Market Crashes AGAIN...Jobless numbers in the Tank and Obama is defiantly on VACATION!

Market Crashes AGAIN...Jobless numbers in the tank and Obama is on Vacation....He's livin large while the rest of us suffer....What a leader???


Stormy Skies for Obama Vacation
Obama Seeks to Separate Tax and Jobs Debates

“We're talking about modest adjustments -- paring back programs that don't work. On the back of an envelope, I can show you what it would take.”

-- President Obama in an interview with CBS news discussing the entitlement reform he will propose in his September economic plan.

President Obama leaves today for what must be the least-anticipated vacation in presidential history.

Obama, always sensitive to media criticism, is acting very anxious about his Martha’s Vineyard family retreat. One can see why. Obama is taking a fantasy preppy getaway in New England as the nation’s economy reels and his approval ratings plummet (his rating on handling of the economy is now at 26 percent, according to Gallup).

Press types always get worked up about presidential vacations – it’s an easy story for the summer doldrums – but with the nation in extremis and the central rap on the president being a lack of forceful leadership and engagement, they actually are onto something this year. Power Play would normally advise presidents to blow raspberries at the press corps and get away anyway, but this looks like a good time to reconsider.

But Obama didn’t want to give in and scrap his trip – to be pushed around by the press corps and the Republicans. Call it defiant vacationing. Bill Clinton may have pandered to the people and scratched his 1995 romp with the swells in the Atlantic surf for a march through Yellowstone, but not Obama.

To minimize the political damage from his trip to Kerryland, Obama went out on a three-day campaign swing to bracket the Republicans rip roaring in Iowa and cast blame on the House for the sorry state of the economy. He promised that he would come back from the Vineyard with a plan to rescue the economy.

This did not go as intended. Rather than casting the image of a president who was no longer leading from behind, it raised a series of unfortunate questions from friends and foes alike: Why wait? What took you so long? Is this a plan or politics?

Having failed with the idea of a cliffhanger vacation in which the world would wait for Obama’s return with the new economic mojo, the president and his staff have already started stepping on his own lines by leaking out the contours of the proposal. This will make the “major” speech a minor event and allow the proposals to be picked apart endlessly between now and the big reveal.

The broad outline is this: Obama will propose one plan to reduce long-term deficits through tax increases and “modest adjustments” to entitlement programs. The president will propose taking those anticipated decreases to the rate of future debt increases to finance his third stimulus package (there was the $800 billion Magilla in February 2009 and then the $26 billion August 2010 aid package to state and local government workers).

The details leaked so far include:

A third state bailout package aimed at protecting public-sector jobs

Public works projects fixing up old roads and rails

Modifying unemployment benefits to work as a subsidy for companies that hire those out of work.

Extending and expanding the existing reductions to the federal payroll tax

Streamlining the patent application process

The passage of trade pacts with foreign nations

By splitting the plan into future savings in exchange for current spending, the president means to protect his long-sought tax increases. Republicans will push had for a tax simplification that closes loopholes but uses that money to bring down rates and spur growth in a revenue-neutral fashion. The president wants that income preserved to finance more demand-side stimulus now.

Regular readers will recognize this as a steroidal version of a J. Wellington Wimpy – I would gladly give you debt reduction on Tuesday for new spending today.

The president will want the debt commission to focus on the debt alone. Republicans will want the discussion about taxes to include economic growth.

Obama promises to ladle on specifics when he returns from his trip, and does so with a warning to John Boehner. Obama says his plan will essentially reflect the deal he and Boehner were working on when debt-limit negations went kablooey. This will be a way for Obama to try to undercut Boehner’s clout in his caucus, leaving to Boehner to dispute or deny details of a plan that will cause fiscal conservatives to roar with indignation. (Of course, Obama own dispirited base won’t like it much either.)

Assuming Obama does have a pile of specifics to defend heading into three months of brutal fall budgetary battles – first the looming expiration of the temporary spending plan passed in the spring on Sept. 30 and then the findings of the super committee after Thanksgiving – he may come to yearn for these dog day doldrums.