Pelosi Presses Obama to Talk Up Stronger U.S. Economy

By Heidi Przybyla  

Photographer: Scott Eells/Bloomberg

House Minority Leader Nancy Pelosi, a Democrat from California, predicted that... Read More

President Barack Obama yesterday devoted his first full speech in two months to the economy’s strength. It was just what Nancy Pelosi wanted.
The House Democratic leader has been pressing the White House to talk more about the issue, according to a person familiar with the discussions. It remains the top concern of voters before the congressional elections, even with Islamic extremism and Ebola dominating the national conversation and the outlook dimming for Democrats.
While the U.S. is driving global growth -- payrolls are expanding at the fastest pace in 15 years and unemployment is at a six-year low -- Americans now trust Republicans more to handle the economy, polls show. That reversal of a historical trend doesn’t bode well for Democrats, and Pelosi knows it.
“He should brag about it,” she said of the economy, in an
interview yesterday in her Capitol Hill office. Obama regularly mentions the economy at appearances, stressing how far the country has come since he took office. Pelosi said that while lately his time has been consumed by foreign policy demands, he should “sing his own praises and boast of what he’s done.”
For Pelosi, 74, a California Democrat who was the first female House speaker, the issue is both political and personal. Her role in enacting Obama’s policies -- the bailout of General Motors (GM), the passage of Obamacare and a $787 billion stimulus plan -- was integral to the U.S. economic recovery.

‘Owns Them’

“She owns them as much as he does,” said David Mayhew, a political science professor at Yale University. While most Americans consider Pelosi’s role in Obama’s legacy a “subtext,” he said, they “could well be calling it Pelosicare instead of Obamacare.”
Pelosi, who lost the speaker’s gavel to Republican John Boehner four years ago, has been hammering on economic data points in speeches, editorial board meetings and forums. She’s touting Obama’s record since 2009, when he assumed control of an economy mired in the deepest recession in seven decades.
The U.S. is in its sixth year of expansion following the worst slump since the Great Depression. The 6.1 percent jobless rate is down from a 26-year high of 10 percent in October 2009. The economy grew 4.6 percent in the second quarter, the fastest rate since the last three months of 2011.
Net worth for households and nonprofits increased by $1.39 trillion from April through June to $81.5 trillion, according to the Federal Reserve. The Standard & Poor’s 500 (SPX) Index’s longest streak of quarterly gains since 1998 combined with home-price appreciation helped to bolster Americans’ finances.

Struggling Households

Yet 7.28 million Americans work part time because they can’t find full-time jobs, and wage growth barely outpaces inflation. Federal Reserve Chair Janet Yellen cited a report showing the median net worth of the bottom fifth of households by income was just $6,400 last year, and many of those 25 million households “had no wealth or had negative net worth.”
Middle-class incomes haven’t returned to pre-recession levels. Annual median household income in July was still more than $2,600 lower than at the start of the recession in December 2007, according to Sentier Research, a consulting firm.
Obama’s economic policies aren’t “translating into the lives of the American people,” Pelosi said during a Sept. 29 Bloomberg News breakfast in New York. “It’s the right direction, but it’s not there yet for Main Street.”
Many Americans agree. They prefer by 11 percentage points that Republicans rather than Democrats handle the economy, according to a CBS News/New York Times poll conducted Sept. 12-15. That compares with a 15-point advantage Democrats had in a July 2007 Wall Street Journal survey.

‘Bitter Pill’

Pelosi said Democrats have taken a hit for policies they championed -- such as the Troubled Asset Relief Program and the auto-industry bailout. Such programs were politically unpopular before they proved critical to reviving the economy, she said.
“We swallowed the bitter pill on a lot of these things that helped the economy, but you have to explain it to people,” she said. “You cannot assume that they know. It’s indicative of the fact that we haven’t done a good enough job explaining.”
Pelosi asked members of her caucus this week to give more money for the congressional elections even as she acknowledged that Democrats weren’t likely to win control of the House, according to two people who listened to a conference call. She said they need to win as many committee seats as possible.
Brad Blakeman, a senior staff member in President George W. Bush’s administration, said the issue goes beyond messaging.

Low Approval

Democrats’ approval ratings are underwater because they lack a vision to improve the economy, with their most ambitious proposal being an increase in the minimum wage, said Blakeman, now a policy professor at Georgetown University.
“The American people know better,” he said. “Pelosi is joined at the hip with Obama.”
Obama, in his speech yesterday at Northwestern University in Evanston, Illinois, said while the economy’s gains haven’t been “broadly shared,” the U.S. is outperforming other nations.
“Our economy isn’t just primed for steadier, more sustained growth,” he said. “America is better poised to lead and succeed in the 21st century than any other nation on Earth.” The U.S., he said, “has put more people back to work than Europe, Japan, and every other advanced economy combined.”
Pelosi spent the first 20 minutes of a Sept. 29 interview with Bloomberg News editors and reporters detailing the effort to forestall a meltdown of U.S. financial markets in 2008 and prevent a government shutdown last year.

Obama-Pelosi Record

The Obama-Pelosi record includes the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, legislation to create lending programs for small businesses, tax cuts to encourage businesses to hire, accelerated write-offs for small businesses and a bill to increase Pell college grants.
It is the era near the end of Bush’s administration that Pelosi wants the American public to recall as they head to the ballot box next month.
She noted the six-year anniversary, on Sept. 29, of the House’s initial rejection of the Bush administration’s $700 billion financial-bailout plan.
The measure, crafted by Treasury Secretary Henry Paulson, was intended to get lending markets back in working order. It wasn’t offered, Pelosi says, until after she called Paulson on Sept. 18 and he first shared his view that the U.S. was on the verge of economic collapse.
“I said, ‘Well then, why am I calling you?’” Pelosi recalled, and later met with Paulson and then-Fed Chairman Ben S. Bernanke.

‘Totally Irresponsible’

“They said, ‘We were saving it for the next president.’ They were just trying to make it six more weeks” until the 2008 presidential election, she said. “This was totally irresponsible,” she said. “This is a big deal.”
According to Paulson’s office, he spoke with Pelosi frequently, including multiple times on Sept. 16, when he asked her for a meeting, a request she couldn’t accept because of scheduling difficulties.
“They sought emergency powers from Congress at the earliest time they thought Congress would approve them, recognizing how devastating it would be to the market if Congress voted it down, which the House did the first time,” Claire Buchan Parker, a spokeswoman for Paulson, said in a statement.
D.J. Nordquist, a spokeswoman for Bernanke, didn’t immediately respond to a request for comment.

Standing Firm

Pelosi calls the health-care law, the Affordable Care Act, “my proudest achievement.”
It was her pressure that stopped congressional Democrats from agreeing to weaken the legislation after Scott Brown won Ted Kennedy’s old Massachusetts Senate seat on a promise to thwart Obamacare, according to a March 28, 2010, Washington Post report.
She persuaded Senate Majority Leader Harry Reid and then-White House Chief of Staff Rahm Emanuel to stand firm. She also headed off an attempt by Democratic Representative Bart Stupak of Michigan to attach a ban on public funding for abortions in exchange for his support, the newspaper reported.
Pelosi then pushed the legislation through the House with only Democratic votes, a solidarity that was a hallmark of her speakership.
“She’s held her caucus together with remarkable cohesion and unity, in a way that’s really unprecedented on either side of the aisle in the past couple of decades,” said Cindy Simon-Rosenthal, co-author of a 2010 book, “Speaker Nancy Pelosi and the New American Politics.”