfilling his major foreign policy promises to the voters during the 2008 elections, by recalling all his troops from Iraq, killing Al Qaeda founder and terrorist Osama bin Laden in Pakistan and revitalizing his countries fight against Taliban in Afghanistan and Pakistan.
Obama and his economic team including Federal Reserve Chairman Bernanke have taken a few aggressive measures to mitigate the financial crisis, that included $862 billion stimulus program, investing in public works projects to generate employment, slashing short-term interest rates to zero, offering loans to cash-strapped banks, Quantitative Easing in two tranches and bought Treasury and mortgage bonds to push down interest rates and calm financial markets.
However, economy proved weaker than expected; Obama’s stimulus program had its share of weaknesses; his inability to overcome political imbroglio and obstacles to push for more government spending or tax cuts to stimulate growth; Obama’s prioritization for overhauling the nation's health care system did not propel the anticipated economic growth, as expected of his administration. Moreover, Obama's 2009 stimulus program proved to be a boon to corporate, financial institutions and fuelled a rally in financial markets without a desired impact on country’s economy and unemployment. Obama and his team spent major component of stimulus package on public works projects that were slow to get going and generate adequate jobs. Obama and his team failed to learn from Japanese unsuccessful experience of investing in Public works projects in the 1990’s which led to even larger deficits and debts without propelling the desired economic growth and unemployment. The unemployment rate is at a recession-level of 8.6 percent, up from 7.8 percent when Obama took office in January 2009.
Nevertheless, the economy is still struggling to recover from the Great Recession of 2007-2009; the housing market remains weak, unemployment rate is up and a debt crisis in Europe is threatening US economic growth in 2012. Zero interest rates have hurt retirees and savers without delivering many economic benefits. Consequently, 60 percent of American adults disapprove of Obama's performance on economic issues, based on an Associated Press-GfK poll of American adults.
However, everything is not lost for President Obama.
On economic front, some economists expect economic growth to pick up to 2.4 percent in 2012. That would be an improvement from the under-2 percent growth expected for 2011. But the economists foresee little improvement — a dip to 8.4 percent — in the unemployment rate by Election Day. Perhaps Obama can take heart from President Ronald Reagan's experience. The unemployment rate was 8.5 percent — a tick away from where it was last month — a year before Reagan was re-elected in a 1984 landslide.
On political front, Obama’s re-election rival, in all probability will be Republican front runner and former Massachusetts governor, Mitt Romney, a Harvard Business School graduate. Mitt Romney served as CEO of Bain & Company, a management consulting business in Boston, and Bain Capital, a spinoff investment firm, in the 1980s and 90s. Given Romney’s corporate background and his economic plans to repeal the Obama administration's health-care law and cutting the corporate tax rate from 35 percent to 25 percent, the US younger generation, who are on the forefront of the “OCCUPY WALL STREET” movement, may prefer Obama over Romney.
Moreover, Obama will win hands down when it comes to the electoral gains emanating from Foreign policy and internal security successes.
Perhaps, Time is a better judge and unforeseen events in 2012 may also have a bearing on the outcome of the impending US presidential elections.